Break-even ACOS equals your profit margin before ad spend. Above it, ads lose money; below it, they print it.
Break-even ACOS is the ACOS at which an ad sale makes exactly zero profit. It equals your profit margin before advertising:
Formula: break-even ACOS = (price − COGS − Amazon fees) ÷ price × 100
Example: a $30 product with $9 COGS and $9 in Amazon fees keeps $12 of margin — a 40% break-even ACOS. Run ads at 25% ACOS and each ad sale nets 15% of price in profit; run them at 55% and every ad sale loses money.
Setting a target ACOS: most sellers set their target safely below break-even (e.g. break-even 40% → target 25–30%) so ad sales contribute real profit, then deliberately tolerate higher ACOS only during launches.
Compute yours in 10 seconds with the free break-even ACOS calculator.
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