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Glossary / POAS (profit on ad spend)
Ad efficiency

POAS (profit on ad spend)

Gross profit divided by ad spend; the contribution-margin analogue of ROAS, and the established industry synonym for contribution-margin ad efficiency.

POAS = Gross Profit / Ad Spend, where Gross Profit = Revenue - COGS - other variable costs

POAS, profit on ad spend, divides gross profit by ad spend, where gross profit is revenue minus COGS minus other variable costs. Salience defines it exactly this way and positions it as focused on profitability rather than revenue (salience.co.uk). ProfitMetrics frames it as the profit-true alternative to ROAS for Google and Facebook ads, dividing the gross profit attributable to a channel by its spend (profitmetrics.io).

Functionally, POAS is the contribution-margin analogue of ROAS: it answers 'how much profit, not revenue, did each ad dollar return'. A POAS of 1.0 means the channel broke even on the profit it generated; above 1.0 it built contribution margin, below 1.0 it consumed it. That makes it directly comparable to break-even ROAS expressed on a margin basis.

In Blufire's lexicon, POAS appears only as a noted synonym. We lead with contribution margin and break-even ROAS as the primary terms because they expose the underlying CM layering (CM1/CM2/CM3) rather than collapsing it into a single ratio. If you arrived here looking for POAS, see the contribution margin and break-even ROAS entries, which carry the same profit-true logic with the full cost walk-down attached.

Worked example (Demonstrative): a channel returning A$40,000 in gross profit on A$10,000 of spend has a POAS of 4.0, meaning A$4 of profit per A$1 of ad spend. The same channel might show a far higher revenue ROAS, which is precisely why the profit view matters.

Contribution margin calculator
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