Cost Cap is a Meta Ads bidding strategy where the advertiser sets a maximum average cost per result, and Meta’s algorithm works to stay at or below that cap while maximizing conversions. Unlike Lowest Cost bidding which spends the full budget regardless of efficiency, Cost Cap provides a ceiling that protects margin. When the algorithm cannot find conversions at or below the cap, it slows or stops spending, which can cause underspending in competitive auctions. Cost Cap is best for advertisers with clear unit economics who need predictable profitability at scale.