What is an income statement waterfall?

An income statement waterfall is a bar chart that walks from total revenue down to net income, with each step showing how much a cost or tax line removes (or adds). Subtotals — gross profit, operating income, pre-tax income — are anchored to zero so the cascade reconciles exactly to the bottom line.

How much of AvalonBay Communities (AVB) revenue becomes net income?

For TTM through Q1 2026, AvalonBay Communities turned $3.06B of revenue into $1.14B of net income — a net margin of 37.3%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are AvalonBay Communities (AVB) gross, operating, and net margins?

For TTM through Q1 2026, AvalonBay Communities reported a gross margin of 67.9%, an operating margin of 29.2%, and a net margin of 37.3%. Each subtotal in the waterfall corresponds to one of these margins.

Why does AvalonBay Communities (AVB) have such a high (or low) gross margin?

Gross margin (gross profit ÷ revenue) reflects how much of each revenue dollar remains after direct production costs. Capital-light software and platform businesses often show gross margins above 60–80% because their cost of revenue is mainly hosting and support. Hardware, retail, and commodity businesses show lower gross margins because raw materials and manufacturing costs are significant. The waterfall makes this visible at a glance — the size of the "Cost of Revenue" bar relative to Revenue is the gross margin complement.

What is the difference between gross, operating, and net margin?

Gross margin = (Revenue − Cost of Revenue) ÷ Revenue. It measures production efficiency. Operating margin = Operating Income ÷ Revenue. It adds operating expenses (R&D, S&M, G&A) and measures the profitability of core operations. Net margin = Net Income ÷ Revenue. It also includes interest, other income/expense, and taxes, and represents the shareholder take after everything.

AvalonBay Communities (AVB) Income Statement Waterfall

Revenue

$3.06B

Gross Margin

+67.9%

Operating Margin

+29.2%

Net Margin

+37.3%

Income statement waterfall for AvalonBay Communities (AVB) — TTM through Q1 2026

Net income: $1.14B

Margin breakdown for AvalonBay Communities (AVB) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$3.06B	$3.06B
Cost of Revenue	−$982.71M	$2.08B
Gross Profit	$2.08B	$2.08B
Operating Expenses	−$1.19B	$893.04M
Operating Income	$893.04M	$893.04M
Other Income / Expense	$253.94M	$1.15B
Pre-tax Income	$1.15B	$1.15B
Tax Benefit	$1.31M	$1.15B
Net Income	$1.14B	$1.14B

Revenue$3.06B
Cost of Revenue−$982.71M
Gross Profit$2.08B
Operating Expenses−$1.19B
Operating Income$893.04M
Other Income / Expense$253.94M
Pre-tax Income$1.15B
Tax Benefit$1.31M
Net Income$1.14B

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Income statement waterfall for AvalonBay Communities (AVB) — TTM through Q1 2026

Margin breakdown for AvalonBay Communities (AVB) — TTM through Q1 2026

Frequently asked questions

+What is an income statement waterfall?

+How much of AvalonBay Communities (AVB) revenue becomes net income?

+What are AvalonBay Communities (AVB) gross, operating, and net margins?

+Why does AvalonBay Communities (AVB) have such a high (or low) gross margin?

+What is the difference between gross, operating, and net margin?

Data & methodology

+What is this view?

+How to read this waterfall

+How is the data calculated?

+What is the USD toggle?

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