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 Chipotle Mexican Grill (CMG) revenue becomes net income?

For TTM through Q1 2026, Chipotle Mexican Grill turned $12.1B of revenue into $1.45B of net income — a net margin of 12%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Chipotle Mexican Grill (CMG) gross, operating, and net margins?

For TTM through Q1 2026, Chipotle Mexican Grill reported a gross margin of 36.1%, an operating margin of 15.8%, and a net margin of 12%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Chipotle Mexican Grill (CMG) 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.

Chipotle Mexican Grill (CMG) Income Statement Waterfall

Revenue

$12.1B

Gross Margin

+36.1%

Operating Margin

+15.8%

Net Margin

+12.0%

Income statement waterfall for Chipotle Mexican Grill (CMG) — TTM through Q1 2026

Net income: $1.45B

Margin breakdown for Chipotle Mexican Grill (CMG) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$12.1B	$12.1B
Cost of Revenue	-$7.75B	$4.39B
Gross Profit	$4.39B	$4.39B
Operating Expenses	-$2.47B	$1.92B
Operating Income	$1.92B	$1.92B
Other Income / Expense	-$2.42M	$1.91B
Pre-tax Income	$1.91B	$1.91B
Income Tax	-$462M	$1.45B
Net Income	$1.45B	$1.45B

Revenue$12.1B
Cost of Revenue-$7.75B
Gross Profit$4.39B
Operating Expenses-$2.47B
Operating Income$1.92B
Other Income / Expense-$2.42M
Pre-tax Income$1.91B
Income Tax-$462M
Net Income$1.45B

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