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 Devon Energy (DVN) revenue becomes net income?

For TTM through Q1 2026, Devon Energy turned $16.5B of revenue into $2.27B of net income — a net margin of 13.7%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Devon Energy (DVN) gross, operating, and net margins?

For TTM through Q1 2026, Devon Energy reported a gross margin of 22.1%, an operating margin of 18.8%, and a net margin of 13.7%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Devon Energy (DVN) 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.

Devon Energy (DVN) Income Statement Waterfall

Revenue

$16.5B

Gross Margin

+22.1%

Operating Margin

+18.8%

Net Margin

+13.7%

Income statement waterfall for Devon Energy (DVN) — TTM through Q1 2026

Net income: $2.27B

Margin breakdown for Devon Energy (DVN) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$16.5B	$16.5B
Cost of Revenue	-$12.9B	$3.66B
Gross Profit	$3.66B	$3.66B
Operating Expenses	-$545M	$3.12B
Operating Income	$3.12B	$3.12B
Other Income / Expense	-$130M	$2.99B
Pre-tax Income	$2.99B	$2.99B
Income Tax	-$694M	$2.29B
Other Items	-$24M	$2.27B
Net Income	$2.27B	$2.27B

Revenue$16.5B
Cost of Revenue-$12.9B
Gross Profit$3.66B
Operating Expenses-$545M
Operating Income$3.12B
Other Income / Expense-$130M
Pre-tax Income$2.99B
Income Tax-$694M
Other Items-$24M
Net Income$2.27B

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