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 Eastman Chemical (EMN) revenue becomes net income?

For TTM through Q1 2026, Eastman Chemical turned $8.64B of revenue into $399M of net income — a net margin of 4.6%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Eastman Chemical (EMN) gross, operating, and net margins?

For TTM through Q1 2026, Eastman Chemical reported a gross margin of 19.8%, an operating margin of 9.4%, and a net margin of 4.6%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Eastman Chemical (EMN) 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.

Eastman Chemical (EMN) Income Statement Waterfall

Revenue

$8.64B

Gross Margin

+19.8%

Operating Margin

+9.4%

Net Margin

+4.6%

Income statement waterfall for Eastman Chemical (EMN) — TTM through Q1 2026

Net income: $399M

Margin breakdown for Eastman Chemical (EMN) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$8.64B	$8.64B
Cost of Revenue	-$6.93B	$1.71B
Gross Profit	$1.71B	$1.71B
Operating Expenses	-$900M	$808M
Operating Income	$808M	$808M
Other Income / Expense	-$357M	$451M
Pre-tax Income	$451M	$451M
Income Tax	-$52M	$399M
Net Income	$399M	$399M

Revenue$8.64B
Cost of Revenue-$6.93B
Gross Profit$1.71B
Operating Expenses-$900M
Operating Income$808M
Other Income / Expense-$357M
Pre-tax Income$451M
Income Tax-$52M
Net Income$399M

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