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 Goldman Sachs (GS) revenue becomes net income?

For TTM through Q2 2026, Goldman Sachs turned $118B of revenue into $21B of net income — a net margin of 17.8%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Goldman Sachs (GS) gross, operating, and net margins?

For TTM through Q2 2026, Goldman Sachs reported a gross margin of 57.3%, an operating margin of 24.8%, and a net margin of 17.8%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Goldman Sachs (GS) 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.

Goldman Sachs (GS) Income Statement Waterfall

Revenue

$118B

Gross Margin

+57.3%

Operating Margin

+24.8%

Net Margin

+17.8%

Income statement waterfall for Goldman Sachs (GS) — TTM through Q2 2026

Net income: $21B

Margin breakdown for Goldman Sachs (GS) — TTM through Q2 2026

Line item	Amount	Running total
Revenue	$118B	$118B
Cost of Revenue	-$50.4B	$67.6B
Gross Profit	$67.6B	$67.6B
Operating Expenses	-$38.3B	$29.3B
Operating Income	$29.3B	$29.3B
Other Income / Expense	-$2.96B	$26.3B
Pre-tax Income	$26.3B	$26.3B
Income Tax	-$5.32B	$21B
Net Income	$21B	$21B

Revenue$118B
Cost of Revenue-$50.4B
Gross Profit$67.6B
Operating Expenses-$38.3B
Operating Income$29.3B
Other Income / Expense-$2.96B
Pre-tax Income$26.3B
Income Tax-$5.32B
Net Income$21B

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