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 NNN REIT (NNN) revenue becomes net income?

For TTM through Q1 2026, NNN REIT turned $936M of revenue into $387M of net income — a net margin of 41.4%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are NNN REIT (NNN) gross, operating, and net margins?

For TTM through Q1 2026, NNN REIT reported a gross margin of 81.4%, an operating margin of 63.1%, and a net margin of 41.4%. Each subtotal in the waterfall corresponds to one of these margins.

Why does NNN REIT (NNN) 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.

NNN REIT (NNN) Income Statement Waterfall

Revenue

$936M

Gross Margin

+81.4%

Operating Margin

+63.1%

Net Margin

+41.4%

Income statement waterfall for NNN REIT (NNN) — TTM through Q1 2026

Net income: $387M

Margin breakdown for NNN REIT (NNN) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$936M	$936M
Cost of Revenue	-$174M	$762M
Gross Profit	$762M	$762M
Operating Expenses	-$171M	$591M
Operating Income	$591M	$591M
Other Income / Expense	-$204M	$387M
Pre-tax Income	$387M	$387M
Income Tax	$0.00	$387M
Net Income	$387M	$387M

Revenue$936M
Cost of Revenue-$174M
Gross Profit$762M
Operating Expenses-$171M
Operating Income$591M
Other Income / Expense-$204M
Pre-tax Income$387M
Income Tax$0.00
Net Income$387M

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Operating Margin63.1%

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Employees100.0

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