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 NXP Semiconductors (NXPI) revenue becomes net income?

For TTM through Q1 2026, NXP Semiconductors turned $12.6B of revenue into $2.65B of net income — a net margin of 21%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are NXP Semiconductors (NXPI) gross, operating, and net margins?

For TTM through Q1 2026, NXP Semiconductors reported a gross margin of 54.9%, an operating margin of 26.9%, and a net margin of 21%. Each subtotal in the waterfall corresponds to one of these margins.

Why does NXP Semiconductors (NXPI) 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.

NXP Semiconductors (NXPI) Income Statement Waterfall

Revenue

$12.6B

Gross Margin

+54.9%

Operating Margin

+26.9%

Net Margin

+21.0%

Income statement waterfall for NXP Semiconductors (NXPI) — TTM through Q1 2026

Net income: $2.65B

Margin breakdown for NXP Semiconductors (NXPI) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$12.6B	$12.6B
Cost of Revenue	-$5.69B	$6.92B
Gross Profit	$6.92B	$6.92B
Operating Expenses	-$3.53B	$3.39B
Operating Income	$3.39B	$3.39B
Other Income / Expense	$10M	$3.4B
Pre-tax Income	$3.4B	$3.4B
Income Tax	-$695M	$2.71B
Other Items	-$56M	$2.65B
Net Income	$2.65B	$2.65B

Revenue$12.6B
Cost of Revenue-$5.69B
Gross Profit$6.92B
Operating Expenses-$3.53B
Operating Income$3.39B
Other Income / Expense$10M
Pre-tax Income$3.4B
Income Tax-$695M
Other Items-$56M
Net Income$2.65B

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