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 PDD Holdings (PDD) revenue becomes net income?

For TTM through Q1 2026, PDD Holdings turned 441.76B CNY of revenue into 95.57B CNY of net income — a net margin of 21.6%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are PDD Holdings (PDD) gross, operating, and net margins?

For TTM through Q1 2026, PDD Holdings reported a gross margin of 56%, an operating margin of 22.2%, and a net margin of 21.6%. Each subtotal in the waterfall corresponds to one of these margins.

Why does PDD Holdings (PDD) 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.

PDD Holdings (PDD) Income Statement Waterfall

Revenue

441.76B CNY

Gross Margin

+56.0%

Operating Margin

+22.2%

Net Margin

+21.6%

Income statement waterfall for PDD Holdings (PDD) — TTM through Q1 2026

Net income: 95.57B CNY

Margin breakdown for PDD Holdings (PDD) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	441.76B CNY	441.76B CNY
Cost of Revenue	−194.46B CNY	247.30B CNY
Gross Profit	247.30B CNY	247.30B CNY
Operating Expenses	−149.26B CNY	98.03B CNY
Operating Income	98.03B CNY	98.03B CNY
Other Income / Expense	18.84B CNY	116.88B CNY
Pre-tax Income	116.88B CNY	116.88B CNY
Income Tax	−21.30B CNY	95.57B CNY
Net Income	95.57B CNY	95.57B CNY

Revenue441.76B CNY
Cost of Revenue−194.46B CNY
Gross Profit247.30B CNY
Operating Expenses−149.26B CNY
Operating Income98.03B CNY
Other Income / Expense18.84B CNY
Pre-tax Income116.88B CNY
Income Tax−21.30B CNY
Net Income95.57B CNY

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Income statement waterfall for PDD Holdings (PDD) — TTM through Q1 2026

Margin breakdown for PDD Holdings (PDD) — TTM through Q1 2026

Frequently asked questions

+What is an income statement waterfall?

+How much of PDD Holdings (PDD) revenue becomes net income?

+What are PDD Holdings (PDD) gross, operating, and net margins?

+Why does PDD Holdings (PDD) have such a high (or low) gross margin?

+What is the difference between gross, operating, and net margin?

Data & methodology

+What is this view?

+How to read this waterfall

+How is the data calculated?

+What is the USD toggle?

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