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 Ralph Lauren (RL) revenue becomes net income?

For TTM through Q1 2026, Ralph Lauren turned $8.11B of revenue into $941M of net income — a net margin of 11.6%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Ralph Lauren (RL) gross, operating, and net margins?

For TTM through Q1 2026, Ralph Lauren reported a gross margin of 69.9%, an operating margin of 14.5%, and a net margin of 11.6%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Ralph Lauren (RL) 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.

Ralph Lauren (RL) Income Statement Waterfall

Revenue

$8.11B

Gross Margin

+69.9%

Operating Margin

+14.5%

Net Margin

+11.6%

Income statement waterfall for Ralph Lauren (RL) — TTM through Q1 2026

Net income: $941M

Margin breakdown for Ralph Lauren (RL) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$8.11B	$8.11B
Cost of Revenue	-$2.45B	$5.67B
Gross Profit	$5.67B	$5.67B
Operating Expenses	-$4.49B	$1.18B
Operating Income	$1.18B	$1.18B
Other Income / Expense	-$1.5M	$1.18B
Pre-tax Income	$1.18B	$1.18B
Income Tax	-$237M	$941M
Net Income	$941M	$941M

Revenue$8.11B
Cost of Revenue-$2.45B
Gross Profit$5.67B
Operating Expenses-$4.49B
Operating Income$1.18B
Other Income / Expense-$1.5M
Pre-tax Income$1.18B
Income Tax-$237M
Net Income$941M

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