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 STERIS (STE) revenue becomes net income?

For TTM through Q1 2026, STERIS turned $5.94B of revenue into $782M of net income — a net margin of 13.2%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are STERIS (STE) gross, operating, and net margins?

For TTM through Q1 2026, STERIS reported a gross margin of 44.2%, an operating margin of 18.6%, and a net margin of 13.2%. Each subtotal in the waterfall corresponds to one of these margins.

Why does STERIS (STE) 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.

STERIS (STE) Income Statement Waterfall

Revenue

$5.94B

Gross Margin

+44.2%

Operating Margin

+18.6%

Net Margin

+13.2%

Income statement waterfall for STERIS (STE) — TTM through Q1 2026

Net income: $782M

Margin breakdown for STERIS (STE) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$5.94B	$5.94B
Cost of Revenue	-$3.31B	$2.63B
Gross Profit	$2.63B	$2.63B
Operating Expenses	-$1.52B	$1.1B
Operating Income	$1.1B	$1.1B
Other Income / Expense	-$54.5M	$1.05B
Pre-tax Income	$1.05B	$1.05B
Income Tax	-$262M	$785M
Net Income	$782M	$782M

Revenue$5.94B
Cost of Revenue-$3.31B
Gross Profit$2.63B
Operating Expenses-$1.52B
Operating Income$1.1B
Other Income / Expense-$54.5M
Pre-tax Income$1.05B
Income Tax-$262M
Net Income$782M

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