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 Seagate Technology (STX) revenue becomes net income?

For TTM through Q2 2026, Seagate Technology turned $11B of revenue into $2.38B 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 Seagate Technology (STX) gross, operating, and net margins?

For TTM through Q2 2026, Seagate Technology reported a gross margin of 41.5%, an operating margin of 28.3%, and a net margin of 21.6%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Seagate Technology (STX) 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.

Seagate Technology (STX) Income Statement Waterfall

Revenue

$11B

Gross Margin

+41.5%

Operating Margin

+28.3%

Net Margin

+21.6%

Income statement waterfall for Seagate Technology (STX) — TTM through Q2 2026

Net income: $2.38B

Margin breakdown for Seagate Technology (STX) — TTM through Q2 2026

Line item	Amount	Running total
Revenue	$11B	$11B
Cost of Revenue	-$6.44B	$4.57B
Gross Profit	$4.57B	$4.57B
Operating Expenses	-$1.46B	$3.12B
Operating Income	$3.12B	$3.12B
Other Income / Expense	-$442M	$2.68B
Pre-tax Income	$2.68B	$2.68B
Income Tax	-$299M	$2.38B
Net Income	$2.38B	$2.38B

Revenue$11B
Cost of Revenue-$6.44B
Gross Profit$4.57B
Operating Expenses-$1.46B
Operating Income$3.12B
Other Income / Expense-$442M
Pre-tax Income$2.68B
Income Tax-$299M
Net Income$2.38B

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