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 Tyler Technologies (TYL) revenue becomes net income?

For TTM through Q1 2026, Tyler Technologies turned $2.38B of revenue into $316M of net income — a net margin of 13.3%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Tyler Technologies (TYL) gross, operating, and net margins?

For TTM through Q1 2026, Tyler Technologies reported a gross margin of 45.6%, an operating margin of 15.5%, and a net margin of 13.3%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Tyler Technologies (TYL) 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.

Tyler Technologies (TYL) Income Statement Waterfall

Revenue

$2.38B

Gross Margin

+45.6%

Operating Margin

+15.5%

Net Margin

+13.3%

Income statement waterfall for Tyler Technologies (TYL) — TTM through Q1 2026

Net income: $316M

Margin breakdown for Tyler Technologies (TYL) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$2.38B	$2.38B
Cost of Revenue	-$1.3B	$1.08B
Gross Profit	$1.08B	$1.08B
Operating Expenses	-$717M	$368M
Operating Income	$368M	$368M
Other Income / Expense	$33.1M	$401M
Pre-tax Income	$401M	$401M
Income Tax	-$85.7M	$316M
Net Income	$316M	$316M

Revenue$2.38B
Cost of Revenue-$1.3B
Gross Profit$1.08B
Operating Expenses-$717M
Operating Income$368M
Other Income / Expense$33.1M
Pre-tax Income$401M
Income Tax-$85.7M
Net Income$316M

Want to see what changed vs last year?Profit Bridge

Frequently asked questions

Data & methodology

Tyler Technologies (TYL) Key Financials

Charts, filings, and peer comparison for every metric

Explore more

Deep-dives across the income statement, cash flow, capital return, and valuation

Overview

TYL Overview

Counters

Income Statement

Cash Flow

Capital Return

How this company returns cash to shareholders — buybacks, dividends, and stock splits.

Forecast & Valuation