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 Zimmer Biomet Holdings (ZBH) revenue becomes net income?

For TTM through Q1 2026, Zimmer Biomet Holdings turned $8.41B of revenue into $761M of net income — a net margin of 9.1%. The waterfall shows where the rest goes: cost of revenue, operating expenses, non-operating items, and taxes.

What are Zimmer Biomet Holdings (ZBH) gross, operating, and net margins?

For TTM through Q1 2026, Zimmer Biomet Holdings reported a gross margin of 70%, an operating margin of 15.6%, and a net margin of 9.1%. Each subtotal in the waterfall corresponds to one of these margins.

Why does Zimmer Biomet Holdings (ZBH) 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.

Zimmer Biomet Holdings (ZBH) Income Statement Waterfall

Revenue

$8.41B

Gross Margin

+70.0%

Operating Margin

+15.6%

Net Margin

+9.1%

Income statement waterfall for Zimmer Biomet Holdings (ZBH) — TTM through Q1 2026

Net income: $761M

Margin breakdown for Zimmer Biomet Holdings (ZBH) — TTM through Q1 2026

Line item	Amount	Running total
Revenue	$8.41B	$8.41B
Cost of Revenue	-$2.52B	$5.89B
Gross Profit	$5.89B	$5.89B
Operating Expenses	-$4.58B	$1.31B
Operating Income	$1.31B	$1.31B
Other Income / Expense	-$409M	$903M
Pre-tax Income	$903M	$903M
Income Tax	-$142M	$761M
Net Income	$761M	$761M

Revenue$8.41B
Cost of Revenue-$2.52B
Gross Profit$5.89B
Operating Expenses-$4.58B
Operating Income$1.31B
Other Income / Expense-$409M
Pre-tax Income$903M
Income Tax-$142M
Net Income$761M

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