Build a Waterfall Chart in Excel: Steps, Tips, and Fixes

In Excel for Microsoft 365 on Windows, place each step of the change in one column and its value in the next, select both columns, then choose Insert > Insert Waterfall, Funnel, Stock, Surface, or Radar Chart > Waterfall. Mark the opening and closing bars as totals by right-clicking each bar and choosing Set as Total; Excel then displays how the intermediate increases and decreases add up to the final result.

What a waterfall chart shows

A waterfall chart, sometimes called a bridge chart, explains how a starting amount changes through a series of additions and subtractions to reach an ending amount. Unlike a regular column chart, its intermediate bars usually begin at the previous step’s running total rather than at zero. Floating bars make the direction and size of each change visible while retaining the context of the accumulated value.

This makes the chart useful for explaining movement between two figures, not just comparing unrelated values. Common examples include how revenue changes from one period to another, how a project budget is consumed, or how a company’s headcount moves from an opening to a closing count. The visual sequence helps readers see which items contributed to the overall change and which offset it.

A waterfall is not a time-series chart by default: categories appear in the order supplied, and the bars represent changes in a running total. You can use months or quarters as categories, but the chart only communicates a meaningful bridge if each value represents a step that can be added to or subtracted from the previous amount.

Prepare the data and check the arithmetic

Arrange the data in two adjacent columns. Put a clear label for each stage in the first column and the amount associated with that stage in the second. Use positive numbers for increases and negative numbers for decreases. Include the opening and closing figures as rows so they can be displayed as full-height totals.

For example, a monthly revenue bridge might use this illustrative data:

Stage	Amount
Opening revenue	10,000
New sales	2,500
Returns	-700
Operating costs	-1,800
Other income	400
Closing revenue	10,400

The bridge checks out: 10,000 + 2,500 – 700 – 1,800 + 400 equals 10,400. This check matters because Excel draws the steps from the sequence of values; it does not know whether the closing figure is supposed to agree with the opening balance and the intervening changes. If the values do not reconcile, investigate missing items, duplicated adjustments, or a sign entered in the wrong direction before formatting the chart.

Keep every adjustment as a numeric value, not a number stored as text.
Use one row per change you want the reader to see; combine tiny items only when the combined category remains understandable.
Sort rows into the explanatory order you want. Excel will not automatically arrange the bridge by size or date.
Leave out blank rows and unrelated notes from the selected chart range.

Create the waterfall chart in Excel for Windows

In Excel for Microsoft 365 on Windows, create the chart with these steps:

Enter category names in the first column and corresponding values in the next column, including the opening and ending totals.
Select the complete range, including both column headings if you have them. For the example, that means selecting the Stage and Amount headings together with all six data rows.
Open Insert > Insert Waterfall, Funnel, Stock, Surface, or Radar Chart > Waterfall. Excel inserts a chart using the selected labels and numbers.
Check that every stage appears along the horizontal axis and that the bars follow your intended order. If the categories and values are interpreted incorrectly, undo the chart, check the selected range and headings, and insert it again.
Right-click the Opening revenue bar and choose Set as Total. Repeat for the Closing revenue bar. These two bars should start at the baseline and show the full opening and ending amounts.
Replace the default chart title with a specific description, such as Revenue change from January to February. Resize the chart or move it so category labels and values are legible.

Excel uses visual styles to distinguish increases, decreases, and totals. The exact default colors can depend on the workbook theme, so do not rely on color alone to explain the chart. Keep the category labels clear, and consider adding data labels when readers need exact amounts rather than approximate bar heights.

Set totals and understand the running balance

The most important formatting step is identifying which bars are totals. In a waterfall chart, ordinary positive and negative entries change the running balance. A total bar instead represents a complete value from the chart’s baseline. In the example, the opening revenue is 10,000, and each intervening category changes that balance until the closing revenue reaches 10,400.

If you leave the opening and closing rows as ordinary change bars, Excel may treat them as additions to the running total. The chart can then look plausible but communicate the wrong story. Use Set as Total for each subtotal or final value that should stand on its own, not only for the first and last bars. For instance, a bridge with a subtotal after gross profit may need that subtotal marked as a total too.

A total bar does not mean Excel has verified the accounting or business logic. It only changes how that selected data point is drawn. Check that the closing amount matches the arithmetic of the opening value plus all changes, and that subtotal rows are not also being counted as additional changes in the data sequence. If a subtotal is included, structure the bridge so it is presented as a checkpoint, not double-counted as a new movement.

Improve labels, colors, and readability

A useful waterfall should be understandable without asking the audience to infer too much from bar heights. Select the chart and use the Chart Design tab to add or adjust chart elements. For example, choose Chart Design > Add Chart Element > Data Labels and select a placement that keeps amounts readable. The available placement choices can vary with chart layout and available space.

Use a descriptive title that names both the measure and the comparison, such as “Quarterly operating income bridge.” Keep category names short enough to fit; wrap or abbreviate only when the meaning remains obvious. If labels overlap, widen the chart, reduce label font size slightly, or shorten the wording rather than removing important categories.

For a chart used in a report, use a restrained palette and make positive, negative, and total bars visually distinct. If you change individual data-point fills, retain a consistent meaning throughout the workbook. Avoid depending on red and green alone, since those colors may be difficult for some readers to distinguish and may carry different meanings in different contexts. Data labels, clear wording, and a concise note can provide additional cues.

Axis scaling can also affect interpretation. Because the step bars float between cumulative values, the vertical axis needs enough room to display the whole bridge. Review the zero baseline and axis limits, especially if you have adjusted them manually. A truncated scale can exaggerate differences, while an unnecessarily broad scale can make small changes hard to see.

Check the chart before sharing it

Before presenting the chart, trace the steps in order and compare them with the source figures. Verify that positive values move the running balance upward and negative values move it downward, and confirm that the closing total agrees with the calculation. For the sample bridge, the net change is 400, so a start at 10,000 should end at 10,400. That independent check can catch a missing return, reversed sign, or mistaken endpoint.

Also check the chart’s audience-facing details. Are the units clear—dollars, thousands of dollars, units, or percentage points? Does the title state what period or scenario is being shown? Do the labels make it clear which items are increases and decreases? A bar labeled “Costs” may be ambiguous if the chart does not clarify whether the displayed value is the cost amount or its negative effect on the balance.

If the source data may change, keep the chart linked to a clean, contiguous data range and verify that new rows are included when the bridge is updated. An Excel Table can help keep related data organized as it grows, but inspect the chart after extending the source: category order, total markers, and labels may need attention when new stages are added.

Common problems and how to fix them

The first or last bar floats. Right-click that data point and choose Set as Total. Setting totals is a chart-formatting action, so adding a row called “Ending balance” alone does not make it a total.
The endpoint is far too high or low. Check signs, omitted adjustments, duplicate entries, and the order of rows. Recalculate the bridge independently; Excel does not reconcile the ending row automatically.
Categories are missing or values appear as labels. Confirm that the selection includes the category and value columns, but not unrelated columns. Make sure numeric entries are stored as numbers rather than text.
The chart has an unexplained extra bar. Look for a heading, blank row, note, or grand total included in the selected range. Re-select only the intended labels and values.
Bars are difficult to compare. Add data labels, simplify long category names, and make the chart wider. Do not assume a reader can estimate small differences accurately from the bars alone.
Updates do not appear as expected. Check the chart’s source range and whether new data was added inside that range. Then verify that any new subtotal or endpoint has the correct total setting.

When to use a waterfall instead of another chart

Choose a waterfall when the central question is “How did we get from the starting value to the ending value?” It is especially effective when a moderate number of named changes explain the result. The bridge layout makes contributions and offsets visible in sequence, which a simple before-and-after comparison would hide.

A clustered column chart is often clearer when the goal is to compare separate categories that do not form a running calculation—for example, sales across several regions. A line chart is usually more suitable for showing a continuous trend over time. A stacked column chart can show components that make up totals across groups, but it does not naturally explain a sequential series of increases and decreases between two endpoints.

Waterfalls become harder to read when there are many tiny adjustments, long labels, or several separate starting points. Consider grouping minor items into a clearly named category such as “Other adjustments,” while preserving a detail table for readers who need the breakdown. If the sequence includes several independent bridges, separate charts or a carefully labeled table may explain the information better than forcing everything into one visual.

Excel on Mac and the web

The instructions above use Excel for Microsoft 365 on Windows. Current desktop versions of Excel for Mac also support waterfall charts, though ribbon layout and context-menu wording can vary slightly by release. Look under the Insert tab for the chart-type menu and use the chart’s context menu to mark a selected point as a total. On Mac, the common shortcut to open a context menu is Control-click or a two-finger click, depending on the mouse or trackpad setup; Windows users can right-click.

Excel for the web and older perpetual-license versions may offer a different set of chart creation or formatting controls. If you cannot find Waterfall in the Insert chart menu, check the Excel version and whether the workbook is open in the desktop app. A chart created in a compatible desktop version may still be viewable in another Excel edition, but editing options can differ. Avoid promising that every recipient can change every waterfall setting unless you know which version they use.

Frequently Asked Questions

How do I make the first and last bars full columns?
Right-click the first bar and choose Set as Total, then repeat for the final bar. Do the same for any intermediate subtotal that should display as a complete value rather than as another change.

Can a waterfall chart show negative values?
Yes. Enter decreases as negative numbers. Excel draws them as downward changes in the running balance, while positive numbers increase it. Check the source signs and endpoint arithmetic to confirm the direction is correct.

Why does my ending total not match the last bar?
The closing value is not calculated automatically from the intervening rows. It is a value in your source data that you must check against the opening value and all changes. Look for omitted or duplicated adjustments and incorrect signs.

Can I add a subtotal in the middle of a waterfall chart?
Yes. Include a row for the subtotal, then right-click its bar and choose Set as Total. Arrange the source rows so that the subtotal is a checkpoint in the story and is not counted again as an additional change.

Can I change the colors of increase and decrease bars?
Yes. Select the relevant bar or data point and use the formatting controls for its fill. Keep the color meaning consistent and use labels or explanatory text as well, so the chart remains understandable when viewed in grayscale or by readers with color-vision differences.

Try it: the Percentage Formula Generator: percent of, percent change, increase and decrease, with the formula.

More in Charts & pivot tables

Sources: Function behaviour and menu paths: Microsoft Support documentation for Excel. Method & sources

Spotted an error in this guide? Let us know.