A waterfall chart is a form of data visualization that helps in understanding the cumulative effect of sequentially introduced positive or negative values. These intermediate values can either be time based or category based.
A typical waterfall chart is used to show how an initial value is increased and decreased by a series of intermediate values, leading to a final value.
Waterfall chart is widely used in the Finance sector to exhibit how a net value is arrived at, by breaking down the aggregate effect of positive and negative contributions.