v3.25.2
Income Taxes (Tables)
12 Months Ended
May 31, 2025
Income Tax Disclosure [Abstract]  
Income before Income Taxes

Income before income taxes as shown in the Consolidated Statements of Income is summarized below for the periods indicated.

Year Ended May 31,

 

2025

 

 

2024

 

 

2023

 

(In thousands)

 

 

 

 

 

 

 

 

 

United States

 

$

645,397

 

 

$

625,167

 

 

$

557,401

 

Foreign

 

 

147,363

 

 

 

162,670

 

 

 

91,981

 

Income Before Income Taxes

 

$

792,760

 

 

$

787,837

 

 

$

649,382

 

 

Provision (Benefit) for Income Tax

Provision (benefit) for income taxes consists of the following for the periods indicated:

Year Ended May 31,

 

2025

 

 

2024

 

 

2023

 

(In thousands)

 

 

 

 

 

 

 

 

 

Current:

 

 

 

 

 

 

 

 

 

U.S. federal

 

$

113,885

 

 

$

109,869

 

 

$

91,749

 

State and local

 

 

43,881

 

 

 

31,996

 

 

 

25,972

 

Foreign

 

 

49,174

 

 

 

62,168

 

 

 

45,694

 

Total Current

 

 

206,940

 

 

 

204,033

 

 

 

163,415

 

Deferred:

 

 

 

 

 

 

 

 

 

U.S. federal

 

 

25,656

 

 

 

(2,263

)

 

 

16,969

 

State and local

 

 

160

 

 

 

618

 

 

 

4,359

 

Foreign

 

 

(130,323

)

 

 

(3,993

)

 

 

(15,092

)

Total Deferred

 

 

(104,507

)

 

 

(5,638

)

 

 

6,236

 

Provision for Income Taxes

 

$

102,433

 

 

$

198,395

 

 

$

169,651

 

Significant Components of Deferred Income Tax Assets and Liabilities

The significant components of deferred income tax assets and liabilities as of May 31, 2025 and 2024 were as follows:

 

 

2025

 

 

2024

 

(In thousands)

 

 

 

 

 

 

Deferred income tax assets related to:

 

 

 

 

 

 

Inventories

 

$

17,348

 

 

$

17,772

 

Accrued compensation and benefits

 

 

15,430

 

 

 

17,649

 

Other accrued and prepaid expenses, net

 

 

21,294

 

 

 

19,058

 

Deferred income and other long-term liabilities

 

 

24,880

 

 

 

31,204

 

Credit, net operating, interest and capital loss carryforwards

 

 

60,457

 

 

 

87,590

 

Research and development

 

 

42,258

 

 

 

33,076

 

Pension and other postretirement benefits

 

 

5,069

 

 

 

-

 

Total Deferred Income Tax Assets

 

 

186,736

 

 

 

206,349

 

Less: valuation allowances

 

 

(49,167

)

 

 

(30,021

)

Net Deferred Income Tax Assets

 

 

137,569

 

 

 

176,328

 

Deferred income tax (liabilities) related to:

 

 

 

 

 

 

Depreciation

 

 

(136,966

)

 

 

(132,007

)

Amortization of intangibles

 

 

(77,142

)

 

 

(125,553

)

Unremitted foreign earnings

 

 

-

 

 

 

(4,055

)

Net unrealized gain on securities

 

 

(372

)

 

 

(1,305

)

Pension and other postretirement benefits

 

 

-

 

 

 

(1,108

)

Total Deferred Income Tax (Liabilities)

 

 

(214,480

)

 

 

(264,028

)

Deferred Income Tax Assets (Liabilities), Net

 

$

(76,911

)

 

$

(87,700

)

A
Reconciliation of Income Tax Expense (Benefit) Computed by Applying U.S. Statutory Federal Income Tax Rate against Income (Loss) before Income Taxes to Provision (Benefit) for Income Taxes

The following table reconciles income tax expense (benefit) computed by applying the U.S. statutory federal income tax rate against income (loss) before income taxes to the provision (benefit) for income taxes:

Year Ended May 31,

 

2025

 

 

2024

 

 

2023

 

(In thousands, except percentages)

 

 

 

 

 

 

 

 

 

Income tax expense at the U.S. statutory federal income tax rate

 

$

166,480

 

 

$

165,446

 

 

$

136,370

 

Foreign rate differential and other foreign tax adjustments

 

 

(32,497

)

 

 

9,632

 

 

 

5,722

 

Impact of foreign derived intangible income deduction

 

 

(38,174

)

 

 

(5,290

)

 

 

(4,187

)

State and local income taxes, net

 

 

34,432

 

 

 

28,000

 

 

 

22,017

 

Impact of GILTI provisions

 

 

3,960

 

 

 

3,548

 

 

 

4,217

 

Nondeductible business expense

 

 

1,895

 

 

 

1,944

 

 

 

1,257

 

Valuation allowance

 

 

17,246

 

 

 

(754

)

 

 

1,199

 

Deferred tax liability for unremitted foreign earnings

 

 

-

 

 

 

3,658

 

 

 

-

 

Changes in unrecognized tax benefits

 

 

(3,771

)

 

 

2,209

 

 

 

(3,334

)

Equity-based compensation

 

 

(1,963

)

 

 

(5,496

)

 

 

(3,482

)

Nondeductible goodwill impairment

 

 

2,119

 

 

 

-

 

 

 

7,264

 

Deferred tax adjustment to U.S. foreign tax credit carryforwards

 

 

(43,922

)

 

 

-

 

 

 

-

 

Other

 

 

(3,372

)

 

 

(4,502

)

 

 

2,608

 

Provision for Income Tax Expense

 

$

102,433

 

 

$

198,395

 

 

$

169,651

 

Effective Income Tax Rate

 

 

12.9

%

 

 

25.2

%

 

 

26.1

%

Activity Related to Unrecognized Tax Benefits

Uncertain income tax positions are accounted for in accordance with ASC 740. The following table summarizes the activity related to unrecognized tax benefits:

(In millions)

 

2025

 

 

2024

 

 

2023

 

Balance at June 1

 

$

4.4

 

 

$

2.9

 

 

$

5.7

 

Additions for tax positions of prior years

 

 

0.2

 

 

 

3.4

 

 

 

0.1

 

Reductions for tax positions of prior years

 

 

(2.9

)

 

 

(1.4

)

 

 

(2.8

)

Settlements

 

 

-

 

 

 

(0.5

)

 

 

-

 

Foreign currency translation

 

 

(0.1

)

 

 

-

 

 

 

(0.1

)

Balance at May 31

 

$

1.6

 

 

$

4.4

 

 

$

2.9