INCOME TAXES (Tables)
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12 Months Ended |
Jun. 30, 2025 |
Income Tax Disclosure [Abstract] |
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Provision for Income Taxes |
The components of the provision for income taxes were as follows:
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(In millions) |
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Year Ended June 30, |
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2025 |
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2024 |
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2023 |
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Current Taxes |
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U.S. federal |
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$ |
14,086 |
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$ |
12,165 |
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$ |
14,009 |
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U.S. state and local |
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3,342 |
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2,366 |
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2,322 |
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Foreign |
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11,423 |
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9,858 |
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6,678 |
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Current taxes |
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$ |
28,851 |
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$ |
24,389 |
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$ |
23,009 |
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Deferred Taxes |
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U.S. federal |
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$ |
(6,250 |
) |
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$ |
(4,791 |
) |
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$ |
(6,146 |
) |
U.S. state and local |
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(1,087 |
) |
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(379 |
) |
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(477 |
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Foreign |
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281 |
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432 |
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564 |
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Deferred taxes |
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$ |
(7,056 |
) |
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$ |
(4,738 |
) |
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$ |
(6,059 |
) |
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Provision for income taxes |
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$ |
21,795 |
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$ |
19,651 |
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$ |
16,950 |
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Income Before Income Taxes |
U.S. and foreign components of income before income taxes were as follows:
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(In millions) |
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Year Ended June 30, |
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2025 |
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2024 |
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2023 |
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U.S. |
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$ |
69,212 |
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$ |
62,886 |
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$ |
52,917 |
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Foreign |
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54,415 |
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44,901 |
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36,394 |
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Income before income taxes |
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$ |
123,627 |
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$ |
107,787 |
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$ |
89,311 |
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Difference Between Income Taxes Computed at Federal Statutory Rate and Provision for Income Taxes |
The items accounting for the difference between income taxes computed at the U.S. federal statutory rate and our effective rate were as follows:
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Year Ended June 30, |
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2025 |
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2024 |
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2023 |
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Federal statutory rate |
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21.0% |
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21.0% |
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21.0% |
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Effect of: |
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Foreign earnings taxed at lower rates |
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(1.5)% |
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(1.4)% |
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(1.8)% |
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Foreign-derived intangible income deduction |
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(1.0)% |
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(1.1)% |
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(1.3)% |
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State income taxes, net of federal benefit |
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1.5% |
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1.5% |
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1.6% |
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Research and development credit |
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(1.1)% |
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(1.1)% |
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(1.1)% |
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Excess tax benefits relating to stock-based compensation |
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(0.9)% |
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(1.1)% |
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(0.7)% |
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Interest, net |
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1.0% |
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1.1% |
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0.8% |
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Other reconciling items, net |
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(1.4)% |
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(0.7)% |
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0.5% |
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Effective rate |
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17.6% |
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18.2% |
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19.0% |
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Deferred Income Tax Assets and Liabilities |
The components of the deferred income tax assets and liabilities were as follows:
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(In millions) |
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June 30, |
|
2025 |
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2024 |
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Deferred Income Tax Assets |
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Stock-based compensation expense |
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$ |
909 |
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$ |
765 |
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Accruals, reserves, and other expenses |
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5,050 |
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4,381 |
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Loss and credit carryforwards |
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2,114 |
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1,741 |
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Amortization |
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4,118 |
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4,159 |
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Leasing liabilities |
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12,874 |
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6,504 |
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Unearned revenue |
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4,324 |
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3,717 |
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Book/tax basis differences in investments and debt |
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303 |
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9 |
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Capitalized research and development |
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16,891 |
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11,442 |
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Other |
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529 |
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426 |
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Deferred income tax assets |
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47,112 |
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33,144 |
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Less valuation allowance |
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(1,169 |
) |
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(1,045 |
) |
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Deferred income tax assets, net of valuation allowance |
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$ |
45,943 |
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$ |
32,099 |
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Deferred Income Tax Liabilities |
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Leasing assets |
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$ |
(12,696 |
) |
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$ |
(6,503 |
) |
Depreciation |
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(5,699 |
) |
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(3,940 |
) |
Deferred tax on foreign earnings |
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(1,148 |
) |
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(1,837 |
) |
Other |
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(127 |
) |
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(167 |
) |
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Deferred income tax liabilities |
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$ |
(19,670 |
) |
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$ |
(12,447 |
) |
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Net deferred income tax assets |
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$ |
26,273 |
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$ |
19,652 |
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Reported As |
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Other long-term assets |
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$ |
29,108 |
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$ |
22,270 |
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Long-term deferred income tax liabilities |
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(2,835 |
) |
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(2,618 |
) |
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Net deferred income tax assets |
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$ |
26,273 |
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$ |
19,652 |
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Changes in Gross Unrecognized Tax Benefits Related to Uncertain Tax Positions |
The aggregate changes in the gross unrecognized tax benefits related to uncertain tax positions were as follows:
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(In millions) |
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Year Ended June 30, |
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2025 |
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2024 |
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|
2023 |
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Beginning unrecognized tax benefits |
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$ |
22,760 |
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$ |
17,120 |
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$ |
15,593 |
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Decreases related to settlements |
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(240 |
) |
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(76 |
) |
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(329 |
) |
Increases for tax positions related to the current year |
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2,066 |
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1,903 |
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|
1,051 |
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Increases for tax positions related to prior years |
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|
468 |
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|
4,289 |
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|
870 |
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Decreases for tax positions related to prior years |
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(300 |
) |
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(464 |
) |
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(60 |
) |
Decreases due to lapsed statutes of limitations |
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(25 |
) |
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(12 |
) |
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(5 |
) |
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Ending unrecognized tax benefits |
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$ |
24,729 |
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$ |
22,760 |
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$ |
17,120 |
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