v3.26.1
Income Taxes
 12 Months Ended
Mar. 31, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Recent U.S. tax legislation
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States. The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing, and the business interest expense limitation. We evaluated the provisions of the OBBBA effective during fiscal year ended March 31, 2026 and determined that there was no material impact on our estimated annual effective tax rate.

Income before income taxes consists of the following:
Year Ended March 31,
(In thousands)202620252024
United States$237,057 $249,803 $239,405 
Foreign20,439 34,386 36,620 
Total income before income taxes$257,496 $284,189 $276,025 

The provision for income taxes consists of the following:
Year Ended March 31,
 (In thousands)202620252024
Current   
Federal$31,573 $34,156 $28,302 
State4,455 5,914 3,662 
Foreign8,614 11,092 11,652 
Deferred   
Federal17,297 12,237 20,582 
State8,004 5,210 3,034 
Foreign(2,748)975 (546)
Total provision for income taxes$67,195 $69,584 $66,686 
The principal components of our deferred tax balances are as follows:
March 31,
(In thousands)20262025
Deferred Tax Assets  
Allowance for credit losses and sales returns$3,404 $2,920 
Inventory capitalization1,941 2,069 
Inventory reserves2,432 1,221 
Net operating loss carryforwards9,225 — 
State income taxes11,759 9,631 
Accrued liabilities3,810 1,275 
Accrued compensation3,067 3,653 
Stock compensation3,746 3,506 
Research and development1,692 6,231 
Lease liability11,732 12,086 
Unrealized foreign exchange loss401 245 
Other8,705 11,268 
Total deferred tax assets$61,914 $54,105 
Deferred Tax Liabilities  
Property, plant and equipment$(11,692)$(9,081)
Intangible assets(476,973)(451,368)
Right-of-use asset(12,009)(12,413)
Total deferred tax liabilities$(500,674)$(472,862)
Net deferred tax liability$(438,760)$(418,757)

The total net deferred tax liability shown above is net of $8.7 million and $0.8 million of deferred tax assets which are included in Other long-term assets on the Consolidated Balance Sheets as of March 31, 2026 and 2025, respectively.

We had no valuation allowance as of March 31, 2026 and March 31, 2025.
For the year ended March 31, 2026, we adopted ASU 2023-09 on a prospective basis. Differences between the provision for income taxes at the U.S. federal statutory income tax rate and the provision in the consolidated statements of operations are as follows:
 Year Ended March 31,
2026
(In thousands) %
Income tax provision at statutory rate$54,074 21.0 %
State income taxes (net of Federal income tax benefit) (a)
11,526 4.5 %
Foreign tax effects:
     Australia:
          Statutory tax rate difference between Australia and the U.S.2,457 1.0 %
     Other foreign jurisdictions(964)(0.5)%
Effect of cross-border tax laws:
     Global intangible low taxed income211 0.1 %
     Foreign derived intangible income(1,032)(0.4)%
     Subpart F130 0.1 %
Tax credits:
     Research and Development(736)(0.3)%
Nontaxable or nondeductible items:
     Compensation limitations1,229 0.5 %
     Stock compensation(149)(0.1)%
Changes in unrecognized tax liabilities241 0.1 %
Other208 0.1 %
Total provision for income taxes$67,195 26.1 %
(a) During the year ended March 31, 2026, the state of California comprised more than 50% of the tax effect in this category.

Differences between the provision for income taxes at the U.S. federal statutory income tax rates and the provision prior to the adoption of ASU 2023-09 are as follows:
 Year Ended March 31,
20252024
(In thousands) % %
Income tax provision at statutory rate$59,680 21.0 $57,965 21.0 
Foreign tax provision4,691 1.7 3,164 1.1 
State income taxes provision, net of federal income tax benefit10,187 3.6 6,004 2.2 
Research and development(600)(0.2)(700)(0.3)
Compensation limitations1,312 0.5 1,910 0.7 
Foreign tax credit(622)(0.2)(889)(0.3)
Uncertain tax positions(3,694)(1.3)390 0.1 
Other(1,370)(0.6)(1,158)(0.3)
Total provision for income taxes$69,584 24.5 $66,686 24.2 
The components of Income taxes paid, net of refunds received, consists of the following:

(In thousands)Year Ended March 31, 2026
Federal$28,100 
State6,143 
Foreign:
     Australia10,512 
     Other foreign1,189 
Income taxes paid, net of refunds$45,944 


Uncertain tax liability activity is as follows:
 202620252024
(In thousands)  
Balance – beginning of year$1,066 $3,325 $3,295 
Reductions based on lapse of statute of limitations(228)(2,649)(417)
Payments and other movements428 390 447 
Balance – end of year$1,266 $1,066 $3,325 

We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. We did not incur any material interest or penalties related to income taxes in 2026, 2025 or 2024. We are subject to taxation in the United States and various state and foreign jurisdictions, and we are generally open to examination from the year ended March 31, 2022 forward. We are currently under audit with the California state taxing authority for the years ended March 31, 2023 and 2024.

We have made the assessment that the undistributed after-tax earnings from our foreign subsidiaries through March 31, 2026 were not indefinitely reinvested and can be remitted to the U.S. parent in a tax-neutral transaction under either the subsidiary countries' relevant income tax treaties or their internal tax law. Accordingly, we have not recorded a deferred tax liability related to these undistributed earnings.