v3.26.1
Income Taxes
 12 Months Ended
May 02, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Income (loss) before provision (benefit) for income taxes consists of the following (in thousands):
Year Ended
May 2, 2026May 3, 2025April 27, 2024
United States$36,047 $13,795 $8,611 
International439,388 41,075 (31,356)
$475,435 $54,870 $(22,745)
The components of income tax expense (benefit) are summarized as follows (in thousands):
Year Ended
May 2, 2026May 3, 2025April 27, 2024
Current
Federal$— $— $2 
State32 12 3 
International6,224 2,253 1,484 
Total current tax expense 6,256 2,265 1,489 
Deferred
Federal(2,562)— 3,092 
State(152)— 359 
International(386)422 684 
Total deferred tax expense (benefit) (3,100)422 4,135 
Total tax expense$3,156 $2,687 $5,624 
The Company adopted ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, on a prospective basis, in the fiscal year 2026. The Company consists of a Cayman Islands parent holding company with various international and U.S. subsidiaries. The applicable statutory rate in Cayman Islands is zero for the Company for the years ended May 2, 2026, May 3, 2025 and April 27,
2024. A reconciliation of the U.S. 21% rate to the effective tax rate pursuant to the disclosure requirements of ASU 2023-09 for the year ended May 2, 2026, was as follows (in thousands):
Year Ended
May 2, 2026
Statutory federal tax expense$99,841 21 %
State tax, net of federal benefit
(2,980)(1)%
Nontaxable or nondeductible items:
Share-based compensation(73,448)(15)%
Section 162(m) limitation
9,378 2 %
Other
1,011 — %
Research tax credit
(32,047)(7)%
Change in valuation allowance
78,617 17 %
Foreign rate differential:
Cayman Islands(86,088)(18)%
Withholding taxes148 — %
Other foreign jurisdictions(635)— %
Change in unrecognized tax benefits9,362 2 %
Other
(3)— %
Effective tax rate$3,156 1 %
Pursuant to the disclosure requirements of ASU 2023-09, the following table presents income taxes paid, net of refunds received, for the year ended May 2, 2026 (in thousands):
Year Ended
May 2, 2026
Federal$— 
State11 
Foreign:
Hong Kong1,992 
Taiwan243 
China125 
Cayman Islands101 
Total income taxes paid$2,472 
The Company consists of a Cayman Islands parent holding company with various international and U.S. subsidiaries. Under the current laws of the Cayman Islands, the Company is not subject to tax on its income. For purposes of the reconciliation, prior to adoption of ASU 2023-09, Income Taxes (Topic 740): improvements to Income Tax Disclosures, between the provision (benefit) for income taxes at the
statutory rate and the effective tax rate, a notional U.S. 21% rate is applied to pretax income (loss) as a result of the following for the periods indicated, respectively:
Year Ended
May 2, 2026May 3, 2025April 27, 2024
Statutory federal tax expense rate21 %21 %21 %
State tax, net of federal benefit— %— %(2)%
Research tax credits(5)%(24)%20 %
Share-based compensation(14)%(53)%24 %
Other1 %— %(1)%
Foreign rate differential(19)%(12)%(34)%
Change in valuation allowance17 %72 %(49)%
Withholding taxes— %1 %(4)%
Effective tax rate1 %5 %(25)%
The tax effects of significant items comprising the Company’s deferred taxes are as follows (in thousands):
May 2, 2026May 3, 2025
Deferred tax assets
Accrued expense$2,851 $1,904 
Net operating losses78,363 28,557 
Research and development credits72,874 35,641 
Share-based compensation10,560 3,667 
Lease liability4,968 3,063 
Intangibles— 141 
Others870 11 
Total deferred tax assets170,486 72,984 
Deferred tax liabilities
Property and equipment basis(1,954)(1,963)
Right of use assets(4,780)(2,890)
Intangibles(6,499)— 
Total deferred tax liabilities(13,233)(4,853)
Valuation allowance(162,892)(69,456)
Net deferred taxes $(5,639)$(1,325)
A valuation allowance is established when the Company believes that it is more likely than not that some portion of its deferred tax assets will not be realized. As of May 2, 2026, the Company recorded $162.9 million of valuation allowance. In fiscal year 2026, the valuation allowance increased by $93.4 million. The Company continues to maintain a full valuation allowance on its U.S. net deferred tax assets. The Company will continue to assess the future realization of its deferred tax assets in each applicable jurisdiction and adjust the valuation allowance accordingly. As of May 2, 2026, the Company had U.S. federal and state net operating loss carryforwards of approximately $353.0 million and $58.5 million, respectively. The U.S. federal net operating loss carryforwards can be carried forward indefinitely. The state net operating loss carryforwards will begin to expire in fiscal 2043. As of May 2, 2026, the Company had U.S. federal and state research credits of $61.3 million and $37.1 million, respectively. The federal research credits will begin to expire in 2039. The state research credits have no expiration date. As of May 2, 2026, the Company had no foreign tax credit carryover. Internal Revenue Code Section 382 limits the use of net operating loss and tax credit carryforwards in certain situations where changes occur in the
stock ownership of a company. In the event that we had a change of ownership, utilization of the net operating loss and tax credit carryforwards may be restricted.
A summary activity of the valuation allowance is as follows (in thousands):
May 2, 2026May 3, 2025
April 27, 2024
Beginning valuation allowance
$69,456 $23,258 $9,306 
Additions
93,436 46,197 13,952 
Ending valuation allowance
$162,892 $69,456 $23,258 
A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands):
May 2, 2026May 3, 2025
Beginning gross unrecognized tax benefits $9,440 $4,574 
Additions for tax positions taken in the current year10,9105,196 
Subtractions for tax positions taken in the prior year(747)(278)
Lapses in statute of limitations(42)(52)
Ending gross unrecognized tax benefits $19,561 $9,440 
The Company recognizes the tax effects of an uncertain tax position only if it is more likely than not to be sustained based solely on such position’s technical merits as of the reporting date and only in an amount more likely than not to be sustained upon review by the tax authorities.
The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. For the years ended May 2, 2026, and May 3, 2025, the Company’s current tax provision was not impacted by interest and penalties.
The Company files U.S. federal and state and non-U.S. income tax returns with varying statutes of limitations. The Company’s tax returns continue to remain subject to examination by U.S. federal authorities for the years ended April 30, 2023 through 2025 and by state authorities for the years ended April 30, 2022 through 2025. For the Company’s international subsidiaries, the tax years that remain open to examination vary based on the year that each entity began operating.