Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Income Tax Disclosure [Abstract]

Components of Earnings (Loss) Before Income Taxes

The components of earnings (loss) before income taxes consisted of the following (in millions):


		For the Years Ended December 31,
		2025				2024				2023

United States operations		$	(127.5	)		$	251.8			$	57.0
Foreign operations			958.3				784.8				1,010.3
Total		$	830.8			$	1,036.6			$	1,067.3

Provision (Benefit) for Income Taxes

The provision (benefit) for income taxes consisted of the following (in millions):


		For the Years Ended December 31,
		2025				2024				2023
Current:
Federal		$	62.9			$	4.4			$	0.5
State			21.5				20.9				19.5
Foreign			128.5				153.8				118.5
			212.9				179.1				138.5
Deferred:
Federal			(120.9	)			(59.7	)			(125.2	)
State			(30.8	)			(12.3	)			(16.7	)
Foreign			64.5				24.3				45.6
			(87.2	)			(47.7	)			(96.3	)
Provision for income taxes		$	125.7			$	131.4			$	42.2

Reconciliation of U.S. Statutory Income Tax Rate to Our Effective Tax Rate

A reconciliation of the U.S. statutory income tax rate to our effective tax rate, and related dollar amounts, for the year ended December 31, 2025 is as follows ($ in millions):


	For the Year Ended December 31, 2025
	Amount				Percent
U.S. federal statutory income tax rate	$	174.5				21.0		%
Domestic state and local income taxes, net of federal effect		(7.3	)			(0.9	)
Foreign tax effects
Switzerland
Statutory income tax rate differential		(85.0	)			(10.2	)
Intercompany distributions		28.9				3.5
State and local income taxes		15.0				1.8
Other		2.2				0.3
China
Intercompany distributions		22.6				2.7
Other		0.2				-
Other foreign jurisdictions		4.4				0.5
Cross-border tax laws
Global intangible low-taxed income		47.0				5.6
Foreign derived deduction eligible income		(9.5	)			(1.1	)
Cross-border tax laws - other		14.8				1.8
Tax credits
Research credits		(16.5	)			(2.0	)
Foreign tax credits		(19.0	)			(2.3	)
Valuation allowance changes		95.7				11.5
Nontaxable and nondeductible items
Contingent consideration		(17.1	)			(2.1	)
Nontaxable and nondeductible items - other		3.5				0.4
Worldwide changes in unrecognized tax benefits		1.5				0.2
Other
Investments in partnership		(48.4	)			(5.8	)
Capital loss		(105.5	)			(12.7	)
Net operating loss		9.9				1.2
Domestic federal - other		13.8				1.7
Total	$	125.7				15.1		%

For the year ended December 31, 2025, state and local income taxes in California, Illinois, Indiana, New York, and Minnesota comprise the majority of the domestic state and local income taxes, net of federal effect category.

A reconciliation of the U.S. statutory income tax rate to our effective tax rate for the years ended December 31, 2024 and 2023 is as follows:


		For the Years Ended December 31,
			2024					2023
U.S. statutory income tax rate				21.0		%			21.0		%
State taxes, net of federal deduction				0.7					0.2
Tax impact of foreign operations, including U.S. taxes on international income and foreign tax credits				(6.6	)				(0.3	)
Change in valuation allowance				(0.3	)				(0.2	)
Non-deductible expenses				0.3					0.7
Tax impact of certain significant transactions				0.1					-
Tax benefit relating to foreign derived intangible income and U.S. manufacturer’s deduction				(0.2	)				(0.8	)
R&D tax credit				(1.1	)				(0.6	)
Share-based compensation				1.0					0.1
Net uncertain tax positions, including interest and penalties				(3.2	)				(16.0	)
Other				1.0					(0.1	)
Effective income tax rate				12.7		%			4.0		%

Components of Income Taxes Paid, Net of Refunds Received

The components of income taxes paid, net of refunds received, consisted of the following (in millions):


		For the Years Ended December 31,
		2025				2024				2023

US federal		$	196.9
US state and local			24.1
US income tax paid		$	221.0
Foreign
China		$	25.5
Other - foreign			130.4
Foreign income tax paid		$	155.9
Net income taxes paid		$	376.9
Net income tax paid (prior to ASU 2023-09)		$	-			$	328.5			$	215.2

Components of Deferred Taxes

The components of deferred taxes consisted of the following (in millions):


		As of December 31,
		2025				2024
Deferred tax assets:
Inventory		$	266.7			$	202.6
Net operating loss carryover			459.3				452.4
Tax credit carryover			121.2				100.5
Capital loss carryover			123.7				7.4
Product liability and litigation			23.7				25.9
Accrued liabilities			94.2				54.8
Share-based compensation			41.2				42.2
Accounts receivable			28.8				31.2
Foreign currency items			28.7				-
Research and development			93.0				129.9
Investment in partnerships			52.6				-
Lease liability			55.3				58.1
Other			1.6				9.4
Total deferred tax assets			1,390.0				1,114.4
Less: Valuation allowances			(573.0	)			(449.4	)
Total deferred tax assets after valuation allowances		$	817.0			$	665.0
Deferred tax liabilities:
Fixed assets		$	153.0			$	118.2
Intangible assets			534.6				437.0
Foreign currency items			-				40.8
Lease asset			49.1				51.4
Defined benefit plans			49.1				33.5
Other			13.4				16.5
Total deferred tax liabilities			799.2				697.4
Total net deferred income taxes		$	17.8			$	(32.4	)

Summary of Tax Credit Carryforwards

At December 31, 2025, net operating loss, tax credit carryovers, and capital loss carryovers are available to reduce future federal, state and foreign taxable earnings (in millions):


Expiration Period:		Net operating loss carryover				Tax credit carryover				Capital loss carryover
1-5 years		$	24.2			$	29.0			$	115.3
6-10 years			231.9				78.8				-
11+ years			39.5				12.2				0.6
Indefinite			163.7				1.2				7.8
			459.3				121.2				123.7
Valuation allowances		$	391.0			$	47.8			$	123.7

Tabular Reconciliation of Total Amounts of Unrecognized Tax Benefits

The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in millions):


		For the Years Ended December 31,
		2025				2024				2023
Balance at January 1		$	241.4			$	391.9			$	521.0
Increases related to business combinations			0.6				-				-
Increases related to prior periods			1.4				80.9				68.7
Decreases related to prior periods			(0.3	)			(136.8	)			(206.2	)
Increases related to current period			4.8				4.3				8.7
Decreases related to settlements with taxing authorities			-				(98.4	)			-
Decreases related to lapse of statute of limitations			(0.5	)			(0.5	)			(0.3	)
Balance at December 31		$	247.4			$	241.4			$	391.9
Amounts impacting effective tax rate, if recognized balance at December 31		$	213.2			$	204.1			$	251.6