v3.26.1
Income Taxes
 12 Months Ended
Jun. 28, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of income before income taxes were as follows:
Year Ended
June 28,
2026		June 29,
2025		June 30,
2024
(in thousands)
United States$535,542 $219,435 $282,736 
Foreign7,726,931 5,738,694 4,077,486 
$8,262,473 $5,958,129 $4,360,222 
Significant components of the provision (benefit) for income taxes attributable to income before income taxes were as follows:
Year Ended
June 28,
2026		June 29,
2025		June 30,
2024
(in thousands)
Federal:
Current$959,341 $701,819 $566,106 
Deferred(270,392)(372,783)(186,238)
688,949 329,036 379,868 
State:
Current28,697 22,979 20,081 
Deferred(5,645)12,448 (15,118)
23,052 35,427 4,963 
Foreign:
Current298,100 238,363 143,595 
Deferred(13,024)(2,914)4,024 
285,076 235,449 147,619 
Total provision for income taxes$997,077 $599,912 $532,450 
Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as the tax effect of carryforwards. Significant components of the Company’s net deferred tax assets and liabilities were as follows:
June 28,
2026		June 29,
2025
(in thousands)
Deferred tax assets:
Tax carryforwards$470,727 $431,533 
Allowances and reserves281,612 260,266 
Outside basis differences of foreign subsidiaries1,250,897 1,002,861 
R&D capitalization126,910 96,594 
Operating lease liabilities72,236 50,722 
Other61,039 54,749 
Gross deferred tax assets2,263,421 1,896,725 
Valuation allowance(464,134)(424,347)
Net deferred tax assets1,799,287 1,472,378 
Deferred tax liabilities:
Capital assets(146,147)(129,145)
Right-of-use assets(72,236)(50,722)
Other(17,144)(17,472)
Gross deferred tax liabilities(235,527)(197,339)
Net deferred tax assets$1,563,760 $1,275,039 
Realization of the Company’s net deferred tax assets is based upon the weighting of available evidence, including such factors as the recent earnings history and expected future taxable income. The Company believes it is more likely than not that such deferred tax assets will be realized with the exception of $464.1 million primarily related to California deferred tax assets. At June 28, 2026, the Company continued to record a valuation allowance to offset the entire California deferred tax asset balance due to the single sales factor apportionment resulting in lower taxable income in California.
At June 28, 2026, the Company had state tax credit carryforwards of $705.6 million. Substantially all of these credits can be carried forward indefinitely.
The Company adopted ASU 2023-09 on a prospective basis beginning with the fiscal year ended June 28, 2026. The following table presents required disclosures pursuant to ASU 2023-09 and reconciles the U.S. federal statutory tax amount and rate to the Company’s Consolidated effective amount and rate for the year ended June 28, 2026:
Year Ended
June 28, 2026
AmountPercent
(in thousands)
Income tax expense computed at federal statutory rate$1,735,119 21.0 %
State and local income taxes, net of federal income tax effect12,265 0.2 %
Foreign tax effects
Malaysia
Statutory tax rate differential223,945 2.7 %
Incentive agreement(1,682,441)(20.4)%
Other2,784 — %
Other foreign jurisdictions12,426 0.2 %
Effect of changes in tax laws or rates enacted in the current period27,450 0.3 %
Effect of cross-border tax laws
Global intangible low-taxed income305,392 3.7 %
Foreign income inclusions taxable at U.S. statutory rate - Subpart F413,370 5.0 %
Other(1,241)— %
Tax credits
Research and development(108,401)(1.3)%
Other(436)— %
Nontaxable or nondeductible items(82,024)(1.0)%
Changes in uncertain tax positions136,674 1.7 %
Other adjustments2,195 — %
Income tax expense, effective tax rate$997,077 12.1 %
At June 28, 2026, the state and local income taxes in Oregon and Minnesota comprised the majority of the state and local income taxes, net of federal tax effect category.
The effect of cross-border tax laws category includes the benefit of foreign tax credits associated with foreign earnings subject to U.S. taxation. The Company presents this category on a net basis as the foreign tax credits directly offset the related U.S. tax liability.
The following table presents the required disclosures prior to the Company’s adoption of ASU 2023-09 and reconciles income tax expense provided at the federal statutory rate (21% in fiscal years 2025 and 2024) to actual income tax expense for the fiscal years ended June 29, 2025 and June 30, 2024.
Year Ended
June 29,
2025		June 30,
2024
(in thousands)
Income tax expense computed at federal statutory rate$1,251,207 $915,647 
State income taxes, net of federal tax benefit(13,581)(37,965)
Foreign income taxed at different rates(451,199)(313,795)
Settlements and reductions in uncertain tax positions(266,805)(18,947)
Tax credits(116,699)(125,523)
State valuation allowance, net of federal tax benefit42,759 44,916 
Equity-based compensation17,391 (11,296)
Increases in uncertain tax positions 138,029 62,333 
Other permanent differences and miscellaneous items(1,190)17,080 
$599,912 $532,450 
Effective from fiscal year 2022, the Company has a 15-year tax incentive ruling in Malaysia for one of its foreign subsidiaries. The impact of the tax incentive decreased worldwide taxes by approximately $967.9 million, $584.8 million, and $416.3 million for fiscal years 2026, 2025, and 2024, respectively. The benefit of the tax incentive on diluted earnings per share was approximately $0.77, $0.45, and $0.32 in fiscal years 2026, 2025, and 2024, respectively.
BEPS 2.0 GMT was fully effective for the Company this fiscal year. The Company assessed GMT under currently enacted legislation and determined that it met transitional safe harbor requirements in most jurisdictions, with limited jurisdictions subject to GMT. The Company assessed the impact and concluded that it was not material. The impact has been included within income tax expense for the twelve months ended June 28, 2026.
On July 4, 2025, the OBBBA was signed into law by U.S. President Donald Trump. The impact on income taxes due to change in legislation is required, under ASC 740, Income Taxes, to be recognized in the period in which the law is enacted, which was this fiscal year. In general, the OBBBA introduced changes to U.S. taxation, including changes in the taxation of non-U.S. income. The Company assessed the changes and concluded that they were not material. The impact has been included within income tax expense for the twelve months ended June 28, 2026.
The Company’s gross uncertain tax positions were $864.1 million, $720.3 million, and $723.8 million as of June 28, 2026, June 29, 2025, and June 30, 2024, respectively. During fiscal year 2026, gross uncertain tax positions increased by $143.8 million. The amount of uncertain tax positions that, if recognized, would impact the effective tax rate was $735.5 million, $604.6 million, and $622.6 million, as of June 28, 2026, June 29, 2025, and June 30, 2024, respectively.
The aggregate changes in the balance of gross uncertain tax positions were as follows: 
(in thousands)
Balance as of June 25, 2023$640,172 
Settlements and effective settlements with tax authorities(9,548)
Lapse of statute of limitations(10,114)
Decreases in balances related to tax positions taken during prior periods(12,326)
Increases in balances related to tax positions taken during current period115,600 
Balance as of June 30, 2024723,784 
Settlements and effective settlements with tax authorities(7,668)
Lapse of statute of limitations(211,696)
Increases in balances related to tax positions taken during prior periods69,016 
Decreases in balances related to tax positions taken during prior periods(3,983)
Increases in balances related to tax positions taken during current period150,868 
Balance as of June 29, 2025720,321 
Settlements and effective settlements with tax authorities(66,083)
Lapse of statute of limitations(15,904)
Increases in balances related to tax positions taken during prior periods3,741 
Decreases in balances related to tax positions taken during prior periods(17,075)
Increases in balances related to tax positions taken during current period239,149 
Balance as of June 28, 2026$864,149 
The Company had accrued $83.1 million, $86.3 million, and $105.7 million cumulatively for gross interest and penalties as of June 28, 2026, June 29, 2025, and June 30, 2024, respectively.
The Company is subject to audits by state and foreign tax authorities. The Company is unable to make a reasonable estimate as to when cash settlements, if any, with the relevant taxing authorities will occur.
The Company files U.S. federal, U.S. state, and foreign income tax returns. As of June 28, 2026, tax years 2005-2026 remain subject to examination in the jurisdictions where the Company operates.
The Internal Revenue Service (“IRS”) examined the Company’s U.S. federal income tax returns for the fiscal years ended June 30, 2019, June 28, 2020, and June 27, 2021. As of June 2026, the IRS proposed adjustments that were not significant, which the Company agreed to and paid.
As a result of the adoption of ASU 2023-09, the Company has included the following table reconciling income taxes paid (net of refunds received):
Year Ended
June 28,
2026
Cash payment for income taxes (net of refunds received)(in thousands)
Federal$1,128,278 
State24,056 
Foreign
Korea91,862 
Other89,800 
Total cash payments for income taxes (net of refunds received)$1,333,996 
Total cash payments for income taxes (net of refunds received) was $972.5 million and $991.8 million, as of June 29, 2025 and June 30, 2024, respectively.