v3.26.1
Income Taxes (Tables)
 12 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
Schedule of Income Before Income Tax, Domestic and Foreign
The following table summarizes earnings before income taxes:
(in millions)202620252024
U.S. operations$1,753 $1,715 $892 
Foreign operations421 386 309 
Earnings before income taxes
$2,174 $2,101 $1,201 
Schedule of Components of Income Tax Expense (Benefit), Current and Deferred
The following table summarizes the components of the provision for income taxes:
(in millions)202620252024
Current:
U.S. federal$164 $135 $305 
U.S. state and local123 72 68 
Foreign91 82 79 
Total current$378 $289 $452 
Deferred:
U.S. federal$104 $205 $(89)
U.S. state and local(15)39 12 
Foreign2 (1)(27)
Total deferred$91 $243 $(104)
Provision for income taxes
$469 $532 $348 
Schedule of Effective Income Tax Rate Reconciliation
The following tables present reconciliations of the U.S. federal statutory income tax provision and rate to our effective income tax provision and rate, reflecting our prospective adoption of ASU 2023-09:
2026
AmountPercent
Federal statutory income tax provision and rate$457 21.0 %
State and local income taxes (1)
75 3.5 
Foreign tax effects5 0.2 
Effect of cross border tax laws
Foreign-derived deduction-eligible income(156)(7.1)
Other effect of cross border tax laws1 — 
Tax credits(18)(0.8)
Changes in valuation allowances24 1.1 
Nontaxable or nondeductible items
     Specialty Alliance share-based compensation50 2.3 
     Other nontaxable or nondeductible items20 0.9 
Changes in unrecognized tax benefits11 0.5 
Effective income tax provision and rate$469 21.6 %
20252024
Federal statutory income tax rate
21.0 %21.0 %
State and local income taxes, net of federal benefit4.0 3.1 
Tax effect of foreign operations0.2 (1.6)
Nondeductible or nontaxable items0.7 (0.1)
Withholding taxes0.3 1.0 
Change in valuation allowances0.1 (1.1)
US taxes on foreign income (2)
(1.3)(2.1)
Impact of resolutions with IRS and other related matters (0.1)0.4 
Opioid litigation0.2 1.0 
Goodwill impairment— 8.7 
Specialty Alliance share-based compensation1.4 — 
Other (1.2)(1.4)
Effective income tax rate25.3 %28.9 %
(1)     The state and local taxes that contribute to the majority (greater than 50%) of the tax effect in this category include New York, Oregon, California, and New Jersey.
(2) Includes the tax impact of the Foreign-Derived Intangible Income deduction offset by Global Intangible Low-Taxed Income tax, and other foreign income that is taxable under the U.S. tax code.
Schedule of Deferred Tax Assets and Liabilities
The following table presents the components of the deferred income tax assets and liabilities at June 30:
(in millions)20262025
Deferred income tax assets:
Receivable basis difference$35 $26 
Accrued liabilities700 651 
Share-based compensation24 23 
Loss and tax credit carryforwards426 386 
Deferred tax assets related to uncertain tax positions51 47 
Other96 97 
Total deferred income tax assets1,332 1,230 
Valuation allowance for deferred income tax assets(257)(254)
Net deferred income tax assets$1,075 $976 
Deferred income tax liabilities:
Inventory basis differences$(1,075)$(1,103)
Property-related(488)(358)
Goodwill and other intangibles(826)(834)
Self-Insurance(993)(981)
Total deferred income tax liabilities(3,382)(3,276)
Net deferred income tax liability
$(2,307)$(2,300)
Schedule of Deferred Tax Assets and Liabilities after Netting by Tax Jurisdiction
Deferred income tax assets and liabilities in the preceding table, after netting by taxing jurisdiction and for uncertain tax positions, are in the following captions in the consolidated balance sheets at June 30:
(in millions)20262025
Non-current deferred income tax asset (1)
$63 $64 
Non-current deferred income tax liability (2)
(2,370)(2,364)
Net non-current deferred income tax liability$(2,307)$(2,300)
(1)Included in other assets in the consolidated balance sheets.
(2)Included in deferred income taxes and other liabilities in the consolidated balance sheets.
Schedule of Unrecognized Tax Benefits Roll Forward The following table presents a reconciliation of the beginning and ending amounts of unrecognized tax benefits:
(in millions)202620252024
Balance at beginning of fiscal year$879 $981 $1,015 
Additions for tax positions of the current year31 8 30 
Additions for tax positions of prior years5 15 28 
Reductions for tax positions of prior years(7)(101)(87)
Settlements with tax authorities — (22)(3)
Expiration of the statute of limitations (1)(2)(2)
Balance at end of fiscal year
$907 $879 $981 
Schedule of Cash Flow, Supplemental Disclosures [Table Text Block]
The following table summarizes the cash paid for income taxes, net of refunds, disaggregated by jurisdiction:
(in millions)2026
U.S. federal$155 
U.S. state and local119 
Foreign:
Puerto Rico23 
Other41 
Total foreign64 
Total cash paid for income taxes, net of refunds$338