Income Taxes (Tables)

12 Months Ended

Jul. 31, 2026

Provision for income taxes from continuing operations

The provision for income taxes consisted of the following for the periods indicated:


	Twelve Months Ended July 31,
(In millions)	2026		2025		2024
Current:
Federal	$	(59)	$	1,219	$	984
State	189		237		202
Foreign	49		25		36
Total current	179		1,481		1,222
Deferred:
Federal	1,205		(453)		(523)
State	72		(70)		(97)
Foreign	(5)		7		(15)
Total deferred	1,272		(516)		(635)
Total provision for income taxes	$	1,451	$	965	$	587

Sources of income from continuing operations before the provision for income taxes

The sources of income before the provision for income taxes consisted of the following for the periods indicated:


	Twelve Months Ended July 31,
(In millions)	2026		2025		2024
United States	$	5,875	$	4,700	$	3,449
Foreign	142		134		101
Total	$	6,017	$	4,834	$	3,550

Differences between income taxes calculated using the federal statutory income tax rate and the provision for income taxes from continuing operations

Differences between income taxes calculated using the federal statutory income tax rate and the provision for income taxes were as follows for the periods indicated:


	Twelve Months Ended July 31,
(In millions)	2026				2025				2024
	Amount		Percent		Amount		Percent		Amount		Percent
Income before income taxes	$	6,017			$	4,834			$	3,550



Statutory federal income tax	$	1,264	21.0	%	$	1,015	21.0	%	$	746	21.0	%
State income taxes, net of federal benefit (1)	206		3.4		132		2.7		83		2.3
Foreign tax effects:
Statutory tax rate differences between foreign and U.S.	14		0.2		4		0.1		—		—



Tax credits
Federal research and experimentation credits	(96)		(1.6)		(113)		(2.3)		(109)		(3.1)


Nontaxable or nondeductible items
Share-based compensation	56		1.0		47		1.0		43		1.2
Shortfalls (excess tax benefits) related to share-based compensation	36		0.6		(120)		(2.5)		(153)		(4.3)

Changes in unrecognized tax benefits	(36)		(0.6)		(11)		(0.2)		(33)		(0.9)
Other adjustments(2)	7		0.1		11		0.2		10		0.3
Provision for income taxes	$	1,451	24.1	%	$	965	20.0	%	$	587	16.5	%

(1) Fiscal 2026: State taxes effect in New York, Illinois, Pennsylvania, New Jersey, New York City, Massachusetts, Minnesota, Georgia, and Michigan made up the majority (greater than 50%) of the tax effect in this category.

Fiscal 2025: State taxes effect in New York, Illinois, New Jersey, Pennsylvania, New York City, Massachusetts, Texas, Minnesota, and Maryland made up the majority (greater than 50%) of the tax effect in this category.

Fiscal 2024: State taxes effect in New York, Illinois, New Jersey, Florida, New York City, Massachusetts, Minnesota, and Michigan made up the majority (greater than 50%) of the tax effect in this category.

(2) Fiscal 2026: Other adjustments include nontaxable or nondeductible items and other tax credits.

Fiscal 2025: Other adjustments include nontaxable or nondeductible items and the effect of cross border tax laws.

Fiscal 2024: Other adjustments include nontaxable or nondeductible items and other tax credits.

Components of deferred tax assets and liabilities

Material deferred tax assets and liabilities were as follows at the dates indicated:


	July 31,
(In millions)	2026		2025
Deferred tax assets:
Accruals and reserves not currently deductible	$	98	$	72
Capitalized research and development	673		1,895
Operating lease liabilities	176		173

Accrued and deferred compensation	154		116
Loss and tax credit carryforwards	243		277

Share-based compensation	106		113
Other, net	27		24
Total gross deferred tax assets	1,477		2,670
Valuation allowance	(257)		(290)
Total deferred tax assets	1,220		2,380
Deferred tax liabilities:

Operating lease right-of-use assets	139		140
Intangibles	1,012		950
Property and equipment	29		32
Other, net	107		56
Total deferred tax liabilities	1,287		1,178
Net deferred tax assets (liabilities)	$	(67)	$	1,202

Components of net deferred tax assets, net of valuation allowances

The components of total net deferred tax assets, net of valuation allowances, as shown on our consolidated balance sheets were as follows at the dates indicated:


	July 31,
(In millions)	2026		2025
Long-term deferred income tax assets	$	172	$	1,222
Long-term deferred income tax liabilities	(239)		(20)
Net deferred tax assets (liabilities)	$	(67)	$	1,202

Unrecognized tax benefits roll forward

The aggregate changes in the balance of our gross unrecognized tax benefits were as follows for the periods indicated:


	Twelve Months Ended July 31,
(In millions)	2026		2025		2024
Gross unrecognized tax benefits, beginning balance	$	394	$	327	$	246
Increases related to tax positions from prior fiscal years, including acquisitions	17		11		36
Decreases related to tax positions from prior fiscal years	—		(21)		(12)
Increases related to tax positions taken during current fiscal year	42		91		95
Settlements with tax authorities	(2)		(2)		(1)
Lapse of statute of limitations	(38)		(12)		(37)
Gross unrecognized tax benefits, ending balance	$	413	$	394	$	327

Schedule of Cash Flow, Supplemental Disclosures

Income taxes paid, net of refunds, were as follows (in millions):


	Twelve Months Ended July 31,
	2026		2025		2024
U.S. federal	$	(6)	$	1,105	$	1,659
U.S. state and local
California	51		31		(4)
New York	25		23		20
Pennsylvania	18		15		14
Other	162		191		161
Foreign
India	24		21		24
Other	7		22		7
Total cash paid for income taxes, net of refunds	$	281	$	1,408	$	1,881