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Income Taxes (Tables) | 12 Months Ended
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Sep. 29, 2024
Income Tax Disclosure [Abstract] |
Components of Income Tax Expense (Benefit) | The components of the income tax provision from continuing operations were as follows (in millions):
| 2024 |  | 2023 |  | 2022
Current provision: |  |  |  |  |
Federal | $ | 1,306 |  |  | $ | 1,229 |  |  | $ | 1,114 |
State | 3 |  |  | 10 |  |  | 1 |
Foreign (1) | 805 |  |  | 491 |  |  | 906 |
| 2,114 |  |  | 1,730 |  |  | 2,021 |
Deferred (benefit) provision: |  |  |  |  |
Federal | (1,553) |  |  | (1,475) |  |  | (34) |
State | (4) |  |  | (8) |  |  | 15 |
Foreign (1) | (331) |  |  | (143) |  |  | 10 |
| (1,888) |  |  | (1,626) |  |  | (9) |
| $ | 226 |  |  | $ | 104 |  |  | $ | 2,012 |
(1) The foreign component of the income tax provision included foreign withholding taxes on royalty revenues included in U.S. earnings.
Income before Income Tax, Domestic and Foreign | The components of income from continuing operations before income taxes by U.S. and foreign jurisdictions were as follows (in millions):
| 2024 |  | 2023 |  | 2022
United States | $ | 9,169 |  |  | $ | 6,400 |  |  | $ | 12,537 |
Foreign | 1,167 |  |  | 1,043 |  |  | 2,461 |
| $ | 10,336 |  |  | $ | 7,443 |  |  | $ | 14,998 |
Effective Income Tax Rate Reconciliation | The following is a reconciliation of the expected statutory federal income tax provision to our actual income tax provision from continuing operations (in millions, except percentages). A significant portion of our U.S. income qualifies for preferential treatment as FDII at a 13% effective tax rate.
| 2024 |  | 2023 |  | 2022
Expected income tax provision at federal statutory tax rate | $ | 2,171 |  |  | $ | 1,563 |  | $ | 3,150 |
Benefit from FDII deduction, excluding the impact of capitalizing research and development expenditures | (596) |  |  | (447) |  |  | (753) |
Benefit from FDII deduction related to capitalizing research and development expenditures | (585) |  |  | (598) |  |  | — |
Benefit related to the transfer of intellectual property between foreign subsidiaries | (317) |  |  | — |  |  | — |
Benefit related to research and development tax credits | (259) |  |  | (235) |  |  | (224) |
Excess tax (benefit) deficiency associated with share-based awards | (176) |  |  | 3 |  |  | (257) |
Foreign currency (gains) losses related to Korean withholding tax receivable | (21) |  |  | (66) |  |  | 243 |
Benefit from fiscal 2021 and 2022 FDII deductions related to a change in sourcing of research and development expenditures | — |  |  | (126) |  |  | — |
Benefit from releasing valuation allowance on unutilized foreign loss carryforwards | — |  |  | (114) |  |  | — |
Nontaxable reversal of 2018 EC fine | — |  |  | — |  |  | (224) |
Other | 9 |  |  | 124 |  |  | 77 |
| $ | 226 |  |  | $ | 104 |  |  | $ | 2,012 |
Effective tax rate | 2 | % |  | 1 | % |  | 13 | %
Deferred Tax Assets and Liabilities | We had deferred tax assets and deferred tax liabilities as follows (in millions):
| September 29, 2024 |  | September 24, 2023
Capitalized research and development expenditures | $ | 3,015 |  |  | $ | 1,490 |
Unused tax credits | 2,172 |  |  | 1,819 |
Customer incentives | 769 |  |  | 659 |
Unused net operating losses | 719 |  |  | 364 |
Accrued liabilities and reserves | 397 |  |  | 401 |
Operating lease liabilities | 282 |  |  | 216 |
Share-based compensation | 152 |  |  | 285 |
Unrealized losses on other investments and marketable securities | 146 |  |  | 159 |
Other | 459 |  |  | 409 |
Total gross deferred tax assets | 8,111 |  |  | 5,802 |
Valuation allowance | (2,061) |  |  | (1,803) |
Total net deferred tax assets | 6,050 |  |  | 3,999 |
Intangible assets | (388) |  |  | (335) |
Operating lease assets | (248) |  |  | (194) |
Unrealized gains on other investments and marketable securities | (169) |  |  | (101) |
Other | (197) |  |  | (170) |
Total deferred tax liabilities | (1,002) |  |  | (800) |
Net deferred tax assets | $ | 5,048 |  |  | $ | 3,199 |
Reported as: |  |  |
Non-current deferred tax assets | $ | 5,162 |  |  | $ | 3,310 |
Non-current deferred tax liabilities (1) | (114) |  |  | (111) |
| $ | 5,048 |  |  | $ | 3,199 |
(1) Non-current deferred tax liabilities were included in other liabilities in the consolidated balance sheets.
Unrecognized Tax Benefits Roll Forward | A summary of the changes in the amount of unrecognized tax benefits for fiscal 2024, 2023 and 2022 follows (in millions):
| 2024 |  | 2023 |  | 2022
Beginning balance of unrecognized tax benefits | $ | 2,296 |  |  | $ | 2,191 |  |  | $ | 2,136 |
Additions based on prior year tax positions | 2 |  |  | 10 |  |  | 58 |
Reductions for prior year tax positions and lapse in statute of limitations | (1) |  |  | (63) |  |  | (136) |
Additions for current year tax positions | 153 |  |  | 158 |  |  | 184 |
Settlements with taxing authorities | — |  |  | — |  |  | (51) |
Ending balance of unrecognized tax benefits | $ | 2,450 |  |  | $ | 2,296 |  |  | $ | 2,191 |

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