XML 37 R20.htm IDEA: XBRL DOCUMENT
v3.25.1

Income Taxes | 12 Months Ended
--- | ---
Mar. 31, 2025
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The income tax provision (benefit) consists of the following (amounts in millions):
| Fiscal Year Ended March 31,
| 2025 |  | 2024 |  | 2023
Income before income taxes: |  |  |  |  |
U.S. | $ | (131.5) |  |  | $ | 555.5 |  |  | $ | 674.7 |
Foreign | 170.4 |  |  | 1,810.4 |  |  | 2,235.0 |
Total income before income taxes | $ | 38.9 |  |  | $ | 2,365.9 |  |  | $ | 2,909.7 |
Current provision: |  |  |  |  |
U.S. Federal | $ | 127.5 |  |  | $ | 347.5 |  |  | $ | 389.5 |
State | — |  |  | 20.0 |  |  | 5.0 |
Foreign | 55.2 |  |  | 118.7 |  |  | 72.0 |
Total current provision | $ | 182.7 |  |  | $ | 486.2 |  |  | $ | 466.5 |
Deferred provision (benefit): |  |  |  |  |
U.S. Federal | $ | (101.0) |  |  | $ | (106.4) |  |  | $ | 53.7 |
State | (5.5) |  |  | (12.3) |  |  | 4.6 |
Foreign | (36.8) |  |  | 91.5 |  |  | 147.2 |
Total deferred provision (benefit) | (143.3) |  |  | (27.2) |  |  | 205.5 |
Income tax provision | $ | 39.4 |  |  | $ | 459.0 |  |  | $ | 672.0 |
The provision (benefit) for income taxes differs from the amount computed by applying the statutory federal tax rate to income before income taxes. The sources and tax effects of the differences in the total income tax provision are as follows (amounts in millions):
| Fiscal Year Ended March 31,
| 2025 |  | 2024 |  | 2023
Computed expected income tax provision | $ | 8.2 |  |  | $ | 496.8 |  |  | $ | 611.0 |
State income taxes, net of federal benefit | (2.1) |  |  | 15.7 |  |  | 8.6 |
Effects of foreign operations - rate differential | (19.2) |  |  | (149.3) |  |  | (184.0) |
Effects of foreign operations - other, net of foreign tax credits | 55.0 |  |  | 212.2 |  |  | 258.9 |
Foreign-derived intangible income (FDII) | (3.1) |  |  | (3.6) |  |  | — |
Business realignment of intellectual property rights | 5.7 |  |  | 0.4 |  |  | — |
Change in uncertain tax positions | 45.1 |  |  | 5.8 |  |  | 50.6 |
Share-based compensation | (14.1) |  |  | (8.4) |  |  | (11.4) |
R&D tax credits | (60.1) |  |  | (69.8) |  |  | (63.8) |
Income tax holidays | (12.0) |  |  | (22.5) |  |  | (26.7) |
Nondeductible Expenses | 6.0 |  |  | 7.7 |  |  | 9.4 |
Other | 13.4 |  |  | 2.6 |  |  | 10.3 |
Change in valuation allowance | 16.6 |  |  | (28.6) |  |  | 9.1 |
Income tax provision | $ | 39.4 |  |  | $ | 459.0 |  |  | $ | 672.0 |
The foreign tax rate differential benefit primarily relates to the Company's operations in Malta and Ireland. The Company's Thailand manufacturing operations are currently subject to numerous tax holidays granted to the Company based on its investment in property, plant, and equipment in Thailand. The Company's tax holiday periods in Thailand expire between fiscal 2026 and 2033, however, the Company actively seeks to obtain new tax holidays. The Company does not expect the future expiration of any of its tax holiday periods in Thailand to have a material impact on its effective tax rate. The aggregate dollar benefit derived from these tax holidays approximated $12.0 million, $22.5 million, and $26.7 million in fiscal 2025, fiscal 2024, and fiscal 2023, respectively. The impact of the tax holidays increased each of the basic and diluted net income per common share by $0.02 in fiscal 2025, $0.04 in fiscal 2024, and $0.05 in fiscal 2023. The tax effects of temporary differences that give rise to significant portions of the Company's deferred tax assets and deferred tax liabilities are as follows (amounts in millions):
| March 31,
| 2025 |  | 2024
Deferred tax assets: |  |  |
Accrued expenses | $ | 51.8 |  |  | $ | 50.2 |
Capital loss carryforward | 9.8 |  |  | 10.5 |
Disallowed expense carryforwards | 242.8 |  |  | 97.8 |
Income tax credits | 266.8 |  |  | 267.8 |
Intangible assets | 1,192.1 |  |  | 1,277.0 |
Inventory valuation | 130.4 |  |  | 72.0 |
Lease liabilities | 33.2 |  |  | 36.2 |
Net operating loss carryforward | 59.3 |  |  | 64.8 |
Share-based compensation | 53.5 |  |  | 40.6 |
Other | 25.6 |  |  | 15.5 |
Gross deferred tax assets | 2,065.3 |  |  | 1,932.4 |
Valuation allowances | (287.4) |  |  | (270.8) |
Deferred tax assets, net of valuation allowances | 1,777.9 |  |  | 1,661.6 |
Deferred tax liabilities: |  |  |
Intangible assets | (50.3) |  |  | (59.0) |
ROU assets | (31.7) |  |  | (34.5) |
Property, plant and equipment | (1.6) |  |  | (0.4) |
Deferred tax liabilities | (83.6) |  |  | (93.9) |
Net deferred tax asset | $ | 1,694.3 |  |  | $ | 1,567.7 |
Reported as: |  |  |
Non-current deferred tax assets | $ | 1,728.1 |  |  | $ | 1,596.5 |
Non-current deferred tax liability | (33.8) |  |  | (28.8) |
Net deferred tax asset | $ | 1,694.3 |  |  | $ | 1,567.7 |
In assessing whether it is more likely than not that deferred tax assets will be realized, the Company considers all available evidence, both positive and negative, including its recent cumulative earnings experience and expectations of future available taxable income of the appropriate character by taxing jurisdiction, tax attribute carryback and carryforward periods available for tax reporting purposes, and prudent and feasible tax planning strategies. Additions and deductions related to the valuation allowance for deferred tax assets for the three fiscal years were as follows (amounts in millions):
| Balance at Beginning of Year |  | Additions Charged to Costs and Expenses |  |  |  | Deductions |  | Balance at End of Year
Fiscal 2025 | $ | 270.8 |  |  | $ | 22.2 |  |  |  |  | $ | (5.6) |  |  | $ | 287.4 |
Fiscal 2024 | $ | 299.4 |  |  | $ | 6.5 |  |  |  |  | $ | (35.1) |  |  | $ | 270.8 |
Fiscal 2023 | $ | 290.3 |  |  | $ | 19.3 |  |  |  |  | $ | (10.2) |  |  | $ | 299.4 |
The Company had federal, state and foreign net operating loss (NOL) carryforwards with an estimated tax effect of $59.3 million available at March 31, 2025, which expire at various times between fiscal 2026 and fiscal 2045, of which a portion of the NOL carryforwards do not expire. The Company had capital loss carryforwards with an estimated tax effect of $9.8 million available at March 31, 2025, which begin to expire in fiscal 2026. The Company had federal, state and foreign credits of $257.3 million available at March 31, 2025, which begin to expire in fiscal 2026. The Company had refundable tax credits in foreign jurisdictions of $9.5 million available at March 31, 2025. The Company had disallowed expense carryforwards with an estimated tax effect of $242.8 million available at March 31, 2025. These expense carryforwards do not expire. The enactment of the TCJA imposed a tax on all previously untaxed earnings of non-U.S. subsidiaries of U.S. corporations. Due to this change, the jurisdiction in which the Company's cash is at any given point in time no longer has a significant impact on the Company's liquidity. The Company intends to invest substantially all of the Company's foreign subsidiary earnings, as well as the Company's capital in the Company's foreign subsidiaries, indefinitely outside of the U.S. in those jurisdictions in which the Company would incur significant, additional costs upon repatriation of such amounts. It is not practical to estimate the additional tax that would be incurred, if any, if the permanently reinvested earnings were repatriated. During fiscal 2018, the Company recognized a one-time transition tax on accumulated unrepatriated foreign earnings, of which the Company expected cash payments of approximately $293.6 million. This tax is payable over a period of eight years, with 8% of the transition tax payable each year for fiscal 2019 through fiscal 2023, and 15%, 20%, and 25%, respectively, payable during fiscal 2024, fiscal 2025 and fiscal 2026. As of March 31, 2025, the Company's transition tax payable was $73.4 million, which is payable within the next 12 months and is included within accrued liabilities. The Company recognizes interest and penalties related to unrecognized tax benefits through income tax expense. The Company is subject to income taxes in the U.S. and numerous foreign jurisdictions. The Company files U.S. federal, U.S. state, and foreign income tax returns. For U.S. federal, and in general for U.S. state tax returns, the fiscal 2007 and later tax years remain effectively open for examination by tax authorities. For foreign tax returns, the Company is generally no longer subject to income tax examinations for years prior to fiscal 2007. Significant judgment is required in evaluating the Company's uncertain tax positions and determining its provision for income taxes. Although the Company believes that it has appropriately reserved for its uncertain tax positions, no assurance can be given that the final tax outcome of these matters will not be different than expectations. The Company will adjust these reserves in light of changing facts and circumstances, such as the closing of a tax audit, tax litigation, interaction with taxing authorities, the closing of a statutory audit period or changes in applicable tax law. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences would impact the provision for income taxes in the period in which such determination is made. The provision for income taxes includes the impact of reserve provisions and changes to the reserves that are considered appropriate, as well as related net interest. The Company recognizes liabilities for anticipated tax audit issues in the U.S. and other domestic and international tax jurisdictions based on its estimate of whether, and the extent to which, the tax positions are more likely than not to be sustained based on the technical merits. The Company believes that it has appropriate support for the income tax positions taken and to be taken on its tax returns and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax laws applied to the facts of each matter. The Company believes it maintains appropriate reserves to offset potential income tax liabilities for positions that are not more than likely than not to be sustained upon final resolution of matters for open tax years. If such reserve amounts ultimately prove to be unnecessary, the resulting reversal of such reserves could result in tax benefits being recorded in the period the reserves are no longer deemed necessary. If such amounts prove to be less than an ultimate assessment, a future charge to expense would be recorded in the period in which the assessment is determined. The following table summarizes the activity related to the Company's gross unrecognized tax benefits for the three fiscal years (amounts in millions):
| Fiscal Year Ended March 31,
| 2025 |  | 2024 |  | 2023
Beginning gross unrecognized tax benefit | $ | 792.4 |  |  | $ | 848.0 |  |  | $ | 804.1 |
Decreases related to settlements with tax authorities | (0.7) |  |  | (5.8) |  |  | (0.4) |
Decreases related to statute of limitation expirations | (6.9) |  |  | (3.3) |  |  | (11.7) |
Increases related to current year tax positions | 27.1 |  |  | 37.4 |  |  | 65.9 |
Increases (decreases) related to prior year tax positions | 9.3 |  |  | (83.9) |  |  | (9.9) |
Ending gross unrecognized tax benefits | $ | 821.2 |  |  | $ | 792.4 |  |  | $ | 848.0 |
As of March 31, 2025 and March 31, 2024, the Company had accrued interest and penalties related to tax contingencies of $135.8 million and $104.6 million, respectively, included within long-term income tax payable on the consolidated balance sheets. During the fiscal years ended March 31, 2025, March 31, 2024, and March 31, 2023 interest and penalties charged to operations were $31.2 million, $24.2 million, and $7.6 million, respectively. The Company is currently under income tax examination in various tax jurisdictions in which it operates. The years under examination range from fiscal 2007 through fiscal 2024. In some jurisdictions, the Company has received tax assessments in excess of established reserves. The Company is contesting these tax assessments, and will continue to do so, including pursuing all available remedies such as appeals and litigation, if necessary. During fiscal 2025, additional assessments were received for these issues and the Company’s position remains unchanged. The total amount of gross unrecognized tax benefits was $821.2 million and $792.4 million as of March 31, 2025, and March 31, 2024, respectively, of which $706.4 million and $682.4 million is estimated to impact the Company's effective tax rate, if recognized. Unrecognized tax benefits may change in the next 12 months due to expiration of statutes of limitation, changes in the Company’s judgment about the level of uncertainty arising from new information, status of tax examinations, tax litigation, and legislative changes. The Company is unable to reasonably estimate the change in the unrecognized tax benefits in the next 12 months. Positions that may be resolved include various U.S. and non-U.S. matters. In September 2021, the Company received a Statutory Notice of Deficiency (2007 to 2012 Notice) from the United States Internal Revenue Service (IRS) for fiscal 2007 through fiscal 2012. The disputed amounts largely relate to transfer pricing matters. In December 2021, the Company filed a petition in the U.S. Tax Court challenging the 2007 to 2012 Notice. In September 2023, the Company received a Revenue Agent Report (RAR) from the IRS for fiscal 2013 and fiscal 2016. In October 2023, the Company received a Statutory Notice of Deficiency (2014 to 2015 Notice) from the IRS for fiscal 2014 and fiscal 2015. The disputed amounts for fiscal 2013 to fiscal 2016 largely relate to transfer pricing matters. In December 2023, the Company filed a petition in the U.S. Tax Court challenging the 2014 to 2015 Notice. In May 2023, the Company received a proposed income adjustment from the Malaysian Inland Revenue Board (IRB) for fiscal 2020. In December 2023, the Company received a Notice of Assessment from the IRB asserting the same proposed income adjustment. In March 2025, the Company entered into a Consent Judgment before the High Court, agreeing that the dispute will be heard before the Special Commissioners of Income Tax (SCIT). It was also agreed that the payment on the taxes assessed is stayed and the IRB will pause all enforcement and proceedings against the collection of the taxes assessed until the appeal before the SCIT is concluded. If the adjustment is upheld by the highest court that has jurisdiction over this matter in Malaysia, it could result in income taxes and penalties up to $410.0 million. The disputed amounts largely relate to the characterization of certain assets. The timing of adjudicating this matter is uncertain but could commence in the next 12 months. In January 2025, the Company received several assessments from the German Tax Authorities (GTA) regarding the German extraterritorial taxation of royalty payments between nonresidents (referred to as offshore receipts in respect of intangible property or ORIP) and intellectual property transfers by nonresidents (referred to as extraterritorial capital gains taxation or ETT). If the assessment is upheld, it could result in income taxes and penalties up to $92.0 million. The timing of adjudicating this matter is uncertain but could occur in the next 12 months. The Company firmly believes that the assessments described above are without merit and plans to pursue all available administrative and judicial remedies necessary to resolve these matters. The Company intends to vigorously defend its positions and the Company is confident in its ability to prevail on the merits. The Company regularly assesses the likelihood of adverse outcomes resulting from examinations such as these to determine the adequacy of the Company's tax reserves. The ultimate outcome of disputes of this nature is uncertain, and if the IRS, IRB, and GTA were to prevail on their assertions, the assessed tax, penalties, and deficiency interest could have a material adverse impact on the Company's financial position, results of operations or cash flows.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration