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v3.23.1

Income Taxes (Tables) | 12 Months Ended
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Apr. 28, 2023
Income Tax Disclosure [Abstract] |
Income Before Income Taxes | Income before income taxes is as follows (in millions):
|  | Year Ended |
|  | April 28, 2023 |  |  | April 29, 2022 |  |  | April 30, 2021 |
Domestic |  | $ | 420 |  |  | $ | 546 |  |  | $ | 433 |
Foreign |  |  | 646 |  |  |  | 549 |  |  |  | 529 |
Total |  | $ | 1,066 |  |  | $ | 1,095 |  |  | $ | 962 |
Provision for Income Taxes | The (benefit) provision for income taxes consists of the following (in millions):
|  | Year Ended |
|  | April 28, 2023 |  |  | April 29, 2022 |  |  | April 30, 2021 |
Current: |  |  |  |  |  |  |  |  |
Federal |  | $ | 209 |  |  | $ | 187 |  |  | $ | 82 |
State |  |  | 39 |  |  |  | 55 |  |  |  | 22 |
Foreign |  |  | 150 |  |  |  | 60 |  |  |  | 134 |
Total current |  |  | 398 |  |  |  | 302 |  |  |  | 238 |
Deferred: |  |  |  |  |  |  |  |  |
Federal |  |  | (44 | ) |  |  | (125 | ) |  |  | 6 |
State |  |  | (3 | ) |  |  | (27 | ) |  |  | 2 |
Foreign |  |  | (559 | ) |  |  | 8 |  |  |  | (14 | )
Total deferred |  |  | (606 | ) |  |  | (144 | ) |  |  | (6 | )
(Benefit) provision for income taxes |  | $ | (208 | ) |  | $ | 158 |  |  | $ | 232 |
Schedule of Effective Income Tax Rate Reconciliation | The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate as follows (in millions):
|  | Year Ended |
|  | April 28, 2023 |  |  | April 29, 2022 |  |  | April 30, 2021 |
Tax computed at federal statutory rate |  | $ | 224 |  |  | $ | 230 |  |  | $ | 202 |
State income taxes, net of federal benefit |  |  | 24 |  |  |  | 15 |  |  |  | 23 |
Foreign earnings in lower tax jurisdictions |  |  | (43 | ) |  |  | (46 | ) |  |  | (26 | )
Stock-based compensation |  |  | 25 |  |  |  | (8 | ) |  |  | 6 |
Research and development credits |  |  | (24 | ) |  |  | (18 | ) |  |  | (13 | )
Benefit for foreign derived intangible income |  |  | — |  |  |  | (49 | ) |  |  | (2 | )
Global minimum tax on intangible income |  |  | 61 |  |  |  | 1 |  |  |  | 19 |
Transition tax and related reserves |  |  | — |  |  |  | 1 |  |  |  | 1 |
Tax (benefits) charges from integration of acquired companies |  |  | (27 | ) |  |  | 23 |  |  |  | 35 |
Tax benefit due to IP Transfer |  |  | (524 | ) |  |  | — |  |  |  | — |
Resolution of income tax matters (1) |  |  | 71 |  |  |  | (3 | ) |  |  | (6 | )
Other |  |  | 5 |  |  |  | 12 |  |  |  | (7 | )
(Benefit) provision for income taxes |  | $ | (208 | ) |  | $ | 158 |  |  | $ | 232 |
(1) During fiscal 2023, we recognized tax expense related to a Danish Supreme Court decision related to withholding tax on a 2005 distribution as well as tax expense related to the currently in progress IRS audit of our fiscal 2018 and 2019 U.S. tax returns. During fiscal 2022, we recognized a tax benefit related to the lapse of statute of limitations for certain issues in our fiscal 2012 and 2013 state income tax returns. During fiscal 2021, we recognized a tax benefit related to the lapse of statutes of limitations for certain issues on our fiscal 2016 and 2017 federal income tax returns.
Deferred Tax Assets and Liabilities | The components of our deferred tax assets and liabilities are as follows (in millions):
|  | April 28, 2023 |  |  | April 29, 2022 |
Deferred tax assets: |  |  |  |  |  |
Reserves and accruals |  | $ | 189 |  |  | $ | 267 |
Net operating loss and credit carryforwards |  |  | 124 |  |  |  | 121 |
Stock-based compensation |  |  | 23 |  |  |  | 23 |
Deferred revenue and financed unearned services revenue |  |  | 264 |  |  |  | 235 |
Acquired intangibles |  |  | 523 |  |  |  | — |
Capitalized research and development (1) |  |  | 111 |  |  |  | — |
Other |  |  | 10 |  |  |  | 6 |
Gross deferred tax assets |  |  | 1,244 |  |  |  | 652 |
Valuation allowance |  |  | (113 | ) |  |  | (111 | )
Deferred tax assets, net of valuation allowance |  |  | 1,131 |  |  |  | 541 |
Deferred tax liabilities: |  |  |  |  |  |
Prepaids and accruals |  |  | 94 |  |  |  | 108 |
Acquired intangibles |  |  | 66 |  |  |  | 48 |
Property and equipment |  |  | 50 |  |  |  | 39 |
Other |  |  | 2 |  |  |  | 7 |
Total deferred tax liabilities |  |  | 212 |  |  |  | 202 |
Deferred tax assets, net of valuation allowance and deferred tax liabilities |  | $ | 919 |  |  | $ | 339 |
(1) As required under the Tax Cuts and Jobs Act of 2017, research and development expenditures are capitalized and amortized beginning in our fiscal 2023.
Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):
|  | Year Ended |
|  | April 28, 2023 |  |  | April 29, 2022 |  |  | April 30, 2021 |
Balance at beginning of period |  | $ | 220 |  |  | $ | 221 |  |  | $ | 211 |
Additions based on tax positions related to the current year |  |  | 9 |  |  |  | 11 |  |  |  | 7 |
Additions for tax positions of prior years |  |  | 1 |  |  |  | — |  |  |  | 11 |
Decreases for tax positions of prior years |  |  | (5 | ) |  |  | (2 | ) |  |  | — |
Settlements |  |  | (3 | ) |  |  | (10 | ) |  |  | (8 | )
Balance at end of period |  | $ | 222 |  |  | $ | 220 |  |  | $ | 221 |
Summary of Tax Years Remain Subject to Examinations under Major Tax Jurisdictions | The tax years that remain subject to examination for our major tax jurisdictions are shown below: Fiscal Years Subject to Examination for Major Tax Jurisdictions at April 28, 2023
2016 — 2023 |  | United States — federal income tax
2018 — 2023 |  | United States — state and local income tax
2020 — 2023 |  | Australia
2018 — 2023 |  | Germany
2007 — 2023 |  | India
2017 — 2023 |  | The Netherlands
2016 — 2023 |  | Canada

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