XML 35 R21.htm IDEA: XBRL DOCUMENT
v3.25.2

INCOME TAXES | 12 Months Ended
--- | ---
Jul. 31, 2025
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The sources of income before income taxes are as follows:
|  | For the Fiscal Years Ended July 31,
|  | 2025 |  | 2024 |  | 2023
United States |  | $ | 180,390 |  |  | $ | 115,618 |  |  | $ | 315,939 |
Foreign |  | 115,801 |  |  | 233,226 |  |  | 183,414 |
Total |  | $ | 296,191 |  |  | $ | 348,844 |  |  | $ | 499,353 |
The components of the provision for income taxes are as follows:
|  | For the Fiscal Years Ended July 31,
Income Taxes: |  | 2025 |  | 2024 |  | 2023
U.S. Federal |  | $ | 37,250 |  |  | $ | 52,832 |  |  | $ | 102,919 |
U.S. state and local |  | 10,660 |  |  | 10,372 |  |  | 14,803 |
Foreign |  | 20,750 |  |  | 48,242 |  |  | 45,174 |
Total current expense |  | 68,660 |  |  | 111,446 |  |  | 162,896 |
U.S. Federal |  | (4,997) |  |  | (22,236) |  |  | (28,819) |
U.S. state and local |  | 268 |  |  | (4,116) |  |  | (3,447) |
Foreign |  | (24,331) |  |  | (1,650) |  |  | (5,517) |
Total deferred expense (benefit) |  | (29,060) |  |  | (28,002) |  |  | (37,783) |
Total income tax expense |  | $ | 39,600 |  |  | $ | 83,444 |  |  | $ | 125,113 |
The One Big Beautiful Bill Act (“OBBB”) was signed into law on July 4, 2025. The OBBB includes a broad range of tax reform provisions affecting businesses including, but not limited to, 100% bonus depreciation, expensing of U.S.-based research and development costs, interest expense deduction limitations and changes to international tax provisions. The most relevant impact to the Company for fiscal year 2025 is the 100% bonus depreciation for qualified property placed in service after January 19, 2025. The other relevant provisions of the OBBB will impact the Company in fiscal years 2026 and 2027. For fiscal year 2026, the Company will have the option to accelerate its previously capitalized and unamortized U.S. research and development costs over a one- or two-year period. Changes to the international provisions will impact the Company in fiscal year 2027. The differences between income tax expense at the federal statutory rate and the actual income tax expense are as follows:
|  | For the Fiscal Years Ended July 31,
|  | 2025 |  | 2024 |  | 2023
Provision at federal statutory rate |  | $ | 62,200 |  |  | $ | 73,257 |  |  | $ | 104,864 |
Differences between U.S. Federal statutory and foreign tax rates |  | (38,152) |  |  | 3,821 |  |  | (41,300) |
Foreign currency remeasurement (gains) losses |  | 21,522 |  |  | (7,621) |  |  | 33,737 |
U.S. state and local income taxes, net of federal benefit |  | 7,779 |  |  | 4,840 |  |  | 9,524 |
Nondeductible compensation |  | 4,133 |  |  | 3,976 |  |  | 4,413 |
Effect of foreign tax law change |  | (15,314) |  |  | — |  |  | — |
Contingent liability accrual and settlement |  | — |  |  | (7,456) |  |  | — |
Global Intangible Low-Taxed Income |  | — |  |  | 12,068 |  |  | 10,936 |
Other |  | (2,568) |  |  | 559 |  |  | 2,939 |
Total income tax expense |  | $ | 39,600 |  |  | $ | 83,444 |  |  | $ | 125,113 |
The effect of the foreign tax law change of $15,314 noted above is due to revaluing the July 31, 2025 deferred tax assets and deferred tax liabilities associated with our German operations as a result of Germany passing legislation in July 2025 reducing its corporate income tax rate in the coming years. A summary of the deferred income tax balances is as follows:
|  | July 31,
|  | 2025 |  | 2024
Deferred income tax asset (liability): |  |  |  |
Inventory basis |  | $ | 11,550 |  |  | $ | 10,019 |
Employee benefits |  | 14,040 |  |  | 10,146 |
Self-insurance reserves |  | 4,531 |  |  | 5,021 |
Accrued product warranties |  | 59,008 |  |  | 62,687 |
Accrued incentives |  | 6,340 |  |  | 7,335 |
Sales returns and allowances |  | 2,942 |  |  | 2,544 |
Accrued expenses |  | 6,030 |  |  | 6,409 |
Property, plant and equipment |  | (43,112) |  |  | (45,494) |
Operating leases |  | 9,998 |  |  | 10,970 |
Deferred compensation |  | 32,591 |  |  | 31,359 |
Intangibles |  | (182,057) |  |  | (197,012) |
Net operating loss and other carryforwards |  | 37,049 |  |  | 30,861 |
Unrealized (gain) loss |  | 5,711 |  |  | 737 |
Unrecognized tax benefits |  | 2,684 |  |  | 2,161 |
Research and development |  | 22,021 |  |  | 20,237 |
Other |  | 6,280 |  |  | 8,709 |
Valuation allowance |  | (14,342) |  |  | (12,676) |
Deferred income tax (liability), net |  | $ | (18,736) |  |  | $ | (45,987) |
Deferred tax assets are reduced by a valuation allowance if, based upon available evidence, it is more likely than not that some, or all, of the deferred tax assets will not be realized. The valuation allowances recorded at July 31, 2025 and July 31, 2024 relate to certain state and foreign net operating loss ("NOL") carryforwards, state tax credit carryforwards, other assets in foreign jurisdictions and certain disallowed state interest carryforwards. As of July 31, 2025, the Company had $15,600 of deferred tax assets related to NOL carryforwards in certain foreign jurisdictions that will expire from fiscal 2026 or be carried forward indefinitely, of which $9,678 has been fully reserved with a valuation allowance, and the remaining amount the Company expects to realize. In addition, the Company has $1,409 of tax-affected U.S. state tax NOL carryforwards that expire from fiscal 2026 to 2045, of which $646 has been fully reserved with a valuation allowance and $615 has no deferred tax asset or valuation allowance recorded since there is no expectation of future realization. The Company has a deferred tax asset related to disallowed interest carryforwards of $18,807 in foreign jurisdictions, which it expects to fully realize, and $1,848 of deferred tax assets related to U.S. state disallowed interest and credit carryforwards, on which a full $1,848 valuation allowance is recorded. With the exception of foreign subsidiary investment basis differences not attributable to un-repatriated foreign earnings, we consider all of our undistributed earnings of our foreign subsidiaries, as of July 31, 2025, to not be indefinitely reinvested outside of the United States, with the exception of those unremitted earnings associated with several European jurisdictions. As of July 31, 2025, the related income tax cost of the repatriation of foreign earnings was not material. The benefits of tax positions reflected on income tax returns but whose outcome remains uncertain are only recognized for financial accounting purposes if they meet minimum recognition thresholds. The total amount of unrecognized tax benefits that, if recognized, would have impacted the Company’s effective tax rate were $8,027 for fiscal 2025, $8,614 for fiscal 2024 and $11,106 for fiscal 2023. Changes in the unrecognized tax benefit during fiscal years 2025, 2024 and 2023 were as follows:
|  | 2025 |  | 2024 |  | 2023
Beginning balance |  | $ | 10,434 |  |  | $ | 13,712 |  |  | $ | 17,998 |
Tax positions related to prior years: |  |  |  |  |  |
Additions |  | 1,201 |  |  | 1,692 |  |  | 649 |
Reductions |  | (648) |  |  | (1,977) |  |  | (1,588) |
Tax positions related to current year: |  |  |  |  |  |
Additions |  | 10,598 |  |  | 386 |  |  | 974 |
Settlements |  | — |  |  | (2,133) |  |  | (2,531) |
Lapses in statute of limitations |  | (1,410) |  |  | (1,246) |  |  | (1,790) |
Ending balance |  | $ | 20,175 |  |  | $ | 10,434 |  |  | $ | 13,712 |
It is the Company’s policy to recognize interest and penalties accrued relative to unrecognized tax benefits in income tax expense. The total amount of interest and penalties expense recognized in the Consolidated Statements of Income and Comprehensive Income for the fiscal years ended July 31, 2025, July 31, 2024 and July 31, 2023 were $1,552, $111 and $523, respectively. The total unrecognized tax benefits above, along with the related accrued interest and penalties, are reported within the liability section of the Consolidated Balance Sheets. A portion of the unrecognized tax benefits is classified as short-term and is included in the “Income and other taxes” line of the Consolidated Balance Sheets, while the remainder is classified as a long-term liability. The components of total unrecognized tax benefits are summarized as follows:
|  | July 31,
|  | 2025 |  | 2024
Unrecognized tax benefits |  | $ | 20,175 |  |  | $ | 10,434 |
Reduction to unrecognized tax benefits for deferred tax assets |  | (10,263) |  |  | (605) |
Accrued interest and penalties |  | 3,776 |  |  | 2,576 |
Total unrecognized tax benefits |  | $ | 13,688 |  |  | $ | 12,405 |
Short-term, included in “Income and other taxes” |  | $ | 1,513 |  |  | $ | — |
Long-term |  | 12,175 |  |  | 12,405 |
Total unrecognized tax benefits |  | $ | 13,688 |  |  | $ | 12,405 |
Within the next 12 months, the Company does not anticipate any material changes in its unrecognized tax benefits as of July 31, 2025. The Company files income tax returns in the U.S. federal jurisdiction and in many U.S. state and foreign jurisdictions. The Company is currently under a federal income tax exam for fiscal year 2022 and by certain foreign jurisdictions for fiscal years ended 2016 through 2021. The Company believes it has adequately reserved for its exposure to additional payments for uncertain tax positions in its liability for unrecognized tax benefits. The major tax jurisdictions we file in, with the years still subject to income tax examinations, are listed below:
Major Tax Jurisdiction |  | Tax Years Subject to Exam
United States – Federal |  | Fiscal 2022 – Fiscal 2024
United States – State |  | Fiscal 2022 – Fiscal 2024
Germany |  | Fiscal 2016 – Fiscal 2023
France |  | Fiscal 2022 – Fiscal 2024
Italy |  | Fiscal 2016 – Fiscal 2023
United Kingdom |  | Fiscal 2024

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 942 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477617/942-740-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480738/235-10-S50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478822/944-740-50-1 Reference 4: 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 5: 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 6: 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 7: 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 8: 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 9: 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 10: 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 11: 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 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 13: 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 14: 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 15: 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 16: 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 17: 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