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Income Taxes | 12 Months Ended
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Mar. 31, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Note 11 — Income Taxes The components of income (loss) before income taxes by jurisdiction are as follows:
|  | Fiscal Years Ended |
|  | March 31, 2023 |  |  | March 31, 2022 |  |  | March 31, 2021 |
|  | (In thousands) |
United States |  | $ | (94,019 | ) |  | $ | (119,249 | ) |  | $ | (55,743 | )
Foreign |  |  | (68,136 | ) |  |  | (18,661 | ) |  |  | (22,457 | )
|  | $ | (162,155 | ) |  | $ | (137,910 | ) |  | $ | (78,200 | )
The benefit from (provision for) income taxes includes the following:
|  | Fiscal Years Ended |
|  | March 31, 2023 |  |  | March 31, 2022 |  |  | March 31, 2021 |
|  | (In thousands) |
Current tax provision |  |  |  |  |  |  |  |  |
Federal |  | $ | (11,494 | ) |  | $ | (7,097 | ) |  | $ | (8,573 | )
State |  |  | (5,231 | ) |  |  | (2,041 | ) |  |  | (3,386 | )
Foreign |  |  | (5,965 | ) |  |  | (4,042 | ) |  |  | 449 |
|  |  | (22,690 | ) |  |  | (13,180 | ) |  |  | (11,510 | )
Deferred tax benefit |  |  |  |  |  |  |  |  |
Federal |  |  | 40,889 |  |  |  | 39,049 |  |  |  | 22,837 |
State |  |  | (80,715 | ) |  |  | 8,057 |  |  |  | (704 | )
Foreign |  |  | 13,098 |  |  |  | 2,591 |  |  |  | 571 |
|  |  | (26,728 | ) |  |  | 49,697 |  |  |  | 22,704 |
Total benefit from (provision for) income taxes |  | $ | (49,418 | ) |  | $ | 36,517 |  |  | $ | 11,194 |
Significant components of the Company’s net deferred tax assets are as follows:
|  | As of |
|  | March 31, 2023 |  |  | March 31, 2022 |
|  | (In thousands) |
Deferred tax assets: |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 71,838 |  |  | $ | 251,276 |
Tax credit carryforwards |  |  | 115,418 |  |  |  | 299,165 |
Capitalized research and development costs |  |  | 75,152 |  |  | — |
Operating lease liabilities |  |  | 78,562 |  |  |  | 93,580 |
Deferred revenue |  |  | 24,123 |  |  |  | 21,546 |
Other |  |  | 107,368 |  |  |  | 99,074 |
Valuation allowance |  |  | (150,047 | ) |  |  | (78,071 | )
Total deferred tax assets |  |  | 322,414 |  |  |  | 686,570 |
Deferred tax liabilities: |  |  |  |  |  |
Intangible assets |  |  | (99,629 | ) |  |  | (119,299 | )
Property, equipment and satellites |  |  | (187,896 | ) |  |  | (163,560 | )
Operating lease assets |  |  | (68,150 | ) |  |  | (87,677 | )
Other |  |  | (29,004 | ) |  |  | (28,261 | )
Total deferred tax liabilities |  |  | (384,679 | ) |  |  | (398,797 | )
Net deferred tax assets (liabilities) |  | $ | (62,265 | ) |  | $ | 287,773 |
A reconciliation of the benefit from (provision for) income taxes to the amount computed by applying the statutory federal income tax rate to income (loss) before income taxes is as follows:
|  | Fiscal Years Ended |
|  | March 31, 2023 |  |  | March 31, 2022 |  |  | March 31, 2021 |
|  | (In thousands) |
Tax benefit (provision) at federal statutory rate |  | $ | 34,047 |  |  | $ | 28,964 |  |  | $ | 16,422 |
State tax provision, net of federal benefit |  |  | 202 |  |  |  | 1,330 |  |  |  | (424 | )
Tax credits, net of valuation allowance |  |  | 22,763 |  |  |  | 21,647 |  |  |  | 17,885 |
Valuation allowance on California R&D tax credits |  |  | (72,438 | ) |  | — |  |  | — |
Non-deductible compensation |  |  | (3,096 | ) |  |  | (5,771 | ) |  |  | (5,728 | )
Non-deductible transaction costs |  |  | (167 | ) |  |  | (1,361 | ) |  | — |
Non-deductible meals and entertainment |  |  | (693 | ) |  |  | (311 | ) |  |  | (354 | )
Stock-based compensation |  |  | (12,032 | ) |  |  | (7,402 | ) |  |  | (9,466 | )
Change in state effective tax rate |  |  | 458 |  |  |  | 539 |  |  |  | (2,360 | )
Base Erosion and Anti-Abuse Tax (BEAT) |  |  | (8,610 | ) |  | — |  |  | — |
Foreign effective tax rate differential, net of valuation allowance |  |  | (5,769 | ) |  |  | (6,201 | ) |  |  | (3,046 | )
Unremitted subsidiary gains |  |  | (887 | ) |  |  | (1,565 | ) |  |  | (1,682 | )
Change to indefinite reinvestment assertion (EBI) |  | — |  |  |  | 8,071 |  |  | — |
Other |  |  | (3,196 | ) |  |  | (1,423 | ) |  |  | (53 | )
Total benefit from (provision for) income taxes |  | $ | (49,418 | ) |  | $ | 36,517 |  |  | $ | 11,194 |
As of March 31, 2023, the Company had federal and state research & development (R&D) tax credit carryforwards of $79.9 million and $185.1 million, respectively, which begin to expire in fiscal year 2040 and fiscal year 2025, respectively. As of March 31, 2023, the Company had federal and state net operating loss carryforwards of $118.1 million and $188.2 million, respectively, which begin to expire in fiscal year 2029 and fiscal year 2024, respectively. Beginning in fiscal year 2023, for federal income tax purposes, the Company is required to capitalize and amortize domestic research and development expenditures over five years and foreign research and development expenditures over 15 years under the Tax Cuts and Jobs Act of 2017, which delays the deductibility of these expenditures. Although Congress may consider legislation that would defer capitalization and amortization requirements to later years, the Company has no assurance that the requirement will be repealed or otherwise modified. In accordance with the authoritative guidance for income taxes (ASC 740), net deferred tax assets are reduced by a valuation allowance if, based on all the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. Future realization of existing deferred tax assets ultimately depends on future profitability and the existence of sufficient taxable income of appropriate character (for example, ordinary income versus capital gains) within the carryforward period available under tax law. In the event that the Company’s estimate of taxable income is less than that required to utilize the full amount of any deferred tax asset, a valuation allowance is established, which would cause a decrease to income in the period such determination is made. A valuation allowance of $150.0 million at March 31, 2023 and $78.1 million at March 31, 2022 has been established relating to state and foreign net operating loss carryforwards, state R&D tax credit carryforwards, and foreign tax credit carryforwards that, based on management’s estimate of future taxable income attributable to such jurisdictions and generation of additional research credits, are considered more likely than not to expire unused. In evaluating the Company's ability to realize the deferred tax asset for California R&D tax credits, the Company considered all available positive and negative evidence, including operating results and forecasted ranges of future taxable income, and determined it is more likely than not that a majority of its California R&D tax credits will not be realized due to reduced taxable income apportioned to California in connection with the Link-16 TDL Sale. As a result, during the second quarter of fiscal year 2023, the Company recorded a valuation allowance of $69.0 million. The Company will continue to monitor its business strategies, weighing positive and negative evidence in assessing its realization of this asset in the future. In the event there is a need to release the valuation allowance, a tax benefit will be recorded. The following table summarizes the activity related to the Company’s unrecognized tax benefits:
|  | As of |
|  | March 31, 2023 |  |  | March 31, 2022 |  |  | March 31, 2021 |
|  | (In thousands) |
Balance, beginning of fiscal year |  | $ | 112,806 |  |  | $ | 92,962 |  |  | $ | 80,591 |
Increase (decrease) related to prior year tax positions |  |  | 809 |  |  |  | 7,486 |  |  |  | (828 | )
Increases related to current year tax positions |  |  | 16,123 |  |  |  | 12,358 |  |  |  | 13,199 |
Balance, end of fiscal year |  | $ | 129,738 |  |  | $ | 112,806 |  |  | $ | 92,962 |
Of the total unrecognized tax benefits at March 31, 2023, $105.2 million would reduce the Company’s annual effective tax rate if recognized, subject to valuation allowance consideration. The Company’s policy is to recognize interest expense and penalties related to income tax matters as a component of income tax expense. As of March 31, 2023 and 2022, the Company has accrued interest and penalties of an insignificant amount and approximately $2.0 million, respectively. The Company recognized a tax benefit of $1.1 million and $1.2 million for reductions of interest and penalties in income tax expense for the fiscal years ended March 31, 2023 and 2022, respectively. In the next 12 months it is reasonably possible that the amount of unrecognized tax benefits will not change significantly. The Company is subject to periodic audits by domestic and foreign tax authorities. By statute, the Company’s U.S. federal and state income tax returns are subject to examination by the tax authorities for fiscal years 2020 and thereafter. Additionally, net operating loss and R&D tax credit carryovers that were generated in prior years may also be subject to examination. With few exceptions, fiscal years 2019 and thereafter remain open to examination by foreign tax authorities. The Company believes that it has appropriate support for the income tax positions taken on its tax returns and its accruals for tax liabilities are adequate for all open years based on an assessment of many factors, including past experience and interpretations.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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