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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Components of Income before Income Taxes | The components of income before income taxes were as follows:
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
|  | (in millions) |
Domestic |  | $ | (94.1 | ) |  | $ | (72.0 | ) |  | $ | 53.4 |
Foreign |  |  | 297.1 |  |  |  | 496.8 |  |  |  | 507.4 |
Total |  | $ | 203.0 |  |  | $ | 424.8 |  |  | $ | 560.8 |
Components of Income Tax Expense | Income taxes were as follows:
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
|  | (in millions) |
Current: |  |  |  |  |  |  |  |  |
Foreign |  | $ | 80.8 |  |  | $ | 100.1 |  |  | $ | 121.8 |
Federal |  |  | 21.3 |  |  |  | 26.3 |  |  |  | 20.1 |
State |  |  | (0.2 | ) |  |  | 7.0 |  |  |  | 5.0 |
|  |  | 101.9 |  |  |  | 133.4 |  |  |  | 146.9 |
Deferred: |  |  |  |  |  |  |  |  |
Foreign |  |  | (1.7 | ) |  |  | (2.0 | ) |  |  | (17.0 | )
Federal |  |  | (34.6 | ) |  |  | (25.1 | ) |  |  | (16.0 | )
State |  |  | (4.8 | ) |  |  | (2.8 | ) |  |  | (0.3 | )
|  |  | (41.1 | ) |  |  | (29.9 | ) |  |  | (33.3 | )
|  | $ | 60.8 |  |  | $ | 103.5 |  |  | $ | 113.6 |
Deferred Tax Assets and Liabilities | The significant categories of temporary differences that gave rise to deferred tax assets and liabilities were as follows:
|  | December 31, |
|  | 2023 |  |  | 2022 |
|  | (in millions) |
Deferred income tax assets: |  |  |  |  |  |
Accruals not currently deductible |  | $ | 77.1 |  |  | $ | 72.9 |
Tax loss and credit carryforwards of certain foreign subsidiaries |  |  | 216.7 |  |  |  | 131.8 |
Tax loss and domestic tax credit carryforwards |  |  | 174.3 |  |  |  | 195.4 |
Deferred compensation plan |  |  | 32.6 |  |  |  | 35.8 |
Deferred interest expense |  |  | 48.9 |  |  |  | 161.1 |
Inventory reserve |  |  | 7.1 |  |  |  | 9.6 |
Operating lease liabilities |  |  | 41.0 |  |  |  | 42.1 |
Depreciation and amortization |  |  | 56.7 |  |  |  | 22.5 |
Other |  |  | 8.9 |  |  |  | 8.6 |
Gross deferred income tax assets |  |  | 663.3 |  |  |  | 679.8 |
Less: valuation allowance |  |  | (375.5 | ) |  |  | (436.6 | )
Total deferred income tax assets |  | $ | 287.8 |  |  | $ | 243.2 |
Deferred income tax liabilities: |  |  |  |  |  |
Intangible assets |  | $ | 72.7 |  |  | $ | 73.0 |
Unremitted foreign earnings |  |  | 18.7 |  |  |  | 13.7 |
Operating lease assets |  |  | 35.8 |  |  |  | 37.2 |
Other |  |  | 2.4 |  |  |  | 6.7 |
Total deferred income tax liabilities |  |  | 129.6 |  |  |  | 130.6 |
Total net deferred tax assets |  | $ | 158.2 |  |  | $ | 112.6 |
Reconciliation between Provision for Income Taxes at Statutory Rate and Provision for Income Taxes at Effective Tax Rate | The applicable statutory income tax rate in the Cayman Islands was zero for Herbalife Ltd. for the years being reported. For purposes of the reconciliation between the provision for income taxes at the statutory rate and the provision for income taxes at the effective tax rate, a notional 21% tax rate is applied for the years ended December 31, 2023, 2022, and 2021 as follows:
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
|  | (in millions) |
Tax expense at United States statutory rate |  | $ | 42.6 |  |  | $ | 89.2 |  |  | $ | 117.8 |
Increase (decrease) in tax resulting from: |  |  |  |  |  |  |  |  |
Differences between U.S. and foreign tax rates on foreign income, including withholding taxes |  |  | 82.9 |  |  |  | (21.5 | ) |  |  | (15.1 | )
U.S. tax expense (benefit) on foreign income, net of foreign tax credits |  |  | 1.1 |  |  |  | (4.7 | ) |  |  | (21.9 | )
(Decrease) Increase in valuation allowances |  |  | (61.1 | ) |  |  | 24.7 |  |  |  | 21.1 |
State taxes, net of federal benefit |  |  | (5.6 | ) |  |  | 3.9 |  |  |  | 3.0 |
Unrecognized tax (benefits) expenses |  |  | (6.1 | ) |  |  | 7.5 |  |  |  | 9.3 |
Excess tax expense (benefits) on equity awards |  |  | 5.2 |  |  |  | 0.6 |  |  |  | (3.5 | )
U.S. research and development tax credit |  |  | (4.4 | ) |  |  | (2.4 | ) |  |  | (2.4 | )
Other |  |  | 6.2 |  |  |  | 6.2 |  |  |  | 5.3 |
Total |  | $ | 60.8 |  |  | $ | 103.5 |  |  | $ | 113.6 |
Changes Occurred in Amount of Unrecognized Tax Benefits | The following changes occurred in the amount of unrecognized tax benefits during the years ended December 31, 2023, 2022, and 2021:
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
|  | (in millions) |
Beginning balance of unrecognized tax benefits |  | $ | 49.7 |  |  | $ | 54.1 |  |  | $ | 52.7 |
Additions for current year tax positions |  |  | 9.7 |  |  |  | 8.8 |  |  |  | 9.2 |
Additions for prior year tax positions |  |  | 1.0 |  |  |  | 2.2 |  |  |  | 5.1 |
Reductions for prior year tax positions |  |  | (6.6 | ) |  |  | (3.7 | ) |  |  | (2.3 | )
Reductions for audit settlements |  |  | (0.2 | ) |  |  | (1.8 | ) |  |  | (5.2 | )
Reductions for the expiration of statutes of limitations |  |  | (4.4 | ) |  |  | (6.2 | ) |  |  | (4.1 | )
Changes due to foreign currency translation adjustments |  |  | (0.1 | ) |  |  | (3.7 | ) |  |  | (1.3 | )
Ending balance of unrecognized tax benefits (excluding interest and penalties) |  |  | 49.1 |  |  |  | 49.7 |  |  |  | 54.1 |
Interest and penalties associated with unrecognized tax benefits |  |  | 18.3 |  |  |  | 22.8 |  |  |  | 18.4 |
Ending balance of unrecognized tax benefits (including interest and penalties) |  | $ | 67.4 |  |  | $ | 72.5 |  |  | $ | 72.5 |

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