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Income Taxes
 3 Months Ended
Sep. 28, 2025
Income Tax Disclosure [Abstract]  
Income Taxes

NOTE 6. INCOME TAXES

The Company's income tax expense and effective tax rate for the three month periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands and percentage of Income before income taxes and non-controlling interest):

 

Three Months Ended

 

 

September 28,
2025

 

 

September 29,
2024

 

Income before income taxes and non-controlling interest

$

10,893

 

 

$

5,246

 

Income tax expense

$

2,356

 

 

$

1,498

 

Effective tax rate

 

21.6

%

 

 

28.6

%

The Company is subject to income taxes in the United States and foreign jurisdictions, primarily Mexico. The Company's income tax positions are based on interpretations of income tax laws and rulings in each of the jurisdictions which the Company operates. Interim income tax expense is determined based on an estimate of the overall annual effective income tax rate which can vary due to the relationship of foreign and domestic earnings, state taxes and available deductions, credits and discrete items.

On July 4, 2025, the One Big Beautiful Bill Act was enacted. There are multiple business tax provisions for which further guidance from the U.S. Treasury and the Internal Revenue Service is needed. The Company is currently reviewing and evaluating the impact of the guidance provided to date that could affect our income tax payable and deferred tax liability, including changes related to bonus depreciation and the expensing of research and development expenditures, among other topics.

The effective tax rate for the three-month period ended September 28, 2025 was consistent with the U.S. federal statutory rate of 21% primarily due to the accrual of foreign income taxes, which are generally higher the U.S. federal statutory rate, partially offset by the recognition of U.S. research and development tax credits and discrete income tax benefits associated with share-based payments. The effective tax rate for the three months ended September 29, 2024 was higher than the US federal statutory rate as a result of profits generated in foreign jurisdictions (Mexico) which has a higher statutory income tax rate.