|
Income Taxes (Tables)
|
12 Months Ended |
|
Jun. 30, 2012
|
| Income Tax Disclosure [Abstract] |
|
| Schedule of Income before Income Taxes, Domestic and Foreign |
The components of income before income taxes are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended June 30, |
(In thousands) |
2012 |
|
2011 |
|
2010 |
Domestic income before income taxes |
$ |
607,146 |
|
|
$ |
752,163 |
|
|
$ |
122,219 |
|
Foreign income before income taxes |
366,948 |
|
|
357,903 |
|
|
168,962 |
|
Total income before income taxes |
$ |
974,094 |
|
|
$ |
1,110,066 |
|
|
$ |
291,181 |
|
|
| Schedule of Components of Income Tax Expense (Benefit) |
The provision for income taxes is comprised of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
Year ended June 30, |
2012 |
|
2011 |
|
2010 |
Current: |
|
|
|
|
|
Federal |
$ |
(699 |
) |
|
$ |
225,192 |
|
|
$ |
63,687 |
|
State |
51 |
|
|
2,095 |
|
|
8,799 |
|
Foreign |
24,383 |
|
|
31,578 |
|
|
30,225 |
|
|
$ |
23,735 |
|
|
$ |
258,865 |
|
|
$ |
102,711 |
|
Deferred: |
|
|
|
|
|
Federal |
$ |
188,882 |
|
|
$ |
40,908 |
|
|
$ |
(9,258 |
) |
State |
3,721 |
|
|
26,458 |
|
|
(3,689 |
) |
Foreign |
1,741 |
|
|
(10,653 |
) |
|
(10,883 |
) |
|
194,344 |
|
|
56,713 |
|
|
(23,830 |
) |
Provision for income taxes |
$ |
218,079 |
|
|
$ |
315,578 |
|
|
$ |
78,881 |
|
|
| Schedule of Deferred Tax Assets and Liabilities |
The significant components of deferred income tax assets and liabilities are as follows:
|
|
|
|
|
|
|
|
|
(In thousands) |
As of June 30, |
2012 |
|
2011 |
Deferred tax assets: |
|
|
|
Tax credits and net operating losses |
$ |
66,392 |
|
|
$ |
62,020 |
|
Employee benefits accrual |
78,112 |
|
|
83,328 |
|
Stock-based compensation |
37,300 |
|
|
63,625 |
|
Capitalized R&D expenses |
57,192 |
|
|
79,815 |
|
Inventory reserves |
57,736 |
|
|
53,217 |
|
Non-deductible reserves |
45,682 |
|
|
45,154 |
|
Deferred profit |
— |
|
|
91,302 |
|
Unearned revenue |
9,991 |
|
|
26,632 |
|
Other |
57,464 |
|
|
59,275 |
|
Gross deferred tax assets |
409,869 |
|
|
564,368 |
|
Valuation allowance |
(40,479 |
) |
|
(30,722 |
) |
Net deferred tax assets |
$ |
369,390 |
|
|
$ |
533,646 |
|
Deferred tax liabilities: |
|
|
|
Unremitted earnings of foreign subsidiaries not permanently reinvested |
$ |
(22,746 |
) |
|
$ |
(25,131 |
) |
Depreciation and amortization |
(10,202 |
) |
|
(20,254 |
) |
Deferred profit |
(37,906 |
) |
|
— |
|
Unrealized gain on investments |
(1,070 |
) |
|
(2,215 |
) |
Total deferred tax liabilities |
(71,924 |
) |
|
(47,600 |
) |
Total net deferred tax assets |
$ |
297,466 |
|
|
$ |
486,046 |
|
|
| Schedule of Effective Income Tax Rate Reconciliation |
The reconciliation of the United States federal statutory income tax rate to KLA-Tencor’s effective income tax rate is as follows:
|
|
|
|
|
|
|
|
|
|
|
Year ended June 30, |
|
2012 |
|
2011 |
|
2010 |
Federal statutory rate |
35.0 |
% |
|
35.0 |
% |
|
35.0 |
% |
State income taxes, net of federal benefit |
0.4 |
% |
|
2.5 |
% |
|
0.6 |
% |
Effect of foreign operations taxed at various rates |
(9.9 |
)% |
|
(9.0 |
)% |
|
(9.6 |
)% |
Research and development tax credit |
(1.1 |
)% |
|
(1.2 |
)% |
|
(1.2 |
)% |
Net change in tax reserves |
(2.8 |
)% |
|
2.1 |
% |
|
0.5 |
% |
Domestic manufacturing benefit |
(0.7 |
)% |
|
(1.9 |
)% |
|
(1.7 |
)% |
Effect of stock-based compensation |
1.3 |
% |
|
1.4 |
% |
|
4.0 |
% |
Other |
0.2 |
% |
|
(0.5 |
)% |
|
(0.5 |
)% |
Effective income tax rate |
22.4 |
% |
|
28.4 |
% |
|
27.1 |
% |
|
| Summary of Income Tax Contingencies |
A reconciliation of the gross unrecognized tax benefit is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended June 30, |
(In thousands) |
2012 |
|
2011 |
|
2010 |
Unrecognized tax benefits at the beginning of the period |
$ |
78,337 |
|
|
$ |
53,492 |
|
|
$ |
49,738 |
|
Increases for tax positions taken in prior years |
4,172 |
|
|
5,228 |
|
|
6,553 |
|
Decreases for tax positions taken in prior years |
(1,002 |
) |
|
— |
|
|
(1,897 |
) |
Increases for tax positions taken in current year |
15,663 |
|
|
32,152 |
|
|
10,912 |
|
Decreases for settlements with taxing authorities |
(43,464 |
) |
|
(11,786 |
) |
|
— |
|
Decreases for lapsing of the statute of limitations |
(2,867 |
) |
|
(749 |
) |
|
(11,814 |
) |
Unrecognized tax benefits at the end of the period |
$ |
50,839 |
|
|
$ |
78,337 |
|
|
$ |
53,492 |
|
|