Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

v3.20.2
INCOME TAXES (Tables)
 12 Months Ended
Jun. 30, 2020
Income Tax Disclosure [Abstract]  
Schedule of Income before Income Taxes, Domestic and Foreign
The components of income before income taxes were as follows: 
  Year ended June 30,
(In thousands) 2020 2019 2018
Domestic income before income taxes $ 752,844    $ 545,401    $ 716,015   
Foreign income before income taxes 563,867    750,830    739,916   
Total income before income taxes $ 1,316,711    $ 1,296,231    $ 1,455,931   
Schedule of Components of Income Tax Expense (Benefit)
The provision for income taxes was comprised of the following: 
(In thousands) Year ended June 30,
2020 2019 2018
Current:
Federal $ 108,136    $ 82,460    $ 504,758   
State 518    5,665    6,422   
Foreign 86,374    59,274    41,414   
195,028    147,399    552,594   
Deferred:
Federal (26,743)   1,636    98,702   
State (1,174)   2,118    1,526   
Foreign (65,425)   (29,939)   844   
(93,342)   (26,185)   101,072   
Provision for income taxes $ 101,686    $ 121,214    $ 653,666   
Schedule of Deferred Tax Assets and Liabilities
The significant components of deferred income tax assets and liabilities were as follows:
(In thousands) As of June 30,
2020 2019
Deferred tax assets:
Tax credits and net operating losses $ 214,305    $ 208,572   
Employee benefits accrual 67,729    65,065   
Stock-based compensation 8,871    9,432   
Inventory reserves 73,939    67,249   
Non-deductible reserves 20,526    21,633   
Unearned revenue 15,786    16,126   
Unrealized loss on investments 5,345    1,492   
Other 66,667    55,518   
Gross deferred tax assets 473,168    445,087   
Valuation allowance (181,846)   (166,571)  
Net deferred tax assets $ 291,322    $ 278,516   
Deferred tax liabilities:
Unremitted earnings of foreign subsidiaries not indefinitely reinvested $ (257,757)   $ (243,491)  
Deferred profit (18,111)   (15,718)  
Depreciation and amortization (439,685)   (515,643)  
Total deferred tax liabilities (715,553)   (774,852)  
Total net deferred tax assets (liabilities) $ (424,231)   $ (496,336)  
Schedule of Effective Income Tax Rate Reconciliation The reconciliation of the U.S. federal statutory income tax rate to our effective income tax rate was as follows: 
  Year ended June 30,
  2020 2019 2018
Federal statutory rate 21.0  % 21.0  % 28.1  %
State income taxes, net of federal benefit 0.2  % 0.5  % 0.5  %
Effect of foreign operations taxed at various rates (12.1) % (10.5) % (11.0) %
Tax Cuts and Jobs Act of 2017 - Transition tax and deferred tax effects —  % (1.5) % 30.3  %
Global intangible low-taxed income 3.0  % 3.5  % —  %
Foreign derived intangible income (5.0) % (4.0) % —  %
Research and development tax credit (1.8) % (1.8) % (1.4) %
Net change in tax reserves 1.5  % 1.4  % (0.4) %
Domestic manufacturing benefit —  % —  % (1.1) %
Non-deductible impairment of goodwill 4.1  % —  % —  %
Effect of stock-based compensation (0.3) % 0.4  % (0.1) %
Restructuring (2.6) % —  % —  %
Other (0.3) % 0.4  % —  %
Effective income tax rate 7.7  % 9.4  % 44.9  %
Summary of Income Tax Contingencies
A reconciliation of gross unrecognized tax benefits was as follows: 
  Year ended June 30,
(In thousands) 2020 2019 2018
Unrecognized tax benefits at the beginning of the year $ 146,426    $ 63,994    $ 68,439   
Increases for tax positions from acquisitions —    60,753    —   
Increases for tax positions taken in prior years 6,826    13,001    4,642   
Decreases for tax positions taken in prior years (518)   (1,304)   (6,045)  
Increases for tax positions taken in current year 34,278    26,178    16,812   
Decreases for settlements with taxing authorities —    —    (9,666)  
Decreases for lapsing of statutes of limitations (14,569)   (16,196)   (10,188)  
Unrecognized tax benefits at the end of the year $ 172,443    $ 146,426    $ 63,994