INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2025

Schedule of Components of Income Tax Expense (Benefit)

The following table sets forth income before taxes and the expense for income taxes:


	Year Ended December 31,
	2025		2024		2023
	(in thousands)
Income before taxes:
U.S.	$	(6,474)	$	217,429	$	309,098
Foreign	79,452		693,156		567,174
Total income before taxes	$	72,978	$	910,585	$	876,272
Income tax expense (benefit):
Current income taxes:
U.S. federal	$	51,449	$	98,137	$	85,075
U.S. state	11,436		18,005		21,884
Foreign	44,198		98,826		387,066
Total current income taxes	107,083		214,968		494,025
Deferred income taxes:
U.S. federal	(25,866)		(8,393)		(12,873)
U.S. state	(10,805)		(797)		(1,662)
Foreign	83,764		(245,264)		(395,784)
Total deferred income taxes	47,093		(254,454)		(410,319)
Total income tax expense (benefit)	$	154,176	$	(39,486)	$	83,706

Schedule of Tax Expense and Effective Tax Rates

The following table sets forth income reconciliations of the statutory federal income tax rate to actual rates based on income or loss before income taxes, reflecting the adoption of new accounting guidance. A subsequent table below provides the corresponding information for the prior year before the adoption of new accounting guidance and is provided for comparative purposes only.


	Year Ended December 31,
	2025
	(in thousands)
Income tax expense and rate attributable to:
Federal income tax rate	$	15,326	21.0	%
State income tax rate, net of federal benefit (1)	(386)		(0.5)	%
Foreign tax effects
Netherlands
Statutory tax rate difference between Netherlands and United States	17,094		23.3	%
HEYDUDE trademark and HEYDUDE goodwill impairment	7,598		10.4	%
Foreign tax credits	(17,323)		(23.7)	%
Non-deductible/non-taxable items	58,571		80.3	%
Other	854		1.2	%
China
Withholding taxes	11,828		16.2	%
Other	(2,721)		(3.7)	%
Malta	(47,361)		(65.0)	%
Other foreign Jurisdictions
Change in valuation allowance	79,375		108.8	%
HEYDUDE trademark and HEYDUDE goodwill impairment	23,700		32.5	%
Withholding taxes	20,622		28.3	%
Other	3,338		4.6	%
Effects of Cross-Border Tax Laws:
Global Intangible Low-Taxed Income	10,277		14.1	%
Other	(239)		(0.3)	%
Tax Credits	(3,602)		(4.9)
Change in valuation allowance	(16,202)		(22.2)	%
Non-deductible/non-taxable items	3,737		5.1	%
HEYDUDE trademark and HEYDUDE goodwill impairment	33,171		45.5	%
Uncertain tax positions	(44,483)		(61.0)	%
Other	1,002		1.3	%
Effective income tax expense and rate	$	154,176	211.3	%

(1) State taxes in California, Colorado, Florida, Indiana, Massachusetts, Ohio, and Tennessee made up the majority (greater than 50 percent) of the tax effect in this category.


		Year Ended December 31,
	2024			2023
		(in thousands)
Income tax expense and rate attributable to:
Federal income tax rate		$	191,223	21.0	%	$	184,017	21.0	%
State income tax rate, net of federal benefit		13,301		1.5	%	16,854		1.9	%
Foreign income tax rate differential		(34,166)		(3.8)	%	31,495		3.6	%
Global Intangible Low-Taxed Income, net		61,440		6.6	%	44,003		5.0	%
Non-deductible/non-taxable items		(12,028)		(1.3)	%	(1,129)		(0.1)	%
Change in valuation allowance		58,861		6.5	%	156,312		17.8	%
U.S. tax on foreign earnings		12,684		1.4	%	1,752		0.2	%
Foreign tax credits		(98,551)		(10.8)	%	(55,648)		(6.4)	%
Research and development credits		(9,903)		(1.1)	%	(6,754)		(0.8)	%
Uncertain tax positions		50,193		5.5	%	330,819		37.8	%
Share-based compensation		(1,157)		(0.1)	%	(2,097)		(0.2)	%
Intra-entity IP transactions		(271,700)		(29.8)	%	(611,403)		(69.8)	%

Other		317		0.1	%	(4,515)		(0.4)	%
Effective income tax expense and rate		$	(39,486)	(4.3)	%	$	83,706	9.6	%

Schedule of Cash Flow, Supplemental Disclosures

The following tables set forth cash paid for income taxes, net of refunds, reflecting the adoption of ASU 2023-09. A subsequent table below provides the corresponding information for the prior years before the adoption of ASU 2023-09 and is provided for comparative purposes only.


	Year Ended December 31,
	2025
	(in thousands)
Cash paid for income taxes, net of refunds:
Federal	$	81,458
State	13,186
Foreign
China	15,584
Netherlands	40,605
Other foreign	34,233
Total	$	185,066


	Year Ended December 31,
	2024		2023
	(in thousands)
Cash paid for income taxes, net of refunds (1)	$	122,678	$	176,564

(1) During the year ended December 31, 2025, we revised our presentation for cash paid for income taxes. Previously, cash paid for income taxes was presented excluding income tax refunds received. Under the revised presentation, cash paid for income taxes is presented net of refunds. We believe the revised presentation provides more meaningful and transparent information regarding our operating cash flows. Amounts for the years ended December 31, 2024, and 2023, have been recast to conform to current period presentation.

Schedule of Deferred Tax Assets and Liabilities

Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The following table sets forth deferred income tax assets and liabilities as of the date shown:


	December 31,
	2025		2024
	(in thousands)
Non-current deferred tax assets:
Share-based compensation expense	$	4,727	$	4,081
Accruals, reserves, and other expenses	12,302		22,974
Net operating loss	311,741		65,776
Intangible assets	832,144		918,000


Foreign tax credit	65,268		49,027
Operating lease liabilities	77,131		75,396
Unrealized loss on foreign currency	—		59,111
Other	55,797		48,866
Valuation allowance	(300,379)		(241,568)
Total non-current deferred tax assets	$	1,058,731	$	1,001,663
Non-current deferred tax liabilities:
Unrealized gain on foreign currency	(1,254)		—
Property and equipment	(17,744)		(25,896)
Right-of-use assets	(65,551)		(63,782)
Intangible assets	(38,561)		(42,409)
Other	(1,449)		(1,313)
Total non-current deferred tax liabilities	$	(124,559)	$	(133,400)

Schedule of Unrecognized Tax Benefits Roll Forward

The following table sets forth a reconciliation of the beginning and ending amount of unrecognized tax benefits:


	Year Ended December 31,
	2025		2024		2023
	(in thousands)
Unrecognized tax benefit as of January 1	$	582,228	$	556,482	$	219,363
Additions in tax positions taken in prior period	1,522		9,855		3,690
Reductions in tax positions taken in prior period	(14,624)		(147,561)		(7)
Additions in tax positions taken in current period	72,177		184,184		325,058
Settlements	(34,840)		—		—
Lapse of statute of limitations	(9,585)		(366)		(148)

Cumulative foreign currency translation adjustment	40,095		(20,366)		8,526
Unrecognized tax benefit as of December 31	$	636,973	$	582,228	$	556,482