Income Taxes

9 Months Ended

Jan. 31, 2026

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Our consolidated interim effective tax rate is based on our expected annual operating income, statutory tax rates, and income tax laws in the various jurisdictions where we operate. Significant or unusual items, including adjustments to accruals for tax uncertainties, are recognized in the fiscal quarter in which the related event or a change in judgment occurs. The effective tax rate on ordinary income for the full fiscal year is expected to be 20.8%, which is less than the U.S. federal statutory rate of 21.0%, due to the beneficial impact of the foreign-derived intangible income deduction and tax credits, mostly offset by state taxes and the tax effects of foreign operations.

The effective tax rate of 18.7% for the nine months ended January 31, 2026, was lower than the expected tax rate of 20.8% on ordinary income for the full fiscal year ending April 30, 2026, primarily due to the beneficial impact of prior fiscal year true-ups and tax rate changes in the current period. The effective tax rate of 18.7% for the nine months ended January 31, 2026, was lower than the effective tax rate of 19.5% for the same period last year. The decrease in our effective tax rate was driven primarily by the favorable year-over-year impact of tax rate changes, lower state taxes, tax credits and changes in valuation allowances, which were partially offset by the unfavorable year-over-year impact of prior fiscal year true-ups.

The Organization for Economic Co-operation and Development (OECD) 15% global minimum tax under the Pillar Two Model Rules, which is now effective in countries with enacted legislation, did not materially impact our financial results in the nine months ended January 31, 2026. We will continue to evaluate the impact in future periods as previously-enacting countries issue related guidance and additional countries consider adoption of the global minimum tax rules. On January 5, 2026, the OECD Inclusive Framework members approved changes to the model rules for the global minimum tax. We are monitoring the implementation of these rules into local laws; however, no material impact to the financial statements is expected for the fiscal year ending April 30, 2026.

On July 4, 2025, the One Big Beautiful Bill Act was signed into law in the United States, which encompasses a broad range of tax reform provisions. We do not expect this to have a material impact on our estimated annual effective tax rate for the fiscal year ending April 30, 2026.