Income Taxes

3 Months Ended

Apr. 30, 2022

Income Taxes

Income Taxes

NOTE 12—INCOME TAXES

We recorded an income tax benefit of $163 million and an income tax expense of $41.7 million in the three months ended April 30, 2022 and May 1, 2021, respectively. The effective tax rate was (438.3)% and 24.2% for the three months ended April 30, 2022 and May 1, 2021, respectively. The decrease in the effective tax rate for the three months ended April 30, 2022 as compared to the three months ended May 1, 2021 is primarily attributable to significantly higher net excess tax benefits from stock-based compensation partially offset by nondeductible amounts related to the extinguishment of debt.

As of April 30, 2022, we had $8.6 million of unrecognized tax benefits, of which $7.9 million would reduce income tax expense and the effective tax rate, if recognized. The remaining unrecognized tax benefits would offset other deferred tax assets, if recognized. As of April 30, 2022, we had $5.9 million of exposures related to unrecognized tax benefits that are expected to decrease in the next 12 months.