Income Taxes

9 Months Ended

Jun. 29, 2024

Income Tax Disclosure [Abstract]

Income Tax Disclosure

Income Taxes

Deferred Tax Assets and Liabilities

The Company records deferred income tax assets and liabilities with respect to temporary differences in accounting treatment of items for financial reporting purposes and income tax purposes. The Company’s deferred tax assets and liabilities by major category as of June 29, 2024 and September 30, 2023 were as follows:

	June 29, 2024		September 30, 2023
Deferred tax assets
Net operating losses and tax credit carryforwards(1)	$	(3,506)	$	(3,841)
Accrued liabilities	(1,215)		(1,335)
Lease liabilities	(862)		(852)
Licensing revenues	(133)		(115)
Other	(669)		(623)
Total deferred tax assets	(6,385)		(6,766)
Deferred tax liabilities
Depreciable, amortizable and other property	6,932		7,581
Investment in subsidiaries / equity investees(2)	1,619		1,753
Right-of-use lease assets	763		751
Other	82		81
Total deferred tax liabilities	9,396		10,166
Net deferred tax liability before valuation allowance	3,011		3,400
Valuation allowance	3,018		3,187
Net deferred tax liability	$	6,029	$	6,587

(1)Balances at June 29, 2024 and September 30, 2023 include approximately $1.5 billion and $1.6 billion, respectively, of International Theme Park net operating losses. The International Theme Park net operating losses are primarily in France and, to a lesser extent, Hong Kong and China. Losses in France and Hong Kong have an indefinite carryforward period and losses in China have a five-year carryforward period. China theme park net operating losses of $0.1 billion, if not used, expire between fiscal 2025 and fiscal 2028. Balances at both June 29, 2024 and September 30, 2023 also include approximately $1.0 billion of foreign tax credits in the U.S., which have a ten-year carryforward period and, if not used, expire beginning in fiscal 2028.

(2)Amounts related to Investment in subsidiaries / equity investees are, in part, due to the tax status of these entities. If the tax status of certain legal entities changes, a significant portion of this balance may reverse.

Valuation Allowance

The Company records deferred income tax assets and liabilities with respect to temporary differences in the accounting treatment of items for financial reporting purposes and for income tax purposes. Where, based on the weight of available

evidence, it is more likely than not that some amount of recorded deferred tax assets will not be realized, a valuation allowance is established for the amount that, in management’s judgment, is sufficient to reduce the deferred tax asset to an amount that is more likely than not to be realized.

Unrecognized Tax Benefits

The Company’s gross unrecognized tax benefits (before interest and penalties) decreased $0.5 billion, from $2.5 billion at September 30, 2023 to $2.0 billion at June 29, 2024. In the next twelve months, it is reasonably possible that our unrecognized tax benefits could change due to resolutions of open tax matters, which would reduce our unrecognized tax benefits by $1.0 billion.