Income Taxes

3 Months Ended

Dec. 28, 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 December 28, 2024 and September 28, 2024 were as follows:

	December 28, 2024		September 28, 2024
Deferred tax assets
Net operating losses and tax credit carryforwards(1)	$	(3,176)	$	(3,444)
Accrued liabilities	(1,173)		(1,199)
Lease liabilities	(845)		(862)
Licensing revenues	(119)		(130)
Other	(489)		(655)
Total deferred tax assets	(5,802)		(6,290)
Deferred tax liabilities
Depreciable, amortizable and other property	6,128		6,584
Investment in U.S. entities(2)	1,068		1,102
Right-of-use lease assets	677		692
Investment in foreign entities	727		465
Other	66		78
Total deferred tax liabilities	8,666		8,921
Net deferred tax liability before valuation allowance	2,864		2,631
Valuation allowance	2,898		2,991
Net deferred tax liability	$	5,762	$	5,622

(1)Further details on our net operating losses and tax credit carryforwards are as follows:

	December 28, 2024
International Theme Park net operating losses	$	(1,424)
U.S. foreign tax credits	(810)
State net operating losses and tax credit carryforwards	(563)
Other	(379)
Total net operating losses and tax credit carryforwards(a)	$	(3,176)

(a)    Approximately $2.0 billion of these carryforwards do not expire. Approximately $1.1 billion expire between fiscal 2026 and fiscal 2035, primarily consisting of U.S. foreign tax credits.

(2)Amounts are, in part, due to the tax status of these entities and 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 $0.2 billion, from $2.0 billion at September 28, 2024 to $1.8 billion at December 28, 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 $0.8 billion.