Income Taxes

9 Months Ended

Nov. 01, 2025

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision (benefit) for income taxes is based on the current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events.

For the third quarter of 2025, the Company’s effective tax rate was 16.0% compared to 21.3% in the third quarter of 2024. The third quarter of 2025 rate differed from the Company’s combined estimated federal and state statutory rate primarily due to foreign earnings taxed at a lower rate than the Company’s combined estimated federal and state statutory rate and a change in geographical mix of earnings. The third quarter of 2024 rate differed from the Company’s combined estimated federal and state statutory rate primarily due to foreign earnings taxed at a lower rate than the Company’s combined estimated federal and state statutory rate.

For year-to-date 2025, the Company’s effective tax rate was (42.9%) compared to (7.8%) for year-to-date 2024. The year-to-date 2025 rate differed from the Company’s combined estimated federal and state statutory rate primarily due to additional tax expense related to share-based compensation awards that vested in fiscal year 2025 and due to non-deductible liabilities related to contingent consideration and contingent compensation payments under the terms of the Merger Agreement. The year-to-date 2024 rate differed from the Company’s combined estimated federal and state statutory rate primarily due to additional tax expense related to share-based compensation awards that vested in fiscal year 2024.

The Company paid income taxes in the amount of $6 million and $8 million for the third quarter of 2025 and 2024, respectively, and $52 million and $45 million for year-to-date 2025 and 2024, respectively.