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Income Taxes
 9 Months Ended
Jun. 30, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
(Loss) income before provision for income taxes consists of the following:
 Year Ended
June 30, 2023		Nine Months Ended June 30, 2022Year Ended September 30, 2021
 (Dollars in Thousands)
Domestic$(201,620)$29,905 $(86,550)
Foreign21,054 10,056 20,637 
(Loss) income before provision for income taxes$(180,566)$39,961 $(65,913)

The (benefit) for income taxes shown in the accompanying consolidated and combined statements of operations is composed of the following:
 Year Ended
June 30, 2023		Nine Months Ended June 30, 2022Year Ended September 30, 2021
 (Dollars in Thousands)
Federal—   
Current$112,181 $59,162 $2,702 
Deferred(184,400)(70,046)(48,043)
State—   
Current6,333 4,385 1,004 
Deferred(7,301)(10,431)(4,980)
Foreign—   
Current9,293 3,465 4,191 
Deferred(8,912)280 (179)
$(72,806)$(13,185)$(45,305)

The (benefit) for income taxes differs from that based on the federal statutory rate due to the following:
 Year Ended
June 30, 2023		Nine Months Ended June 30, 2022Year Ended September 30, 2021
 (Dollars in Thousands)
Taxes at U.S. statutory rate (21%)$(37,919)$8,392 $(13,842)
State and local taxes, net of federal tax benefit(1,762)(7,003)(3,141)
Foreign derived intangible income (FDII)(36,436)(17,150)— 
Global Intangible Low-Taxed Income (GILTI)3,027 446 — 
Foreign taxes and rate differences(2,943)2,669 1,181 
Uncertain tax positions405 (2,556)(2,522)
Stock-based compensation4,828 152 — 
Return to Provision4,070 498 — 
Tax credits(396)(3,385)(523)
Change in valuation allowance(5,680)5,287 (27,953)
Other— (535)1,495 
(Benefit) for income taxes$(72,806)$(13,185)$(45,305)

The Company's tax benefit for the fiscal 2023 was favorably impacted primarily by the Foreign-Derived Intangible Income (“FDII”) deduction, the benefit from the deduction of state taxes, the difference in foreign tax rates, and the change in valuation allowance on certain jurisdictions, offset by Global Intangible Low-Taxed Income (“GILTI”), stock-based compensation, and return to provision adjustment. Assuming certain requirements are met, the FDII deduction is a benefit for U.S. companies that sell their products or services to customers for use outside the U.S.
Net deferred tax liabilities consist of the following at June 30, 2023 and 2022:
 June 30,
 20232022
(Dollars in Thousands)
Deferred tax assets:  
Federal, state and foreign credits$7,171 $10,162 
Net operating loss carryforwards10,720 11,557 
Deferred revenue15,962 11,783 
Other reserves and accruals22,346 23,429 
Intangible assets19,369 19,215 
Capitalized research and development46,693 2,479 
Property, leasehold improvements and other basis differences4,186 5,135 
Other temporary differences2,660 3,615 
Total gross deferred tax assets129,107 87,375 
Valuation allowance(15,995)(24,110)
Total net deferred tax assets113,112 63,265 
Deferred tax liabilities:
Intangible assets(1,005,672)(1,099,532)
Contract assets and costs(41,643)(91,298)
Deferred revenue(3,315)(1,092)
Property, leasehold improvements, and other basis differences(5,820)(7,634)
Other temporary differences(3,935)(4,180)
Total gross deferred tax liabilities(1,060,385)(1,203,736)
Net deferred tax (liabilities)$(947,273)$(1,140,471)

Reflected in the deferred tax assets above at June 30, 2023, the Company has foreign net operating loss carryforwards of $45.3 million, with unlimited carryforwards, federal and state research & development (R&D) credits of $6.7 million and foreign R&D credits of $0.5 million which begin to expire in 2027.

The Company's valuation allowance for deferred tax assets was $16.0 million and $24.1 million as of June 30, 2023 and 2022, respectively. The significant items of the valuation allowance as of June 30, 2023 are attributable to a reserve against foreign deferred tax assets of $3.2 million, foreign net operating losses of $5.7 million and state R&D credits of $6.4 million.

For fiscal 2023, the Company's income tax provision included amounts determined under the provisions of ASC 740 intended to satisfy additional income tax assessments, including interest and penalties, that could result from any tax return positions for which the likelihood of sustaining the position on audit does not meet a threshold of “more likely than not.” Tax liabilities were recorded as a component of their income taxes payable and other non-current liabilities. The ultimate amount of taxes due will not be known until examinations are completed and settled or the audit periods are closed by statutes.
At June 30, 2023, the amount of unrecognized tax benefits, excluding interest and penalties is $7.6 million. Upon being recognized, $7.6 million would reduce the effective tax rate. A reconciliation of the reserve for uncertain tax positions, excluding interest and penalties, is as follows:
 Year Ended June 30,
 20232022
 (Dollars in Thousands)
Beginning balance$6,716 $8,032 
Additions for current year tax positions1,011 396 
Additions for prior year tax positions1,657 1,761 
Reductions for prior year tax positions— (2,250)
Reductions for settlements with tax authorities— — 
Reductions for expirations of statute of limitations(1,823)(1,223)
Uncertain tax positions, excluding interest and penalties, end of year$7,561 $6,716 

The Company's policy is to recognize interest and penalties related to income tax matters as provision for (benefit from) income taxes. As of June 30, 2023, the Company had approximately $1.1 million of accrued interest and $0.5 million of penalties related to uncertain tax positions. The total amount of uncertain tax positions, including interest and penalties, is $9.1 million. The Company recorded a benefit for interest and penalties of approximately $(0.2) million during fiscal 2023 mainly due to expirations of statute of limitations. It is reasonably possible as of June 30, 2023 that the liability for unrecognized tax benefits for the uncertain tax position will decrease by approximately $1.5 million over the next twelve-month period.

The Company is subject to income tax in many jurisdictions outside the United States. The Company is no longer under examination by the taxing authority regarding any U.S. federal income tax returns for fiscal years prior to 2020. Its operations in certain jurisdictions remain subject to examination for tax years 2014 to 2022, some of which are currently under audit by local tax authorities. The resolutions of these audits are not expected to be material to its consolidated and combined financial statements.