Income Taxes

3 Months Ended

Mar. 29, 2025

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company determines its income taxes for interim reporting periods by applying the Company’s estimated annual effective tax rate to the year-to-date results, adjusted for tax items discrete to each period.

For the three months ended March 29, 2025, the Company recorded an income tax provision of $123 million representing an effective tax rate of 14.8%. The difference between the U.S. federal statutory tax rate of 21% and the Company's estimated annual effective tax rate was primarily due to the income tax benefit from foreign-derived intangible income (FDII) and research and development (R&D) tax credits, partially offset by the tax rate detriment from foreign earnings.

For the three months ended March 30, 2024, the Company recorded an income tax benefit of $52 million representing an effective tax rate of (73.2)%. The difference between the U.S. federal statutory tax rate of 21% and the Company's estimated annual effective tax rate was primarily due to the income tax benefit from FDII and R&D tax credits, partially offset by the tax rate detriment from foreign earnings. In addition, the tax benefit reflected discrete income tax benefits of $61 million, primarily related to tax effects of stock-based compensation.

As of both March 29, 2025 and December 28, 2024, the Company had long-term income tax liabilities related to unrecognized tax benefits of $1.4 billion recorded under Other long-term liabilities in the Company’s Condensed Consolidated Balance Sheets.