Income Taxes

6 Months Ended

Mar. 31, 2026

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

Effective Tax Rate

For the three and six months ended 31 March 2026, our consolidated income statements include an income tax expense of $158.7 and $318.1, respectively, compared to an income tax benefit of $505.8 and $365.1 for the comparative prior-year periods. The tax expenses in fiscal year 2026 represent an effective tax rate of 18.0% and 18.3% on the pre-tax income reported for the three and six months ended 31 March 2026, respectively. The tax benefits in fiscal year 2025 represented an effective tax rate of 22.5% and 25.1% on the pre-tax losses reported for the three and six months ended 31 March 2025, respectively. The fiscal year 2025 rates were primarily impacted by pre-tax charges of $2.9 billion for business and asset actions and other prior-year items as further discussed below.

Prior-Year Business and Asset Actions

In fiscal year 2025, we recorded charges related to our decision to exit certain projects and implement other cost-reduction measures as described in Note 4, Business and Asset Actions. These efforts resulted in pre-tax charges of approximately $2.9 billion during the second quarter of fiscal year 2025, which resulted in an overall loss from continuing operations before taxes for the three and six months ended 31 March 2025. The related net tax benefit of these actions, which primarily related to our U.S. operations, totaled $640.6.

The related net tax benefit of $640.6 recorded during the second quarter included a cost of $22.5 to establish reserves for uncertain tax positions related to the deductibility of certain costs in foreign subsidiaries as well as a cost of $13.1 primarily related to lower U.S. tax benefits for foreign-derived income. We also incurred a $41.8 increase in our valuation allowance related to tax benefits for foreign business and asset actions for which we could not recognize an income tax benefit.

Prior-Year Tax Reform Adjustment Related to Deemed Foreign Dividends

During the second quarter of fiscal year 2025, we recorded a net income tax benefit of $34.9 related to our intent to file a refund claim after a review of several U.S. Tax Court cases regarding the U.S. taxation of deemed foreign dividends in the transition year of the U.S. Tax Cuts and Jobs Act (our fiscal year 2018). While we were not a party to these cases, the opinions resulted in a change to our intent to pursue a refund claim. The $34.9 income tax benefit was net of a $67.8 reserve for an uncertain tax position related to the calculation of the refund amount.

Prior-Year Tax on Repatriation of Foreign Earnings

During the second quarter of fiscal year 2025, we recorded an income tax expense of $31.4 related to estimated withholding taxes on foreign earnings that we no longer intended to indefinitely reinvest.

Prior-Year Shareholder Activism-Related Costs

During the first six months of fiscal year 2025, we incurred costs of $61.3 related to a proxy contest led by an activist shareholder as further discussed in Note 17, Supplemental Information. The related net tax benefit recorded during the first half of fiscal year 2025 was $8.4.

Cash Paid for Taxes, Net of Refunds

Income tax payments, net of refunds, were $263.4 and $710.1 for the six months ended 31 March 2026 and 2025, respectively. Fiscal year 2025 included tax payments related to the sale of the LNG business.