Income Taxes (Tables)

12 Months Ended

Jun. 30, 2019

Components of Income (Loss) Before Income Taxes

The components of income (loss) before income taxes were as follows:



	Year Ended
	June 30, 2019			June 24, 2018		June 25, 2017
	(in thousands)
United States	$	(59,876	)	$	128,190	$	7,553
Foreign	2,506,447			3,023,599		1,804,120
	$	2,446,571		$	3,151,789	$	1,811,673

Components of Provision (Benefit) for Income Taxes

Significant components of the provision (benefit) for income taxes attributable to income before income taxes were as follows:



	Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
	(in thousands)
Federal:
Current	$	143,845		$	630,148		$	(70,858	)
Deferred	(10,722		)	12,871			99,700
	133,123			643,019			28,842
State:
Current	5,994			5,348			(963		)
Deferred	4,944			(3,273		)	(2,246		)
	10,938			2,075			(3,209		)
Foreign:
Current	110,283			132,566			85,479
Deferred	797			(6,552		)	2,798
	111,080			126,014			88,277
Total provision for income taxes	$	255,141		$	771,108		$	113,910

Components of Net Deferred Tax Assets and Liabilities

Significant components of the Company’s net deferred tax assets and liabilities were as follows:



	June 30, 2019			June 24, 2018
	(in thousands)
Deferred tax assets:
Tax carryforwards	$	231,390		$	206,073
Allowances and reserves	97,671			118,559
Equity-based compensation	14,661			16,189
Inventory valuation differences	18,516			14,021
Prepaid cost sharing	74,139			65,644
Outside basis differences of foreign subsidiaries	16,260			—
Other	17,972			16,514
Gross deferred tax assets	470,609			437,000
Valuation allowance	(226,928		)	(199,839		)
Net deferred tax assets	243,681			237,161
Deferred tax liabilities:
Intangible assets	(9,883		)	(21,558		)
Convertible debt	(46,993		)	(60,252		)
Capital assets	(83,298		)	(61,429		)
Amortization of goodwill	(11,299		)	(10,738		)
Outside basis differences of foreign subsidiaries	—			(6,656		)
Other	(8,752		)	(7,955		)
Gross deferred tax liabilities	(160,225		)	(168,588		)
Net deferred tax assets	$	83,456		$	68,573

Reconciliation of Income Tax Expense Provided at Federal Statutory Rate to Actual Income Tax Expense (Benefit)

A reconciliation of income tax expense provided at the federal statutory rate (21% in fiscal year 2019, 28.27% in fiscal year 2018, and 35% in fiscal year 2017) to actual income tax expense is as follows:



	Year Ended
	June 30, 2019			June 24, 2018			June 25, 2017
	(in thousands)
Income tax expense computed at federal statutory rate	$	513,780		$	891,011		$	634,086
State income taxes, net of federal tax benefit	(17,565		)	(50,585		)	(11,973		)
Foreign income taxed at different rates	(260,344		)	(939,808		)	(352,860		)
Settlements and reductions in uncertain tax positions	(31,291		)	(33,367		)	(144,519		)
Tax credits	(71,779		)	(69,301		)	(37,713		)
State valuation allowance, net of federal tax benefit	26,742			57,302			12,070
Equity-based compensation	(7,566		)	(35,875		)	13,187
Other permanent differences and miscellaneous items	39,251			43,214			1,632
U.S. tax reform impacts	63,913			908,517			—
	$	255,141		$	771,108		$	113,910

Changes in Balance of Gross Unrecognized Tax Benefits

The aggregate changes in the balance of gross unrecognized tax benefits were as follows:




	(in thousands)
Balance as of June 26, 2016	$	417,432
Settlements and effective settlements with tax authorities	(6,691		)
Lapse of statute of limitations	(113,491		)
Increases in balances related to tax positions taken during prior periods	6,557
Decreases in balances related to tax positions taken during prior periods	(11,528		)
Increases in balances related to tax positions taken during current period	47,168
Balance as of June 25, 2017	339,447
Settlements and effective settlements with tax authorities	(693		)
Lapse of statute of limitations	(88,837		)
Increases in balances related to tax positions taken during prior periods	2,044
Decreases in balances related to tax positions taken during prior periods	(1,320		)
Increases in balances related to tax positions taken during current period	54,772
Balance as of June 24, 2018	305,413
Settlements and effective settlements with tax authorities	(3,705		)
Lapse of statute of limitations	(28,176		)
Increases in balances related to tax positions taken during prior periods	78,927
Decreases in balances related to tax positions taken during prior periods	(1,577		)
Increases in balances related to tax positions taken during current period	69,890
Balance as of June 30, 2019	$	420,772