Taxes on Earnings

12 Months Ended

Jan. 31, 2026

Income Tax Disclosure [Abstract]

Taxes on Earnings

Taxes on Earnings

The provision for income taxes for fiscal 2025, 2024, and 2023 consisted of the following:

($000)	2025 1		1	2024		2023
Current
Federal	$	508,923		$	580,253	$	532,913
State	113,803			95,369		85,169
	622,726			675,622		618,082
Deferred
Federal	68,901			(7,016)		(16,265)
State	5,486			(2,182)		(4,556)
	74,387			(9,198)		(20,821)
Total	$	697,113		$	666,424	$	597,261
1 Foreign income taxes were not material to the consolidated financial statements in fiscal 2025.

The provision for taxes for financial reporting purposes is different from the tax provision computed by applying the U.S. federal statutory income tax rate. For fiscal 2025, 2024, and 2023, the differences are reconciled in the tables below:

($000)	2025
	Amount		Percent
Federal income taxes at the statutory rate	$	596,853	21.0	%
State and local income taxes, net of federal income tax effect1	94,238		3.3	%
Other adjustments	6,022		0.2	%
Total	$	697,113	24.5	%
1 State taxes in California contributed to the majority of the tax effect in this category.

	2024		2023
Federal income taxes at the statutory rate	21.0	%	21.0	%
State and local income taxes, net of federal income tax effect, and other	3.2	%	3.2	%
Total	24.2	%	24.2	%

The components of deferred taxes at January 31, 2026 and February 1, 2025 are as follows:

($000)	2025		2024
Deferred Tax Assets
Accrued liabilities	$	33,414	$	32,819
Deferred compensation	48,790		45,689
Stock-based compensation	51,814		53,995
State taxes and credits	20,618		20,534
Employee benefits	34,156		29,549
Operating lease liabilities	923,093		870,577
Other	9,056		9,633
Gross Deferred Tax Assets	1,120,941		1,062,796
Less: Valuation allowance	(116)		(583)
Deferred Tax Assets	1,120,825		1,062,213
Deferred Tax Liabilities
Depreciation and amortization	(441,213)		(364,320)
Merchandise inventory	(24,977)		(26,004)
Supplies	(15,866)		(14,873)
Operating lease assets	(878,287)		(826,425)
Other	(21,909)		(17,631)
Deferred Tax Liabilities	(1,382,252)		(1,249,253)
Net Deferred Tax Liabilities	$	(261,427)	$	(187,040)

At the end of fiscal 2025 and 2024, the Company’s state tax credit carryforwards for income tax purposes were approximately $8.6 million and $9.6 million, respectively. The state tax credit carryforwards will begin to expire in fiscal 2032. As of January 31, 2026 and February 1, 2025, the Company has provided a valuation allowance of $0.1 million and $0.6 million, respectively, for deferred tax assets related to state tax credits that are not expected to be realized.

The changes in amounts of unrecognized tax benefits (gross of federal tax benefits and excluding interest and penalties) at fiscal 2025, 2024, and 2023 are as follows:

($000)	2025		2024		2023
Unrecognized tax benefits - beginning of year	$	54,291	$	52,379	$	53,544
Gross increases:
Tax positions in current period	12,159		13,100		13,206
Tax positions in prior period	2,516		1,163		2,295
Gross decreases:
Tax positions in prior periods	(426)		(3,405)		(4,366)
Lapse of statutes of limitations	(13,059)		(8,820)		(11,148)
Settlements	(1,382)		(126)		(1,152)
Unrecognized tax benefits - end of year	$	54,099	$	54,291	$	52,379

At the end of fiscal 2025, 2024, and 2023, the reserves for unrecognized tax benefits were $61.3 million, $62.2 million, and $58.6 million inclusive of $7.2 million, $7.9 million, and $6.2 million of related reserves for interest and penalties, respectively. The Company accounts for interest and penalties related to unrecognized tax benefits as a part of its provision for taxes on earnings. If recognized, $48.9 million would impact the Company’s effective tax rate. The difference between the total amount of unrecognized tax benefits and the amounts that would impact the effective tax rate relates to amounts attributable to deferred tax assets and liabilities. These amounts are net of federal and state income taxes.

The Company is open to audit by the Internal Revenue Service under the statute of limitations for fiscal years 2022 through 2025. The Company’s state income tax returns are generally open to audit under the various statutes of limitations for fiscal years 2021 through 2025. Certain state tax returns are currently under audit by various tax authorities. The Company does not expect the results of these audits to have a material impact on the consolidated financial statements.

In July 2025, “An Act to provide for reconciliation pursuant to title II of H. Con. Res. 14.”, also known as the “One Big Beautiful Bill Act” (“OBBBA”), was signed into law. The OBBBA made several changes to business tax provisions including the reinstatement of 100% bonus depreciation and immediate expensing of domestic research and development expenditures. These changes did not have a material impact to the consolidated financial statements in fiscal 2025.

The following table presents the supplemental cash flow disclosures for Income taxes paid, net for fiscal 2025:

($000)	2025 1
Federal	$	493,259
California	60,872
Other states	51,434
Total Income taxes paid, net	$	605,565
1 Foreign income taxes paid were not material to the consolidated financial statements in fiscal 2025.