Income Taxes (Tables)

12 Months Ended

Jul. 30, 2022

The provision for income taxes consists of the following (in millions):


Years Ended	July 30, 2022		July 31, 2021		July 25, 2020
Federal:
Current	$	2,203	$	1,959	$	1,101
Deferred	(176)		(203)		(374)
	2,027		1,756		727
State:
Current	458		513		264
Deferred	(156)		(46)		287
	302		467		551
Foreign:
Current	313		583		1,429
Deferred	23		(135)		49
	336		448		1,478
Total	$	2,665	$	2,671	$	2,756

Income Before Provision for Income Taxes

Income before provision for income taxes consists of the following (in millions):


Years Ended	July 30, 2022		July 31, 2021		July 25, 2020
United States	$	13,550	$	12,335	$	7,534
International	927		927		6,436
Total	$	14,477	$	13,262	$	13,970

Difference Between Income Taxes at Federal Statutory Rate and Provision for Income Taxes

The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for income taxes consist of the following:


Years Ended	July 30, 2022		July 31, 2021		July 25, 2020
Federal statutory rate	21.0	%	21.0	%	21.0	%
Effect of:
State taxes, net of federal tax benefit	1.7		2.7		3.5
Foreign income at other than U.S. rates	0.8		1.5		(1.5)
Tax credits	(1.6)		(1.4)		(0.9)
Foreign-derived intangible income deduction	(3.9)		(4.2)		(2.6)
Stock-based compensation	0.3		0.6		(0.1)
Other, net	0.1		(0.1)		0.3
Total	18.4	%	20.1	%	19.7	%

Aggregate Changes in Gross Unrecognized Tax Benefits

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


Years Ended	July 30, 2022		July 31, 2021		July 25, 2020
Beginning balance	$	3,106	$	2,518	$	1,925
Additions based on tax positions related to the current year	157		224		188
Additions for tax positions of prior years	74		618		554
Reductions for tax positions of prior years	(81)		(122)		(136)
Settlements	(69)		(93)		(4)
Lapse of statute of limitations	(86)		(39)		(9)
Ending balance	$	3,101	$	3,106	$	2,518

Components of Deferred Tax Assets and Liabilities

The following table presents the breakdown for net deferred tax assets (in millions):


	July 30, 2022		July 31, 2021
Deferred tax assets	$	4,449	$	4,360
Deferred tax liabilities	(55)		(134)
Total net deferred tax assets	$	4,394	$	4,226

The following table presents the components of the deferred tax assets and liabilities (in millions):


	July 30, 2022		July 31, 2021
ASSETS
Allowance for accounts receivable and returns	$	90	$	68
Sales-type and direct-financing leases	29		39
Inventory write-downs and capitalization	430		392
Deferred foreign income	210		164
IPR&D and purchased intangible assets	1,184		1,195
Depreciation	10		—
Deferred revenue	1,744		1,526
Credits and net operating loss carryforwards	1,336		1,264
Share-based compensation expense	138		123
Accrued compensation	333		333
Lease liabilities	248		277
Capitalized research expenditures	149		303
Other	439		454
Gross deferred tax assets	6,340		6,138
Valuation allowance	(834)		(771)
Total deferred tax assets	5,506		5,367
LIABILITIES
Goodwill and purchased intangible assets	(767)		(686)
Depreciation	—		(46)
Unrealized gains on investments	(26)		(112)
ROU lease assets	(237)		(260)
Other	(82)		(37)
Total deferred tax liabilities	(1,112)		(1,141)
Total net deferred tax assets	$	4,394	$	4,226

Change in Valuation Allowance for Deferred Tax Assets

The changes in the valuation allowance for deferred tax assets are summarized as follows (in millions):


	July 30, 2022		July 31, 2021		July 25, 2020
Balance at beginning of fiscal year	$	771	$	700	$	457
Additions	84		91		279
Deductions	(10)		(5)		(29)
Write-offs	(12)		(16)		(7)
Foreign exchange and other	1		1		—
Balance at end of fiscal year	$	834	$	771	$	700