Income Taxes (Tables)

12 Months Ended

Jul. 31, 2024

Income Tax Disclosure [Abstract]

Provision for income taxes from continuing operations

The provision for income taxes consisted of the following for the periods indicated:

	Twelve Months Ended July 31,
(In millions)	2024		2023		2022
Current:
Federal	$	984	$	970	$	253
State	202		208		93
Foreign	36		86		31
Total current	1,222		1,264		377
Deferred:
Federal	(523)		(559)		85
State	(97)		(99)		18
Foreign	(15)		(1)		(4)
Total deferred	(635)		(659)		99
Total provision for income taxes	$	587	$	605	$	476

Sources of income from continuing operations before the provision for income taxes

The sources of income before the provision for income taxes consisted of the following for the periods indicated:

	Twelve Months Ended July 31,
(In millions)	2024		2023		2022
United States	$	3,449	$	2,798	$	2,433
Foreign	101		191		109
Total	$	3,550	$	2,989	$	2,542

Differences between income taxes calculated using the federal statutory income tax rate and the provision for income taxes from continuing operations

Differences between income taxes calculated using the federal statutory income tax rate and the provision for income taxes were as follows for the periods indicated:

	Twelve Months Ended July 31,
(In millions)	2024		2023		2022
Income before income taxes	$	3,550	$	2,989	$	2,542
Statutory federal income tax	$	746	$	628	$	534
State income tax, net of federal benefit	83		86		87
Federal research and experimentation credits	(109)		(106)		(94)
Share-based compensation	43		58		45
Excess tax benefits related to share-based compensation	(153)		(26)		(112)
Effects of non-U.S. operations	—		(28)		4
Other, net	(23)		(7)		12
Total provision for income taxes	$	587	$	605	$	476

Components of deferred tax assets and liabilities

Material deferred tax assets and liabilities were as follows at the dates indicated:

	July 31,
(In millions)	2024		2023
Deferred tax assets:
Accruals and reserves not currently deductible	$	47	$	31
Capitalized research and development	1,321		667
Operating lease liabilities	137		153
Accrued and deferred compensation	132		90
Loss and tax credit carryforwards	204		256
Share-based compensation	117		94
Other, net	20		27
Total gross deferred tax assets	1,978		1,318
Valuation allowance	(227)		(235)
Total deferred tax assets	1,751		1,083
Deferred tax liabilities:
Operating lease right-of-use assets	105		128
Intangibles	864		840
Property and equipment	38		8
Other, net	49		47
Total deferred tax liabilities	1,056		1,023
Net deferred tax assets	$	695	$	60

Components of net deferred tax assets, net of valuation allowances

The components of total net deferred tax assets, net of valuation allowances, as shown on our consolidated balance sheets were as follows at the dates indicated:

	July 31,
(In millions)	2024		2023
Long-term deferred income tax assets	$	698	$	64
Long-term deferred income tax liabilities included in other long-term obligations	(3)		(4)
Net deferred tax assets	$	695	$	60

Schedule of Unrecognized Tax Benefits Roll Forward

The aggregate changes in the balance of our gross unrecognized tax benefits were as follows for the periods indicated:

	Twelve Months Ended July 31,
(In millions)	2024		2023		2022
Gross unrecognized tax benefits, beginning balance	$	246	$	216	$	190
Increases related to tax positions from prior fiscal years, including acquisitions	36		11		9
Decreases related to tax positions from prior fiscal years	(12)		(16)		(13)
Increases related to tax positions taken during current fiscal year	95		38		31
Settlements with tax authorities	(1)		(2)		—
Lapse of statute of limitations	(37)		(1)		(1)
Gross unrecognized tax benefits, ending balance	$	327	$	246	$	216