Income Taxes

3 Months Ended

Mar. 02, 2025

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The Company’s effective income tax rate was 20.6% for the three months ended March 2, 2025, compared to 15.9% for the same prior-year period. The increase in the effective tax rate in the current quarter is primarily driven by an unfavorable impact of stock-based compensation as a proportion to pre-tax earnings, as well as a lower tax deduction from foreign-derived intangible income.

The Organization for Economic Cooperation and Development reached agreement among over 140 countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two. Many countries continue to announce changes in their tax laws and regulations based on the Pillar Two framework. The Company determined that Pillar Two did not have a material impact to our tax provision for the three months ended March 2, 2025. We will continue to evaluate the impact of legislative changes as additional guidance becomes available.