v3.25.0.1
Income Taxes
 12 Months Ended
Jan. 26, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The income tax expense (benefit) applicable to income before income taxes consists of the following:
 Year Ended
 Jan 26, 2025Jan 28, 2024Jan 29, 2023
 (In millions)
Current income taxes:   
Federal$14,032 $5,710 $1,703 
State892 335 46 
Foreign699 502 228 
Total current15,623 6,547 1,977 
Deferred income taxes:
Federal(4,515)(2,499)(2,165)
State(242)(206)— 
Foreign280 216 1 
Total deferred(4,477)(2,489)(2,164)
Income tax expense (benefit)$11,146 $4,058 $(187)
Income before income tax consists of the following:
 Year Ended
 Jan 26, 2025Jan 28, 2024Jan 29, 2023
 (In millions)
U.S.$77,456 $29,495 $3,477 
Foreign6,570 4,323 704 
Income before income tax$84,026 $33,818 $4,181 
The income tax expense (benefit) differs from the amount computed by applying the U.S. federal statutory rate of 21% to income before income taxes as follows:
 Year Ended
 Jan 26, 2025Jan 28, 2024Jan 29, 2023
 (In millions, except percentages)
Tax expense computed at federal statutory rate$17,645 21.0 %$7,102 21.0 %$878 21.0 %
Expense (benefit) resulting from:
State income taxes, net of federal tax effect554 0.7 %120 0.4 %50 1.2 %
Foreign-derived intangible income(2,976)(3.5)%(1,408)(4.2)%(739)(17.7)%
Stock-based compensation(2,097)(2.5)%(741)(2.2)%(309)(7.4)%
U.S. federal research and development tax credit(990)(1.2)%(431)(1.3)%(278)(6.6)%
Foreign tax rate differential(984)(1.2)%(467)(1.4)%(83)(2.0)%
Acquisition termination cost— — %— — %261 6.2 %
Other(6)— %(117)(0.3)%33 0.8 %
Income tax expense (benefit)$11,146 13.3 %$4,058 12.0 %$(187)(4.5)%
The tax effect of temporary differences that gives rise to significant portions of the deferred tax assets and liabilities are presented below:
 Jan 26, 2025Jan 28, 2024
 (In millions)
Deferred tax assets: 
Capitalized research and development expenditure$6,256 $3,376 
GILTI deferred tax assets2,820 1,576 
Accruals and reserves, not currently deductible for tax purposes2,058 1,121 
Research and other tax credit carryforwards759 936 
Net operating loss and capital loss carryforwards456 439 
Operating lease liabilities299 263 
Stock-based compensation124 106 
Property, equipment and intangible assets82 64 
Other deferred tax assets360 179 
Gross deferred tax assets13,214 8,060 
Less valuation allowance(1,610)(1,552)
Total deferred tax assets11,604 6,508 
Deferred tax liabilities:
Unremitted earnings of foreign subsidiaries(891)(502)
Operating lease assets(286)(255)
Equity investments(264)(60)
Acquired intangibles(70)(74)
Gross deferred tax liabilities(1,511)(891)
Net deferred tax asset (1)$10,093 $5,617 
(1)    Net deferred tax asset includes long-term deferred tax assets of $11 billion and $6.1 billion and long-term deferred tax liabilities of $886 million and $462 million for fiscal years 2025 and 2024, respectively. Long-term deferred tax liabilities are included in other long-term liabilities on our Consolidated Balance Sheets.
As of January 26, 2025, we intend to indefinitely reinvest approximately $1.4 billion of cumulative undistributed earnings held by certain subsidiaries. We have not provided the amount of unrecognized deferred tax liabilities for temporary differences related to these investments as the determination of such amount is not practicable.
As of both January 26, 2025 and January 28, 2024, we had a valuation allowance of $1.6 billion related to capital loss carryforwards, and certain state and other deferred tax assets that management determined are not likely to be realized due, in part, to jurisdictional projections of future taxable income, including capital gains. To the extent realization of the deferred tax assets becomes more-likely-than-not, we would recognize such deferred tax assets as income tax benefits during the period.
Given our current and possible future earnings, we believe that we may release the valuation allowance associated with certain state deferred tax assets in the near term, which would decrease our income tax expense for the period the release is recorded. The timing and amount of the valuation allowance release could vary based on our assessment of all available information.
As of January 26, 2025, we had U.S. federal, state and foreign net operating loss carryforwards of $479 million, $332 million and $349 million, respectively. The federal and state carryforwards will begin to expire in fiscal years 2026 and 2027, respectively. The foreign net operating loss carryforwards of $349 million may be carried forward indefinitely. As of January 26, 2025, we had federal research tax credit carryforwards of $46 million, before the impact of uncertain tax positions, that will begin to expire in fiscal year 2026. We have state research tax credit carryforwards of $1.5 billion, before the impact of uncertain tax positions. $1.4 billion is attributable to the State of California and may be carried over indefinitely and $98 million is attributable to various other states and will begin to expire in fiscal year 2026. As of January 26, 2025, we had federal capital loss carryforwards of $1.3 billion that will begin to expire in fiscal year 2028.
Our tax attributes remain subject to audit and may be adjusted for changes or modification in tax laws, other authoritative interpretations thereof, or other facts and circumstances. Utilization of tax attributes may also be subject to limitations due to ownership changes and other limitations provided by the Internal Revenue Code and similar state and foreign tax provisions. If any such limitations apply, the tax attributes may expire or be denied before utilization.
A reconciliation of gross unrecognized tax benefits is as follows:
 Jan 26, 2025Jan 28, 2024Jan 29, 2023
 (In millions)
Balance at beginning of period$1,670 $1,238 $1,013 
Increases in tax positions for current year1,268 616 268 
Increases in tax positions for prior years48 87 1 
Decreases in tax positions for prior years(88)(148)(15)
Lapse in statute of limitations(27)(19)(20)
Settlements(10)(104)(9)
Balance at end of period$2,861 $1,670 $1,238 
Included in the balance of unrecognized tax benefits as of January 26, 2025 are $2 billion of tax benefits that would affect our effective tax rate if recognized.
We classify an unrecognized tax benefit as a current liability, or amount refundable, to the extent that we anticipate payment or receipt of cash for income taxes within one year. The amount is classified as a long-term liability, or reduction of long-term amount refundable, if we anticipate payment or receipt of cash for income taxes during a period beyond a year.
We include interest and penalties related to unrecognized tax benefits as a component of income tax expense. We recognized net interest and penalties related to unrecognized tax benefits in the income tax expense line of our consolidated statements of income of $92 million, $42 million, and $33 million during fiscal years 2025, 2024, and 2023, respectively. As of January 26, 2025 and January 28, 2024, we have accrued $251 million and $140 million, respectively, for the payment of interest and penalties related to unrecognized tax benefits, which is not included as a component of our gross unrecognized tax benefits.
While we believe that we have adequately provided for all tax positions, amounts asserted by tax authorities could be greater or less than our accrued position. Accordingly, our provisions on federal, state and foreign tax-related matters to be recorded in the future may change as revised estimates are made or the underlying matters are settled or otherwise resolved. As of January 26, 2025, we have not identified any positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly increase or decrease within the next twelve months.
We are subject to taxation by taxing authorities both in the United States and other countries. As of January 26, 2025, the significant tax jurisdictions that may be subject to examination include the United States for fiscal years after 2021, as well as China, Germany, Hong Kong, India, Israel, Taiwan, and the United Kingdom for fiscal years 2014 through 2024. As of January 26, 2025, the significant tax jurisdictions for which we are currently under examination include Germany, Hong Kong, India, Israel, and Taiwan for fiscal years 2014 through 2024, and the State of California for fiscal years 2020 to 2022.