Income Taxes (Tables)

12 Months Ended

Jan. 29, 2023

Company's Current and Deferred Taxes from Federal, State and Foreign Sources

The Company's domestic and foreign income before income tax expense and current and deferred income taxes from federal, state, and foreign sources are as follows:


	2022		2021		2020
	(In thousands)
Income (loss) before income tax expense
Domestic	$	(98,764)	$	204,350	$	122,573
Foreign	1,431,335		1,129,519		696,777
	$	1,332,571	$	1,333,869	$	819,350
Current income tax expense
Federal	$	34,752	$	25,701	$	70
State	33,369		17,608		10,439
Foreign	400,250		322,105		185,803
	$	468,371	$	365,414	$	196,312
Deferred income tax expense (recovery)
Federal	$	8,932	$	5,858	$	19,754
State	2,363		1,045		5,923
Foreign	(1,895)		(13,770)		8,448
	$	9,400	$	(6,867)	$	34,125
Income tax expense	$	477,771	$	358,547	$	230,437

Schedule of Effective Income Tax Rate Reconciliation

The Company's income tax expense for 2022, 2021, and 2020 include certain discrete tax amounts, as follows:


	2022		2021		2020
	(In thousands)
Impairment of goodwill and other assets	$	(28,171)	$	—	$	—
Gain on disposal of assets	1,661		—		—
Acquisition-related expenses	—		(1,417)		(3,133)
Total tax adjustments	$	(26,510)	$	(1,417)	$	(3,133)

A summary reconciliation of the effective tax rate is as follows:


	2022		2021		2020
	(Percentages)
Federal income tax at statutory rate	21.0	%	21.0	%	21.0	%
Foreign tax rate differentials	6.8		5.0		4.6
U.S. state taxes	(0.4)		0.8		0.8
Non-deductible compensation expense	0.7		0.7		2.1
Excess tax benefits from stock-based compensation	(0.5)		(0.9)		(0.8)
Impairment of goodwill and other assets and gain on disposal of assets	7.8		—		—
Permanent and other	0.5		0.3		0.4
Effective tax rate	35.9	%	26.9	%	28.1	%

Tax Effects of Temporary Differences of Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities as of January 29, 2023 and January 30, 2022 are presented below:


	January 29, 2023		January 30, 2022
	(In thousands)
Deferred income tax assets:
Net operating loss carryforwards	$	2,312	$	6,686
Inventories	43,471		16,326

Intangible assets, net	778		873
Non-current lease liabilities	216,495		173,700
Stock-based compensation	16,093		10,739
Accrued bonuses	13,647		7,830
Unredeemed gift card liability	12,877		9,804
Foreign tax credits	1,909		2,003
Other	6,958		10,116
Deferred income tax assets	$	314,540	238,077
Valuation allowance	(743)		(2,804)
Deferred income tax assets, net of valuation allowance	$	313,797	$	235,273
Deferred income tax liabilities:
Property and equipment, net	$	(142,516)	$	(104,498)
Intangible assets, net	(5,224)		(17,669)
Right-of-use lease assets	(192,221)		(154,634)
Other	(22,518)		(5,733)
Deferred income tax liabilities	(362,479)		(282,534)
Net deferred income tax liabilities	$	(48,682)	$	(47,261)

Balance sheet classification:
Deferred income tax assets	$	6,402	$	6,091
Deferred income tax liabilities	(55,084)		(53,352)
Net deferred income tax liabilities	$	(48,682)	$	(47,261)