Income Taxes (Tables)

12 Months Ended

Jan. 03, 2025

The provision for income taxes for the periods presented included the following:


	Year Ended
(in millions)	January 3, 2025		December 29, 2023		December 30, 2022
Current:
Federal	$	381	$	212	$	290
State	84		68		80
Foreign	22		23		33
Deferred:
Federal	(77)		(75)		(169)
State	(13)		(20)		(36)
Foreign	(9)		(13)		(5)
Total	$	388	$	195	$	193

Schedule of Reconciliation of the Provision for Income Taxes

A reconciliation of the provision for income taxes to the amount computed by applying the statutory federal income tax rate to income before income taxes for the periods presented was as follows:


	Year Ended
(in millions)	January 3, 2025			December 29, 2023			December 30, 2022
Amount computed at the statutory federal income tax rate	$	344		$	85		$	186
State income taxes, net of federal tax benefit	28			26			36
Goodwill	—			104			—
Research and development credits	(25)			(19)			(31)
Excess tax benefits from stock-based compensation	(15)			(2)			(13)
Change in valuation allowance for deferred tax assets	4			3			3
Impact of foreign operations	(5)			(13)			2
Dividends paid to employee stock ownership plan	(2)			(2)			(2)
Change in accruals for uncertain tax positions	39			14			(1)

Other	20			(1)			13
Total	$	388		$	195		$	193
Effective income tax rate	23.7		%	48.4		%	21.8		%

Schedule of Deferred Tax Assets (Liabilities)

Deferred income taxes are recorded for differences in the basis of assets and liabilities for financial reporting purposes and tax reporting purposes. Deferred tax assets (liabilities) were comprised of the following:


(in millions)	January 3, 2025		December 29, 2023
Capitalized research and development	$	370	$	290
Operating lease liabilities	179		156
Accrued vacation and bonuses	85		95
Reserves	39		33
Deferred compensation	42		39
Credits and net operating losses carryovers	46		36
Vesting stock awards	30		29
Deferred revenue	9		—
Accumulated other comprehensive loss	6		—
Other	30		18
Total deferred tax assets	836		696
Valuation allowance	(31)		(27)
Deferred tax assets, net of valuation allowance	$	805	$	669

Purchased intangible assets	$	(361)	$	(347)
Operating lease right-of-use assets	(138)		(126)
Property, plant and equipment	(98)		(90)

Deferred revenue	—		(3)
Other	(7)		(4)
Total deferred tax liabilities	(604)		(570)
Net deferred tax assets	$	201	$	99

Schedule of Income Tax Related Balance on Balance Sheet

Income tax balance sheet items are included in the accompanying consolidated balance sheets as follows:


(in millions)	January 3, 2025		December 29, 2023
Other current assets:
Prepaid income taxes and tax refunds receivable	$	86	$	40
Other long-term assets:
Deferred tax assets	$	203	$	102
Accounts payable and accrued liabilities:
Income taxes payable	$	21	$	3
Other long-term liabilities:
Deferred tax liabilities	$	2	$	3
Unrecognized tax benefits	$	162	$	114

Schedule of Changes in the Unrecognized Tax Benefits

The changes in the unrecognized tax benefits were as follows:


	Year Ended
(in millions)	January 3, 2025		December 29, 2023		December 30, 2022
Unrecognized tax benefits at beginning of year	$	110	$	92	$	2
Additions for tax positions related to current year	81		58		91
Additions for tax positions related to prior years	46		15		—
Reductions for tax positions related to current year	(1)		(1)		—
Reductions for tax positions related to prior years	(59)		(54)		—
Settlements with taxing authorities	(3)		—		—
Lapse of statute of limitations	(1)		—		(1)
Unrecognized tax benefits at end of year	$	173	$	110	$	92
Unrecognized tax benefits that, if recognized, would affect the effective income tax rate	$	57	$	15	$	—