Income Taxes

Company response: We respectfully acknowledge the Staff's comment and are providing additional details and references to identify the materiality considerations that we used when determining the items to disclose in MD&A, as well as the referenced rate reconciliation contained within Note 14, Income Taxes. The “one-time tax adjustment” referenced as a cash flow benefit on page 23 in Liquidity and Capital Resources relates to changes to the timing of deduction of previously capitalized domestic research and development expenses under IRC Section 174 from the One Big Beautiful Bill Act. We are deducting the remaining unamortized domestic research and development costs over two years (half in 2025 and the other… response letter →

Company response: to the Staff’s request, the Company proposes to expand its disclosure in the income tax footnote of the consolidated financial statements and in MD&A in its Q1 2026 Form 10-Q (and in future filings as appropriate) as follows: United States Securities and Exchange Commission Division of Corporation Finance “Given our recent history of generating net income in the United States, we believe that there is a reasonable possibility that sufficient positive evidence may become available within the next 12 months to allow us to release a significant portion of the federal valuation allowance. The reversal would result in a significant income tax benefit in the period when we release it. However,… response letter →

Company response: The Company acknowledges the Staff’s comment and respectfully advises the Staff that it will enhance its disclosures in future filings regarding its assessment of the realizability of deferred tax assets and the related valuation allowance. Specifically, in future Annual Reports on Form 10-K, and in Quarterly Reports on Form 10-Q as appropriate, the Company will revise its critical accounting policy for income taxes to provide a more transparent disclosure regarding the ongoing evaluation of the need for a valuation allowance, including the significant factors and estimates affecting management’s judgment. Such disclosure will include, as applicable, discussion of the Company’s recent… response letter →

Company response: Because we incurred a loss from continuing operations before taxes of $440.7 million in our Fiscal Year 2025 Consolidated Income Statement, negative percentages within the Effective Tax Rate Reconciliation Table reflect an increase to our Effective Tax Rate. The (49.0%) impact on our Effective Tax Rate primarily represents the portion of such costs included in our pre-tax charge for which we recognized a tax benefit, offset by a corresponding valuation allowance as such benefits were not more likely than not to be realized and therefore had a negative impact on our Effective Tax Rate. During our fiscal year 2025, we incurred pre-tax charges of $3,747.0 million for business and asset actions… response letter →

Company response: The “tax valuation allowance” adjustment represents a discrete, non-cash charge recorded to establish a valuation allowance against deferred tax assets. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. A valuation allowance is established if it is more likely than not that some portion or all of the deferred income tax asset will not be realized. The Company considers this a discrete adjustment rather than a reflection of the Company’s ongoing performance. It also does not preclude our business from utilizing the underlying tax credits for which the valuation allowance was established. Management believes excluding this discrete… response letter →