Income Taxes

9 Months Ended

Oct. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

For the three months ended October 31, 2023 and 2022, our effective tax rates were 20.8% and 19.0%, respectively. During the three months ended October 31, 2023, as compared to the prior year period, our effective tax rate increased primarily due to the reduced benefit from the foreign derived intangible income deduction.

For the nine months ended October 31, 2023 and 2022, our effective tax rates were 6.7% and 20.0%, respectively. During the nine months ended October 31, 2023 as compared to the prior year period, our effective tax rate decreased primarily due to the increase in excess tax benefits related to equity compensation. We recognized such excess tax benefits of $72 million and $10 million in our provision for income taxes for the nine months ended October 31, 2023 and 2022, respectively. The increase in excess tax benefits during the nine months ended October 31, 2023 was primarily due to our Chief Executive Officer’s exercise of stock options in February 2023 in connection with a previously announced plan.