Income Taxes (Tables)

12 Months Ended

Jan. 28, 2018

The Company's regional income before income taxes is as follows:

The provision for taxes consists of the following:



	Fiscal Year Ended
(in thousands)	January 28, 2018			January 29, 2017		January 31, 2016
Current tax provision
Federal	$	2,108		$	—	$	—
State	—			—		—
Foreign	13,442			16,034		8,709
Subtotal	15,550			16,034		8,709
Deferred tax provision (benefit)
Federal	7,701			107		6,679
State	—			—		(96		)
Foreign	(60		)	2,258		(6,410		)
Subtotal	7,641			2,365		173
Provision for taxes	$	23,191		$	18,399	$	8,882

The provision for taxes reconciles to the amount computed by applying the statutory federal rate to income before taxes as follows:



	Fiscal Year Ended
(in thousands)	January 28, 2018			January 29, 2017			January 31, 2016
Federal income tax at statutory rate	$	20,222		$	25,571		$	7,133
State income taxes, net of federal benefit	(159		)	—			(7		)
Foreign taxes at rates less than federal rates	(8,698		)	(12,074		)	(62		)
Tax credits generated	(3,278		)	(2,864		)	(3,598		)
Changes in valuation allowance	(41,911		)	5,578			1,847
Non-taxable gain on sale	—			(2,978		)	—
Changes in uncertain tax positions	1,538			1,047			1,009
Deemed dividends	299			266			276
Equity compensation	(8,333		)	2,553			2,529
Permanent differences	264			448			28
Deferred tax provision - indefinite life intangibles	—			—			5,670
Triune Earn-out	—			—			(5,670		)
Revaluation of deferred tax assets and liabilities	—			—			334
Impact of US tax reform⁽¹⁾	65,442			—			—
Other	(2,195		)	852			(607		)
Provision for taxes	$	23,191		$	18,399		$	8,882

The components of the net deferred income tax assets and liabilities at January 28, 2018 and January 29, 2017 are as follows:



(in thousands)	January 28, 2018			January 29, 2017
Non-current deferred tax asset:
Deferred revenue	$	—		$	6,229
Inventory reserve	2,406			3,096
Bad debt reserve	659			645
Accrued service fees	306			—
Foreign tax credits	9,987			—
Research credit carryforward	11,707			25,770
NOL carryforward	8,326			42,870
Payroll and related accruals	7,344			12,556
Share-based compensation	9,282			5,524
Foreign pension deferred	477			727
Other deferred assets	1,847			5,918
Valuation allowance	(41,050		)	(82,961		)
Total non-current deferred tax asset	11,291			20,374
Non-current deferred tax liabilities:
Inventory reserve - foreign	—			—
Goodwill and other intangibles	(5,844		)	(12,534		)
Property, plant and equipment	(4,955		)	(7,483		)
Repatriation of foreign earnings	(10,427		)	—
Other non-current deferred tax liabilities	(511		)	(1,745		)
Total non-current deferred tax liabilities	(21,737		)	(21,762		)
Net deferred tax assets (liabilities)	$	(10,446	)	$	(1,388	)

Changes in the valuation allowance for the three years ended January 28, 2018 are summarized in the table below:

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits (before federal impact of state items) is as follows:



	Fiscal Year Ended
(in thousands)	January 28, 2018			January 29, 2017
Beginning balance	$	11,452		$	10,567
Additions based on tax positions related to the current year	5,789			1,005
Reductions for tax positions of prior years, net	(1,182		)	(120		)
Ending balance	$	16,059		$	11,452

The liability for UTP is reflected on the Balance Sheets as follows:



	Fiscal Year Ended
(in thousands)	January 28, 2018		January 29, 2017
Deferred tax assets - non-current	$	12,135	$	9,309
Accrued liabilities	—		—
Other long-term liabilities	3,924		2,143
Total accrued taxes	$	16,059	$	11,452