Income Taxes (Tables)

12 Months Ended

Nov. 29, 2020

Schedule of effective income tax rate reconciliation

The Company's income tax (benefit) expense differed from the amount computed by applying the U.S. federal statutory income tax rate to income before income taxes as follows:


	Year Ended
	November 29, 2020				November 24, 2019				November 25, 2018

	(Dollars in thousands)
Income tax expense at U.S. federal statutory rate	$	(39,855)	21.0	%	$	100,293	21.0	%	$	111,755	22.4	%
State income taxes, net of U.S. federal impact	(5,246)		2.8	%	4,496		1.0	%	11,102		2.2	%
Change in valuation allowance	18,271		(9.6)	%	(81)		—	%	(9,239)		(1.9)	%
Impact of foreign operations(1)	(8,868)		4.7	%	7,132		1.5	%	(17,149)		(3.4)	%
Foreign-derived intangible income benefit ("FDII")	—		—	%	(11,918)		(2.5)	%	—		—	%
Reassessment of tax liabilities	(1,531)		0.7	%	(6,480)		(1.4)	%	(12,552)		(2.5)	%
Stock-based compensation	(22,332)		11.8	%	(15,730)		(3.3)	%	(10,715)		(2.1)	%

Other, including non-deductible expenses	1,547		(0.8)	%	4,892		1.0	%	(1,783)		(0.4)	%
Change in tax law	(4,628)		2.4	%	—		—	%	143,359		28.7	%
Total	$	(62,642)	33.0	%	$	82,604	17.3	%	$	214,778	43.0	%

___________

(1)Included in the Impact of foreign operations are foreign rates differential, GILTI and tax impact on actual and deemed repatriation of foreign earnings.

Schedule of income before income tax, domestic and foreign

The U.S. and foreign components of income before income taxes were as follows:


	Year Ended
	November 29, 2020		November 24, 2019		November 25, 2018

	(Dollars in thousands)
Domestic	$	(197,718)	$	120,692	$	151,229
Foreign	7,935		356,892		348,793
Total income before income taxes	$	(189,783)	$	477,584	$	500,022

Schedule of components of income tax expense (benefit)

Income tax expense consisted of the following:


	Year Ended
	November 29, 2020		November 24, 2019		November 25, 2018

	(Dollars in thousands)
U.S. Federal
Current	$	8,396	$	13,182	$	12,468
Deferred	(79,676)		(22,319)		126,210
	$	(71,280)	$	(9,137)	$	138,678
U.S. State
Current	$	978	$	(2,939)	$	6,447
Deferred	(6,435)		1,002		4,655
	$	(5,457)	$	(1,937)	$	11,102
Foreign
Current	$	23,228	$	87,324	$	61,605
Deferred	(9,133)		6,354		3,393
	$	14,095	$	93,678	$	64,998
Consolidated
Current	$	32,602	$	97,567	$	80,520
Deferred	(95,244)		(14,963)		134,258
Total income tax expense	$	(62,642)	$	82,604	$	214,778

Schedule of deferred tax assets and liabilities

The Company's deferred tax assets and deferred tax liabilities were as follows:


	November 29, 2020		November 24, 2019

	(Dollars in thousands)
Deferred tax assets
Foreign tax credit carryforwards	$	232,164	$	157,379
State net operating loss carryforwards	16,054		10,070
Foreign net operating loss carryforwards	58,644		45,047
Employee compensation and benefit plans	102,846		141,489
Advance royalties	10,021		15,213
Accrued liabilities	32,304		24,648
Sales returns and allowances	30,740		22,494
Inventory	25,380		11,635
Property, plant and equipment	—		12,266
Unrealized foreign exchange gains or losses	18,665		5,527
Lease liability	251,285		—
Other	17,898		9,557
Total gross deferred tax assets	796,001		455,325
Less: Valuation allowance	(38,543)		(19,611)
Deferred tax assets, net of valuation allowance	757,458		435,714
Deferred tax liabilities
U.S. Branches	(25,330)		(27,134)
Residual tax liability on unremitted foreign earnings	(7,940)		(5,672)
Property, plant and equipment	(4,531)		—
Right of use asset	(227,054)		—
Total deferred tax liabilities	(264,855)		(32,806)
Total net deferred tax assets	$	492,603	$	402,908

Summary of valuation allowance

The following table details the changes in valuation allowance during the year ended November 29, 2020:


	Valuation Allowance at November 24, 2019		Changes in Related Gross Deferred Tax Asset		Change / (Release)		Valuation Allowance at November 29, 2020

	(Dollars in thousands)
Foreign tax credit and U.S. state net operating loss carryforwards	$	2,540	$	5,508	$	—	$	8,048
Foreign net operating loss carryforwards and other foreign deferred tax assets	17,071		(4,847)		18,271		30,495
	$	19,611	$	661	$	18,271	$	38,543

Schedule of unrecognized tax benefits roll forward

The following table reflects the changes to the Company's unrecognized tax benefits for the year ended November 29, 2020 and November 24, 2019:


	November 29, 2020		November 24, 2019

	(Dollars in thousands)
Unrecognized tax benefits beginning balance	$	36,559	$	26,594
Increases related to current year tax positions	1,575		2,432
Increases related to tax positions from prior years	262		3,696
Decreases related to tax positions from prior years	(889)		(3,222)
Settlement with tax authorities	(4,322)		7,119
Lapses of statutes of limitation	(446)		(45)
Other, including foreign currency translation	(453)		(15)
Unrecognized tax benefits ending balance	$	32,286	$	36,559