AMGN · 10-Q · 2026Q2 · Full report
Income Tax Rate Changes
AMGEN INC · 2026-08-05 · Importance 45 · Surprise 64 · In source text
The effective tax rate increased to 14.2% from 8.7% for the second quarter and to 13.6% from 10.7% for the first six months of 2026. The increases primarily reflected a change in earnings mix, including lower amortization expense from acquisition-related assets; first-half 2026 tax-rate pressure was partly offset by net unrealized investment losses versus prior-year gains. The IRS is contesting profit-allocation positions for 2010–2012 and 2013–2015 that could produce approximately $3.6 billion and $5.1 billion of additional federal tax, respectively, plus interest, with asserted penalties of approximately $2.0 billion for 2013–2015. The IRS also issued substantially similar draft notices for 2016–2018 in 2026, and Amgen stated that a full assessment could materially affect its financial statements.
Key facts
- On January 5, 2026, the OECD issued administrative guidance related to the global minimum tax agreement that, when fully enacted, will exempt U.S. companies from extra territorial minimum taxes effective January 1, 2026. source
- On July 4, 2025, OB3 was enacted in the United States with multiple provisions, with most provisions effective as of January 1, 2026. source
- Foreign jurisdictions subject to 15% minimum tax on adjusted financial statement income effective for selected countries including Singapore as of January 1, 2025 and applicable scope as described: 15% minimum tax source
- U.S. tax on foreign earnings reduced to 12.6% as of January 1, 2026 source
- Effective tax rates for the three and six months ended June 30, 2026 were 14.2% and 13.6%, respectively source
- Provision for income taxes for the three months ended June 30, 2026 was $ and for the three months ended June 30, 2025 was $ (amounts blank in table) but effective tax rates were 14.2% and 8.7%, respectively, for the three months ended June 30, 2026 and 2025. source
- Effective tax rates were 13.6% and 10.7% for the six months ended June 30, 2026 and June 30, 2025, respectively. source
- The increase in our effective tax rate for the three months ended June 30, 2026, was primarily due to the change in earnings mix, including lower amortization expense from acquisition-related assets. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| net_income | positive | probable | — | On January 5, 2026, the OECD issued administrative guidance related to the global minimum tax agreement that, when fully enacted, will… |
| net_income | unclear | realized | — | On July 4, 2025, OB3 was enacted in the United States with multiple provisions, with most provisions effective as of January 1, 2026. |
| net_income | negative | realized | — | Foreign jurisdictions subject to 15% minimum tax on adjusted financial statement income effective for selected countries including… |
| net_income | positive | realized | — | U.S. tax on foreign earnings reduced to 12.6% as of January 1, 2026 |