ORCL · 10-K · 2026A · Full report

Provision for Income Taxes

ORACLE CORP · 2026-06-22 · Importance 53 · Surprise 60 · Matches filing data

Provision for income taxes increased in fiscal 2026 primarily due to a $933 million unfavorable impact from the enactment of the U.S. One, Big, Beautiful Bill Act (signed July 4, 2025) which required a remeasurement of a deferred tax liability tied to a prior partial legal entity realignment. Additional drivers included an unfavorable jurisdictional mix of earnings ($589 million), higher pre-tax income ($584 million) and a net change in unrecognized tax benefits ($240 million), partially offset by a $1.5 billion increase in tax benefits related to stock-based compensation and a $125 million one-time tax attribute. Management notes effective tax rates are sensitive to jurisdictional earnings mix and tax law changes and that tax reserves and uncertain tax positions are subject to ongoing audits and adjustments.

Key facts

• The enactment of the U.S. One, Big, Beautiful Bill Act resulted in an unfavorable impact of $933 million on provision for income taxes. source
• Tax benefits related to stock-based compensation increased provision-offsetting benefits by $1.5 billion in fiscal 2026. source
• Provision for income taxes was $2,467 million for the year ended May 31, 2026. source
• Effective tax rate was 12.6% for fiscal 2026. source
• An unfavorable jurisdictional mix of earnings increased provision for income taxes by $589 million in fiscal 2026. source
• Higher income before provision for income taxes increased provision for income taxes by $584 million in fiscal 2026. source
• Oracle realized a one-time tax attribute of $125 million in fiscal 2026. source

Impact estimates