Quarterly report [Sections 13 or 15(d)]

Income Taxes

v3.26.1
Income Taxes
 9 Months Ended
Jul. 04, 2026
Income Tax Disclosure [Abstract]  
Income Taxes

Note 11—Income Taxes

Our effective income tax rate was (0.8)% for the nine months ended July 4, 2026, compared to (10.4)% for the nine months ended June 28, 2025. For the nine months ended July 4, 2026, the Company’s provision for income taxes is based upon an estimated annual tax rate for the year applied to ordinary income. The differences between the statutory rate and our effective rate for the nine months ended July 4, 2026 and the nine months ended June 28, 2025 were primarily attributable to state taxes and change in valuation allowance. Our effective income tax rate can fluctuate due to factors including valuation allowances, changes in tax laws, federal and state audits, and the impact of other discrete items.

For the nine months ended June 28, 2025, we utilized the discrete effective tax rate method, as allowed by ASC 740- 270-30-18, “Income Taxes—Interim Reporting,” to calculate our interim income tax provision. The discrete method treats the year-to-date period as if it was the annual period and determines the income tax expense or benefit on that basis. The Company believed that the use of this discrete method was more appropriate than the annual effective tax rate method due to the sensitivity of tax adjustments to marginal pre-tax book profitability anticipated for the year.