Company: CRUS
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0000772406-25-000034
Chunk: 12

Company: CIRRUS LOGIC, INC.
Filing Date: 2025-08-05
Form: 10-Q
Item: Item 2
Chunk 12
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 sublease assumptions for previously vacated office space.

Interest Income

The Company reported interest income of $8.8 million and $8.4 million for the three months ended June 28, 2025 and June 29, 2024, respectively.  Interest income increased in the current period due to returns generated from higher combined average cash, cash equivalents and marketable securities balances, compared to the prior period.

Interest Expense

The Company reported interest expense of $0.2 million and $0.2 million for the three months ended June 28, 2025 and June 29, 2024, respectively.  Interest expense consists primarily of commitment fees associated with the Company's Revolving Credit Facility (see Note 8 - Revolving Credit Facility of the Notes to the Consolidated Condensed Financial Statements).

Other Income (Expense)

For the three months ended June 28, 2025 and June 29, 2024, the Company reported other expense of $0.4 million and $1.6 million in other income, respectively.  This activity primarily related to non-investment related income (expense) and remeasurement on foreign currency denominated monetary assets and liabilities.   

Income Taxes

Our provision for income taxes is based on estimated effective tax rates derived from an estimate of annual consolidated earnings before taxes, adjusted for nondeductible expenses, other permanent items and any applicable credits. 

The following table presents the provision for income taxes (in thousands) and the effective tax rates:

Three Months EndedJune 28,June 29,20252024Income before income taxes$80,628 $56,603 Provision for income taxes$19,931 $14,508 Effective tax rate24.7 %25.6 %

Our income tax expense for the first quarter of fiscal year 2026 was $19.9 million compared to $14.5 million for the first quarter of fiscal year 2025, resulting in effective tax rates of 24.7 percent and 25.6 percent, respectively.  

Effective tax rates for all periods presented were unfavorably impacted by a provision in the Tax Cuts and Jobs Act of 2017 that requires research and development ("R&D") expenditures incurred in tax years beginning after December 31, 2021 to be capitalized and amortized ratably over five or fifteen years depending on the location in which the research activities are conducted.  In addition, our effective tax rates for all periods presented were