Mobileye Global Inc. Income Taxes Disclosure

NOTE 8 - INCOME TAXES

Income (Loss) before income taxes included in the consolidated statements of operations and comprehensive income (loss)

Income (loss) before income taxes for the years ended December 27, 2025, December 28, 2024, and December 30, 2023 was comprised of the following:

​

​

Benefit (provision) for income taxes included in the consolidated statements of operations and comprehensive income (loss)

Benefit (provision) for income taxes for the years ended December 27, 2025, December 28, 2024, and December 30, 2023 was comprised of the following:

​

​

Effective income tax rate reconciliation

The difference between the tax provision at the statutory federal income tax rate and the benefit (provision) for income taxes in dollars and as a percentage of income (loss) before income taxes (effective tax rate) for each year is as follows. The disclosure reflects the implementation of ASU 2023-09 retrospectively.

​

​

Income taxes paid, net of refunds received (Cash Taxes), for the years ended December 27, 2025, December 28, 2024, and December 30, 2023 were as follows:

​

​

In the fiscal years ended 2025, 2024 and 2023, certain Israeli operations are taxable in the U.S. as branch activities due to restructuring activities prior to the Mobileye IPO. As a result, these operations are taxed both in the U.S. and locally in Israel. For U.S. tax purposes, due to cumulative losses, deferred tax assets have not been benefited as a result of the valuation allowance which results in a residual tax provision associated with a deferred tax liability recorded for goodwill. Such deferred tax liability was reduced in 2024 due to the goodwill impairment recorded for the Mobileye reporting unit, resulting in a tax benefit recorded in 2024.

The decrease in the effective tax rate for the year ended December 27, 2025, as compared to the year ended December 28, 2024, is mainly due to the deferred tax effects of goodwill impairment to the Mobileye reporting unit recorded in 2024.

In Israel, the Company benefits from a reduced tax rate under the Special Preferred Technological Enterprise status under the Law for the Encouragement of Capital Investments, 1959, or the Investment Law.

Under the Investment Law, income derived by Preferred Companies from ‘Special Preferred Technological Enterprises’ (as defined in the 2017 Amendment), would be subject to 6% tax rate on income deriving from intellectual property, subject to a number of conditions being fulfilled, including a minimal amount or ratio of annual research and development expenditures and research and development employees, as well as having at least 25% of annual income derived from exports. Special Preferred Technological Enterprise is defined as an enterprise which meets the aforementioned conditions and for which total consolidated revenue of its parent company and all subsidiaries are more than ILS 10 billion.

Deferred income taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and increase in unbenefited U.S. deferred tax assets subject to a valuation allowance.

Due to the fact that certain Israeli operations were taxable in the U.S. as branch activities, the Company recognized in the years ended December 27, 2025 and December 28, 2024 the tax effects of temporary differences between the carrying amount of assets and

liabilities for financial reporting purposes and the amounts used for U.S. income tax purposes which resulted in a net deferred tax liability after evaluation of deferred tax assets for realizability.

Significant components of the Company’s deferred tax assets and deferred tax liabilities were as follows:

​

​

Changes in valuation allowance for deferred tax assets were as follows:

​

​

Realization of deferred tax assets is based on the Company’s judgment and various factors including reversal of deferred tax liabilities, the ability to generate future taxable income in jurisdictions where such assets have arisen, and potential tax planning strategies. A valuation allowance is recorded in order to reduce the deferred tax assets to the amount expected to be realized in the future. The valuation allowance for the years presented are primarily related to U.S. branch deferred tax assets not currently expected to be realized given that the Company has sustained recent losses.

Prior to the Tax Deconsolidation, the income tax benefit (provision) included in these consolidated financial statements had been calculated using the separate return method, as if the Company had filed its own tax returns. Following the Tax Deconsolidation, Mobileye is a standalone taxpayer from a U.S. federal and applicable state income tax perspective for the period starting July 12, 2025. As such, the Company now calculates and report its U.S. federal and applicable state income tax liabilities as a standalone taxpayer. Additionally, the Tax Deconsolidation resulted in an adjustment to the Company’s deferred income tax assets and liabilities, primarily with respect to its net operating losses, reflecting attributes that the Company will not retain as a result of its status as a standalone taxpayer. Most of the net operating losses were utilized by the Company’s Parent on its historic income tax returns. These deferred adjustments are offset with a change in deferred tax asset valuation allowance.

As of December 27, 2025, the Company has U.S. net operating loss carryforwards of $192 million which have an indefinite carry-forward period. $141 million of these U.S. net operating loss carryforwards are subject to separate return limitation year rules as they were generated before the Company joined its Parent’s consolidated income tax return on July 17, 2021. These net operating loss

carryforwards have been reflected in these consolidated financial statements and the Company will recognize a benefit for these net operating losses when determined to be realizable. As of December 27, 2025, the Company has removed all the historical separate return method hypothetical net operating loss carryforwards that were generated after joining its Parent’s consolidated income tax filing group. These net operating losses generated by the Company have been fully utilized as part of the Parent consolidated income tax return filings in the periods prior to the Tax Deconsolidation.

The Company has a non-U.S. net operating loss carryforward of $242 million as of December 27, 2025. This net operating loss carryforward amount relates primarily to operations in Israel and has an indefinite carry-forward period.

The Company intends to indefinitely reinvest undistributed foreign earnings into foreign operations and expects future U.S. cash generated to be sufficient to meet future U.S. cash needs. Therefore, the Company has not provided for deferred income taxes on undistributed foreign earnings. In making this determination, the Company evaluates both near-term and long-term fiscal needs of its U.S. domestic operations and its foreign subsidiaries. The estimation of the unrecognized deferred tax liability on undistributed foreign earnings is not practicable for the consolidated balance sheets dates presented.

Uncertain tax positions

A reconciliation of the beginning and ending amount of unrecognized tax benefits related to uncertain tax positions was as follows:

​

​

If the remaining balance of unrecognized tax benefits were recognized in a future period, it would result in a tax benefit of $22 million as of December 27, 2025. The balance of uncertain tax positions, which also includes accrued penalties and interest, is included in other long-term liabilities on the consolidated balance sheets.

The Company files income tax returns in the U.S., Israel, and in other certain foreign jurisdictions. The Company is no longer subject to U.S. and Israeli tax examinations for year prior to 2021 and 2020, respectively.