What do companies do with their profits after paying taxes?

Turning to what these large companies could do with their added profits from a tax cut, there are basically four options.

First, they could "spend" the tax savings by boosting its expenses. That could be done by investing in more R&D or paying its employees more.

Second, they could "spend" the tax savings by lowering prices of their goods and services. Some advocate this as an option for companies to try and gain market share against competitors. It would also benefit consumers by lowering the prices of goods and services. However, if all companies in a particular industry choose this option, then a market share gain based on lowering prices might be hard to accomplish, though the overall size of the market could increase.

Third, companies could use the higher profits to increase capital expenditures.

Fourth, companies could simply pass the higher profits on to their shareholders.

There are other possibilities, but these seem to be the main focus. Debate arises over how companies will use the increased profits afforded by lowering the tax rate. As a basic approach, we can look at what companies do with their current profits. And as the previous table shows, this is really only about large companies as smaller companies don't pay substantial income taxes to the extent that a tax cut would lead to meaningfully more profits which they could "spend".

For context, the chart below shows a recent history of after-tax corporate profits. They have been steady over the past several years at all-time highs, though the composition at an industry level has been shifting. Also note this is after-tax profits, but companies will have more cash flow to use since some expenses for tax purposes are non-cash, such as depreciation of assets.