Recall the formula to factor a difference of squares.
a^2- b^2 ⇔ ( a+ b)( a- b)
We can apply this formula to our expression.
( x^2)^2- 1^2 ⇔ ( x^2+ 1)( x^2- 1)
We can notice that the second factor is also a difference of two squares. Let's use the formula once again.
(x^2+1)( x^2- 1)
⇕
(x^2+1)( x+ 1)( x- 1)
Now, the given polynomial is completely factored. Therefore, the correct option is G.