Income Taxes |
6 Months Ended |
|---|---|
Jun. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The Company generally provides for income taxes in interim periods based on the estimated annual effective tax rate for the year, adjusting for discrete items in the quarter in which they arise. For both the six months ended June 30, 2025 and 2024, the Company recorded a provision for income taxes of $2.3 million by applying its estimated annual effective tax rate to its year-to-date measure of ordinary income and adjusted for $2.0 million and $3.3 million, respectively, of discrete income tax expense primarily from equity compensation. The effective tax rate for the six months ended June 30, 2025 differed from the statutory rate of 21% primarily due to the unfavorable impact of state taxes, non-deductible compensation and equity charges, partially offset by the favorable impact of the research and development credits and a foreign-derived intangible income (“FDII”) deduction. The effective tax rate for the six months ended June 30, 2024 differed from the statutory rate of 21% primarily due to the benefit of the research and development credits and a foreign-derived intangible income benefit deduction, partially offset by the unfavorable impact of the non-deductible compensation, equity charges, and Global Intangible Low-Taxed Income tax inclusion. On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted in the United States, which includes significant tax reform provisions. Included in the OBBBA are provisions that allow for the immediate expensing of domestic United States research and development expenses, immediate expensing of certain capital expenditures, and other changes to the U.S. taxation of profits derived from foreign operations. The Company is currently evaluating the impact that the OBBBA may have on its consolidated financial statements. The Organization for Economic Co-Operation and Development introduced Base Erosion and Profit Shifting Pillar Two rules that impose a global minimum tax rate of 15% on multi-national corporations. These rules did not have an impact on the Company’s provision for income taxes for the six months ended June 30, 2025. As of June 30, 2025 and December 31, 2024, the Company had gross unrecognized tax benefits of $11.0 million and $10.5 million, respectively. The Company recognizes interest and penalties related to uncertain tax positions in interest and other income (expense), net in the Condensed Consolidated Statements of Operations. Accrued interest and penalties are included within other long-term liabilities on the Condensed Consolidated Balance Sheets. As of June 30, 2025 and December 31, 2024, the amount of accrued interest and penalties was $0.9 million and $0.6 million, respectively. The Company files income tax returns in the United States and various state and foreign jurisdictions. In the normal course of business, the Company is subject to examinations by taxing authorities, including major jurisdictions such as the United States, Germany, Italy, France, the United Kingdom, and India. With few exceptions, as of June 30, 2025, the Company was no longer subject to U.S., state, and foreign tax examinations for years before 2021, 2020, and 2020, respectively.
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