Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Dec. 31, 2024

Schedule of Components of Income Tax (Benefit) Expense

The following table presents the components of our income tax expense for the periods presented (in millions):


	Year Ended December 31,
	2025		2024		2023
Current income tax expense (benefit):
State	$	(1)	$	3	$	4
Foreign	1		1		—
Total current income tax expense (benefit)	—		4		4
Deferred income tax expense:
Federal	1		1		—
State	1		—		—
Total deferred income tax expense	2		1		—
Total income tax expense	$	2	$	5	$	4

Schedule of Reconciliation of Federal Statutory Rate and Effective Tax Rate

The following table presents the difference between income tax expense at the U.S. federal statutory income tax rate and the reported income tax expense for the year ended December 31, 2025:


	Amount		Percentage
Federal statutory income tax	$	5	(21.0)	%
Domestic - federal:
Research and development credits	(54)		213.2	%
Non-taxable or non-deductible items:
Non-deductible executive compensation	10		(41.0)	%
Excess tax benefits on share-based compensation	(36)		141.6	%
Meals and entertainment	2		(6.7)	%
Other, net	—		(0.6)	%
Changes in valuation allowances - federal	55		(216.3)	%
U.S. state and local income taxes	(5)		21.4	%
Foreign tax effects	1		(5.0)	%
Worldwide changes in unrecognized tax benefits	24		(95.5)	%
Effective taxes	$	2	(9.9)	%

The following table presents a reconciliation of the federal statutory rate and our effective tax rate for the periods presented:


	Year Ended December 31,
	2024		2023
Tax expense at federal statutory rate	(21.0)	%	(21.0)	%
State income taxes, net of federal tax benefit	(11.1)		2.6
Meals and entertainment	1.6		0.1
Share-based compensation	5.3		10.4
Non-deductible executive compensation	16.9		10.8
Research and development credits	(36.3)		(6.8)
Other, net	1.9		(8.3)
Valuation allowance	46.7		15.0
Effective tax rate	4.0	%	2.8	%

Schedule of Deferred Tax Assets and Liabilities

The following table presents the significant components of our deferred tax assets and liabilities as of the dates presented (in millions):


	December 31,
	2025		2024
Deferred tax assets:
Federal and state net operating loss carryforwards	$	438	$	345
Research and development credits	250		206
Capitalized research and development	156		247
Share-based compensation	111		110
Lease liabilities	23		24
Accruals and reserves	9		8



Intangible assets	5		—
Other deferred tax assets	—		3
Total deferred tax assets	992		943
Deferred tax liabilities:
Right of use assets	(14)		(14)
Intangible assets	—		(5)
Goodwill	(18)		(13)

Other deferred tax liabilities	(1)		(1)


Total deferred tax liabilities	(33)		(33)
Net deferred tax assets before valuation allowance	959		910
Less: valuation allowance	(965)		(914)
Net deferred tax liabilities	$	(6)	$	(4)

Schedule of Changes in Unrecognized Tax Benefits

Changes for unrecognized tax benefits for the periods presented are as follows (in millions):


Balance at January 1, 2023	$	90
Gross increases—current period tax positions	9
Gross increases—prior period tax positions	3
Gross decreases—prior period tax positions	(7)
Balance at December 31, 2023	$	95
Gross increases—current period tax positions	16
Gross increases—prior period tax positions	6
Gross decreases—prior period tax positions	(1)
Gross decreases—statute of limitations lapse	(1)
Balance at December 31, 2024	$	115
Gross increases—current period tax positions	20
Gross increases—prior period tax positions	4


Balance at December 31, 2025	$	139