v3.25.4
Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The domestic and foreign components of income before income taxes and provision for income taxes were as follows:
Years ended
December 31, 2025December 31, 2024December 31, 2023
(in US $ millions)
Income before income taxes
Domestic450 537 599 
Foreign1,059 1,691 (414)
1,509 2,228 185 
Current income tax (expense)
Federal(35)(14)1 
Provincial(64)(18)— 
Foreign(193)(99)(55)
(292)(131)(54)
Deferred income tax recovery (expense)
Federal1 (41)(1)
Provincial17 (31)(1)
Foreign(4)(6)3 
14 (78)1 
Provision for income taxes(278)(209)(53)
The reconciliation of the expected income tax expense calculated using the statutory tax rate to the actual provision for income taxes reported in the consolidated statements of operations and comprehensive income for the years ended December 31, 2025, 2024 and 2023 is as follows:
Years ended
 December 31, 2025December 31, 2024December 31, 2023
(in US $ millions, except percentages)
Income before income taxes1,509 2,228 185 
Expected income tax expense at Canadian Federal statutory income tax rate of 15.0%(1)
(226)15.0 %(334)15.0 %(28)15.0 %
Provincial tax(2)
(47)3.1 %(46)2.1 %(1)0.5 %
Other jurisdiction tax effects
United States
Foreign tax rate differential4 (0.3)%(8)0.4 %(39)21.1 %
U.S. State taxes
(18)1.2 %(242)10.9 %119 (64.3)%
Change in valuation allowance(13)0.9 %361 (16.2)%(543)293.5 %
Income not subject to tax in U.S.(3)
36 (2.4)%33 (1.5)%43 (23.2)%
Unrealized investment (loss) gain not subject to tax in U.S.(3)
(3)0.2 %49 (2.2)%29 (15.7)%
Stock-based compensation30 (2.0)%15 (0.7)%(47)25.4 %
Sales of businesses— — %— — %196 (105.9)%
Effect in changes in tax rates on unrealized investment gain— — %(132)5.9 %— — %
Other(17)1.1 %13 (0.6)%3 (1.6)%
Singapore
Foreign tax rate differential
(5)0.3 %(3)0.1 %(1)0.5 %
Singapore benefit of tax holiday20 (1.3)%21 (0.9)%9 (4.9)%
Pillar Two tax(10)0.7 %— — %— — %
Other(5)0.3 %(4)0.2 %3 (1.6)%
Ireland
Foreign tax rate differential
12 (0.8)%20 (0.9)%16 (8.6)%
Unrealized investment (loss) gain not subject to tax in Ireland(3)
(46)3.0 %44 (2.0)%53 (28.6)%
Pillar Two tax(16)1.1 %(5)0.2 %— — %
Other(13)0.9 %(14)0.6 %5 (2.7)%
Other foreign jurisdictions
1 (0.1)%8 (0.4)%(12)6.5 %
Effect of cross-border tax laws
Domestic taxes on foreign earnings(3)
(66)4.4 %(60)2.7 %(58)31.4 %
Domestic taxes on unrealized investment gains(3)
46 (3.0)%(62)2.8 %(45)24.3 %
Other— — %(13)0.6 %— — %
Tax credits
30 (2.0)%13 (0.6)%18 (9.7)%
Change in valuation allowance
— — %115 (5.2)%71 (38.4)%
Nontaxable or nondeductible items
Net unrealized gain on equity and other investments34 (2.3)%29 (1.3)%128 (69.2)%
Sales of businesses— — %— — %45 (24.3)%
Stock-based compensation12 (0.8)%— — %(15)8.1 %
Non-deductible loss on embedded derivative(19)1.3 %— — %— — %
Other permanent differences1 (0.1)%(3)0.1 %(1)0.5 %
Other adjustments
— — %(4)0.2 %(1)0.5 %
Provision for income taxes(278)18.4 %(209)9.4 %(53)28.6 %
(1) This represents the Canadian federal statutory income tax rate, which is 15% after a 13% general tax reduction and 10% federal abatement are applied to the 38% basic rate.
(2) Provincial taxes in Ontario made up the majority of the tax effect in this category.
(3) Foreign income is subject to tax in Canada.
Historical net operating losses and tax credits were utilized to offset tax liabilities which has reduced the amount of Federal and Provincial cash paid for income taxes. As of December 31, 2025, 2024 and 2023 the Company had Canadian unused non-capital tax losses and undeducted research and development expense balances of $5 million, $5 million and $343 million, respectively. In addition, as of December 31, 2025, 2024 and 2023, the Company had unused tax credits of nil, $26 million and $94 million, respectively. The below table illustrates the total cash paid for income taxes paid (net of refunds received) for the years ended December 31, 2025, 2024 and 2023:
Years ended
December 31, 2025December 31, 2024December 31, 2023
(in US $ millions)
Federal1 4 3 
Provincial43 2 1 
Aggregated Other Jurisdictions16 14 10 
Disaggregated Other Jurisdictions
Ireland116 60 27 
Singapore10 5 — 
U.S.8 31 9 
Total cash paid for income taxes, net194 116 50 

The significant components of the Company’s deferred income tax assets and liabilities as of December 31, 2025 and 2024 were as follows:
 December 31, 2025December 31, 2024
(in US $ millions)
Deferred tax assets  
Tax loss carryforwards578 608 
Accruals and reserves124 107 
Lease liabilities51 57 
Capital and intangible assets39 48 
Stock-based compensation expense33 37 
Research and development expenditures11 23 
Tax credits— 15 
Other deferred tax assets1 — 
Total deferred tax assets, before valuation allowance837 895 
Valuation allowance(489)(482)
Total deferred tax assets348 413 
Deferred tax liabilities  
Equity and other investments(255)(294)
Outside basis difference of foreign subsidiaries(80)(125)
Lease assets(23)(25)
Intangible assets(4)— 
Other deferred tax liabilities(8)(5)
Total deferred tax liabilities(370)(449)
Total deferred tax (liabilities) assets, net(22)(36)
During the year ended December 31, 2025, the Company assessed whether a valuation allowance should be established or maintained against its deferred tax assets, based on consideration of all available positive and negative evidence, using a "more-likely-than-not" standard. The factors the Company uses to assess the likelihood of realization are its recent operating results, historical losses and the cumulative losses, forecasts of future pre-tax income and tax planning strategies that could be implemented to realize the deferred tax assets.
The Company had a provision for income taxes of $278 million in the year ended December 31, 2025, as a result of earnings, offset by unrealized losses on the company's equity and other investments.
The Company had a provision for income taxes of $209 million in the year ended December 31, 2024, as a result of earnings and unrealized gains on the company's equity and other investments, net of an offset to the reversal of valuation allowance.
During the year ended December 31, 2024, there were significant unrealized gains on the Company's equity and other investments resulting in a deferred tax expense. As a result, a portion of the valuation allowance was reversed which partially offset the deferred tax expense in the current year.
During the year ended December 31, 2024, the Company performed a U.S. state tax sourcing analysis that resulted in a change to our U.S. state tax apportionment. This also resulted in a reduction in deferred tax assets, including unused non-capital tax losses, that were fully offset by a valuation allowance.
During the year ended December 31, 2023, the Company had a provision for income taxes of $53 million, primarily as a result of earnings in jurisdictions outside of North America.
We are subject to review and audit by tax authorities around the world, which may lead to adjustments to our tax liabilities. We received a proposed assessment from the Canada Revenue Agency ("CRA") in the fourth quarter related to transfer pricing for tax year 2020. We disagree with the proposed assessment and intend to defend our position.
While we believe that our tax provision is adequate, the final determination and timing of resolution of any tax audits or litigation cannot be predicted with certainty. We continue to monitor the progress of tax audits with tax authorities. Adjustments arising from tax audits or litigation will be recorded in the period in which such matters are resolved.
The gross unrecognized tax benefits related to uncertain tax positions were as follows:
Years ended
December 31, 2025December 31, 2024December 31, 2023
(in US $ millions)
Balance at the beginning of the year15 10 9 
Additions for tax positions of prior years5 — — 
Additions based on tax positions related to the current year5 5 1 
Balance at the end of the year25 15 10 
In the years ended December 31, 2025, 2024, 2023, the Company accrued interest of $1 million, nil, and nil, respectively, related to uncertain tax positions.
The Company remains subject to audit by the relevant tax authorities for the years ended 2018 through 2025.
Investment tax credits, which are earned as a result of qualifying research and development expenditures, are recognized and applied to reduce income tax expense in the year in which the expenditures are made and their realization is reasonably assured.
As of December 31, 2025, the Company had U.S. federal unused non-capital tax losses of approximately $287 million, of which $253 million has no expiry and $34 million will begin to expire starting in 2031. In
addition, the Company had unused non-capital tax losses in various U.S. states of approximately $348 million, of which $5 million has no expiry and $343 million will begin to expire in 2031.
As of December 31, 2024, the Company had U.S. federal unused non-capital tax losses of approximately $306 million, of which $272 million has no expiry and $34 million will begin to expire starting in 2031. In addition, the Company had unused non-capital tax losses in various U.S. states of approximately $339 million, of which $6 million has no expiry and $333 million will begin to expire in 2031.
As of December 31, 2025, the Company also has $760 million of capital losses in Canada that do not expire as well as $1.6 billion of capital losses in the U.S. that expires in 2028.
As of December 31, 2024, the Company has $761 million of capital losses in Canada that do not expire as well as $1.7 billion of capital losses in the U.S. that expires in 2028.