v3.26.1
Income Taxes
 3 Months Ended 12 Months Ended
Mar. 31, 2026
Dec. 31, 2025
Income Tax Disclosure [Abstract]    
Income Taxes
14. Income Taxes
The Company’s income tax expense was not material for the three months ended March 31, 2026, and 2025.
The Company’s effective tax rate for the three months ended March 31, 2026, and 2025 was approximately 0%. For the periods presented, the difference between the effective tax rate and the federal statutory rate of 21% primarily relates to certain non-deductible items, the absence of current taxable income, and the full valuation allowance on deferred tax assets.
16. Income Taxes
Income Taxes and Rate Reconciliation
The Company is subject to U.S. federal and state corporate income taxes. For the years ended December 31, 2025, 2024, and 2023, net loss before income taxes was generated in the U.S.
Income taxes consisted of the following for the periods presented (in thousands):
Year Ended December 31,
202520242023
Current:
Federal$— $— $— 
State3 1 9 
Total3 1 9 
Deferred:
Federal— — — 
State— — — 
Total— — — 
Income taxes$3 $1 $9 
The U.S. federal statutory rate is reconciled to the Company's effective income tax rate for the year ended December 31, 2025 after the adoption of ASU 2023-09 as follows (in thousands):
Year Ended
December 31, 2025
AmountPercent
Federal statutory rate, benefit$(122,960)21.0 %
State income taxes, net of benefit(14,600)2.5 %
R&D credits(5,119)0.9 %
Nontaxable or nondeductible items
Stock-based compensation110,014 (18.8)%
Change in unrecognized tax benefits1,035 (0.2)%
Other1,626 (0.3)%
Change in valuation allowance30,007 (5.1)%
Effective tax rate$3 — %
The following table presents the Company’s effective income tax rate reconciliation for the years ended December 31, 2024 and 2023, in accordance with the guidance prior to the adoption of ASU 2023-09 (in thousands):
Year Ended December 31,
20242023
Federal statutory rate, benefit$(14,586)$(11,958)
State income taxes, net of benefit(5,318)(4,881)
Nondeductible expenses35 153 
Stock-based compensation2,566 1,618 
Change in valuation allowance20,366 18,099 
R&D credits(3,084)(3,022)
Other22 — 
Income taxes$1 $9 
The expense for income taxes in the table above related to continuing operations differs from the amounts computed by applying the statutory income tax rate of 21% due to a pretax loss in each period.
Deferred Income Taxes
The components of net deferred tax assets were as follows for the periods presented (in thousands):
December 31,
20252024
Deferred tax assets:
Net operating loss carryforwards$76,818 $47,448 
Accrued expenses and other current liabilities1,426 1,666 
Charitable contributions19 22 
Depreciation and amortization886 930 
Stock-based compensation1,785 233 
Operating lease liabilities1,292 2,136 
Capitalized research and development expense8,687 12,920 
Section 195 capitalization262 369 
Research and development credits15,804 12,076 
Total deferred tax assets106,979 77,800 
Less: valuation allowance(105,744)(75,737)
Total deferred tax assets, net of valuation allowance1,235 2,063 
Deferred tax liabilities:
Operating lease right-of-use assets(1,236)(2,064)
Other1 1 
Total deferred tax liabilities(1,235)(2,063)
Net deferred tax assets$— $— 
The Company determines its valuation allowance on deferred tax assets by considering whether it is more likely than not that deferred tax assets will be realized. Due to the Company’s history of operating losses, the Company’s deferred tax assets are not likely to be realized and, accordingly, the Company has provided a full valuation allowance on its deferred tax assets. The valuation allowance increased by $30.0 million and $20.4 million for the years ended December 31, 2025 and 2024, respectively, primarily due to the increase in the Company’s U.S. and state net operating losses (“NOL”) carryforwards and tax credit carryforwards.
Available Carryforwards
As of December 31, 2025, NOLs and tax credit carryforwards were as follows (in millions):
AmountExpiration Years
NOLs, federal
$288.7 Indefinite
NOLs, state
180.9 2039
Research and development tax credits, federal
11.8 2039
Research and development tax credits, state
8.2 Indefinite
The federal and state NOL carryforwards may be subject to significant limitations under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, and similar provisions under state law. These provisions limit the amount of NOL carryforwards that may be utilized in any given year in the event of certain circumstances, including significant changes in ownership.
Uncertain Tax Positions
A reconciliation of the beginning and ending balance of total gross unrecognized tax benefits was as follows for the periods presented (in thousands):
December 31,
20252024
Beginning balance of unrecognized tax benefits
$3,269 $2,441 
Gross increases based on tax positions related to current year
1,035 795 
Gross increases (decrease) based on tax positions related to prior years(103)33 
Ending balance of unrecognized tax benefits
$4,201 $3,269 
For the years ended December 31, 2025 and 2024, no material interest and penalties related to unrecognized tax benefits were recognized. The Company is subject to taxation in the United States and various state jurisdictions. All tax years are open for examination. The Company currently has no federal or state tax examinations in progress.