Income Taxes |
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| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Taxes | Income Taxes The following table presents income taxes and the effective tax rates for the periods indicated (in thousands, except percentages):
Our income taxes for the three and six months ended June 27, 2026 were determined using an estimated annual effective tax rate adjusted for discrete items that occurred during that period as required under Accounting Standards Codification (“ASC”) 740-270, Accounting for Income Taxes in Interim Periods. We have historically recorded interim provision for income taxes by applying ASC 740-270. For the three and six months ended June 28, 2025, due to the level of forecasted provision for income taxes relative to the forecasted pre-tax income used in computing the effective tax rate, the effective tax rate was highly sensitive to fluctuations in pre-tax income and did not provide a reasonable estimate for income taxes in the interim period. As such, we computed the provision for income taxes for the three and six months ended June 28, 2025 using an actual year-to-date tax calculation. Our effective tax rate for the three and six months ended June 27, 2026 is different from the statutory federal corporate tax rate of 21% primarily due to state taxes, the effect of non-deductible stock-based compensation for executive officers offset by the favorable impact of U.S. federal research tax credits and excess tax benefits from stock-based compensation. Our effective tax rate for the three and six months ended June 28, 2025 was different from the statutory federal corporate tax rate of 21% primarily due to state taxes, the effect of non-deductible stock-based compensation for executive officers, offset by the favorable impact of U.S. federal research tax credits, excess tax benefits from stock-based compensation and the U.S. tax impact of foreign operations. We maintained a valuation allowance of $32.3 million for the three and six months ended June 27, 2026, compared to $30.6 million for the three and six months ended June 28, 2025, on certain federal tax credits along with state deferred tax assets that we believe are not more likely than not to be realized in future periods. We considered scheduled reversals of deferred tax liabilities, historic profitability, projected future taxable income, ongoing tax planning strategies and other matters, including the period over which its deferred tax assets will be recoverable, in assessing the need for and the amount of the valuation allowance. In the event that actual results differ from these estimates, or if we decide to adjust these estimates in the future periods, further adjustments to its valuation allowance may be recorded, which could materially impact our financial position and net income in the period of the adjustment. In December 2021, the Organization for Economic Cooperation and Development enacted model rules for a new global minimum tax framework (“Pillar Two”), and certain governments in countries which we operate have enacted local Pillar Two legislation, with an effective date from January 1, 2024. We currently do not expect Pillar Two to have a material impact on our financial statements. In July 2025, President Trump signed the One Big Beautiful Bill Act ("OBBBA"), which includes a broad range of tax reform provisions affecting businesses. The OBBBA includes numerous changes to existing tax law including extending or making permanent certain business and international tax measures initially established under the 2017 Tax Cuts and Jobs Act, which were set to expire. Additionally, the OBBBA permanently eliminates the requirement to capitalize and amortize U.S.-based research and experimental expenditures over five years, making these expenditures fully deductible in the period incurred. We have accounted for the effects of the OBBBA in the financial statements for the period ended June 27, 2026. We will continue to evaluate the impacts of OBBBA including the potential impacts on future periods and tax planning strategies.
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