19. Income Taxes

Effective Income Tax Rate – Three and Six Months Ended June 30, 2026

The Company’s effective income tax rate during the three months ended June 30, 2026 was 24.4%, resulting in income tax expense of $14,263. The effective income tax rate differs from the U.S. federal statutory rate of 21.0% primarily due to non-deductible amounts associated with the repurchase of convertible notes.

The Company’s effective income tax rate during the six months ended June 30, 2026 was 51.9%, resulting in income tax expense of $22,812. The effective income tax rate differs from the U.S. federal statutory rate of 21.0% primarily due to non-deductible amounts associated with the repurchase of convertible notes, partly offset by tax windfalls associated with the vesting of stock-based compensation awards and a lower tax rate on foreign earnings.

Effective Income Tax Rate – Three and Six Months Ended June 30, 2025

The Company’s effective income tax rate during the three months ended June 30, 2025 was 22.3%, resulting in income tax expense of $7,093. The effective income tax rate differs from the U.S. federal statutory tax rate of 21% primarily due to state and local income taxes, partly offset by a lower tax rate on foreign earnings.

The Company’s effective income tax rate during the six months ended June 30, 2025 was 20.6%, resulting in income tax expense of $12,832. The effective income tax rate differs from the U.S. federal statutory tax rate of 21% primarily due to tax windfalls associated with the vesting of stock-based compensation awards and a lower tax rate on foreign earnings. These items were partly offset by state and local income taxes.

Income Tax Payments

Disclosed below is a summary of income taxes paid by jurisdiction pursuant to the disclosure requirements of ASU 2023-09.

	Six Months Ended June 30, 2026
United States—Federal	$	6,207
United States—State and local		2,332
United Kingdom		15,017
Other		747
Total	$	24,303

Deferred Tax Assets and Liabilities

A summary of the components of the Company’s deferred tax assets and liabilities are as follows:

	June 30, 2026			December 31, 2025
Deferred tax assets:
Capital losses	$	5,398		$	6,689
Accrued expenses		4,599			6,584
Interest carryforward		4,168			—
Stock-based compensation		1,779			3,210
Acquisition costs		936			970
Foreign currency translation adjustment		698			—
Start-up expenses		645			289
Operating lease liabilities		459			631
NOLs—Foreign		—			745
Other		221			—
Deferred tax assets		18,903			19,118
Deferred tax liabilities:
Goodwill and intangible assets		22,041			74
Unrealized gains		1,053			494
Software capitalization		910			912
Fixed assets and prepaid assets		688			356
Right of use assets—operating leases		457			627
Unremitted earnings—European subsidiaries		87			65
Foreign currency translation adjustment		—			592
Deferred tax liabilities		25,236			3,120
Total deferred tax assets less deferred tax liabilities		(6,333	)		15,998
Less: Valuation allowance		(4,345	)		(6,195	)
Deferred tax (liabilities)/assets, net	$	(10,678	)	$	9,803

Capital Losses – U.S.

The Company’s tax effected capital losses at June 30, 2026 were $5,398. These capital losses expire in 2028. The table below sets forth the aggregate changes in these capital losses:

Balance at January 1, 2026	$	6,689
Expirations		—
Utilizations		(1,291	)
Balance at June 30, 2026	$	5,398

Valuation Allowance

The Company’s valuation allowance has been established on its net capital losses (net of unrealized gains), as it is more-likely-than-not that these deferred tax assets will not be realized.

Income Tax Examinations

The Company is subject to U.S. federal income tax as well as income tax of multiple state, local and certain foreign jurisdictions. As of June 30, 2026, with few exceptions, the Company was no longer subject to income tax examinations by any taxing authority for the years before 2021.

Uncertain Tax Positions

There were no unrecognized tax benefits at June 30, 2026 and December 31, 2025.

Undistributed Earnings of Foreign Subsidiaries

ASC 740-30, Income Taxes, provides guidance that U.S. companies do not need to recognize tax effects on foreign earnings that are indefinitely reinvested. The Company repatriates earnings of its foreign subsidiaries and therefore has recognized a deferred tax liability of $87 and $65 at June 30, 2026 and December 31, 2025, respectively.