INCOME TAXES |
6 Months Ended | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2026 | |||||||||||||
| Income Tax Disclosure [Abstract] | |||||||||||||
| INCOME TAXES |
Our provision for income taxes is calculated using an estimated annual effective tax rate (“AETR”), which is based upon projected annual income or loss, including anticipated losses in certain jurisdictions, non-deductible expenses under applicable federal and local tax laws, statutory rates, and planned tax strategies across the jurisdictions in which we operate. Certain items that do not relate directly to ordinary income are excluded from the AETR and are recognized in the period in which they occur. Our effective tax rate was 32.4% and 26.8% for the three months ended June 30, 2026 and June 30, 2025, respectively, and 37.5% and 35.5% for the six months ended June 30, 2026 and June 30, 2025, respectively. The effective tax rate for the three months ended June 30, 2026 differed from the blended U.S. federal and state statutory tax rate primarily due to projected losses in certain foreign jurisdictions for which no tax benefit was recognized as a result of valuation allowances with respect to such foreign jurisdictions, as well as discrete tax benefits related to uncertain tax positions and the effective settlement of a domestic tax audit, partially offset by penalties accrued for foreign tax matters. The effective tax rate for the three months ended June 30, 2025 was generally consistent with the blended U.S. federal and state statutory tax rate, with no significant variances. The effective tax rate for the six months ended June 30, 2026 differed from the blended U.S. federal and state statutory tax rate primarily due to projected losses in certain foreign jurisdictions for which no tax benefit was recognized as a result of valuation allowances with respect to such foreign jurisdictions, as well as discrete tax benefits related to uncertain tax positions, partially offset by a $6 million cumulative adjustment related to a foreign tax provision and penalties accrued for foreign tax matters. The effective tax rate for the six months ended June 30, 2025 differed from the blended U.S. federal and state statutory tax rate primarily due to the effect of losses incurred in certain non-U.S. jurisdictions for which no tax benefit was recognized. Additionally, permanent differences between the book and tax treatment contributed to the variance from the statutory rate. Our income tax returns remain subject to examination by the relevant tax authorities in various jurisdictions for tax years 2007 through 2025. The amount of the unrecognized tax benefits may change within the next twelve months as a result of audits, settlements with tax authorities, or the expiration of statutes of limitations. During the third quarter of 2025, the One Big Beautiful Bill Act (Public Law 119-21) was signed into law, making several provisions of the Tax Cuts and Jobs Act permanent. Under ASC 740, “Income Taxes,” the effects of changes in tax laws are recognized in the period of enactment. The provisions effective during the first six months of 2026 did not have a material impact on our effective tax rate for the three months or six months ended June 30, 2026, but we continue to assess the potential impact of these legal changes, including provisions that become effective later in 2026, on our business and financial results.
|
||||||||||||