Income Taxes |
9 Months Ended |
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Jun. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The Company recorded income tax expense of $2.4 million and $5.2 million during the three and nine months ended June 30, 2026, respectively, which were primarily driven by the profit mix in foreign jurisdictions, valuation allowance implications in the United States and state income taxes in jurisdictions where the Company does not have a net operating loss carry over. The Company recorded income tax expense of $2.6 million and $13.8 million during the three and nine months ended June 30, 2025, respectively. The tax expense for both periods was primarily driven by a $6.6 million tax expense related to the outside basis difference in a China subsidiary. The tax expense in each period was also driven by the profits in foreign jurisdictions and state income taxes in jurisdictions where the Company does not have a net operating loss carryover. The Company evaluates the realizability of its deferred tax assets and assesses the need for a valuation allowance on a quarterly basis. The Company operates in multiple countries under many legal forms and, as a result, is subject to domestic and foreign tax authorities in numerous jurisdictions. The Company evaluates the profitability of its operations in each jurisdiction on a historic cumulative basis and on a forward-looking basis, while carefully considering carry-forward periods of tax attributes and ongoing tax planning strategies in assessing the need for the valuation allowance. The Company maintains a valuation allowance against U.S. net deferred tax assets and against net deferred tax assets on certain foreign tax-paying components. The Company is subject to U.S. federal, state, local and foreign income taxes in various jurisdictions. The amount of income taxes paid is subject to the Company’s interpretation of applicable tax laws in the jurisdictions in which it files. During the fourth quarter of fiscal year 2025, the Company recorded an unrecognized tax benefit of $2.5 million related to a capital loss on one of its foreign subsidiaries based on its estimated tax return filing position. The Company filed its U.S. federal tax return in July 2026, which increased the amount of the capital loss and resulting tax refund claim. As the incremental capital loss claimed on the tax return filed has been determined to not meet the more-likely-than-not recognition standard under ASC 740, Income Taxes, the Company has recorded an additional unrecognized tax benefit of $17.5 million. The claim is expected to be subject to examination by the Internal Revenue Service and review by the Joint Committee on Taxation, and the ultimate resolution may differ from the amount currently recognized in the financial statements. The unrecognized tax benefit is reflected as a reduction to “Long-term income tax receivables” recorded in the Condensed Consolidated Balance Sheets. In the normal course of business, the Company is subject to income tax audits in various global jurisdictions in which it operates. The years subject to examination vary for the United States and international jurisdictions, with the earliest tax year being 2018. Based on the outcome of these examinations or the expiration of statutes of limitations for specific jurisdictions, it is reasonably possible that the related unrecognized tax benefits could change from those recorded in the Condensed Consolidated Balance Sheets. The Company currently does not anticipate that it is reasonably possible that the unrecognized tax benefits and accrued interest on those benefits will be reduced in the next twelve months. These unrecognized tax benefits would impact the effective tax rate if recognized.
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