Income Taxes |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | NOTE 8: INCOME TAXES Each interim period is considered an integral part of the annual period; accordingly, we measure our income tax expense from continuing operations using an estimated annual effective tax rate. An enterprise is required, at the end of each interim reporting period, to make its best estimate of the annual effective tax rate for the full fiscal year and use that rate to provide for income taxes on a current year-to-date basis, as adjusted for discrete taxable events that occur during the interim period. Our income tax provision from continuing operations was $5.3 million and $6.5 million for the three and six months ended June 30, 2026, respectively, and our income tax provision from continuing operations was $8.4 million and $0.6 million for the three and six months ended June 30, 2025, respectively. The change in our income tax provision from continuing operations during the three months ended June 30, 2026, when compared to the same period in 2025, was primarily due to the decrease in pretax income. The change in our income tax provision during the six months ended June 30, 2026, when compared to the same period in 2025, was primarily due to a discrete tax benefit recorded during the first quarter of 2025 to release income tax reserves as a result of the U.S. federal statute of limitation of assessment expiring on tax years 2014, 2015, and 2016. Our effective tax rate for the three and six months ended June 30, 2026 differs from the U.S. federal statutory rate of 21.0%, primarily due to the benefit of foreign-derived deduction eligible income and the tax effects of stock-based compensation. Our accounting policy is to recognize accrued interest and penalties related to unrecognized tax benefits and income tax liabilities as part of our income tax expense. As of June 30, 2026, we had an accrued interest liability of $25.9 million, which was included in unrecognized tax benefits in other long-term liabilities on our unaudited condensed consolidated balance sheet, and no penalties were accrued. We are currently under examination by the Internal Revenue Service (“IRS”) for the 2018 tax year and have various ongoing audits for foreign and state income tax returns. These examinations may lead to proposed or ordinary course adjustments to our taxes. We are no longer subject to tax examinations by tax authorities for years prior to 2018. As of June 30, 2026, no material assessments have resulted, except as noted below regarding our 2012 through 2016 HM Revenue & Customs (“HMRC”) audit. In January 2021, we received from HMRC an issue closure notice relating to adjustments for 2012 through 2016 tax years. These proposed adjustments are related to deductions for intercompany financing and would result in an increase to income tax expense in an estimated range of $20.0 million to $30.0 million, which is inclusive of transition tax benefits and exclusive of interest expense, at the close of the audit if HMRC prevails. We disagree with the proposed adjustments, and we intend to defend our position through applicable administrative and, if necessary, judicial remedies. We are also currently subject to audit by HMRC in tax years 2017 through 2023. If HMRC were to seek adjustments of a similar nature through a closure notice for transactions in these years, we could be subject to significant additional tax liabilities. Our policy is to review and update tax reserves as facts and circumstances change. |