Income Taxes |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Income Taxes [Abstract] | |
| INCOME TAXES | 8. INCOME TAXES
The Company is subject to taxation in the United States, in various state and local jurisdictions, and in the United Kingdom. The current income tax expense recorded in each period presented relates principally to the Texas franchise tax, which is assessed on gross margin rather than on taxable income.
The Company recorded income tax expense of approximately $0.2 million for each of the three and six months ended June 30, 2026, and an income tax benefit of less than $0.1 million and income tax expense of approximately $0.1 million for the three and six months ended June 30, 2025, respectively. The effective tax rate was (4.2)% and (2.2)% for the three and six months ended June 30, 2026, and 0.2% and (1.0)% for the three and six months ended June 30, 2025.
The provision for income taxes for interim periods is determined using an estimate of the Company’s annual effective tax rate, adjusted for discrete items arising in the period. The Company’s effective tax rate differs from the U.S. federal statutory rate of 21% primarily because the Company maintains a full valuation allowance against its net deferred tax assets. As a result of cumulative losses in both the United States and the United Kingdom, management has concluded that it is not more likely than not that those deferred tax assets will be realized, and accordingly no tax benefit has been recognized for losses incurred in the periods presented.
There have been no material changes to the Company’s deferred tax assets, valuation allowance or unrecognized tax benefits since December 31, 2025. The Company evaluates its tax positions on a quarterly basis and revises its estimates as appropriate. |