INCOME TAXES |
6 Months Ended |
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Jun. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| INCOME TAXES | INCOME TAXES The Company uses the asset and liability method of accounting for income taxes. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted. The measurement of a deferred tax asset is reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. As of June 30, 2026, and June 30, 2025, no material valuation allowance has been recorded against the Company’s deferred tax assets. The Company applies a recognition threshold and measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For a tax benefit to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company has not identified any uncertain income tax positions that could have a material impact on the condensed consolidated financial statements. The Company recognizes interest and penalties accrued on any unrecognized tax exposures as a component of income tax expense; the Company did not have any such amounts accrued as of June 30, 2026, and December 31, 2025. Tax years from 2022 to 2025 remain subject to examination. For interim periods, the Company recognizes an income tax expense or benefit based on an estimated annual effective tax rate ("EAETR"), calculated on a worldwide consolidated basis, expected for the full fiscal year. The EAETR is based on the statutory tax rates then in effect and adjusted for estimated permanent differences. Discrete items, when material, are excluded from the EAETR and are recognized in the interim period in which they occur. These changes in permanent differences and discrete items result in variances to the effective tax rate from period to period. The Company’s EAETR changes throughout the year as on-going estimates of pre-tax income, and changes in permanent differences are revised. For the three and six months ended June 30, 2026, the Company recognized an income tax expense of approximately $0.4 million and $3.1 million on a net loss before income taxes of $3.4 million and $12.1 million, respectively. Income tax expense for the six month period included a discrete tax benefit of approximately $1.7 million related to a one‑time transaction that resulted in the recognition of a deferred tax asset. This discrete benefit was recognized in the period incurred and was excluded from the Company’s estimated annual effective tax rate. The Company’s effective tax rate for the three months ended June 30, 2026, was (10.4)%, The Company’s effective tax rate for the six months ended June 30, 2026, was (25.5)%, which was significantly impacted by the discrete item described above. For the three and six months ended June 30, 2025, the Company recognized an income tax expense (benefit) of approximately less than $(0.1) million and $4.1 million on a net loss before income taxes of $5.8 million and $12.3 million, respectively. The effective tax rate for the three and six months ended June 30, 2025 was 0.4% and (33.5)%, respectively. The effective tax rates for the periods differed from the federal statutory rate of 21% primarily due to state taxes, GAAP compensation incurred that is not deductible for tax purposes, as well as other items related to prior periods’ business combinations that generate permanent book/tax differences. The Company does not expect that any law changes enacted during the period will have a material impact on the provision for income taxes.
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