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INCOME TAXES
 6 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The following table summarizes the Company's income tax provision and effective tax rates for the three and six months ended June 30, 2026 and 2025 (in thousands, except percentages):

Three months endedSix months ended
June 30,June 30,
2026202520262025
Loss before income taxes$(1,553)$(704)$(2,669)$(3,352)
Income tax provision$2,018 $691 $4,669 $3,522 
Effective tax rate(130)%(98)%(175)%(105)%

The effective tax rates for the three and six months ended June 30, 2026 and 2025 were calculated using the discrete method based on the Company's period-to-date results adjusted for permanent and temporary differences.

Due to its cannabis operations, the Company is subject to the limitations of the U.S. Internal Revenue Code of 1986, as amended (the "IRC"), Section 280E under which the Company is only allowed to deduct expenses directly related to cost of goods sold of non-medical cannabis products. This results in permanent differences between ordinary and necessary business expenses deemed non-allowable under IRC Section 280E. As a result, the effective tax rate can be highly variable and may not necessarily correlate with pre-tax income and provides for effective tax rates that are well in excess of statutory tax rates.

On April 23, 2026, the U.S. Department of Justice (the "DOJ") issued a final order that placed both FDA-approved drugs containing cannabis and cannabis subject to a qualifying state medical list in Schedule III of the Controlled Substances Act. As a result, business conducted within these categories is no longer subject to IRC Section 280E, allowing for full deduction of ordinary and necessary business expenses. Due to the timing of when the final order was issued, the Company recorded the impact in its income tax provision for the three months ended June 30, 2026. The impact of this change in 280E applicability was a reduction in income tax expense of approximately $786,000 in each of the three and six months ended June 30, 2026. The Company continues to monitor guidance from the DOJ and the U.S. Internal Revenue Service (the "IRS") to properly record and disclose any impact in its future financial statements.

In February 2026, the IRS filed a lien against FSC in connection with an approximate $1 million tax liability for the 2023 and 2024 tax periods, which periods were prior to the FSC Acquisition Date. The Company recorded this liability as part of the allocation of the purchase consideration for FSC. The Company is disputing the assessment through a Collection Due Process (“CDP”) Hearing and pursuing a resolution, including potential reduction or collection alternatives. While the matter is pending, IRS enforcement is generally stayed. Although the liability is fully accrued in the accompanying condensed consolidated financial statements, an unfavorable outcome could materially impact the Company’s operations and financial position.

In June 2025, the IRS filed a lien against the Company in connection with an approximate $6 million 2023 tax liability. The Company is disputing the assessment through a CDP Hearing and pursuing a resolution, including potential reduction or collection alternatives. While the matter is pending, IRS enforcement is generally stayed. Although the liability is fully accrued in the accompanying condensed consolidated financial statements, an unfavorable outcome could materially impact the Company’s operations and financial position.