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Income Taxes
 6 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
Income Tax Disclosure Income Taxes
Accounting Policy
The Company accounts for income taxes under the liability method in accordance with ASC 740, Income Taxes. Under this method, deferred tax assets ("DTAs") and deferred tax liabilities ("DTLs") are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as for net operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
Deferred tax assets are reduced by a valuation allowance when, based on all available positive and negative evidence, it is more likely than not that some or all of those assets will not be realized.
Income Tax Benefit
The Company recorded an income tax benefit of $1.5 million for the three months ended June 30, 2026, compared to a benefit of $49 thousand for the three months ended June 30, 2025. For the six months ended June 30, 2026 and 2025, the income tax benefit was $1.5 million and $48 thousand, respectively.
The effective tax rate for the three months ended June 30, 2026 was approximately 110%, compared to approximately 1% for the three months ended June 30, 2025. The income tax benefit and effective tax rate for the 2026 period were primarily attributable to a discrete benefit of approximately $1.2 million resulting from the partial release of the valuation allowance maintained against the Company's deferred tax assets, as described below. Other significant items affecting the effective tax rate include state income tax impacts, executive compensation limitations under IRC Section 162(m) and stock compensation related adjustments. The effective tax rate for the current period is not indicative of the Company’s expected annual effective tax rate.
Deferred Tax Assets and Valuation Allowance

The following table presents the change in the net deferred tax position:
(In thousands)June 30, 2026December 31, 2025
Gross deferred tax assets$31,831 $30,992 
Valuation allowance(28,482)(30,992)
Deferred tax asset3,349 — 
Deferred tax liability(2,618)(783)
Net deferred tax asset (liability)731$(783)
At December 31, 2025, the Company maintained a full valuation allowance against its deferred tax assets and reported a net deferred tax liability of $783 thousand. At June 30, 2026, the Company recognized a deferred tax asset, net of the remaining valuation allowance and before offsetting deferred tax liabilities, of approximately $3.3 million. After offsetting deferred tax labilities of approximately $2.6 million, the Company reported a net deferred tax asset of $731 thousand.
During the quarter ended June 30, 2026, management evaluated all available positive and negative evidence and concluded that a portion of the Company’s deferred tax assets met the more likely than not recognition threshold. This conclusion was supported primarily by objectively verifiable positive evidence, including expected taxable income from sufficiently developed strategic actions, together with forecasted future taxable income as corroborative evidence. Accordingly, the Company released approximately $1.2 million of the valuation allowance previously maintained against those deferred tax assets and recognized a corresponding discrete income tax benefit. The change in the valuation allowance balance also reflects current period changes in the underlying deferred tax assets and temporary differences.
The Company continues to maintain a substantial valuation allowance against the remaining deferred tax assets, as cumulative consolidated losses in recent years constitute significant negative evidence regarding realizability. Management will continue to reassess the valuation allowance as additional objective evidence becomes available.
Section 382 Limitations

As of June 30, 2026, the Company had approximately $44.1 million of Federal net operating loss and recognized built-in loss carryforwards. Based on management’s preliminary Section 382 analysis, approximately $33.8 million of these tax attributes are expected to be subject to annual utilization limitation under Internal Revenue Code Section 382. The formal Section 382 study remains in process and is expected to be completed during 2026. Management will evaluate any additional refinements necessary for each reporting period completed. The Company has reflected the applicable Section 382 limitations, including those resulting from the 2025 ownership change, in its assessment of the realizability of its deferred tax assets.