Income Taxes |
9 Months Ended |
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Sep. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The Company’s effective tax rate was 22.9% and 22.8% for the three and nine months ended September 30, 2026, respectively. For the three and nine months ended September 30, 2025, the Company’s effective tax rate was 25.2% and 24.4%, respectively. For the three and nine months ended September 30, 2026 and 2025, the differences between the effective tax rate and the federal statutory rate were primarily due to state income taxes offset by other foreign adjustments. Each interim period is considered an integral part of the annual period and tax expense or benefit is measured using an estimated annual effective income tax rate. The estimated annual effective tax rate for the full year is applied to the respective interim period, taking into account year-to-date amounts and projected amounts for the year. Since the Company operates in foreign countries with varying tax rates, the Company’s quarterly effective tax rate is dependent on the level of income or loss from international operations in the reporting period. The Company’s subsidiary in Costa Rica is operating under a 100% tax holiday through April 6, 2034. The impact of the tax holiday in Costa Rica for the three and nine months ended September 30, 2026 and 2025, was immaterial. The Company is subject to income taxes in the U.S. and foreign jurisdictions. Significant judgment is required in evaluating uncertain tax positions and determining the provision for income taxes. The Company continues to evaluate the realizability of its deferred tax assets on a quarterly basis. In prior periods, the Company recorded valuation allowances in certain foreign jurisdictions primarily due to cumulative losses and other negative evidence. The Company has continued to improve business performance and has consistently generated pre-tax income in recent quarters in certain foreign jurisdictions in which it recorded valuation allowances. This recent profitability represents positive evidence that the Company is weighing against the historical negative evidence in assessing the realizability of its deferred tax assets. If the Company is able to sustain its current level of profitability and generate sufficient future taxable income, it is reasonably possible that a reduction of a significant portion of the valuation allowances may be appropriate in a future reporting period. Any such reduction could result in a material income tax benefit in the period recognized and could have a significant impact on the Company’s effective tax rate and earnings. The Company’s assessment remains dependent on the level and sustainability of future earnings and other relevant factors in these foreign jurisdictions. In December 2021, the Organization for Economic Cooperation and Development (“OECD”) enacted model rules for a new global minimum tax framework (“Pillar Two”). Under the Pillar Two rules, a company is required to determine a combined effective tax rate for each jurisdiction. If the jurisdictional effective tax rate determined under the Pillar Two rules is less than 15%, a top-up tax will be due to bring the jurisdictional effective tax rate up to 15%. In December 2022, European Union Member States adopted a directive implementing the Pillar Two rules requiring Member States to enact the directive into their national laws and these began to go into effect from January 1, 2024. The Company has estimated the applicable top-up tax and recorded this in tax expense for the three and nine months ended September 30, 2026. The estimated impact of top-up tax for the three and nine months ended September 30, 2026 was immaterial. On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (“OBBBA”), which includes a broad range of tax reform provisions affecting businesses. The legislation features permanent extension, with modifications, of key 2017 Tax Cuts and Jobs Act provisions that were set to change at the end of 2025. The effects of the OBBBA were included in the Company’s condensed consolidated financial statements for the three and nine months ended September 30, 2026 and 2025, and the impact was immaterial.
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