Quarterly report [Sections 13 or 15(d)]

Income Taxes

v3.25.3
Income Taxes
 9 Months Ended
Sep. 30, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Interim income taxes are based on an estimated annualized effective tax rate applied to the respective quarterly periods, adjusted for discrete tax items in the period in which they occur. Although the Company believes its tax estimates are reasonable, the Company can make no assurance that the final tax outcome of these matters will not be different from that which it has reflected in its historical income tax provisions and accruals. The Company will adjust its liability for uncertain tax positions, if any, based on changes in facts and circumstances such as the closing of a tax audit or changes in estimates. The Company’s income tax provision may be impacted to the extent that the final outcome of these tax positions is different than the position taken.
The Company is subject to income taxes in the United States and Australia. Significant judgment is required in evaluating the Company’s tax positions and determining the provision for income taxes. During the ordinary course of business, the Company considers tax positions for which the ultimate tax determination is uncertain for the purpose of determining whether a reserve is required, despite the Company’s belief that the tax positions are fully supportable. To date the Company has not established a reserve provision because the Company believes that all tax positions are highly certain.
The following table summarizes our effective tax rate for the periods presented:
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Loss before income taxes $ (4,087) $ (5,529) $ (16,043) $ (16,238)
(Provision for) benefit from income taxes
 (873) 90 (892) (395)
Effective tax rate (21)% 2% (6)% (2)%
For the three and nine months ended September 30, 2025, as compared to the same periods in the prior year, the Company’s effective tax rate changed due to current tax expense as a result of amended tax amounts owed in relation to the acquisition of mnml. The effective tax rate was lower than the U.S. statutory rate of 21.0% for the three and nine months ended September 30, 2025 primarily due to non-deductible permanent differences in the U.S. and a full valuation allowance on the net deferred tax assets in U.S. and Australia.
One Big Beautiful Bill Act
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was signed into law. Some of the provisions of the OBBBA affecting corporations include the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, increasing the limit of the deduction of interest expense to thirty percent of EBITDA, fully deducting domestic research and experimental expenditures, and one hundred percent bonus depreciation on eligible property acquired after January 19, 2025. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. As a result of these provisions, the Company expects to recognize a cash tax benefit in 2025. However, the Company does not anticipate the OBBBA will have a significant/material impact on its current effective tax rate and net deferred federal tax liabilities for the nine months ended September 30, 2025.