XML 38 R18.htm IDEA: XBRL DOCUMENT v3.25.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of income (loss) before income taxes are as follows:
 Year Ended December 31, 
 202420232022
 $$$
U.S.201,516 117,446 67,744 
PRC(263,159)(315,852)(583,610)
Other(471,358)(627,430)(1,445,171)
Total(533,001)(825,836)(1,961,037)
The current and deferred components of the income tax expense (benefit) from continuing operations are as follows:
 Year Ended December 31, 
 202420232022
 $$$
Current tax expense (benefit)   
U.S.57,222 25,170 4,844 
PRC12,331 24,956 27,905 
Other16,225 5,059 6,547 
Total85,778 55,185 39,296 
Deferred tax expense (benefit)
U.S.23,556 — — 
PRC180 687 3,480 
Other2,271 — 2 
Total26,007 687 3,482 
Income tax expense (benefit)111,785 55,872 42,778 
The reconciliation of the statutory tax rate to our effective income tax rate is as follow:
 Year Ended December 31, 
 202420232022
 $$$
Loss before tax(533,001)(825,836)(1,961,037)
U.S. statutory tax rate21 %21 %21 %
Expected taxation at U.S. statutory tax rate(111,930)(173,426)(411,818)
Foreign and preferential tax rate differential93,741 144,310 209,384 
Non-deductible expenses1,130 19,134 29,223 
Stock compensation expenses53,446 32,581 33,872 
State tax expense (benefit)(7,988)(5,872)1,683 
Change in valuation allowance157,286 845,811 229,550 
Tax relief credits— (704,928)— 
Research tax credits and incentives(43,602)(64,343)(42,844)
Deductible research expenses(13,644)— — 
Tax on unremitted earnings23,743 — — 
Foreign-derived intangible income(40,397)(37,395)(6,272)
Taxation for the year111,785 55,872 42,778 
Effective tax rate(21.0)%(6.8)%(2.2)%
Significant components of deferred tax assets (liabilities) are as follows:
 Year Ended December 31,
 202420232022
 $ $ $ 
Accruals and reserves121,549 106,708 97,896 
Net operating losses carryforward1,137,890 996,588 862,214 
Stock-based compensation38,397 26,687 19,700 
Research tax credits34,561 68,117 86,000 
Tax relief credits704,928 704,928 — 
Intangible asset amortization1,081,442 699,974 813,043 
Lease liability obligation11,882 7,893 10,348 
R&D and other capitalized costs277,061 164,190 63,156 
Total gross deferred tax assets3,407,710 2,775,085 1,952,357 
Less valuation allowance(3,403,505)(2,771,470)(1,943,775)
Net deferred tax assets4,205 3,615 8,582 
Property, plant and equipment, net(10,795)(12,374)(14,480)
Tax on unremitted earnings(23,735)— — 
Right of use asset(11,682)(7,735)(10,098)
Total gross deferred tax liabilities(46,212)(20,109)(24,578)
Net deferred tax assets/(liabilities)(42,007)(16,494)(15,996)
Valuation allowances have been provided on deferred tax assets where, based on all available evidence, it was considered more likely than not that some portion or all of the recorded deferred tax assets will not be realized in future periods. After consideration of all positive and negative evidence, the Company believes that as of December 31, 2024, it is more likely than not that net deferred tax assets will not be realized. Adjustments may be required in the future if the Company estimates that the amount of deferred tax assets to be realized is more or less than the net amount recorded.
The valuation allowances for the years ended December 31, 2024, 2023 and 2022 were as follows:
 Year Ended December 31,
 202420232022
 $ $ $ 
Beginning balance, as of January 12,771,470 1,943,775 1,758,409 
Additions/(subtractions) charged to income tax provision157,286 845,811 229,550 
Additions/(subtractions) charged to equity497,823 — — 
Currency translation and other(23,074)(18,116)(44,184)
Ending balance, as of December 313,403,505 2,771,470 1,943,775 
As of December 31, 2024 and 2023, the Company had net operating losses of approximately $6,720,659 and $5,945,753, respectively. As of December 31, 2024, net operating losses were primarily comprised of: $2,185,546 from entities in the PRC which expire in years 2025 through 2034; and $4,526,020 derived from Switzerland which expires in years 2025 through 2031. The Company has approximately $43,677 of U.S. research tax credits which will expire between 2036 and 2044 and approximately $704,928 of Switzerland tax relief credits which will expire in 2028, if not utilized.
The gross unrecognized tax benefits for the years ended December 31, 2024, 2023 and 2022 were as follows:
 Year Ended December 31,
 202420232022
 $ $ $ 
Beginning balance, as of January 114,264 11,555 9,925 
Additions based on tax positions related to prior tax years— — — 
Reductions based on tax positions related to prior tax years— — — 
Additions based on tax positions related to the current tax year2,975 2,709 1,630 
Reductions based on lapse of statute of limitations— — — 
Ending balance, as of December 3117,239 14,264 11,555 
Current and prior year additions include assessment of U.S. federal and state tax credits and incentives. As of December 31, 2024, the Company had $17,239 of unrecognized tax benefits substantially all of which, if recognized, would reduce the effective tax rate. The Company does not anticipate that the amount of existing unrecognized tax benefits will significantly change within the next 12 months.
The Company has elected to record interest and penalties related to income taxes as a component of income tax expense. For the years ended December 31, 2024, 2023 and 2022, the Company’s accrued interest and penalties, where applicable, related to uncertain tax positions were not material.
The Company conducts business in a number of tax jurisdictions and, as such, is required to file income tax returns in multiple jurisdictions globally. As of December 31, 2024, Australia tax matters are open to examination for the years 2013 through 2024, China tax matters are open to examination for the years 2014 through 2024, Switzerland tax matters are open to examination for the years 2021 through 2024, and U.S. federal tax matters are open to examination for years 2015 through 2024. Various U.S. states and other non-US tax jurisdictions in which the Company files tax returns remain open to examination for 2014 through 2024.
The Company qualifies for the Technology Advanced Service Enterprises and High and New Technology Enterprise status for certain subsidiaries in China, which begin to expire at the end of 2025. The income tax benefits attributable to this status for the year ended December 31, 2024 is approximately $4,631, or less than $0.01 per share outstanding.
During 2024, the Company concluded that a portion of earnings from certain subsidiaries, primarily in the U.S. and Canada, are no longer indefinitely reinvested. As a result, the Company recognized a deferred tax liability of $23,735. The Company continues to assert that earnings in other jurisdictions remain permanently reinvested.