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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income from Operations Before Income Taxes

The components of income from operations before income taxes are as follows:

		For the Years Ended December 31,
		2018				2017				2016
		(Amounts in thousands)
Domestic		$	(73	)		$	(6,709	)		$	(4,882	)
Foreign			21,509				13,957				16,574
Income from operations before income taxes		$	21,436			$	7,248			$	11,692

Provision for Income Taxes

The components of the income tax provision (benefit) from operations are as follows:

		For the Years Ended December 31,
		2018				2017				2016
		(Amounts in thousands)
Current and deferred components of the tax provision (benefit) from operations:
Current		$	4,354			$	3,624			$	4,077
Deferred			465				(24,729	)			(4,066	)
Total		$	4,819			$	(21,105	)		$	11
Jurisdictional components of the tax provision (benefit) from operations:
Federal		$	(393	)		$	(24,012	)		$	(3,809	)
State			718				(438	)			(207	)
Foreign			4,494				3,345				4,027
Total		$	4,819			$	(21,105	)		$	11

Consolidated Deferred Tax Assets (Liabilities)

		December 31,
		2018				2017
		(Amounts in thousands)
Deferred tax assets:
Temporary timing differences:
Stock-based compensation expense		$	2,874			$	1,662
Contingent consideration			2,263				2,196
Other			2,632				1,704
Total temporary timing differences			7,769				5,562
Net operating loss carryforwards			—				4,361
Tax business credits carryforwards			2,004				1,265
Total deferred tax assets			9,773				11,188
Less: Valuation allowance			(131	)			(6	)
Net deferred tax assets			9,642				11,182
Deferred tax liabilities:
Goodwill			(1,076	)			(807	)
Acquired intangible assets			(26,903	)			(32,359	)
Conversion option on convertible notes			(2,394	)			(3,183	)
Total deferred tax liabilities			(30,373	)			(36,349	)
Total net deferred tax liabilities		$	(20,731	)		$	(25,167	)

Reconciliation of Federal Statutory Rate to Effective Income Tax Rate

The reconciliation of the federal statutory rate to the effective income tax rate for the years ended December 31, 2018, 2017 and 2016 is as follows:

		For the Years Ended December 31,
		2018								2017								2016
		Amount				%				Amount				%				Amount				%
		(Amounts in thousands, except percentages)
Income before income taxes		$	21,436							$	7,248							$	11,692
Expected tax at statutory rate			4,502				21.0	%			2,537				35.0	%			3,975				34.0	%
Adjustments due to:
Difference between U.S. and foreign tax			345				1.6	%			(1,797	)			(24.8	%)			(2,031	)			(17.4	%)
State income and franchise tax			(146	)			(0.7	%)			(307	)			(4.2	%)			(326	)			(2.8	%)
Business tax credits			(1,523	)			(7.1	%)			(708	)			(9.8	%)			(236	)			(2.0	%)
Permanent differences:
Stock-based compensation expense			(1,213	)			(5.7	%)			(946	)			(13.1	%)			31				0.3	%
Transaction costs			—				0.0	%			1,232				17.0	%			156				1.3	%
U.S. taxation of foreign earnings			2,190				10.2	%			—				0.0	%			—				0.0	%
Executive compensation			367				1.7	%			265				3.7	%			—				0.0	%
Other			97				0.5	%			205				2.8	%			380				3.3	%
Change in U.S. federal tax rates			—				0.0	%			(12,839	)			(177.1	%)			—				0.0	%
Change in U.S. state tax rates			748				3.5	%			(151	)			(2.1	%)			—				0.0	%
Change in Netherlands tax rate			(388	)			(1.8	%)			—				0.0	%			—				0.0	%
Transition tax			(1,338	)			(6.2	%)			3,266				45.1	%			—				0.0	%
Uncertain tax provisions			1,021				4.8	%			241				3.3	%			—				0.0	%
Change in valuation allowance			125				0.6	%			(12,164	)			(167.8	%)			(1,981	)			(16.9	%)
Return to provision adjustments			33				0.2	%			(161	)			(2.2	%)			—				0.0	%
Other			(1	)			(0.1	%)			222				3.0				43				0.4	%
Income tax provision (benefit)		$	4,819				22.5	%		$	(21,105	)			(291.2	%)		$	11				0.1	%

Summary of Tax Returns Periods Subject to Examination by Federal, State and International Taxing Authorities

The Company’s tax returns are subject to examination by federal, state and international taxing authorities for the following periods:

Jurisdiction		Fiscal Years Subject to Examination
United States – federal and state			2015-2018
Sweden			2012-2018
Germany			2017-2018
Netherlands			2012-2018

Reconciliation of Unrecognized Tax Benefits

The following is a tabular reconciliation of the total amounts of unrecognized tax benefits:

		For the Years Ended December 31,
		2018				2017
		(Amounts in thousands)
Balance of gross unrecognized tax benefits, beginning of period		$	1,806			$	1,407
Gross amounts of increases in unrecognized tax benefits as a result of tax positions taken in the current period			1,062				199
Gross amounts of increases in unrecognized tax benefits as a result of tax positions taken in the prior period			—				679
Gross amounts of decrease due to release			(16	)			(479	)
Balance of gross unrecognized tax benefits, end of period		$	2,852			$	1,806

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- Definition

Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Tabular disclosure of income tax examinations that an enterprise is currently subject to or that have been completed in the current period typically including a description of the examination, the jurisdiction conducting the examination, the tax year(s) under examination, the likelihood of an unfavorable settlement, the range of possible losses, the liability recorded, the increase or decrease in the liability from the prior period, and any penalties and interest that have been recorded.

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