XML 45 R26.htm IDEA: XBRL DOCUMENT
v3.24.0.1

INCOME TAXES | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The domestic and foreign components of income before income taxes consisted of the following:
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
| (In thousands)
United States | $ | 465,463 |  |  | $ | 417,636 |  |  | $ | 102,886 |
Foreign | 47,676 |  |  | 34,412 |  |  | 18,042 |
Income before income taxes | $ | 513,139 |  |  | $ | 452,048 |  |  | $ | 120,928 |
The income taxes provision for (benefit from) the years presented is as follows:
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
| (In thousands)
Current: |  |  |  |  |
Federal | $ | 96,151 |  |  | $ | 34,499 |  |  | $ | — |
State | 13,937 |  |  | 9,719 |  |  | 488 |
Foreign | 11,303 |  |  | 10,605 |  |  | 6,232 |
| 121,391 |  |  | 54,823 |  |  | 6,720 |
Deferred: |  |  |  |  |
Federal | (50,211) |  |  | (6,245) |  |  | (28,398) |
State | 1,287 |  |  | 3,806 |  |  | (4,380) |
Foreign | 1,736 |  |  | 2,305 |  |  | 1,537 |
| (47,188) |  |  | (137) |  |  | (31,241) |
Income taxes provision for (benefit from) | $ | 74,203 |  |  | $ | 54,686 |  |  | $ | (24,521) |
A reconciliation of the income taxes provision (benefit) and the amount computed by applying the statutory federal income tax rate of 21% to income before income taxes for the years presented is as follows:
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
| (In thousands)
Income tax provision at statutory federal rate | $ | 107,760 |  |  | $ | 94,926 |  |  | $ | 27,681 |
State taxes, net of federal benefit | 18,107 |  |  | 9,980 |  |  | 489 |
Foreign tax rate and tax law differential | 5,965 |  |  | 4,905 |  |  | 1,073 |
Tax credits | (29,229) |  |  | (19,864) |  |  | (15,632) |
Non-taxable income related to Section 45X tax credits | (11,229) |  |  | — |  |  | — |
Stock-based compensation | (13,969) |  |  | (45,551) |  |  | (80,950) |
Other permanent items | (964) |  |  | 4,149 |  |  | 178 |
Other nondeductible/nontaxable items | (724) |  |  | (62) |  |  | 2,316 |
Uncertain tax positions | 8,432 |  |  | 6,073 |  |  | 6,911 |
Foreign-derived intangible income deduction | (15,391) |  |  | (9,161) |  |  | — |
Section 162(m) | 5,445 |  |  | 9,291 |  |  | 25,812 |
Convertible notes settlements | — |  |  | — |  |  | 8,223 |
Warrant mark-to-mark adjustment | — |  |  | — |  |  | (622) |
Income tax provision (benefit) | $ | 74,203 |  |  | $ | 54,686 |  |  | $ | (24,521) |
A summary of significant components of the Company’s deferred tax assets and liabilities as of December 31, 2023 and 2022 is as follows:
| December 31,
| 2023 |  | 2022
| (In thousands)
Deferred tax assets: |  |  |
Allowances and reserves | $ | 53,191 |  |  | $ | 40,166 |
Net operating loss and tax credit carryforwards | 23,267 |  |  | 26,748 |
Stock-based compensation | 15,811 |  |  | 20,230 |
Deferred revenue | 53,656 |  |  | 40,120 |
Fixed assets, goodwill and intangibles | — |  |  | 609 |
Convertible notes and related hedges | 38,773 |  |  | 49,405 |
Capitalized research and development expense | 83,098 |  |  | 47,870 |
Other | 15,189 |  |  | 11,099 |
Subtotal | 282,985 |  |  | 236,247 |
Total deferred tax assets | 282,985 |  |  | 236,247 |
Deferred tax liabilities: |  |  |
Fixed assets and intangibles | (2,833) |  |  | — |
Unremitted foreign earnings | (5,189) |  |  | (3,755) |
Deferred cost of goods sold | (27,782) |  |  | (32,449) |
Total deferred tax liabilities | (35,804) |  |  | (36,204) |
Net deferred tax asset | $ | 247,181 |  |  | $ | 200,043 |
The Company's accounting for deferred taxes involves the evaluation of a number of factors concerning the realizability of the Company's deferred tax assets. Assessing the realizability of deferred tax assets is dependent upon several factors, including the likelihood and amount, if any, of future taxable income in relevant jurisdictions during the periods in which those temporary differences become deductible. The Company's management forecasts taxable income by considering all available positive and negative evidence including its history of operating income or losses and its financial plans and estimates which are used to manage the business. These assumptions require significant judgment about future taxable income. The amount of deferred tax assets considered realizable is subject to adjustment in future periods if estimates of future taxable income are reduced. As of December 31, 2023, the Company evaluated its undistributed foreign earnings and identified $81.6 million in earnings that it does consider to be permanently reinvested that may be subject to withholding taxes in local jurisdictions when they are distributed. The Company has recorded a provision of approximately $5.2 million for the taxes that would fall due when such earnings are repatriated. The Company has approximately $5.0 million of federal tax credit and $12.7 million of state tax credit carryforwards. The federal credits begin to expire in 2031 and the state credits can be carried forward indefinitely. As of December 31, 2023, the Company has foreign net operating losses of $5.9 million from GreenCom acquisition, which can be carried over indefinitely. Utilization of some of the federal credit carryforwards and state net operating loss and credit carryforwards are subject to annual limitations due to the “change in ownership” provisions of the Code and similar state provisions. The Company believes that no such change has occurred through December 31, 2023. Accounting for uncertain tax positions prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is required to recognize in the financial statements the impact of a tax position, if that position is more-likely than-not of being sustained on audit, based on the technical merits of the position. The Company recorded a net charge for unrecognized tax benefits in 2023 of $5.5 million. The Company does not have any tax positions for which it is reasonably possible the total amount of gross unrecognized tax benefits will increase or decrease over the next year. The unrecognized tax benefits may increase or change during the next year for items that arise in the ordinary course of business. As of December 31, 2023, the total amount of gross unrecognized tax benefits was $27.2 million, of which $25.4 million, if recognized, would impact the Company’s effective tax rate. A tabular reconciliation of the total amounts of unrecognized tax benefits for the years presented is as follows (in thousands):
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
Unrecognized tax benefits—at beginning of year | $ | 21,768 |  |  | $ | 20,904 |  |  | $ | 8,421 |
Increases (decreases) in balances related to tax positions taken in prior years | (417) |  |  | (4,786) |  |  | 4,391 |
Increases in balances related to tax positions taken in current year | 5,985 |  |  | 6,562 |  |  | 8,301 |
Settlements | — |  |  | (657) |  |  | — |
Lapses in statutes of limitations | (118) |  |  | (255) |  |  | (209) |
Unrecognized tax benefits—at end of year | $ | 27,218 |  |  | $ | 21,768 |  |  | $ | 20,904 |
The Company includes interest and penalties related to unrecognized tax benefits within the income tax provision for (benefit from). In the year ended December 31, 2023, 2022 and 2021, the total amount of gross interest and penalties accrued was $2.9 million, $0.8 million and $0.3 million, respectively. Both the unrecognized tax benefits and the associated interest and penalties that are not expected to result in payment or receipt of cash within one year are classified as other non-current liabilities in the consolidated balance sheets. In connection with tax matters, the Company’s interest and penalty expense recognized in 2023, 2022 and 2021 in the consolidated statements of operations was $3.8 million, $0.9 million and $1.4 million, respectively. The Company’s tax returns continue to remain effectively subject to examination by U.S. federal authorities for the years 2006 and onwards and by California state authorities for the years 2006 and onwards due to use and carryovers of net operating losses and tax credits. The Company is currently under audit in India. In August 2022, the U.S. enacted the IRA, which included revisions to the Internal Revenue Code of 1986, as amended (the “Code”). The IRA introduced a 15% corporate alternative minimum income tax (“CAMT”) for corporations whose average adjusted financial income for any consecutive three-year period ending after December 31, 2021, exceeds $1.0 billion. Further, the IRA also extended the investment tax credits for clean energy and expanded the incentives to clean energy manufacturing. For the year ended December 31, 2023, the Company is not subject to the CAMT based on its current operating results and interpretations of the latest IRA guidance. The Company recognized $53.5 million reduction in costs of goods sold and income taxes payable related to the AMPTC. In December 2021, the Organization for Economic Co-operation and Development Inclusive Framework on Base Erosion Profit Shifting released Model Global Anti-Base Erosion rules (“Model Rules”) under Pillar Two. The Model Rules set forth the “common approach” for a Global Minimum Tax at 15 percent for multinational enterprises with a turnover of more than 750 million euros. Rules under Pillar Two were effective from January 1, 2024. The Company does not expect adoption of Pillar Two rules to have a significant impact on its consolidated financial statements in 2024.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration