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Income Taxes
 9 Months Ended
Sep. 30, 2025
Income Tax Disclosure [Abstract]  
Income Taxes

Note 8. Income Taxes

The Company’s income tax expense and related balance sheet accounts reflect the consolidated results of the Company and its subsidiaries.

In accordance with ASC 740-270, Interim Reporting, the Company evaluates its best estimate of the annual effective tax rate at the end of each interim reporting period. This estimated rate is applied to year-to-date pre-tax income to determine the interim provision for income taxes. When a reliable estimate of the annual effective tax rate cannot be made, due to factors such as volatility in projected earnings or discrete tax events, the Company may apply the actual effective tax rate for the interim period, as permitted under the guidance.

For the three and nine months ended September 30, 2025, the Company estimated its annual effective tax rate based on projected full-year income and applied this rate to year-to-date pre-tax income. The resulting tax provision was adjusted to reflect discrete tax items recognized during the period.

The effective income tax rates for the three and nine months ended September 30, 2025 was (44.5)% and 13.9%, respectively. The Company’s effective income tax rates for the three and nine months ended September 30, 2025 differed from the U.S. federal statutory rate of 21% primarily due to the jurisdictional mix of earnings, U.S. state income taxes, and non-deductible share-based compensation. The jurisdictional mix was impacted by significant acquisition-related depreciation and amortization, which contributed to a U.S. pre-tax loss while generating pre-tax income in most foreign jurisdictions.

For the three and nine months ended September 30, 2024, the Company applied the actual effective tax rate for the interim period, as it was unable to reasonably estimate the annual effective tax rate due to variability in forecasted income and fluctuations in quarterly results.

The effective income tax rates for the three and nine months ended September 30, 2024 was (9.7)% and (0.8)%, respectively. The Company’s effective income tax rates for the three and nine months ended September 30, 2024 were lower than the U.S. federal statutory rate of 21% primarily due to a jurisdictional mix of earnings with the Company recording significant expenses in the U.S. related to the Sterling Acquisition, nondeductible share-based compensation, and U.S. state income taxes.