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INCOME TAXES | 12 Months Ended
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Dec. 31, 2025
Income Tax Disclosure [Abstract] |
INCOME TAXES | 7. INCOME TAXES The components of loss before income tax were as follows:
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
Domestic | $ | (55.4) |  |  | $ | (84.0) |  |  | $ | (118.5) |
Foreign | 9.5 |  |  | 5.5 |  |  | 7.3 |
Total | $ | (45.9) |  |  | $ | (78.5) |  |  | $ | (111.2) |
Income tax expense consisted of the following:
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
Current taxes: |  |  |  |  |
State | $ | (0.1) |  |  | $ | 0.7 |  |  | $ | — |
Foreign | 5.3 |  |  | — |  |  | 5.0 |
Total current | $ | 5.2 |  |  | $ | 0.7 |  |  | $ | 5.0 |
Deferred taxes: |  |  |  |  |
Foreign | $ | (0.1) |  |  | $ | 0.3 |  |  | $ | 0.4 |
Total deferred | $ | (0.1) |  |  | $ | 0.3 |  |  | $ | 0.4 |
Total income tax expense | $ | 5.1 |  |  | $ | 1.0 |  |  | $ | 5.4 |
The reconciliation between the U.S. federal statutory income tax rate and our effective tax rate as a percentage of loss before income taxes was as follows:
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
U.S. federal statutory tax rate | $ | (9.8) |  | 21.0 | % |  | $ | (16.0) |  | 21.0 | % |  | $ | (23.4) |  | 21.0 | %
State and local income taxes* | (0.5) |  | 1.2 | % |  | (0.5) |  | 0.7 | % |  | (1.2) |  | 1.1 | %
Effect of cross-border tax laws |  |  |  |  |  |  |  |
GILTI | — |  | — | % |  | — |  | — | % |  | (5.9) |  | 5.3 | %
Withholding tax | (0.6) |  | 1.4 | % |  | 0.4 |  | (0.5) | % |  | (0.8) |  | 0.7 | %
Partnership income | 1.1 |  | (2.4) | % |  | — |  | — | % |  | — |  | — | %
Other | (0.1) |  | 0.1 | % |  | — |  | — | % |  | — |  | — | %
Tax credits |  |  |  |  |  |  |  |
Research and development credits | (2.5) |  | 5.4 | % |  | (4.3) |  | 5.7 | % |  | (12.2) |  | 10.9 | %
Changes in valuation allowances | 9.0 |  | (19.4) | % |  | (1.8) |  | 2.3 | % |  | 34.1 |  | (30.6) | %
Nontaxable or nondeductible items |  |  |  |  |  |  |  |
Base erosion payment waived | (5.1) |  | 11.1 | % |  | 8.4 |  | (11.0) | % |  | — |  | — | %
Stock-based compensation | 9.4 |  | (20.2) | % |  | 13.7 |  | (18.0) | % |  | 5.8 |  | (5.2) | %
Other | (0.2) |  | 0.5 | % |  | 0.2 |  | (0.3) | % |  | 0.2 |  | (0.2) | %
Other adjustments | 0.1 |  | (0.1) | % |  | (0.4) |  | 0.5 | % |  | (0.1) |  | 0.1 | %
India |  |  |  |  |  |  |  |
Withholding tax | 0.3 |  | (0.6) | % |  | (2.4) |  | 3.2 | % |  | 1.8 |  | (1.6) | %
Other | 0.3 |  | (0.8) | % |  | 0.1 |  | (0.2) | % |  | 0.1 |  | (0.1) | %
Peru |  |  |  |  |  |  |  |
Withholding tax | 0.5 |  | (1.1) | % |  | 0.5 |  | (0.6) | % |  | 0.5 |  | (0.5) | %
Other foreign jurisdictions | 2.0 |  | (4.5) | % |  | 3.1 |  | (4.1) | % |  | 1.6 |  | (1.4) | %
Changes in unrecognized tax benefits | 1.2 |  | (2.6) | % |  | — |  | — | % |  | 4.9 |  | (4.3) | %
Total income tax expense | $ | 5.1 |  | (11.0) | % |  | $ | 1.0 |  | (1.3) | % |  | $ | 5.4 |  | (4.8) | %
*Income taxes in California for 2023, 2024, and 2025 made up the majority (greater than 50%) of the state tax effect. Significant components of our deferred tax assets and liabilities consisted of the following:
| December 31, 2025 |  | December 31, 2024
Deferred tax assets: |  |  |
Net operating loss carryforwards | $ | 126.1 |  |  | $ | 112.2 |
Capitalized research and development costs | 62.0 |  |  | 70.0 |
Research and development credits | 51.1 |  |  | 47.5 |
Stock-based compensation | 5.1 |  |  | 6.8 |
Transaction costs | 2.7 |  |  | — |
Lease liabilities | 1.1 |  |  | 0.7 |
Deferred revenue | 1.0 |  |  | 0.8 |
Accruals and reserves | 1.2 |  |  | 1.3 |
Partnership income | 1.0 |  |  | — |
Gross deferred tax assets | 251.3 |  |  | 239.3 |
Valuation allowance | (236.4) |  |  | (224.4) |
Total deferred tax assets | $ | 14.9 |  |  | $ | 14.9 |
Deferred tax liabilities: |  |  |
Deferred commissions | (5.7) |  |  | (6.6) |
Depreciation and amortization | (7.9) |  |  | (6.8) |
Operating lease ROU assets | (0.8) |  |  | (0.7) |
Partnership income | — |  |  | (0.2) |
Total deferred tax liabilities | $ | (14.4) |  |  | $ | (14.3) |
Net deferred tax assets | $ | 0.5 |  |  | $ | 0.6 |
Based on the weight of the available evidence, which includes our historical operating losses, lack of taxable income, and the accumulated deficit, we have a full valuation allowance against our U.S. federal and state deferred tax assets as of December 31, 2025 and 2024. The valuation allowance decreased by $12.0 million for the year ended December 31, 2025 and increased by $1.1 million for the year ended December 31, 2024. As of December 31, 2025, U.S. federal and state NOL carryforwards were $537.6 million and $212.9 million, and U.S. federal and state research and development tax credit carryforwards were $46.3 million and $33.8 million. If not utilized, certain federal and state NOLs will begin to expire at various dates beginning in 2035 and 2031, respectively, while the federal research and development tax credit carryforwards will start to expire in various amounts beginning in 2033. State research and development tax credit carryforwards can be carried forward indefinitely. Our NOL and tax credit carryovers may be subject to annual usage limitations, as promulgated by the Internal Revenue Service and similar state provisions, due to ownership changes that may have occurred in the past. These annual limitations may result in the expiration of NOLs and tax credits before utilization. The federal NOL carryforwards generated after December 31, 2017 have an indefinite carryforward period and are subject to an 80% deduction limitation based upon taxable income prior to NOL deduction. Of the total federal NOL carryforwards as of December 31, 2025, $439.7 million are carried forward indefinitely but are limited to 80% of taxable income. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law in the U.S. The OBBBA provides for the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act and restores certain favorable corporate tax provisions, such as the current deduction for U.S.-based research expenditures. The impact of the OBBBA was not material to our consolidated financial statements and related disclosures. Uncertain Tax Positions As of December 31, 2025, the unrecognized tax benefits of $24.0 million, if recognized, would not have an impact on our effective tax rate. The activity related to the unrecognized tax benefits was as follows:
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
Gross unrecognized tax benefits—beginning of period | $ | 22.7 |  |  | $ | 22.5 |  |  | $ | 16.4 |
Increases related to tax positions taken during current year | 1.4 |  |  | 2.3 |  |  | 5.0 |
Increases related to tax positions taken during prior years | 0.1 |  |  | 0.4 |  |  | 1.2 |
Decreases related to tax positions taken during prior years | (0.2) |  |  | (2.5) |  |  | (0.1) |
Gross unrecognized tax benefits—end of period | $ | 24.0 |  |  | $ | 22.7 |  |  | $ | 22.5 |
We recognize interest and penalties related to unrecognized tax benefits in income tax expense. There were no interest and penalties recognized during the year ended December 31, 2025. Interest and penalties were not material during the years ended December 31, 2024 and 2023. We file income tax returns subject to varying statutes of limitations. Due to our loss carryovers, the statutes of limitations remain open for all tax years since inception in our major tax jurisdictions. We believe that we have provided adequate reserves for income tax uncertainties in all open tax years. We are not currently aware of uncertain tax positions that could result in significant additional payments, accruals, or other material deviations in the next 12 months. The amount of income taxes paid, net of refunds, were as follows:
| Year Ended December 31,
| 2025 |  | 2024 |  | 2023
US State | $ | 0.8 |  |  | $ | — |  |  | $ | 0.3 |
Foreign |  |  |  |  |
India | 1.7 |  |  | 1.1 |  |  | 2.0 |
Canada | 0.7 |  |  | 0.2 |  |  | 0.6 |
UK | (0.1) |  |  | 0.7 |  |  | 1.2 |
Colombia | 0.4 |  |  | 0.5 |  |  | 0.2 |
Peru | 0.5 |  |  | 0.5 |  |  | 0.5 |
Saudi Arabia | 0.2 |  |  | 0.5 |  |  | 0.2 |
All other foreign | 1.8 |  |  | 1.8 |  |  | 1.4 |
Income taxes paid, net of amounts refunded | $ | 6.0 |  |  | $ | 5.3 |  |  | $ | 6.4 |

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