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

10. Income Tax Matters

The following table presents the income tax provision by region (in millions of dollars):

 

 

 

Quarter Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2025

 

 

2024
As Adjusted1

 

 

2025

 

 

2024
As Adjusted1

 

Domestic

 

$

(8.0

)

 

$

(1.8

)

 

$

(20.6

)

 

$

(12.0

)

Foreign

 

 

(0.3

)

 

 

(0.6

)

 

 

(1.6

)

 

 

(1.6

)

Total

 

$

(8.3

)

 

$

(2.4

)

 

$

(22.2

)

 

$

(13.6

)

 

1.
Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 14 for further discussion.

The income tax provision for the quarters ended September 30, 2025 and September 30, 2024 was $8.3 million and $2.4 million, respectively, reflecting an effective tax rate of 17% and 21%, respectively. The difference between the effective tax rate and the projected blended statutory tax rate for the quarter ended September 30, 2025 was primarily due to a decrease of 7% related to Federal research and development credits, partially offset by an increase of 2% related to non-deductible compensation expense. There was no material difference between the effective tax rate and the blended statutory tax rate for the quarter ended September 30, 2024.

The income tax provision for the nine months ended September 30, 2025 and September 30, 2024 was $22.2 million and $13.6 million, respectively, reflecting an effective tax rate of 21% and 23%, respectively. There was no material difference between the effective tax rate and the blended statutory tax rate for the nine months ended September 30, 2025 and September 30, 2024.

 

Our gross unrecognized benefits relating to uncertain tax positions were $7.7 million and $6.9 million at September 30, 2025 and December 31, 2024, respectively, of which, $7.7 million and $6.9 million would be recorded through our income tax provision and thus, impact the effective tax rate at September 30, 2025 and December 31, 2024, respectively, if the gross unrecognized tax benefits were to be recognized.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act ("OBBBA"). The OBBBA made permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing, and the business interest expense limitation. ASC 740, “Income Taxes”, requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted. Consequently, as of the date of enactment, the Company evaluated all deferred tax balances under the newly enacted tax law and made all changes required to the Company's Form 10-Q for the quarter ended September 30, 2025, which included no material impact to the income tax rate.