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

9. Income Taxes

At the end of each interim period, the Company records income taxes by applying an estimated annualized effective tax rate to the current period income or loss before income taxes. The Company’s annualized effective tax rate is based on pre-tax earnings, enacted U.S. statutory tax rates, non-deductible expenses, tax credits, certain tax rate differences between U.S. and foreign jurisdictions, and

specific events that are discretely recognized entirely within the interim period in which they occur. Exodus’ foreign subsidiary Proper Trust AG files an income tax return in Switzerland.

For the three months ended September 30, 2025 and 2024, the Company recorded an income tax expense of $3.3 million on pre-tax income of $20.3 million and an income tax expense of $0.1 million on a pre-tax income of $1.0 million, resulting in effective tax rates of 16.1% and 11.4%, respectively. For the nine months ended September 30, 2025 and 2024, the Company recorded an income tax expense of $4.2 million on pre-tax income of $46.0 million and an income tax expense of $9.4 million on a pre-tax income of $55.4 million, resulting in effective tax rates of 9.1% and 16.9%, respectively.

Our effective tax rate for the nine months ended September 30, 2025 was primarily impacted by federal research tax credits and the change in permanent differences, including the tax benefit from the foreign derived intangible income, non-deductible expenses and discrete items, including stock-based compensation and tax effect of realized and unrealized digital asset gains and losses during the period. For purposes of recording the discrete tax expense related to digital assets, for the nine months ended September 30, 2025 realized gains or losses are recorded to the Company’s current taxes payable and unrealized gains and losses are recorded to the deferred tax liability based on current period activity. The effective tax rate for the nine months ended September 30, 2024 was primarily impacted by the change in permanent differences and discrete items, including the tax benefit from the foreign derived intangible income and the effect of digital asset gains and losses, specifically recognized in the period.

On July 4, 2025, the “One Big Beautiful Bill Act” (P.L. 119‑21) was enacted into law. The legislation reinstates and extends several provisions of the 2017 Tax Cuts and Jobs Act, including permanent 100% bonus depreciation, enhanced Section 179 expensing, full R&D expense deduction for domestic expenditures and modification to the international tax framework. We are currently assessing its impact on our consolidated financial statements. The primary impact of the legislation is the acceleration of deductions related to research and development costs incurred in the US which did not have a material impact on the Company’s effective tax rate in the quarter ended September 30, 2025. We are continuing to assess its impact on our consolidated financial statements.