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INCOME TAXES | 9 Months Ended
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Sep. 30, 2025
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES We recognized an income tax benefit (provision) of $15.1 million and $(2.2) million for the nine months ended September 30, 2025 and 2024, respectively ($0.7 million and $(0.8) million for the third quarter of 2025 and 2024, respectively). The income tax benefit for the nine months ended September 30, 2025 was driven primarily by the reversal of liabilities for uncertain tax positions. The income tax (provision) benefit for the three and nine months ended September 30, 2025 was also driven by income tax expense on transfer pricing income from India and the United States and no tax benefit on the pretax loss from our Luxembourg operating company. The income tax (provision) benefit consists of the following:
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2025 |  | 2024 |  | 2025 |  | 2024
Current: |  |  |  |  |  |  |  |
Foreign - U.S. federal |  | $ | (138) |  |  | $ | 51 |  |  | $ | (660) |  |  | $ | (53) |
Foreign - U.S. state |  | (25) |  |  | 196 |  |  | (97) |  |  | 164 |
Foreign - non-U.S. |  | (476) |  |  | (998) |  |  | 15,917 |  |  | (2,272) |
|  | $ | (639) |  |  | $ | (751) |  |  | $ | 15,160 |  |  | $ | (2,161) |
Deferred: |  |  |  |  |  |  |  |
Domestic |  | $ | (21) |  |  | $ | (58) |  |  | $ | (91) |  |  | $ | (76) |
Foreign - U.S. state |  | — |  |  | — |  |  | — |  |  | — |
Foreign - non-U.S. |  | — |  |  | — |  |  | — |  |  | — |
|  | $ | (21) |  |  | $ | (58) |  |  | $ | (91) |  |  | $ | (76) |
Income tax (provision) benefit |  | $ | (660) |  |  | $ | (809) |  |  | $ | 15,069 |  |  | $ | (2,237) |
Uncertain Tax Positions The Company follows ASC Topic 740 Income Taxes, which clarifies the accounting and disclosure for uncertainty in tax positions. We analyzed our tax filing positions in the domestic and foreign tax jurisdictions where we are required to file income tax returns as well as for all open tax years subject to audit in these jurisdictions. The Company has open tax years in the United States (2017 through 2023), India (2011 through 2024) and Luxembourg (2017 through 2023). During the second quarter of 2025, Management concluded that certain of its India tax positions for several years were more likely than not to be sustained based on second quarter developments (including, among other reasons, a net refund received of $1.3 million). As a result, the Company recognized a $9.6 million reversal of its reserve for uncertain tax positions related to India and a $9.0 million reversal of related accrued interest. The effective tax rate differs from the Luxembourg statutory tax rate due to tax rate differences on foreign earnings, increases in uncertain tax positions, state taxes, a decrease in unrecognized tax benefits, tax exempt income primarily from the sale of Pointillist and a valuation allowance against deferred tax assets the Company believes it is more likely than not will not be realized. The following table summarizes changes in unrecognized tax benefits:
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2025 |  | 2024 |  | 2025 |  | 2024
Amount of unrecognized tax benefit as of the beginning of the period |  | $ | 2,108 |  |  | $ | 10,183 |  |  | $ | 10,240 |  |  | $ | 9,208 |
Decreases as a result of tax positions taken in a prior period |  | — |  |  | (193) |  |  | (8,012) |  |  | — |
Increases as a result of tax positions taken in a prior period |  | 431 |  |  | 260 |  |  | — |  |  | 767 |
Decreases as a result of tax positions taken in the current period |  | (135) |  |  | — |  |  | — |  |  | — |
Increases as a result of tax positions taken in the current period |  | — |  |  | 54 |  |  | 176 |  |  | 329 |
Amount of unrecognized tax benefit as of the end of the period |  | $ | 2,404 |  |  | $ | 10,304 |  |  | $ | 2,404 |  |  | $ | 10,304 |
The following table reconciles the Luxembourg statutory tax rate to our effective tax rate:
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2025 |  | 2024 |  | 2025 |  | 2024
Statutory tax rate |  | 24.94 | % |  | 24.94 | % |  | 24.94 | % |  | 24.94 | %
Change in valuation allowance |  | (67.29) |  |  | (23.68) |  |  | (49.07) |  |  | (26.46) |
State tax expense |  | (1.52) |  |  | 0.82 |  |  | (1.06) |  |  | 0.38 |
Uncertain tax positions |  | (13.63) |  |  | (7.25) |  |  | 275.29 |  |  | (5.39) |
Tax rate differences on foreign earnings |  | 2.89 |  |  | (1.13) |  |  | 2.27 |  |  | (0.47) |
Tax exempt income |  | — |  |  | — |  |  | — |  |  | 0.21 |
Other |  | 14.94 |  |  | (3.23) |  |  | (1.50) |  |  | (2.34) |
Effective tax rate |  | (39.67) | % |  | (9.53) | % |  | 250.87 | % |  | (9.13) | %
The total amount of unrecognized tax benefits including interest and penalties that, if recognized, would affect the effective tax rate is $3.5 million and $19.2 million as of September 30, 2025 and December 31, 2024, respectively. The Company recognizes interest, if any, related to unrecognized tax benefits as a component of income tax expense. As of September 30, 2025 and 2024, the Company had recorded accrued interest and penalties related to unrecognized tax benefits of $1.1 million and $9.1 million, respectively.

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