XML 26 R16.htm IDEA: XBRL DOCUMENT v3.25.4
Income Taxes
 9 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
For the three months ended December 31, 2025 and 2024, the Company recorded an income tax provision of approximately $11 thousand and an income tax provision of approximately $0.5 million, respectively, and for the nine months ended December 31, 2025 and 2024, the Company recorded an income tax provision of $29 thousand and an income tax provision of $22 thousand, respectively. The effective tax rate for the three months ended December 31, 2025 was approximately (0.1)%, compared to approximately (192.1)% for the three months ended December 31, 2024, and the effective tax rate for the nine months ended December 31, 2025 was approximately (0.1)%, compared to approximately 0.4% for the nine months ended December 31, 2024. The effective tax rate for the three months ended December 31, 2025 differs from the statutory rate primarily as a result of the goodwill impairment and the Company maintaining a valuation allowance against the majority of our deferred tax assets.

As of December 31, 2025, the Company maintained a valuation allowance against the majority of our deferred tax assets for which realization cannot be considered more likely than not at this time. Management assesses the need for the valuation allowance on a quarterly basis. In assessing the need for a valuation allowance, the Company considers all positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and past financial performance.

On July 4, 2025, the “One Big Beautiful Bill Act”, or “OBBBA”, was signed into law, which represents the enactment date under U.S. GAAP. Key corporate tax provisions include the restoration of 100% bonus depreciation, immediate expensing for domestic research and experimental expenditures, changes to Section 163(j) interest limitations, updates to Global Intangible Low-Taxed Income (“GILTI”), and Foreign-Derived Intangible Income (“FDII”) rules, amendments to energy credits, and expanded Section 162(m) aggregation requirements.

In accordance with ASC 740, the effects of the new tax legislation are recognized in the period of enactment. Management has evaluated the provisions of the OBBBA, recalculated temporary differences, reassessed valuation allowances, and considered any necessary adjustments. Based on this evaluation, management concluded that the effects of the OBBBA are not material to the Company’s consolidated financial statements for the three and nine months ended December 31, 2025. Management will continue to monitor forthcoming guidance, interpretations, and technical clarifications to assess whether any future adjustments or additional disclosures may be required.