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Note 12 - Income Tax
 9 Months Ended
Sep. 30, 2025
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

12.

Income Tax

 

The determination of the annual effective tax rate is based upon a number of significant estimates and judgments, including the estimated annual pretax income in each tax jurisdiction in which the Company operates and the development of tax planning strategies during the year. In addition, as a global commercial enterprise, the Company’s tax expense can be impacted by changes in tax rates or laws, the finalization of tax audits and reviews and other factors that cannot be predicted with certainty. As such, there can be significant volatility in interim tax provisions.

 

Income tax expense (benefit) was $0.1 million and $0.3 million for the three months ended September 30, 2025 and 2024, respectively, and was ($0.3) million and $0.2 million for the nine months ended September 30, 2025 and 2024, respectively. The Company’s effective tax rate of (8.6)% and 0.6% for the three and nine months ended September 30, 2025, respectively, were lower than the U.S statutory rate due to the tax effect of goodwill impairment. The Company’s effective tax rates of (6.9)% and (1.4)% for the three and nine months ended September 30, 2024, respectively, were different than the U.S. statutory rate primarily due to the inclusion of non-deductible executive compensation. The effective tax rate for both periods was also impacted by changes in valuation allowances associated with the Company’s assessment of the likelihood of the recoverability of deferred tax assets.

 

On July 4, 2025, subsequent to the end of the second quarter of fiscal 2025, the One Big Beautiful Bill Act (the “Act”) was signed into law. The Act includes several significant tax-related provisions, including the permanent extension of certain elements of the Tax Cuts and Jobs Act. The legislation features staggered effective dates beginning in 2025 and continuing through 2027. The Company has incorporated the provisions from the Act into the Q3 2025 income tax provision and has concluded that these changes did not have a significant impact on its consolidated financial statements and related disclosures.