Quarterly report [Sections 13 or 15(d)]

INCOME TAXES

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

NOTE 13 – INCOME TAXES

 

The Company recorded a current income tax benefit of $15.2 million for the three months ended September 30, 2025 and a current income tax expense of $0.3 million for the nine months ended September 30, 2025. The Company did not record an income tax expense for the three and nine months ended September 30, 2024 as it generated sufficient tax losses, after consideration of discrete items, during each of the periods.

 

The significant decrease from the $15.5 million income tax expense recorded for the six months ended June 30, 2025 is primarily due to the favorable impact of the One Big Beautiful Bill Act, enacted on July 4, 2025. The legislation restored immediate expensing of domestic R&D expenditures, reinstated 100% bonus depreciation, and provided more favorable rules for determining the limitation on business interest expense, which collectively reduced the Company’s taxable income and resulted in a current tax benefit for the three months ended September 30, 2025.

 

As previously disclosed, the Company’s ability to utilize its net operating loss (“NOL”) carryforwards are subject to limitation under Section 382 of the Internal Revenue Code of 1986, as amended. Per Section 382, a change in ownership greater than 50% within a three-year period results in annual limitations on the utilization of NOL carryforwards. The Company is currently in the process of determining if a Section 382 change has occurred and to what extent the use of its NOL carryforwards may be limited. Preliminary results indicate that the Company has experienced multiple ownership changes and may have a material limitation on the use of its NOL carryforwards. The Company expects to complete its Section 382 analysis by December 31, 2025.