Income Taxes (Tables)

12 Months Ended

Dec. 31, 2024

Schedule of Income (Loss) before Income Tax, Domestic and Foreign

Income before provision (benefit) for income taxes included the following components for the years ended December 31 (in thousands):


	2024		2023		2022
United States	$	357,484	$	134,509	$	191,353
Foreign	24,020		22,552		4,885
Total	$	381,504	$	157,061	$	196,238

Schedule of Significant Components of the Provision (Benefit) for Income Taxes

Significant components of the provision (benefit) for income taxes were as follows for the years ended December 31 (in thousands):


	2024		2023		2022
Current:
Federal	$	60,924	$	33,084	$	10,804
State	18,298		10,371		10,118
Foreign	3,388		2,804		2,892
Total current	82,610		46,259		23,814
Deferred:
Federal	(63,073)		(60,673)		26,180
State	(20,838)		(9,172)		(2,015)
Foreign	(1,815)		89		(2,146)
Total deferred	(85,726)		(69,756)		22,019
Tax impact of unrecorded tax benefits liability	7,586		4,775		3,475
Provision for (benefit from) income taxes	$	4,470	$	(18,722)	$	49,308

Schedule of Reconciliation of the company's Effective Income Tax Rate to the Federal Statutory Rate

A reconciliation of our effective income tax rate to the federal statutory rate follows for the years ended December 31 (in thousands):


	2024			2023			2022
Federal income tax at the statutory rate	$	80,120		$	32,983		$	41,224
Excess stock-based compensation benefit	(83,748)			(106,522)			(4,616)
Executive compensation limitation	51,858			77,350			5,784
R&D credits	(36,571)			(26,204)			(13,340)
Nontaxable gain on investments	(19,727)			—			—
Change in unrecognized tax benefits	7,356			4,351			3,215
Other permanent differences	5,176			1,201			1,118
Global intangible low-taxed income	3,081			1,890			653
Foreign derived intangible income deduction	(2,558)			(961)			(2,597)
Foreign tax credit	(1,914)			(1,922)			—
State income taxes, net of federal benefit	1,713			3,730			7,915
Change in valuation allowance	(903)			(4,695)			10,216
Tax effects of intercompany transactions	(222)			(2,033)			(417)
Difference between statutory and foreign tax rates	801			1,013			(428)
Other	8			1,097			581
Provision for (benefit from) income taxes	$	4,470		$	(18,722)		$	49,308
Effective tax rate	1.2		%	(11.9)		%	25.1		%

Schedule of Components of Deferred Income Tax Assets and Liabilities

Significant components of our deferred income tax assets and liabilities are as follows at December 31, 2024 and December 31, 2023 (in thousands):


	2024		2023
Deferred income tax assets:
R&D capitalization, net	$	193,265	$	99,746
Deferred revenue	66,948		59,443
Stock-based compensation	51,088		10,544
Convertible debt, net	31,603		39,649
Reserves, accruals, and other	21,634		12,264
R&D tax credit carryforward	19,100		16,554
Net operating loss carryforward	17,824		2,115
Accrued bonus	12,101		11,253
Lease liability	11,966		9,664
Inventory reserve	5,794		1,986
Deferred compensation	4,021		2,803
Strategic investments	—		6,109
Amortization	—		4,425
Total gross deferred tax assets	435,344		276,555
Valuation allowance	(23,054)		(21,600)
Total deferred income tax assets, net of valuation allowance	412,290		254,955
Deferred income tax liabilities:
Strategic investments	(42,260)		—
Amortization	(36,185)		—
Depreciation	(16,739)		(14,575)
Right of use asset	(10,639)		(8,404)
Prepaid expenses	(2,874)		(2,223)
Customer contract asset	(1,174)		(690)
Goodwill amortization	(509)		(314)
Other	—		(965)
Total deferred income tax liabilities	(110,380)		(27,171)
Net deferred income tax assets	$	301,910	$	227,784

Deferred taxes are reflected in the consolidated balance sheet as follows:
Non-current tax assets (included in deferred tax asset, net)	304,282		227,784
Non-current tax liabilities (included in other long-term liabilities)	(2,372)		—
Total	$	301,910	$	227,784

Schedule of Valuation Allowance

The following table presents the valuation allowance activity for years ended December 31, 2024, 2023 and 2022 (in thousands):


	2024		2023		2022
Balance, beginning of period	$	21,600	$	26,368	$	16,168
Tax provision (benefit)	(576)		(4,262)		10,409
Deductions charged to tax provision / benefit	(327)		(505)		(164)
Additions (reversals) to other accounts	2,357		(1)		(45)
Balance, end of period	$	23,054	$	21,600	$	26,368

Schedule of Roll forward of Liability for Unrecognized Tax Benefits exclusive of Accrued Interest

The following table presents a roll forward of our liability for unrecognized tax benefits, exclusive of accrued interest, as of December 31 (in thousands):


	2024		2023		2022
Balance, beginning of period	$	25,754	$	21,492	$	18,249
Increase (decrease) in previous year tax positions	501		(215)		232
Increase in current year tax positions	7,313		6,963		3,343
Decrease due to lapse of statute of limitations	(842)		(2,486)		(332)
Balance, end of period	$	32,726	$	25,754	$	21,492