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Income Taxes
6 Months Ended
Jun. 30, 2019
Income Taxes  
Income Taxes

Note 12.  Income Taxes

 

The income tax provision was $0.8 million during the three months ended June 30, 2019, a decrease of $2.2 million when compared to the three months ended June 30, 2018. The $2.2 million decrease was primarily due to a $3.4 million reduction in tax expense attributable to the decrease in pretax income of $16.3 million, partially offset by a $0.9 million increase in our valuation allowance relating to uncertainty regarding our utilization of research and development credits and $0.3 million of tax benefits relating to stock option exercises and RSU vesting.

 

The income tax provision was $1.3 million during the six months ended June 30, 2019, a decrease of $5.3 million when compared to the six months ended June 30, 2018. Of the $5.3 million decrease,  $5.7 million was attributable to the decrease in pretax income of $27.2 million, offset by $0.4 million primarily related to a decrease in the tax benefits relating to stock option exercises and RSU vesting.

 

We have significant net operating loss carryforwards in the United States and certain European jurisdictions, and, as a result, we do not currently pay significant income taxes in those jurisdictions. Tax expense reflects the tax liability that would be payable without consideration of the usage of any net operating loss carryforwards. At December 31, 2018, we had $71.9 million of deferred tax assets worldwide comprised of net operating loss carryforwards, tax credit carryforwards and other temporary differences, which are available to reduce income tax liabilities in future years. This amount was net of a $6.8 million valuation allowance. As of June 30, 2019, the valuation allowance increased to $7.7 million due to the uncertainty of the utilization of certain research and development credits.