Income taxes

3 Months Ended

Mar. 31, 2020

The provision for income taxes in the periods presented is based upon the income (loss) before income taxes (in thousands):


	Three Months Ended March 31,
	2020		2019
Income tax provision	$	(1,993)	$	(170)

The Company’s income tax provision in the three months ended March 31, 2020 was due to income taxes on earnings from operations in the U.S. and foreign tax jurisdictions. The Company’s income tax provision in the three months ended March 31, 2019 was primarily related to income taxes of the Company’s non-U.S. operations. The increase in income tax expense for the three months ended March 31, 2020, as compared to the same period in 2019 was primarily due to increased earnings from its U.S. operations for the three months ended March 31, 2020 while the Company has historically experienced net losses in the U.S.

The Company conducts its business globally and its operating income is subject to varying rates of tax in the U.S., China and Japan. Consequently, the Company’s effective tax rate is dependent upon the geographic distribution of its earnings or losses and the tax laws and regulations in each geographical region.

Due to historical losses in the U.S., the Company has a full valuation allowance on its U.S. federal and state deferred tax assets. Management continues to evaluate the realizability of deferred tax assets and the related valuation allowance. If management's assessment of the deferred tax assets or the corresponding valuation allowance were to change, the Company would record the related adjustment to income during the period in which management makes the determination.

As of March 31, 2020, there were no material changes to either the nature or the amounts of the uncertain tax positions previously determined for the year ended December 31, 2019.

On March 27, 2020, the “Coronavirus Aid, Relief, and Economic Security Act” (“CARES Act”) was signed into law. The new legislation includes a number of income tax provisions applicable to individuals and businesses. Due to historical net operating losses incurred in the U.S., the CARES Act did not have material impacts on the Company’s condensed consolidated financial statements as of March 31, 2020. The Company continues to examine the elements of the CARES Act and the impacts they may have on its future business.