Income Taxes

9 Months Ended

Sep. 30, 2019

The Company determines its effective tax rate each quarter based upon its estimated annual effective tax rate. The Company records the tax impact of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, in the interim period in which they occur. In addition, jurisdictions with a projected loss for the year where no tax benefit can be recognized are excluded from the estimated annual effective tax rate.

Income tax expense (benefit), income (loss) before income taxes and the corresponding effective tax rate for the three and nine months ended September 30, 2019 and 2018 were as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Income tax expense (benefit)	$	(574	)	$	(1,190	)	$	45,996		$	19,831
Income (loss) before income taxes	(16,172		)	31,474			171,532			153,113
Effective tax rate	4		%	(4		)%	27		%	13		%

The effective tax rate for the three and nine months ended September 30, 2019 compared to the three and nine months ended September 30, 2018 was higher primarily due to the geographic mix of increased pre-tax earnings as a result of the sale of the AVS product line recorded in the nine months ended September 30, 2019 and the inability to record a tax benefit for pre-tax losses in certain foreign jurisdictions in both the three and nine months ended September 30, 2019. Additionally, benefits recorded from adjustments to provisional amounts recorded as a result of the U.S. Tax Cuts and Jobs Act resulted in a lower effective tax rate in the three and nine months ended September 30, 2018.

The income tax rate for the three and nine months ended September 30, 2019 and 2018 varies from the U.S. statutory rate primarily due to the inability to record a tax benefit for pre-tax losses in certain foreign jurisdictions to the extent not offset by other categories of income, tax credits, the impact of income taxes on foreign earnings taxed at rates varying from the U.S. statutory rate, and other permanent items. Further, the Company’s current and future provision for income taxes is impacted by the initial recognition of and changes in valuation allowances in certain countries. The Company intends to maintain these valuation allowances until it is more likely than not that the deferred tax assets will be realized.