Income Taxes

6 Months Ended

Jun. 30, 2024

Income Tax Disclosure [Abstract]

Income Taxes

6. Income Taxes

The Company’s quarterly provision for income taxes is based on an estimated effective annual income tax rate, and it also includes the tax impact of certain unusual or infrequently occurring items, if any. These may include changes in judgment about valuation allowances and effects of changes in tax laws or rates in the interim period in which they occur.

The Company's provision for income taxes for the three and six months ended June 30, 2024 was $69 and $57, respectively, on pre-tax losses of $1,949 and $4,372, respectively, and the Company's provision for income taxes for the three and six months ended June 30, 2023 was $144 and $192, respectively, on pre-tax losses of $5,773 and $11,508, respectively. For the three and six months ended June 30, 2024, the Company's effective tax rate varies from the federal income tax rate primarily due to valuation allowances in the U.S. and taxable income generated by certain of the Company's foreign wholly owned subsidiaries.

The Company reviews the likelihood that it will realize the benefit of its deferred tax assets and, therefore, the need for valuation allowances on a quarterly basis. There is no income tax benefit recognized with respect to losses incurred and no provision for income taxes recognized with respect to earnings generated in jurisdictions with a valuation allowance. This causes variability in the Company’s effective tax rate. The Company will maintain the valuation allowances until it is more likely than not that the net deferred tax assets will be realized.

Tax positions taken by the Company are subject to audits by multiple tax jurisdictions. The Company believes that it has provided adequate reserves for its uncertain tax positions for all tax years still open for assessment. It is reasonably possible that uncertain tax positions existing as of June 30, 2024 could decrease by approximately $368 within the next twelve months. For the three and six months ended June 30, 2024 and 2023, the Company did not recognize any material interest, penalties or other changes related to uncertain tax positions.