Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Summary of Our Domestic and Foreign Income (Loss) Before Income Taxes

The following table presents a summary of our domestic and foreign income (loss) before income taxes for the periods presented:

	Year Ended December 31,
	2023		2022		2021
	(in millions)
Domestic	$	95	$	37	$	(127	)
Foreign		30		30		(58	)
Income (loss) before income taxes	$	125	$	67	$	(185	)

Summary of the Components of Our Provision (Benefit) for Income Taxes

The components of our provision (benefit) for income taxes consisted of the following for the periods presented:

	Year Ended December 31,
	2023			2022			2021
	(in millions)
Current income tax expense (benefit):
Federal	$	94		$	37		$	6
State		25			3			(1	)
Foreign		21			26			2
Current income tax expense (benefit)		140			66			7
Deferred income tax expense (benefit):
Federal		(9	)		(19	)		(21	)
State		6			1			(5	)
Foreign		(22	)		(1	)		(18	)
Deferred income tax expense (benefit)		(25	)		(19	)		(44	)
Provision (benefit) for income taxes	$	115		$	47		$	(37	)

Summary of Deferred Tax Assets and Deferred Tax Liabilities

The significant components of our deferred tax assets and deferred tax liabilities consisted of the following as of the dates presented:

	December 31,
	2023			2022
	(in millions)
Deferred tax assets:
Stock-based compensation	$	14		$	28
Net operating loss carryforwards		96			83
Provision for accrued expenses		8			6
Lease financing obligation		13			17
Foreign advertising spend		14			14
Tax credit carryforward		10			7
Capitalized research expenses		52			39
Interest carryforward		32			53
Other		14			19
Total deferred tax assets	$	253		$	266
Less: valuation allowance		(106	)		(114	)
Net deferred tax assets	$	147		$	152
Deferred tax liabilities:
Intangible assets	$	(42	)	$	(48	)
Property and equipment		(3	)		(6	)
Prepaid expenses		(4	)		(4	)
Building - corporate headquarters		(12	)		(16	)
Other		(1	)		(1	)
Total deferred tax liabilities	$	(62	)	$	(75	)
Net deferred tax asset (liability)	$	85		$	77

Reconciliation of the (Benefit) Provision for Income Taxes

A reconciliation of the provision (benefit) for income taxes to the amounts computed by applying the statutory federal income tax rate to income (loss) before income taxes is as follows for the periods presented:

	Year Ended December 31,
	2023			2022			2021
	(in millions)
Income tax expense at the federal statutory rate	$	26		$	14		$	(39	)
Foreign rate differential (1)		—			—			(14	)
State income taxes, net of effect of federal tax benefit		6			5			(2	)
Unrecognized tax benefits and related interest		27			17			4
IRS audit settlement		31			—			—
Transfer pricing reserve adjustment		24			—			—
FDII, GILTI and other provisions		(9	)		(2	)		—
Research tax credit		(4	)		(2	)		(7	)
Stock-based compensation		22			11			(1	)
Change in valuation allowance		(6	)		5			8
Executive compensation		2			1			6
Other, net		(4	)		(2	)		8
Provision (benefit) for income taxes	$	115		$	47		$	(37	)

(1)During 2021, intercompany debt was extinguished, which resulted in a reduction of our overall foreign rate differential.

Reconciliation of the Beginning and Ending Amount of Gross Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits (excluding interest and penalties) is as follows during the periods presented:

	December 31,
	2023			2022			2021
	(in millions)
Balance, beginning of year	$	157		$	144		$	144
Increases to tax positions related to the current year		8			5			5
Increases to tax positions related to the prior year		17			29			1
Decreases due to lapsed statute of limitations		—			(20	)		—
Decreases due to tax positions related to the prior year		(6	)		(1	)		—
Settlements during current year		(40	)		—			(6	)
Balance, end of year	$	136		$	157		$	144