Income Taxes

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 10. INCOME TAXES

The effective tax rates for the six months ended June 30, 2023 and 2022 are as follows:

	Six Months Ended June 30,
	2023			2022
Effective tax rate		(0.973	%)		(0.546	%)

For the three months ended June 30, 2023 and 2022, the Company recorded tax expense of $269 and $73, respectively. For six months ended June 30, 2023 and 2022, the Company recorded tax expense of $198 and $105, respectively.

The Company’s 2023 and 2022 income tax expense and rates differed from the amount of income tax determined by applying the U.S. Federal income tax rate to pre-tax income primarily as a result of the U.S., Finland, Germany, UK and Italy jurisdictions that have a full valuation allowance recorded on deferred tax assets. In addition, the tax rate is lower than the U.S. statutory federal tax rate as a result of foreign earnings that are taxed at lower tax rates.

The Company continues to monitor the realization of its deferred tax assets and assesses the need for a valuation allowance in other jurisdictions. The Company analyzes available positive and negative evidence to determine if a valuation allowance is needed based on the weight of the evidence. This objectively verifiable evidence includes the current and prior two years' profit and loss positions after considering pre-tax book income plus or minus permanent adjustments as well as other positive and negative evidence available. This process requires management to make estimates, assumptions, and judgments that are uncertain in nature. The Company has established a valuation allowance with respect to deferred tax assets in the U.S., Finland, Germany, UK and Italy and continues to monitor and assess potential valuation allowances in all its jurisdictions.