Income Taxes

12 Months Ended

Dec. 31, 2025

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision for (benefit from) income taxes consists of:

	Year Ended December 31,
(in thousands)	2025		2024		2023
Current income tax:
Federal	$	18	$	—	$	—
State	(888)		1,357		502
Foreign	3,472		2,361		1,149
	2,602		3,718		1,651
Deferred income tax:
Federal	952		(5,576)		59
State	534		(707)		138
Foreign	(1,165)		(2,203)		—
	321		(8,486)		197
Provision for (benefit from) income taxes	$	2,923	$	(4,768)	$	1,848

The components of net loss before income taxes consist of the following:

	Year Ended December 31,
(in thousands)	2025		2024		2023
United States	$	(61,393)	$	(77,811)	$	(65,972)
International	(20,342)		(16,867)		(13,799)
Total net loss before income taxes	$	(81,735)	$	(94,678)	$	(79,771)

Applying the updated requirements in ASU 2023-09 on a prospective basis, cash payments made for income taxes, net of refunds, are as follows:

	Year Ended December 31,
(in thousands)	2025
Federal	$	—
State and municipal:
California	498
Maryland	297
New York	617
Other(1)	1,422
Foreign:
Australia	608
India	561
New Zealand	1,673
Other(1)	87
Income taxes paid, net of refunds	$	5,763

(1) No other jurisdiction meets the 5% threshold for the separate reporting requirement.

Deferred tax (liabilities) assets are comprised of the following at:

	December 31,
(in thousands)	2025		2024
Deferred tax liabilities:
Operating lease assets	$	(1,723)	$	(1,588)
Software development costs	(737)		(2,788)
Intangible assets	(25,480)		(29,776)
481(a) adjustment	(465)		(950)
Depreciation on property, plant and equipment	(2,040)		(1,901)
Partnership basis difference	(6,333)		(4,993)
Gross deferred tax liabilities	(36,778)		(41,996)
Deferred tax assets:
Allowances for bad debts and inventory	2,713		2,896
Capitalized inventory costs	15		17
Employee benefit accruals	6,116		5,096
Interest expense limitation under section 163 (j)	4,294		2,594
Operating lease liabilities	1,767		1,730
Federal net operating loss carryforward	52,428		29,339
State net operating loss carryforward	13,233		11,020
Foreign net operating loss carryforward	14,956		11,117
Federal and state tax credit carryforwards	16,933		16,435
R&D capitalization	12,527		28,484
Other	953		900
Gross deferred tax assets	125,935		109,628
Less valuation allowance	(106,013)		(85,100)
Non-current net deferred tax liabilities	$	(16,856)	$	(17,468)

The non-current net deferred tax liabilities are included within other long-term liabilities on the Company's consolidated balance sheets. The Company has a federal operating loss carryforward of $249.7 million with an unlimited carryforward period. The Company also has state tax credits of $2.0 million and net operating loss carryforwards that vary by jurisdiction, ranging from zero to $83.3 million, and expire in various tax years through 2045. The Company has foreign net operating loss carryforwards of $60.5 million expiring through 2044 and $24.3 million with an indefinite carryforward period.

In evaluating our ability to recover our deferred tax assets, management considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and results of recent operations. A valuation allowance is required to the extent it is more likely than not that the future benefit associated with certain federal, state, and foreign deferred tax assets including tax loss carryforwards will not be realized.

As of December 31, 2025, management believes that it is more likely than not that the benefit from its deferred tax assets will not be realized except for the estimated amount of future tax associated with indefinite lived intangible assets in certain jurisdictions. In calculating the valuation allowance, the Company was only permitted to use its existing deferred tax liabilities related to its indefinite-lived intangible assets (i.e. “naked credit deferred tax liabilities”) as a source of taxable income to support the realization of its existing indefinite-lived deferred tax assets.

As a result of this analysis, management determined that the Company's United States, Switzerland, Australia, and certain Canadian jurisdictions should maintain a full valuation allowance.

No provision is made for certain taxes applicable to the undistributed earnings of the Company's foreign subsidiaries as it is the intention of management to fully utilize those earnings in the operations of foreign subsidiaries.

The Tax Cuts and Jobs Act created a new requirement that certain income earned by foreign subsidiaries, known as global intangible low-tax income ("GILTI"), must be included in the gross income of their U.S. shareholder. The FASB allows an accounting policy election of either recognizing deferred taxes for temporary differences expected to reverse as GILTI in future years or recognizing such taxes as a current-period expense when incurred. The company elected to treat the tax effect of GILTI as a current-period expense when incurred.

In the current year, the income tax provision includes an overall increase in deferred tax assets and a corresponding increase in U.S. valuation allowance of $14.0 million primarily related to the write-off of unamortized research and development costs, resulting in the generation of NOL's. The foreign valuation allowance increased $7.0 million primarily due to increased NOL’s in Canada, Switzerland, and Australia and interest disallowance in Australia.

In 2024, the income tax provision included a decrease in deferred tax assets and a corresponding decrease in U.S. valuation allowance of $10.1 million primarily related to the impact of non-deductible stock-based compensation and deferred tax liabilities recorded as a result of the Stuzo Acquisition and Delaget Acquisition. The foreign valuation allowance increased $7.2 million due to increased PAR Ordering NOL’s and Australia NOL’s acquired in the TASK Group Acquisition, which did not have any impact on tax expense.

In 2023, the income tax provision included an increase in deferred tax assets and a corresponding increase in valuation allowance of $10.8 million related to the capitalization of R&D expenses for tax purposes and an increase in deferred tax assets and corresponding increase in valuation allowance of $3.3 million from foreign net operating loss carryforwards related to the MENU Acquisition.

The Company records the benefits relating to uncertain tax positions only when it is more likely than not (likelihood of greater than 50%), based on technical merits, that the position would be sustained upon examination by taxing authorities. Tax positions that meet the more likely than not threshold are measured using a probability-weighted approach as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. At December 31, 2025, the Company had no reserve for uncertain tax positions and the Company believes the Company has adequately provided for its tax-related liabilities. The Company is no longer subject to federal income tax audits for years before 2021. The Company's foreign subsidiaries have statutes of limitations ranging from 3 - 5 years. The statute is closed through 2020 for the major jurisdictions of Australia and New Zealand.

The following table presents the required disclosures pursuant to ASU 2023-09 and reconciles the Company's effective tax rate from the U.S. federal statutory tax rate of 21%:

	Year Ended December 31, 2025
	Amount		Percent
Federal statutory tax rate	$	(17,164)	21.0	%
State taxes, net of federal benefit(1)	(207)		0.2
Tax credits:
Research and development	(279)		0.3
Foreign tax impacts:
Australia
Statutory tax rate difference	(1,516)		1.9
Valuation allowance	5,219		(6.4)
Other	43		(0.1)
Canada
Prior Year NOL Adjustment	(900)		1.1
Other	1,150		(1.4)
Switzerland
Statutory tax rate difference	883		(1.1)
Other	601		(0.7)
Other foreign jurisdictions	1,098		(1.3)
Nontaxable or nondeductible expenses:
Stock based compensation	(1,857)		2.3
Executive compensation	3,831		(4.7)
Other	443		(0.5)
Valuation allowance	11,685		(14.3)
Other	(107)		0.1
Effective tax rate	$	2,923	(3.6)	%

(1) State taxes in New York and Texas comprised greater than 50% of the tax effect in this category.

The following table reconciles the Company's effective tax rate from the U.S. federal statutory tax rate of 21% prior to the adoption of ASU 2023-09:

	Year Ended December 31,
	2024		2023
Federal statutory tax rate	21.0	%	21.0	%
State taxes, net of federal benefit	(0.5)		(0.7)
Contingent consideration revaluation	0.1		2.4
Nondeductible expenses	(1.4)		(0.2)
Tax credits (including R&D)	2.8		1.5
Foreign income tax rate differential	(3.9)		(4.9)
Stock based compensation	(1.6)		(1.2)
Valuation allowance	(11.0)		(20.1)
Other	(0.5)		(0.1)
Effective tax rate	5.0	%	(2.3)	%

The effective income tax rate was (3.6)%, 5.0% and (2.3)% during the years ended December 31, 2025, December 31, 2024, and December 31, 2023, respectively. The decrease in 2025 compared to the statutory tax rate of 21.0% was primarily due to the increase in valuation allowance, stock-based compensation, and the foreign income tax rate differential. The decrease in 2024 and 2023 compared to the statutory tax rate of 21.0% was primarily due to the increase in valuation allowance and the foreign income tax rate differential.