INCOME TAXES

12 Months Ended

Dec. 31, 2025

Income Tax Disclosure [Abstract]

INCOME TAXES

6.INCOME TAXES

The Organization for Economic Cooperation and Development (“OECD”) Pillar 2 global minimum tax rules, which generally provide for a minimum effective tax rate of 15%, are intended to apply for tax years beginning in 2024. On February 2, 2023, the OECD issued administrative guidance providing transition and safe harbor rules around the implementation of the Pillar 2 global minimum tax. Under a transitional safe harbor released July 17, 2023, the undertaxed profits rule top-up tax in the jurisdiction of a company's ultimate parent entity will be zero for each fiscal year of the transition period, if that jurisdiction has a corporate tax rate of at least 20%. The safe harbor transition period will apply to fiscal years beginning on or before December 31, 2025 and ending before December 31, 2026. We are closely monitoring developments and evaluating the impact these new rules are anticipated to have on our tax rate, including eligibility to qualify for these safe harbor rules. Based on the 2025 financial results and safe harbor rules, we currently do not anticipate the Pillar 2 laws to have a material impact on our effective tax rate.

On July 4, 2025, the U.S. enacted a budget reconciliation package (known as the “One Big Beautiful Bill Act” or “OBBBA”) which includes a broad range of tax provisions affecting businesses. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company has included the impacts of the bill in the consolidated financial statements for the year ended December 31, 2025. We will continue to evaluate the full impact of these legislative changes as additional guidance and results become available.

For the years ended December 31, 2025, 2024 and 2023, income before income taxes is broken out between U.S. and foreign-sourced operations and consisted of the following (in thousands):

	2025		2024		2023
Domestic	$	110,396	$	93,687	$	60,935
Foreign		60,541		56,306		51,154
Total	$	170,937	$	149,993	$	112,089

The components of the provision for income taxes for the years ended December 31, 2025, 2024 and 2023, consisted of the following (in thousands):

	2025		2024		2023
Current expense:
Federal	$	17,745	$	26,061	$	15,684
State		4,863		5,286		3,775
Foreign		14,626		13,162		10,862
Total current expense		37,234		44,509		30,321
Deferred expense (benefit):
Federal		4,766		(12,609)		(11,030)
State		378		(1,421)		(1,699)
Foreign		70		(843)		86
Total deferred expense (benefit)		5,214		(14,873)		(12,643)
Total income tax expense	$	42,448	$	29,636	$	17,678

The difference between the income tax expense reported and amounts computed by applying the statutory federal rate of 21.0% to pretax income for the years ended December 31, 2025, 2024 and 2023, consisted of the following (in thousands):

	2025				2024				2023
	Amount		Percent		Amount		Percent		Amount		Percent
Computed federal income tax expense at applicable statutory rate of 21%	$	35,897	21.0	%	$	31,499	21.0	%	$	23,539	21.0	%
Domestic Federal
Tax credits
Research and development tax credits		(1,910)	(1.1)			(2,765)	(1.8)			(2,209)	(2.0)
Other		348	0.2			(31)	(0.0)			—	—
Nontaxable or nondeductible expenses
Share-based payment awards		(3,364)	(2.0)			(1,817)	(1.2)			(3,001)	(2.6)
Section 162(m) limitation		6,967	4.1			1,927	1.3			1,685	1.5
Other		809	0.5			101	0.1			241	0.2
Effects of cross-border tax laws
Global intangible low-taxed income, net of related foreign tax credits		618	0.4			668	0.4			(652)	(0.6)
Foreign-derived intangible income		(3,312)	(2.0)			(2,790)	(1.9)			(2,691)	(2.4)
Subpart F income, net of related foreign tax credits		(906)	(0.5)			(1,792)	(1.2)			(990)	(0.9)
Changes in valuation allowance		(52)	(0.0)			—	—			(90)	(0.1)
Other adjustments		766	0.4			131	0.1			(388)	(0.3)
State and local income tax expense(1)		4,130	2.3			3,081	2.1			1,554	1.4
Foreign tax effects		2,340	1.4			1,206	0.8			676	0.6
Changes in unrecognized tax benefits		117	0.1			218	0.1			4	0.0
Total income tax expense	$	42,448	24.8	%	$	29,636	19.8	%	$	17,678	15.8	%

(1) For the year ended December 31, 2025, California, Minnesota, Massachusetts, New York and New Jersey taxes make up the majority (greater than 50 percent) of the tax effect in this category. For the year ended December 31, 2024, California, Minnesota, New Jersey, Massachusetts, Pennsylvania and New York make up the majority of the tax effect in this category. For the year ended December 31, 2023, Minnesota, California, New Jersey and New York make up the majority of the tax effect in this category.

Deferred income tax assets and liabilities at December 31, 2025 and 2024, consisted of the following temporary differences and carry-forward items (in thousands):

	December 31, 2025		December 31, 2024
Deferred income tax assets:
Allowance for credit losses on trade receivables	$	4,246	$	2,215
Accrued compensation expense		11,146		11,701
Inventory differences		5,943		5,139
Net operating loss carryforwards		7,384		8,320
Stock-based compensation expense		10,328		7,569
Operating lease assets		16,686		11,586
State R&D tax credits		6,293		5,924
IRC section 174 capitalized R&D		24,868		35,200
Other		10,794		10,759
Total deferred income tax assets		97,688		98,413
Deferred income tax liabilities:
Prepaid expenses		(1,482)		(1,277)
Property and equipment		(24,564)		(22,699)
Intangible assets		(51,625)		(29,440)
Foreign withholding tax		(1,742)		(1,681)
Operating lease liabilities		(16,751)		(11,737)
Other		(19)		(1,632)
Total deferred income tax liabilities		(96,183)		(68,466)
Valuation allowance		(14,121)		(14,143)
Net deferred income tax (liabilities) assets	$	(12,616)	$	15,804
Reported as:
Deferred income tax assets	$	7,049	$	16,044
Deferred income tax liabilities		(19,665)		(240)
Net deferred income tax (liabilities) assets	$	(12,616)	$	15,804

Deferred tax assets and liabilities are netted on the balance sheet by separate tax jurisdictions. Deferred income tax balances reflect the temporary differences between the carrying amounts of assets and liabilities and their tax basis and are stated at enacted tax rates expected to be in effect when taxes are actually paid or recovered. The valuation allowance is primarily related to state credit carryforwards, non-US net operating loss carryforwards, and capital loss carryforwards for which we believe it is more likely than not that the deferred tax assets will not be realized. The valuation allowance did not materially change during the year ended December 31, 2025, increased by $0.4 million during the year ended December 31, 2024, and increased by $0.2 million during the year ended December 31, 2023.

As of December 31, 2025, we had U.S federal net operating loss carryforwards of $15.9 million, which were generated by Cianna Medical, DFINE Inc., Biosphere Medical, Inc., and Biolife LLC, prior to our acquisition of these companies. These net operating loss carryforwards are subject to annual limitations under Internal Revenue Code Section 382. If unused, $15.0 million of the net operating losses will expire between 2030 and 2037. We anticipate that we will utilize all current net operating loss carryforwards prior to their expiration dates over the next 10 years. We utilized a total of $7.5 million in U.S. federal net operating loss carryforwards during the year ended December 31, 2025.

As of December 31, 2025, we had $23.3 million of non-U.S. net operating loss carryforwards, of which $21.6 million have no expiration date and $1.7 million expire at various dates through 2036. Non-U.S. net operating loss carryforwards utilized during the year ended December 31, 2025 were not material.

We do not consider our foreign earnings to be permanently reinvested. Consequently, we have recorded tax expense of $0.3 million, $0.7 million and $0.4 million for foreign withholding taxes on unremitted foreign earnings during the years ended December 31, 2025, 2024 and 2023, respectively.

We are subject to income taxes in the U.S. and numerous foreign jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes and recording the related assets and liabilities. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. In our opinion, we have made adequate provisions for income taxes for all years subject to audit. We are no longer subject to U.S. federal, state, and local income tax examinations by tax authorities for years before 2022. In foreign jurisdictions, we are no longer subject to income tax examinations for years before 2019.

Although we believe our estimates are reasonable, the final outcomes of these matters may be different from those which we have reflected in our historical income tax provisions and accruals. Such differences could have a material effect on our income tax provision and operating results in the period in which we make such determination.

The total liability for unrecognized tax benefits at December 31, 2025, including interest and penalties, was $2.2 million, of which $2.2 million would favorably impact our effective tax rate if recognized. The total liability for unrecognized tax benefits at December 31, 2024, including interest and penalties, was $2.1 million, of which $2.1 million would favorably impact our effective tax rate if recognized. As of December 31, 2025 and 2024, we had accrued $0.3 million and $0.2 million, respectively, in total interest and penalties related to unrecognized tax benefits. We account for interest and penalties for unrecognized tax benefits as part of our income tax provision. During the years ended December 31, 2025, 2024 and 2023, our liability for unrecognized tax benefit was increased (decreased) for interest and penalties by $0.1 million, $(0.1) million, and $(0.1) million, respectively.

A reconciliation of the beginning and ending amount of liabilities associated with uncertain tax benefits for the years ended December 31, 2025, 2024 and 2023, consisted of the following (in thousands):

	2025		2024		2023
Unrecognized tax benefits, opening balance	$	1,880	$	1,622	$	1,576
Gross increases (decreases) in tax positions taken in a prior year		(15)		70		112
Gross increases in tax positions taken in the current year		419		559		442
Lapse of applicable statute of limitations		(334)		(371)		(508)
Unrecognized tax benefits, ending balance	$	1,950	$	1,880	$	1,622

The tabular roll-forward ending balance does not include interest and penalties related to unrecognized tax benefits.

Income taxes paid for the years ended December 31, 2025, 2024 and 2023, consisted of the following (in thousands):

	2025		2024		2023
Federal	$	12,245	$	27,711	$	16,456
State		3,713		6,140		3,927
Foreign
Netherlands		2,604		*		1,912
France		2,246		*		*
Mexico		2,179		*		1,741
China		1,946		*		*
Ireland		1,818		*		2,321
Other		4,641		11,196		5,177
Total income taxes paid	$	31,392	$	45,047	$	31,534

* The amount of income taxes paid during the year does not meet the 5% disaggregation threshold.