Income Taxes

6 Months Ended

Jun. 30, 2025

Income Tax Disclosure [Abstract]

Income Taxes

(7) Income Taxes

We recorded income tax expense on a pre-tax loss resulting in a negative effective tax rate of 60.2% for the three months ended June 30, 2025, as compared to income tax expense on pre-tax earnings resulting in an effective rate of 34.9% for the three months ended June 30, 2024. The 2025 rate was negative due to a pre-tax loss that primarily resulted from the goodwill and indefinite lived intangible asset impairment charges recorded in Switzerland and the United Kingdom and losses on the disposals of South Africa and New Caledonia, all of which are non-deductible. The 2025 rate was also unfavorably impacted by the lower level and overall mix of earnings due in part to restructuring costs recorded in the quarter and the 2025 enacted one-time French exceptional corporate income tax surcharge. The negative effective tax rate of 60.2% for the three months ended June 30, 2025 was significantly different than the United States Federal statutory rate of 21% primarily due to the factors noted above as well as tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances and the French business tax.

We recorded income tax expense on a pre-tax loss resulting in a negative effective rate of 144.8% for the six months ended June 30, 2025, as compared to income tax expense on pre-tax earnings resulting in an effective rate of 33.4% for the six months ended June 30, 2024. The 2025 rate was negative due to a pre-tax loss that primarily resulted from the goodwill and indefinite lived intangible asset impairment charges recorded in Switzerland and the United Kingdom and losses on the disposals of South Africa and New Caledonia, all of which are non-deductible. The 2025 rate was also unfavorably impacted by the lower level and overall mix of earnings due in part to restructuring costs recorded in the quarter and the 2025 enacted one-time French exceptional corporate income tax surcharge. The negative effective tax rate of 144.8% for the first half of 2025 was significantly different than the United States Federal Statutory rate of 21% primarily due to the factors noted above as well as tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances and the French business tax.

We had gross unrecognized tax benefits related to various tax jurisdictions, including interest and penalties, of $38.4 as of June 30, 2025. If recognized, the entire amount would favorably affect the effective tax rate except for $10.0. As of December 31, 2024, we had gross unrecognized tax benefits related to various tax jurisdictions, including interest and penalties, of $36.1.

We conduct business globally in various countries and territories. We are routinely audited by the tax authorities of the various tax jurisdictions in which we operate. Generally, the tax years that could be subject to examination are 2018 through 2025 for our major operations in France, Italy, the United Kingdom and the United States. As of June 30, 2025, we were subject to tax audits in Austria, Germany, India, Israel, Spain and the United States.