v3.25.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
 
Loss before income tax (benefit) provision for the years ended December 31, 2024, 2023 and 2022 consists of the following:
 
 Year Ended December 31,
 202420232022
United States$(586,004)$(753,105)$(1,329,931)
Foreign(7,154)(38,148)(113,027)
Loss before income tax (benefit) provision$(593,158)$(791,253)$(1,442,958)
 
The components of the provision (benefit) for income taxes consists of the following:
 Year Ended December 31,
 202420232022
Current:   
Federal$10 $— $— 
State607 433 456 
Foreign5,775 3,888 5,085 
Total current provision6,392 4,321 5,541 
Deferred:
Federal(64,196)205 (52,411)
State(29,022)2,643 (17,624)
Foreign485 3,001 (3,372)
Total deferred provision(92,733)5,849 (73,407)
Total income tax (benefit) provision$(86,341)$10,170 $(67,866)
 
The reconciliation between income taxes computed at the U.S. statutory income tax rate to our provision for income taxes for the years ended December 31, 2024, 2023 and 2022 is as follows:
 
 Year Ended December 31,
 202420232022
Benefit for income taxes at 21% rate$(124,563)$(166,217)$(303,028)
State taxes, net of federal benefit(9,752)(40,385)(17,265)
Stock-based compensation (benefit) expense(882)26,155 28,015 
Non-deductible lobbying expenses6,924 1,009 4,788 
Change in valuation allowance18,307 130,817 166,978 
Non-deductible executive compensation18,275 30,106 54,925 
Loss (gain) on remeasurement of warrant liabilities1,270 12,084 (6,173)
Foreign rate differential1,003 3,348 1,802 
Income tax reserves3,848 4,119 (553)
Other(771)9,134 2,645 
Total income tax (benefit) provision$(86,341)$10,170 $(67,866)
Significant components of the Company’s deferred tax assets (liabilities) as of December 31, 2024 and 2023 are as follows:
 
 Year Ended December 31,
 20242023
Deferred tax assets:  
Net operating loss carryforwards$1,100,214 $1,042,874 
Intangible assets13,770 82,813 
Accrual and other temporary differences78,535 59,656 
Operating lease22,239 24,784 
Stock-based compensation60,754 51,065 
Capitalized research and development costs199,678 128,719 
Fixed assets3,710 2,451 
Gross deferred tax assets1,478,900 1,392,362 
Valuation allowance(1,453,715)(1,358,934)
Net deferred tax assets$25,185 $33,428 
Deferred tax liabilities:
Capitalized software costs$— $(4,535)
Fixed assets(108)(162)
Intangible assets(6,532)— 
Operating lease(21,472)(25,528)
Other(4,041)(7,798)
Gross deferred tax liabilities(32,153)(38,023)
Total net deferred tax liabilities$(6,968)$(4,595)
    
 
In assessing whether it is more likely than not that deferred tax assets will be realized, the Company considers all available evidence, both positive and negative, including its recent cumulative earnings or loss, experience and expectations of future available taxable income of the appropriate source and character by taxing jurisdiction, tax attribute carryback and carryforward periods available for tax purposes, and prudent and feasible tax planning strategies.

The Company records its deferred tax assets of $6.8 million and $7.8 million for 2024 and 2023, respectively, in deposits and other non-current assets in the consolidated balance sheet and its deferred tax liabilities of $13.8 million and $12.4 million for 2024 and 2023, respectively, in other long-term liabilities in the consolidated balance sheets. The Company has provided a valuation allowance for the U.S. deferred tax assets as of December 31, 2024 and 2023. For the years ended December 31, 2024, and 2023, the U.S. valuation allowance increased by $94.8 million (of which $76.5 million was established through goodwill and $18.3 million was established through the consolidated statement of operations), and $130.8 million, respectively primarily due to the operating losses.
 
As of December 31, 2024, the Company had U.S. federal and state tax net operating loss (“NOL”) carryforwards of $4.0 billion and $4.3 billion, respectively, which may be available to offset future income tax liabilities. Of the federal net operating loss carryforward, $0.7 billion expires at various dates beginning in 2032 through 2037 and $3.3 billion does not expire. Of the state NOL carryforward, $4.0 billion expires at various dates beginning in 2025 through 2044 and $0.3 billion does not expire.

Utilization of the NOL carryforwards may be subject to limitation under Section 382 of the Internal Revenue Code of 1986 based on ownership changes that could occur in the future. These ownership changes may limit the amount of NOL and tax credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. There could be additional ownership changes in the future, which may result in additional limitations on the utilization of the NOL and tax credit carryforwards. The Company has analyzed the impact of these limitations on its attributes and included the impact of these limitations in its U.S. deferred tax assets.
As of December 31, 2024, foreign earnings of $9.7 million have been retained by the Company’s foreign subsidiaries for indefinite reinvestment. Upon repatriation of those earnings, in the form of dividends or otherwise, the Company could be subject to withholding taxes payable to the various foreign countries. Determination of the amount of unrecognized deferred income tax liability related to these outside basis differences is not practicable.

In addition to filing federal income tax returns, the Company files income tax returns in numerous states and foreign jurisdictions that impose an income tax. The Company is subject to U.S. federal, state and local income tax examinations by tax authorities for the years beginning in 2012. The Company is no longer subject to foreign income tax examinations for tax years prior to 2018.
 
The following table presents a reconciliation of the total amounts of unrecognized tax benefits, excluding interest and penalties, included in long-term income tax liabilities on the Company’s consolidated balance sheets:
 
Year Ended December 31,
202420232022
Unrecognized tax benefits at the beginning of the year$57,424 $58,011 $72,407 
Additions for tax positions of prior years— 1,026 1,807 
Reduction for tax positions of prior years(1,395)(269)— 
Additions for tax positions of current year377 449 — 
Settlements— — (7,412)
Foreign currency adjustments(376)(1,793)(8,791)
Unrecognized tax benefits at the end of the year$56,030 $57,424 $58,011 
 
As of December 31, 2024, 2023 and 2022, the Company had $54.2 million, $55.9 million and $58.0 million, respectively, of net unrecognized tax benefits, which would affect the Company’s tax rate if recognized. The Company does not anticipate any material changes to its unrecognized tax benefits within the next twelve months.

The Company recognizes interest and penalties accrued related to unrecognized tax benefits as income tax expense. During the years ended December 31, 2024, 2023 and 2022, the Company recognized $5.3 million, $5.0 million and $6.4 million in interest and penalties. The Company had $22.2 million and $16.8 million of interest and penalties accrued at December 31, 2024 and 2023, respectively.

Significant judgment is required in evaluating the Company's uncertain tax positions and determining its provision for income taxes. Although the Company believes that it has appropriately reserved for its uncertain tax positions, no assurance can be given that the final tax outcome of these matters will not be different than expectations. The Company will adjust these reserves in light of changing facts and circumstances, such as the closing of a tax audit, the refinement of an estimate, the closing of a statutory audit period or changes in applicable tax law. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences would impact the provision for income taxes in the period in which such determination is made. The provision for income taxes includes the impact of reserve provisions and changes to the reserves that are considered appropriate, as well as related net interest.

The Company recognizes liabilities for anticipated tax audit issues in the U.S. and other domestic and international tax jurisdictions based on its estimate of whether, and the extent to which, the tax positions are more likely than not to be sustained based on the technical merits. The Company believes that it has appropriate support for the income tax positions taken and to be taken on its tax returns and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax laws applied to the facts of each matter.

The Company believes it maintains appropriate reserves to offset any potential income tax liabilities that may arise upon final resolution of matters for open tax years. If such reserve amounts ultimately prove to be unnecessary, the resulting reversal of such reserves could result in tax benefits being recorded in the period the reserves are no longer deemed necessary. If such amounts prove to be less than an ultimate assessment, a future charge to expense would be recorded in the period in which the assessment is determined.