Income Taxes |
3 Months Ended |
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Mar. 31, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes For interim tax reporting, we estimate an annual effective tax rate that is applied to year-to-date ordinary income or loss. We evaluate and update our estimated annual effective income tax rate on a quarterly basis based on current and forecasted operating results and tax laws. The tax effects of significant unusual or infrequently occurring items are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur. Our interim estimate of our annual effective tax rate and our interim tax provision are subject to volatility due to factors such as jurisdictions in which our deferred taxes and/or tax attributes are subject to a full valuation allowance, relative changes in unrecognized tax benefits and changes in tax laws. Based upon the mix and timing of our actual annual earnings or loss compared to annual projections, as well as changes in the factors noted above, our effective tax rate may vary quarterly and may make quarterly comparisons not meaningful. Income tax expense was $27 million and $9 million during the three months ended March 31, 2026 and 2025, respectively. This represents an effective income tax rate of (254.3%) and 7.7% for the three months ended March 31, 2026 and 2025, respectively, including items treated discretely. For the three months ended March 31, 2026, the income tax expense attributable to our income before income taxes differs from the amounts computed using the statutory tax rate, primarily due to the detrimental effects of jurisdictional rate differences, the inclusion of withholding taxes on cross-border payments, net increases in valuation allowances, permanent differences such as non-deductible expenses, and our estimate of global minimum tax. These detrimental effects were partially offset by the beneficial effects of net changes in uncertain tax positions and permanent differences, such as non-taxable income. For the three months ended March 31, 2025, the income tax expense attributable to our loss before income taxes differs from the amounts computed using the statutory tax rate, primarily due to the detrimental effects of jurisdictional rate differences, permanent tax differences, such as non-deductible expenses, the inclusion of withholding taxes on cross-border payments, global minimum tax, and net return-to-provision adjustments. These negative impacts to our effective tax rate were partially offset by the beneficial effects of net decreases in valuation allowances, permanent tax differences, such as non-taxable income, and changes to uncertain tax positions.
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