Company: LASR
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001124796-25-000154
Chunk: 48

Company: NLIGHT, INC.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 8
Chunk 48
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,Change20252024$%Income tax expense$273 $261 $12 4.6 %

Nine Months Ended September 30,Change20252024Amount%Income tax expense$427 $525 $(98)18.7 %

We record income tax expense for taxes in our foreign jurisdictions including Finland, Italy, Austria, and South Korea. While our tax expense is largely dependent on the geographic mix of earnings related to our foreign operations, we also record tax expense for uncertain tax positions taken and associated penalties and interest. We consider all available evidence, both positive and negative, in assessing the extent to which a valuation allowance should be applied against our deferred tax assets. Due to the uncertainty with respect to their ultimate realizability, we continue to maintain a full valuation allowance on deferred tax assets in the United States, and a partial valuation allowance in China as of September 30, 2025. Our effective tax rate may vary from period to period based on changes in estimated taxable income or loss by jurisdiction, changes to the valuation allowance, changes to U.S. federal, state or foreign tax laws, future expansion into areas with varying country, state, and local income tax rates and deductibility of certain costs and expenses by jurisdiction.

26

On July 4, 2025, the One Big Beautiful Bill Act ("the Act") was signed into law. Some of the tax related provisions of the Act affecting corporations include but are not limited to expensing of domestic research expenses, increasing the limit of the deduction of interest expense deduction to thirty percent of EBITDA, and one hundred percent bonus depreciation on eligible property acquired after January 19, 2025. We are evaluating the impact of the Act on our financial condition and results of operations in future periods.  Preliminarily, we do not anticipate a material change to our effective income tax rate or net deferred federal income tax assets as we maintain a full valuation allowance for all U.S. deferred tax assets.

The increase in income tax expense for the three months ended September 30, 2025 compared to the same period in 2024 was driven by an increase in foreign income. The decrease in income tax expense for the nine months ended September 30, 2025 compared to the same period in 2024 was driven by expiring statutes of limitations on unrecognized tax positions in the three months ended June 30, 2025. 

Liquidity and Capital Resources

We had cash and cash equivalents and restricted cash of $81.4 million