Company: CWAN
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001866368-25-000018
Chunk: 93

Company: Clearwater Analytics Holdings, Inc.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 8
Chunk 93
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,20252024United States$39,710 $21,658 Rest of World28,501 17,936 Total long-lived assets, net$68,211 $39,594 

Note 14. Income Taxes

As a part of the Up-C structure, Clearwater Analytics Holdings, Inc. owns a portion of CWAN Holdings, which contains all operations of the business and is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, CWAN Holdings is generally not subject to U.S. federal, state, and local income taxes. Any taxable income or loss generated by CWAN Holdings is passed through to and included in the taxable income or loss of its members in accordance with the terms of the operating agreement of CWAN Holdings. CWAN Holdings’ international wholly-owned subsidiaries are subject to taxes in foreign jurisdictions.The Company is taxed as a corporation and pays corporate federal, state, and local taxes on income allocated to it from CWAN Holdings based on the Company’s economic interest held in CWAN Holdings. While the Company consolidates CWAN Holdings for financial reporting purposes, the Company will not be taxed on the earnings attributed to the non-controlling interests. As a result, the income tax burden on the earnings attributed to the non-controlling interest is not reported by the Company in its condensed consolidated financial statements.Our tax provision for interim periods is determined using an estimated annual effective tax rate, adjusted for discrete items arising in the applicable quarter. In each quarter, we update the estimated annual effective tax rate and make a year-to-date adjustment to the provision. The estimated annual effective tax rate may be subject to significant volatility due to several factors, including our ability to accurately predict the proportion of our pretax income in multiple jurisdictions, certain book-tax differences, the effects of business combinations, and exchanges from non-controlling interests.The following table provides details of the provision for (benefit from) income taxes:Three Months EndedJune 30,Six Months EndedJune 30,2025202420252024Income (loss) before income taxes$(26,498)$355 $(18,012)$2,492 Provision for (benefit from) income taxes(2,347)79 (797)(19)Effective tax rate8.9%22.3%4.4%(0.8%)For the three and six months ended June 30, 2025, the Company’s effective tax rate was different than the statutory rate primarily because of