Company: CXDO
Filing Date: 2025-03-04
Form Type: 10-K
Source: 0001654954-25-002287
Chunk: 449

Company: Crexendo, Inc.
Filing Date: 2025-03-04
Form: 10-K
Item: Item 2
Chunk 449
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 the future tax consequences of events that have been recognized in the financial statements or tax returns. Variations in the actual outcome of these future tax consequences could materially impact our financial position, results of operations, and cash flows.  In assessing the need for a valuation allowance, we evaluate all significant available positive and negative evidence, including historical operating results, estimates of future taxable income and the existence of prudent and feasible tax planning strategies. At December 31, 2024, we determined that it is more likely-than-not that we will not be able to realize our deferred income tax assets in the future. A valuation allowance of $5,417 and $4,782 was recorded against our gross deferred tax asset balance as of December 31, 2024 and 2023, respectively.   Interest and penalties associated with income taxes are classified as income tax expense in the consolidated statements of operations.  Stock-Based Compensation – For equity-classified awards, compensation expense is recognized over the requisite service period based on the computed fair value on the grant date of the award. Equity classified awards include the issuance of stock options and restricted stock units (“RSUs”).  Operating Segments – Accounting guidance establishes standards for the way public business enterprises are to report information about operating segments in annual financial statements and requires enterprises to report selected information about operating segments in financial reports issued to stockholders. The Company has reorganized into two operating segments, which consist of cloud telecommunications services and software solutions. The software solutions segment includes the results of operation of NetSapiens, LLC, NSHC, Inc., NetSapiens Canada, Inc., and NetSapiens International Limited. The cloud telecommunications segment includes the results of operations of Allegiant Networks, LLC, Crexendo Business Solutions, Inc., Crexendo International, Inc., and Crexendo Business Solutions of Virginia, Inc. We generate 94% of our total revenue from customers within the United States and 6% of our total revenues from customers in other parts of the world.

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Significant Customers – No customer accounted for 10% or more of our total revenue for the years ended December 31, 2024 and 2023.  No customer accounted for 10% or more of our total trade receivables as of December 31, 2024 and 2023. Recently Adopted Accounting Pronouncements – In September 2016, the FASB issued ASU 2016-13, Financial Instruments -