Company: MRCY
Filing Date: 2025-02-04
Form Type: 10-Q
Source: 0001049521-25-000009
Chunk: 99

Company: MERCURY SYSTEMS INC
Filing Date: 2025-02-04
Form: 10-Q
Item: Item 8
Chunk 99
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 December 27, 2024, the Company incurred $2,300 of severance costs. The Company incurs restructuring and other charges in connection with management's decision to undertake certain actions to realign operating expenses through workforce reductions and the closure of certain Company facilities, businesses and product lines. All of the restructuring and other charges are classified as Operating expenses in the Consolidated Statements of Operations and Comprehensive Loss and any remaining restructuring obligations are expected to be paid within the next twelve months. The restructuring liability is classified as Accrued expenses in the Consolidated Balance Sheets. The following table presents the detail of charges included in the Company’s liability for restructuring and other charges:Severance & RelatedBalance at June 28, 2024$8,758 Restructuring charges2,300 Cash paid(9,185)Balance at December 27, 2024$1,873 

G.Income Taxes 

The Company recorded an income tax benefit of $6,725 and $18,141 on a loss before income taxes of $24,304 and $63,722 for the second quarters ended December 27, 2024 and December 29, 2023, respectively. The Company recorded an income tax benefit of $12,319 and $31,168 on a loss before income taxes of $47,423 and $113,457 for the six months ended December 27, 2024, and December 29, 2023, respectively.During the second quarter and six months ended December 27, 2024, the Company recognized a tax provision of $138 and $357 related to stock compensation shortfalls, respectively, and during the second quarter and six months ended December 29, 2023, the Company recognized a tax provision of $431 and $1,646 related to stock compensation shortfalls respectively.The effective tax rate for the second quarter and six months ended December 27, 2024 differed from the federal statutory rate primarily due to federal and state research and development credits, non-deductible compensation, and state taxes. The effective tax rate for the second quarter and six months ended December 29, 2023 differed from the federal statutory rate primarily due to federal and state research and development credits, non-deductible compensation, stock compensation shortfalls, and state taxes.The Company continues to maintain a valuation allowance on the majority of its foreign net operating loss carryforwards and state research and developmental tax credit carryforwards. Based on forecasted taxable income and the scheduled