Company: CRCT
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001828962-25-000146
Chunk: 63

Company: Cricut, Inc.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 8
Chunk 63
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ured Overnight Financing Rate, the Adjusted Australian Dollar Rate, the Adjusted Canadian Dollar Offered Rate or the Adjusted New Zealand Dollar Rate, as applicable for the interest period in effect for such borrowing plus the applicable rate. 

8.Income Taxes

The Company computes interim period income taxes by applying an estimated annual effective tax rate to our year-to-date income from operations before income taxes, except for significant unusual or infrequently occurring items. The estimated effective tax rate is adjusted each quarter. The estimated effective tax rate was 27.6% and 27.2% for the three and six months ended June 30, 2025, respectively, and 33.6% and 32.1% for the three and six months ended June 30, 2024, respectively. The Company’s provision for income taxes was $9.4 million and $18.1 million for the three and six months ended June 30, 2025, respectively, and $10.0 million and $18.7 million for the three and six months ended June 30, 2024, respectively. The provision for income taxes varied from the tax computed at the U.S. federal statutory income tax rate for the three and six months ended June 30, 2025, primarily due to a decrease in stock-based compensation difference attributable to the decrease in stock price upon vesting versus the stock price at the grant date. The Company reviews its deferred tax assets for realization based upon historical taxable income, prudent and feasible tax planning strategies, the expected timing of the reversals of existing temporary differences and expected future taxable income. The Company has concluded that it is more likely than not that the net deferred tax assets will be realized. Accordingly, the Company has not recorded a valuation allowance against net deferred tax assets for any of the periods presented.On July 4, 2025, the "One Big Beautiful Bill Act" (OBBBA) was enacted into law. Key corporate tax provisions include the restoration of 100% bonus depreciation, immediate expensing for domestic research and experimental expenditures, updates to Global Intangible Low-Taxed Income and Foreign-Derived Intangible Income rules and expanded Section 162(m) aggregation requirements. In accordance with ASC 740, the effects of the new tax law will be recognized in the period of enactment. The Company is currently evaluating the impact of the OBBBA, and an estimate of the financial effect cannot be made at this time.

9.Capital Structure 

As of June 30,