v3.25.4
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Summary of Loss Before Provision for (benefit from) Income Taxes
Income before provision for income taxes consisted of the following (in thousands):
Years Ended December 31,
202520242023
United States$1,584,577 $426,944 $174,637 
Foreign72,791 62,229 62,454 
Income before provision for income taxes$1,657,368 $489,173 $237,091 
Summary of Provision for (benefit from) Income Taxes
Provision for income taxes consisted of the following (in thousands):
Years Ended December 31,
202520242023
Current:
Federal$— $— $— 
State1,537 1,556 2,333 
Foreign25,101 20,265 22,189 
Total current provision26,638 21,821 24,522 
Deferred:
Federal— — — 
State— — — 
Foreign(3,914)(566)(4,806)
Total deferred provision(3,914)(566)(4,806)
Total provision for income taxes$22,724 $21,255 $19,716 
Summary of Reconciliation of Effective Income Tax Rate
A reconciliation of the expected tax provision at the statutory federal income tax rate to the Company’s recorded tax provision consisted of the following, subsequent to the adoption of ASU 2023-09 (in thousands, except percentages):
Year Ended
December 31, 2025
AmountPercent
U.S. federal tax at statutory rate$348,047 21.0 %
State and local income taxes, net of federal income tax effect(1)
1,537 0.1 
Foreign tax effects:
United Kingdom (“U.K.”):
Statutory tax rate difference between the U.K. and U.S. (29,130)(1.8)
Stock-based compensation expense(159,108)(9.6)
Changes in valuation allowance184,024 11.1 
Other(3,279)(0.2)
Other foreign jurisdictions8,637 0.5 
Effects of changes in tax laws or rates enacted in the current period— — 
Effects of cross-border tax laws— — 
Tax credits(151,602)(9.1)
Changes in valuation allowances467,493 28.1 
Nontaxable or nondeductible items:
Stock-based compensation expense(720,691)(43.4)
Nondeductible officers' compensation34,453 2.1 
Other4,442 0.3 
Changes in unrecognized tax benefits37,901 2.3 
Total provision for income taxes and effective tax rate$22,724 1.4 %
————
(1) State taxes in Maryland made up the majority of the tax effect in this category.
A reconciliation of the expected tax provision at the statutory federal income tax rate to the Company’s recorded tax provision consisted of the following, prior to the adoption of ASU 2023-09 (in thousands):
Years Ended December 31,
20242023
Expected tax provision at U.S. federal statutory rate$102,726 $49,789 
State income taxes - net of federal benefit1,365 2,309 
Foreign tax rate differential(15,767)859 
Research and development tax credits(103,858)(45,667)
Stock-based compensation(513,841)(79,128)
Non-deductible officers’ compensation
33,404 34,479 
Change in valuation allowance507,149 35,070 
Base Erosion Anti-Abuse Tax and related elections— 14,700 
Taxes withheld at source5,599 4,378 
Non-deductible expenses5,545 3,610 
Other(1,067)(683)
Total provision for income taxes$21,255 $19,716 
Summary of Significant Deferred Tax Assets and Liabilities Significant deferred tax assets and liabilities consisted of the following (in thousands):
As of December 31,
20252024
Net operating loss carryforwards$2,617,820 $1,583,076 
Capitalized research and experimental expenses85,377 504,156 
Reserves and accruals113,289 87,111 
Tax credit carryforwards528,449 394,579 
Stock-based compensation62,453 76,604 
Lease liabilities54,842 60,103 
Depreciation and amortization16,679 15,839 
Capitalized facilitative expenses22,573 38,436 
Gross deferred tax assets3,501,482 2,759,904 
Acquisition related intangibles(4,925)(6,827)
Right-of-use assets(47,941)(50,208)
Total net deferred tax assets before valuation allowance3,448,616 2,702,869 
Valuation allowance(3,452,323)(2,710,393)
Net deferred tax assets (liabilities)$(3,707)$(7,524)
Summary of Reconciliation of the Gross Unrecognized Tax Benefits
A reconciliation of the gross unrecognized tax benefits consists of the following (in thousands):
Years Ended December 31,
202520242023
Unrecognized tax benefit beginning of year$151,183 $112,016 $81,904 
Increases in current year tax positions45,426 39,494 14,346 
Increases in prior year tax positions43 2,926 15,766 
Decreases in prior year tax positions— — — 
Decreases in prior year tax positions due to settlements(12,445)(3,253)— 
Decreases in prior year tax positions due to lapse of statute of limitations— — — 
Unrecognized tax benefit end of year$184,207 $151,183 $112,016 
Schedule of Cash Flow, Supplemental Disclosures
The amounts of cash taxes for the year ended December 31, 2025 included the following, subsequent to the adoption of ASU 2023-09 (in thousands):
Year Ended
December 31, 2025
Federal$— 
State2,500 
Foreign
Korea5,771 
Japan4,796 
France2,843 
Germany1,724 
All other foreign4,052 
Income taxes, net of amounts refunded
$21,686 
Employment taxes$364,675