Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Components of Income (Loss) Before Income Tax

Components of the Company’s income (loss) before income taxes are as follows (in thousands):

	Year Ended December 31,
	2023			2022			2021
Income (loss) before income taxes:
Canada	$	(6,490	)	$	(4,946	)	$	(1,371	)
U.S.		38,992			28,365			19,168
Other		51,246			63,740			38,375
Total	$	83,748		$	87,159		$	56,172

Components of Income Tax Provision (Benefit)

Components of the Company’s income tax provision (benefit) are as follows (in thousands):

	Year Ended December 31,
	2023			2022			2021
Current
Canada	$	59		$	65		$	95
U.S.		14,424			17,205			205
Other		11,113			14,492			9,486
		25,596			31,762			9,786
Deferred
Canada		—			—			493
U.S.		(12,224	)		(15,370	)		(2,133	)
Other		(2,502	)		(3,284	)		(2,305	)
		(14,726	)		(18,654	)		(3,945	)
Total	$	10,870		$	13,108		$	5,841

Reconciliation of Statutory Canadian Tax rate to Effective Tax Rate

The reconciliation of the statutory Canadian tax rate to the effective tax rate related to income before income taxes is as follows (in thousands, except percentage data):

	Year Ended December 31,
	2023			2022			2021
Statutory Canadian tax rate		29.00	%		29.00	%		29.00	%
Expected income tax provision at Canadian statutory tax rate	$	24,287		$	25,276		$	16,291
International tax rate differences		(4,804	)		(6,289	)		(3,621	)
U.S. state income taxes, net		860			3			(249	)
Withholding and other taxes		300			789			429
Transaction costs and permanent differences		423			140			1,169
Disallowed compensation		2,571			2,138			1,111
Foreign-derived intangible income		(4,500	)		(4,467	)		(1,211	)
Tax credits		(3,602	)		(2,256	)		(1,408	)
Statutory tax rate changes		165			—			489
Uncertain tax positions		90			(168	)		(472	)
Change in valuation allowance		2,068			2,048			918
Acquisition contingent consideration adjustments		—			(698	)		87
Provision to return differences		(1,056	)		(19	)		33
Windfall benefit from share-based compensation		(1,685	)		(254	)		(5,131	)
U.K. patent box		(4,247	)		(3,135	)		(2,594	)
Reported income tax provision	$	10,870		$	13,108		$	5,841
Effective tax rate		13.0	%		15.0	%		10.4	%

Significant Components of Deferred Tax Assets and Liabilities

Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2023 and 2022 are as follows (in thousands):

	December 31,
	2023			2022
Deferred tax assets:
Losses	$	11,274		$	9,954
Operating lease liabilities		10,194			11,117
Compensation related deductions		8,457			9,010
Inventories		12,497			9,368
Tax credits		3,222			2,624
Capitalized R&D		25,238			13,623
Warranty		964			836
Other		724			284
Total deferred tax assets		72,570			56,816
Valuation allowance on deferred tax assets		(16,674	)		(14,568	)
Net deferred tax assets	$	55,896		$	42,248
Deferred tax liabilities:
Depreciation	$	(5,389	)	$	(4,049	)
Amortization		(24,436	)		(26,746	)
Operating lease right-of-use assets		(9,198	)		(10,477	)
Deferred revenue		(5,316	)	$	(3,057	)
Total deferred tax liabilities	$	(44,339	)	$	(44,329	)
Net deferred tax assets (liabilities)	$	11,557		$	(2,081	)

Reconciliation of Total Amounts of Unrecognized Tax Benefits

The reconciliation of the total amounts of unrecognized tax benefits is as follows (in thousands):

Balance at December 31, 2020	$	5,258
Additions based on tax positions related to the current year		1,162
Additions for tax positions of prior years		9
Reductions to tax positions of prior years		(41	)
Reductions to tax positions resulting from a lapse of the applicable statute of limitations		(1,591	)
Settlements with tax authorities		—
Balance at December 31, 2021		4,797
Additions based on tax positions related to the current year		553
Additions for tax positions of prior years		34
Reductions to tax positions of prior years		(563	)
Reductions to tax positions resulting from a lapse of the applicable statute of limitations		(572	)
Settlements with tax authorities		—
Balance at December 31, 2022		4,249
Additions based on tax positions related to the current year		561
Additions for tax positions of prior years		47
Reductions to tax positions of prior years		(22	)
Reductions to tax positions resulting from a lapse of the applicable statute of limitations		(492	)
Settlements with tax authorities		—
Balance at December 31, 2023	$	4,343

Income Tax Returns to be Reviewed

The Company’s income tax returns may be reviewed by tax authorities in the following countries for the following periods under the appropriate statute of limitations:

United States	2019 - Present
Canada	2017 - Present
United Kingdom	2021 - Present
Germany	2017 - Present
Czech Republic	2021 - Present
China	2013 - Present
Japan	2018 - Present