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Income Taxes
9 Months Ended
Sep. 30, 2016
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The Company is required to determine its effective tax rate each quarter based upon its estimated annual effective tax rate. The Company is also required to record the tax impact of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, in the interim period in which they occur. In addition, jurisdictions with a projected loss for the year where no tax benefit can be recognized are excluded from the estimated annual effective tax rate.
The effective tax rate for the three and nine months ended September 30, 2016 was 25% and 29%, respectively. The effective tax rate for the three and nine months ended September 30, 2015 was 28% and 33%, respectively. The effective tax rate for the three and nine months ended September 30, 2016 compared to the three and nine months ended September 30, 2015 was lower primarily due to the tax benefits related to the U.S. research tax credit and the early adoption of ASU 2016-09 related to share-based compensation reflected in the 2016 effective tax rate which was not statutory in the three and nine months ended September 30, 2015. The income tax rate for the three and nine months ended September 30, 2016 varies from statutory rates primarily due to the impact of income taxes on foreign earnings taxed at rates lower than the U.S. statutory rate, the inability to record a tax benefit for pre-tax losses in certain foreign jurisdictions to the extent not offset by other categories of income, tax credits, income tax incentives, excess tax benefits related to share-based compensation, withholding taxes and other permanent items. Further, the Company’s current and future provision for income taxes may be impacted by the recognition of valuation allowances in certain countries. The Company intends to maintain these allowances until it is more likely than not that the deferred tax assets will be realized.