Income Taxes

9 Months Ended

Sep. 28, 2024

Income Tax Disclosure [Abstract]

Income Taxes

8. INCOME TAXES

The Company records its provision for income taxes on an interim basis based upon the estimate of the annual effective income tax rate for the full year applied to “ordinary” income or loss, adjusted each quarter for discrete items.

The Company recorded income tax expense of $15.5 million and $18.2 million for the three and nine-month periods ended September 28, 2024, respectively and income tax expense of $0.6 million and $1.4 million for the three and nine-month periods ended September 30, 2023, respectively.

The Company’s effective tax rate was negative 56.8% and negative 83.5% for the three and nine-month periods ended September 28, 2024, respectively, and negative 0.6% and negative 1.3% for the three and nine-month periods ended September 30, 2023, respectively. The effective tax rates for the three and nine-month periods ended September 28, 2024 and September 30, 2023 differed from the statutory rate of 21% primarily due to increased current federal and state taxes resulting from certain non-deductible expenses, most notably interest expense, and the changes in the valuation allowance recorded against certain deferred tax assets.

For both the three and nine-month periods ended September 28, 2024, the Company recognized a benefit of $1.9 million from the reversal of acquired uncertain tax positions. There has been no change to the Company’s policy that recognizes potential interest and penalties related to uncertain tax positions in income tax expense in the accompanying consolidated statements of operations.