Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Summary of Components of Provision for Income Taxes

A summary of the components of the provision for income taxes for the years ended December 31, 2017, 2016 and 2015 is as follows:

(In thousands)	2017			2016			2015
Current
Federal	$	466		$	12,733		$	7,504
State		(150	)		1,141			279
International		6,458			477			(29	)
Total Current		6,774			14,351			7,754

Deferred
Federal		8,024			647			(585	)
State		1,882			73			(66	)
International		4,167			(3,405	)		(41	)
Total Deferred		14,073			(2,685	)		(692	)
Total Provision for Income Taxes	$	20,847		$	11,666		$	7,062

Effective Income Tax Rate Differs from Federal Statutory Rate

Our effective income tax rate differs from the federal statutory rate due to the following:

	2017			2016			2015
Tax provision computed at the federal statutory rate		35.00	%		35.00	%		35.00	%
State income tax provision, net of federal benefit		2.17			3.93			4.86
Federal research credits		(11.88	)		(8.15	)		(12.55	)
Foreign taxes		(2.27	)		(0.34	)		2.10
Tax-exempt income		(0.75	)		(0.53	)		(1.94	)
State tax incentives		(2.71	)		(2.77	)		(5.04	)
Stock-based compensation		1.43			2.53			6.91
Domestic production activity deduction		(1.13	)		(2.23	)		(3.17	)
Bargain purchase		—			(2.64	)		—
Impact of U.S. tax reform		26.70			—			—
Other, net		0.09			0.08			1.30
Effective Tax Rate		46.65	%		24.88	%		27.47	%

Income Before Provision for Income Taxes

Income before provision for income taxes for the years ended December 31, 2017, 2016 and 2015 is as follows:

(In thousands)	2017		2016			2015
U.S. entities	$	26,552	$	54,077		$	27,400
International entities		18,135		(7,182	)		(1,692	)
Total	$	44,687	$	46,895		$	25,708

Principal Components of Current and Non-current Deferred Taxes

Deferred income taxes on the balance sheet result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The principal components of our current and non-current deferred taxes are as follows:

(In thousands)	2017			2016
Deferred tax assets
Inventory	$	7,545		$	12,020
Accrued expenses		3,103			5,551
Investments		—			1,062
Deferred compensation		5,204			5,751
Stock-based compensation		2,988			4,724
Uncertain tax positions related to state taxes and related interest		370			762
Pensions		4,727			4,273
Foreign losses		3,091			6,486
State losses and credit carry-forwards		3,854			4,021
Federal loss and research carry-forwards		3,058			5,886
Valuation allowance		(6,006	)		(6,149	)
Total Deferred Tax Assets		27,934			44,387

Deferred tax liabilities
Property, plant and equipment		(3,553	)		(4,433	)
Intellectual property		(663	)		(1,918	)
Investments		(290	)		—
Total Deferred Tax Liabilities		(4,506	)		(6,351	)
Net Deferred Tax Assets	$	23,428		$	38,036

Change in Unrecognized Income Tax Benefits

The change in the unrecognized income tax benefits for the years ended December 31, 2017, 2016 and 2015 is reconciled below:

(In thousands)	2017			2016			2015
Balance at beginning of period	$	2,226		$	2,537		$	3,334
Increases for tax position related to:
Prior years		465			95			—
Current year		285			428			280
Decreases for tax positions related to:
Prior years		(14	)		—			(29	)
Settlements with taxing authorities		—			—			(103	)
Expiration of applicable statute of limitations		(596	)		(834	)		(945	)
Balance at end of period	$	2,366		$	2,226		$	2,537