Income Taxes |
9 Months Ended |
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Oct. 03, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes |
14. Income Taxes
We are taxed as a Corporation under Subchapter C in the U.S. We also file in U.S. state and local jurisdictions and in other countries where we have operations. Our effective tax rate is based on pre-tax earnings, enacted U.S. statutory tax rates, non-deductible expenses, and certain tax rate differences between U.S. and foreign jurisdictions. Our foreign subsidiaries file income tax returns in local country jurisdictions as required. The U.K., France, and Australia entities are included on U.S. tax returns as pass-through entities.
We account for income taxes in accordance with FASB ASC 740, “Income Taxes” (“ASC 740”). While we generally measure our income tax provision for interim periods using an estimate of our annual effective tax rate, we measured our income tax provision for the three and nine months ended October 3, 2026 using the actual year-to-date method. We used this method primarily because a small change in our forecasted income (loss) before taxes can have a significant impact on the annualized effective tax rate and we thus believe using the actual year-to-date method for this specific period more accurately reflects our tax provision as is consistent with guidance in ASC 740. Our provision for income taxes consists of provisions for federal, state, and foreign income taxes. Deferred tax liabilities and assets attributable to different tax jurisdictions are not offset in the Unaudited Condensed Consolidated Financial Statements.
During the three month periods ended October 3, 2026 and September 27, 2025, we recorded a total income tax (benefit) provision of approximately $(0.3) and $6.1 on pre-tax (loss) income of $(13.6) and $21.3 resulting in an effective tax rate of 2.2% and 28.6%, respectively. During the nine month periods ended October 3, 2026 and September 27, 2025, we recorded a total income tax provision of approximately $4.4 and $17.1 on pre-tax income of $2.0 and $63.8 resulting in an effective tax rate of 220.0% and 26.8%, respectively. For the three and nine month periods ended October 3, 2026, the effective tax rate was primarily impacted by the impairment of non-deductible goodwill, non-deductible executive compensation, statutory rate differentials and other permanent items. For the three and nine month periods ended September 27, 2025, the effective tax rate was primarily impacted by the change in statutory rate differentials, changes in estimated state income tax and apportionment rates, and permanent differences.
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