Grindr Inc.GRND
Grindr Inc. Income Taxes Disclosure
Income Tax
On July 4, 2025, President Trump signed into law the legislation commonly referred to as the One Big Beautiful Bill Act (“OBBBA”). The OBBBA includes various provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The OBBBA has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. While the OBBBA did not have a significant impact on the Company’s total tax provision as of December 31, 2025, the Company is still evaluating the Company’s position on the elective provisions of the law and the potential impacts of those elections on the consolidated financial statements.
Net income (loss) before income tax includes the following components:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| United States | $ | 118,586 | $ | (118,307) | $ | (51,646) | |||||||||||
| International | 27 | 17 | (99) | ||||||||||||||
| $ | 118,613 | $ | (118,290) | $ | (51,745) | ||||||||||||
Income tax provision consisted of the following:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Current income tax provision | |||||||||||||||||
| Federal | $ | 18,372 | $ | 15,379 | $ | 10,034 | |||||||||||
| State and local | 2,797 | 3,178 | 1,949 | ||||||||||||||
| International | 60 | 61 | 22 | ||||||||||||||
| Total current tax provision | 21,229 | 18,618 | 12,005 | ||||||||||||||
| Deferred income tax provision (benefit) | |||||||||||||||||
| Federal | 2,424 | (4,211) | (7,610) | ||||||||||||||
| State and local | 209 | (1,696) | (372) | ||||||||||||||
| Total deferred tax provision (benefit) | 2,633 | (5,907) | (7,982) | ||||||||||||||
| Total income tax provision | $ | 23,862 | $ | 12,711 | $ | 4,023 | |||||||||||
The tax effects of temporary differences that give rise to portions of deferred tax assets and deferred tax liabilities are as follows:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Deferred tax assets | |||||||||||
| Capitalized research expenditures | $ | 9,469 | $ | 6,413 | |||||||
| Equity awards | 3,930 | 1,844 | |||||||||
| Accrued compensation | 3,017 | 2,392 | |||||||||
| Right-of-use asset | 1,104 | 790 | |||||||||
| General business credit | 451 | 388 | |||||||||
| Accrued expenses | 372 | 59 | |||||||||
| Capitalized interest carryforward | — | 6,357 | |||||||||
| Other | 520 | 234 | |||||||||
| Gross deferred tax assets | 18,863 | 18,477 | |||||||||
| Less: Valuation allowance | — | — | |||||||||
| Total deferred tax assets | 18,863 | 18,477 | |||||||||
| Deferred tax liabilities | |||||||||||
| Intangible assets | (19,087) | (16,490) | |||||||||
| Lease liability | (1,103) | (724) | |||||||||
| Other | (64) | (21) | |||||||||
| Total gross deferred tax liabilities | (20,254) | (17,235) | |||||||||
Net deferred tax assets (liabilities) | $ | (1,391) | $ | 1,242 | |||||||
As of each reporting date, the Company evaluates both positive and negative evidence that may affect its assessment of the future realization of deferred tax assets. As of December 31, 2025, and 2024, the Company determined that sufficient
positive evidence exists to determine that it is more likely than not that all deferred taxes assets are fully realizable. Accordingly, the valuation allowance was zero as of December 31, 2025, and 2024.
Tax credit carryforwards are as follows:
| December 31, 2025 | |||||||||||
| Amount | Expiration Years | ||||||||||
| Tax credits, state | 672 | Do Not Expire | |||||||||
| December 31, 2024 | |||||||||||
| Amount | Expiration Years | ||||||||||
| Tax credits, state | 577 | Do Not Expire | |||||||||
The reconciliation of the provision for income taxes to the amount computed by applying a 21% statutory U.S. federal income tax rate to income before taxes, and the Company’s effective tax rate to the statutory tax rate after to the adoption of ASU 2023-09 is as follows:
Year Ended December 31, 2025 | |||||||||||
Amount | Percent | ||||||||||
| Income tax provision at the federal statutory rate of 21.0% | $ | 24,909 | 21.0% | ||||||||
State and local income taxes(1) | 2,386 | 2.0% | |||||||||
| Effect of cross-border tax laws | |||||||||||
| Foreign derived intangible income deduction | (4,204) | (3.5)% | |||||||||
| Tax credits | |||||||||||
| Research tax credit | (1,575) | (1.3)% | |||||||||
| Nondeductible items | |||||||||||
| Officer compensation | 8,363 | 7.1% | |||||||||
| Equity compensation | (4,327) | (3.6)% | |||||||||
| Warrant liability revaluation | (2,079) | (1.8)% | |||||||||
| Other | 170 | 0.1% | |||||||||
| Worldwide changes in unrecognized tax benefits | 312 | 0.3% | |||||||||
| Other | (93) | (0.1)% | |||||||||
| $ | 23,862 | 20.1% | |||||||||
(1)The states and local jurisdictions that contribute to the majority (greater than 50%) of the tax effect in this category include New York state and city, Illinois, New Jersey, Pennsylvania, and California.
The reconciliation of the Company’s effective tax rate to the statutory tax rate prior to the adoption of ASU 2023-09 is as follows:
Year Ended December 31, | |||||||||||
| 2024 | 2023 | ||||||||||
| Income tax provision at the federal statutory rate of 21.0% | 21.0% | 21.0% | |||||||||
| State taxes | (2.1)% | (0.6)% | |||||||||
| Stock-based compensation | 2.2% | (1.5)% | |||||||||
| Foreign derived intangible income deduction | 2.9% | 4.3% | |||||||||
| Change in valuation allowance | 3.9% | (8.3)% | |||||||||
| Change in fair value of warrant liability | (32.9)% | (20.1)% | |||||||||
| Research tax credit | 0.9% | 2.7% | |||||||||
| Uncertain tax positions | (0.2)% | (0.6)% | |||||||||
| Officer compensation | (6.6)% | (4.1)% | |||||||||
| Other items | 0.2% | (0.6)% | |||||||||
| (10.7)% | (7.8)% | ||||||||||
The following table summarizes the activity related to the gross unrecognized tax benefits for the years ended December 31, 2025, 2024, and 2023:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Balance at the beginning of the year | $ | 946 | $ | 797 | $ | 586 | |||||||||||
| Adjustments related to prior year tax positions | 8 | 10 | — | ||||||||||||||
| Increases related to current year tax positions | 398 | 270 | 211 | ||||||||||||||
| Decreases due to statute of limitation expiration | (190) | (131) | — | ||||||||||||||
| Balance at end of the year | $ | 1,162 | $ | 946 | $ | 797 | |||||||||||
All of the Company’s unrecognized tax benefits, if recognized, would change the effective rate. The Company does not expect any material changes to the unrecognized tax benefits over the next twelve months. The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits, and uncertain income tax positions must meet a more likely than not recognition threshold to be recognized. The Company recognizes interest and penalties related to unrecognized tax benefits in “Income tax provision” in the consolidated statements of operations. Interest and penalties are not material for each of the periods presented.
The Company believes it is more likely than not that all significant tax positions taken to date would be sustained by the relevant taxing authorities. As of December 31, 2025, and 2024, there were no active taxing authority examinations in any of the Company’s major tax jurisdictions. The Company remains subject to examination for federal and state income tax purposes for the tax years ended 2021 through 2024.
The amounts of cash income taxes paid (net of refunds) by the Company were as follows:
| Year Ended December 31, 2025 | |||||
| Federal | $ | 18,473 | |||
| State and local | 2,573 | ||||
| International | 59 | ||||
| $ | 21,105 | ||||
The amount of cash income taxes paid (net of refunds) by the Company during the years ended December 31, 2024, and 2023 was $17,433 and $17,709, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 2, 2026 | Showing above |
| 2024 | Mar 7, 2025 | |
| 2023 | Mar 11, 2024 | |
| 2022 | Mar 17, 2023 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.