TechTarget, Inc. Income Taxes Disclosure
12. Income Taxes
The following table depicts the loss before income tax benefit by geography:
|
|
Years Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
United States |
|
$ |
(981,271 |
) |
|
$ |
(91,482 |
) |
|
$ |
(55,865 |
) |
Foreign |
|
|
(60,458 |
) |
|
|
(37,916 |
) |
|
|
(11,539 |
) |
Loss before income tax benefit |
|
$ |
(1,041,729 |
) |
|
$ |
(129,398 |
) |
|
$ |
(67,404 |
) |
Income tax benefit consisted of the following:
|
|
Years Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Current provision: |
|
|
|
|
|
|
|
|
|
|||
Federal |
|
$ |
(3,947 |
) |
|
$ |
(869 |
) |
|
$ |
— |
|
State |
|
|
(1,864 |
) |
|
|
(323 |
) |
|
|
— |
|
Foreign |
|
|
(1,895 |
) |
|
|
(2,579 |
) |
|
|
(3,873 |
) |
Total current provision |
|
|
(7,706 |
) |
|
|
(3,771 |
) |
|
|
(3,873 |
) |
Deferred benefit: |
|
|
|
|
|
|
|
|
|
|||
Federal |
|
|
33,094 |
|
|
|
10,305 |
|
|
|
7,933 |
|
State |
|
|
6,223 |
|
|
|
4,202 |
|
|
|
2,557 |
|
Foreign |
|
|
1,812 |
|
|
|
1,799 |
|
|
|
3,010 |
|
Total deferred benefit |
|
|
41,129 |
|
|
|
16,306 |
|
|
|
13,500 |
|
Income tax benefit |
|
$ |
33,423 |
|
|
$ |
12,535 |
|
|
$ |
9,627 |
|
The income tax benefit for the years ended December 31, 2025 differs from the amount computed by applying the statutory federal income tax rate to the combined income before provision for income taxes, after the adoption of ASU 2023-09, as follows:
|
|
Year Ended December 31, 2025 |
|
|||||
|
$ |
218,764 |
|
|
|
21.00 |
% |
|
Domestic federal |
|
|
|
|
|
|
||
Tax credits |
|
|
2,640 |
|
|
|
0.25 |
% |
Nontaxable and nondeductible items, net |
|
|
|
|
|
|
||
Goodwill impairment |
|
|
(176,789 |
) |
|
|
(16.97 |
)% |
Other |
|
|
(4,007 |
) |
|
|
(0.38 |
)% |
Effect of cross-border tax laws |
|
|
(1,850 |
) |
|
|
(0.18 |
)% |
Other reconciling items |
|
|
4,642 |
|
|
|
0.45 |
% |
Changes in unrecognized tax benefits |
|
|
(184 |
) |
|
|
(0.02 |
)% |
Domestic state and local income taxes, net of federal effect* |
|
|
2,803 |
|
|
|
0.27 |
% |
Foreign tax effects |
|
|
|
|
|
|
||
United Kingdom |
|
|
|
|
|
|
||
Goodwill impairment |
|
|
(10,580 |
) |
|
|
(1.02 |
)% |
Other |
|
|
(1,017 |
) |
|
|
(0.10 |
)% |
Other foreign jurisdictions |
|
|
(999 |
) |
|
|
(0.10 |
)% |
Income tax benefit/effective tax rate |
|
$ |
33,423 |
|
|
|
3.20 |
% |
*State taxes in California, Pennsylvania, New York and Georgia made up the majority (greater than 50%) of the tax effect in this category.
The income tax benefit for the years ended December 31, 2024 and 2023 differs from the amounts computed by applying the statutory federal income tax rate to consolidated loss before income tax benefit, before the adoption of ASU 2023-09, as follows:
|
|
Years Ended December 31, |
|||||||
|
|
2024 |
|
|
2023 |
|
|
||
Benefit computed at statutory rate |
|
$ |
27,174 |
|
|
$ |
14,154 |
|
|
Increase/(decrease) resulting from: |
|
|
|
|
|
|
|
||
Foreign tax rate differential |
|
|
101 |
|
|
|
27 |
|
|
State income tax provision, net of federal benefit |
|
|
2,937 |
|
|
|
2,020 |
|
|
Change in tax rate |
|
|
— |
|
|
|
107 |
|
|
Change in valuation allowance |
|
|
— |
|
|
|
(2,108 |
) |
|
Remeasurement of contingent consideration |
|
|
4,712 |
|
|
|
26,028 |
|
|
Other |
|
|
325 |
|
|
|
3 |
|
|
Acquisition costs |
|
|
(8,256 |
) |
|
|
(75 |
) |
|
Non-deductible expenditure |
|
|
(133 |
) |
|
|
(373 |
) |
|
Goodwill impairment |
|
|
(13,909 |
) |
|
|
(29,326 |
) |
|
Movement in uncertain tax positions |
|
|
(416 |
) |
|
|
(830 |
) |
|
Income tax benefit |
|
$ |
12,535 |
|
|
$ |
9,627 |
|
|
Informa TechTarget recognize deferred tax assets and liabilities based on the differences between the financial statement carrying amount and the tax basis of assets and liabilities by applying tax rates that are expected to be in effect when the differences reverse. Significant components of deferred taxes are as follows:
|
|
As of December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Deferred tax assets: |
|
|
|
|
|
|
||
Property and equipment |
|
$ |
355 |
|
|
$ |
67 |
|
Net operating loss carryforwards |
|
|
14,531 |
|
|
|
3,268 |
|
Tax credit carryforwards |
|
|
2,636 |
|
|
|
207 |
|
Employee benefit accruals |
|
|
955 |
|
|
|
963 |
|
Accruals and allowances |
|
|
4,840 |
|
|
|
3,775 |
|
Other |
|
|
1,922 |
|
|
|
1,004 |
|
Interest deductions carried forward |
|
|
11,514 |
|
|
|
10,112 |
|
Capitalized R&D expenses |
|
|
9,444 |
|
|
|
9,844 |
|
Operating lease liability |
|
|
981 |
|
|
|
4,285 |
|
Gross deferred tax assets |
|
|
47,178 |
|
|
|
33,525 |
|
Less valuation allowance |
|
|
(4,172 |
) |
|
|
(722 |
) |
Total deferred tax assets |
|
|
43,006 |
|
|
|
32,803 |
|
Deferred tax liabilities: |
|
|
|
|
|
|
||
Intangible assets |
|
|
(139,213 |
) |
|
|
(133,265 |
) |
Internally developed software |
|
|
— |
|
|
|
(30,437 |
) |
Right of use assets |
|
|
(606 |
) |
|
|
(3,186 |
) |
Unrepatriated earnings |
|
|
(491 |
) |
|
|
(174 |
) |
Total deferred tax liabilities |
|
|
(140,310 |
) |
|
|
(167,062 |
) |
Net deferred tax liabilities |
|
$ |
(97,304 |
) |
|
$ |
(134,259 |
) |
The following table represents a roll forward of the valuation allowance against deferred tax assets:
|
|
As of December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Balance at beginning of year |
|
$ |
722 |
|
|
$ |
5,027 |
|
|
$ |
2,676 |
|
Decrease through net parent investment |
|
|
— |
|
|
|
(5,027 |
) |
|
|
— |
|
Increase in valuation allowance |
|
|
3,450 |
|
|
|
— |
|
|
|
2,351 |
|
Purchase accounting |
|
|
— |
|
|
|
722 |
|
|
|
— |
|
Balance at end of year |
|
$ |
4,172 |
|
|
$ |
722 |
|
|
$ |
5,027 |
|
A valuation allowance has been provided where it is more likely than not that the deferred tax assets related to those operating loss carryforwards will not be realized.
As of December 31, 2024, the Company maintained a valuation allowance against a portion of its state net operating loss carryforwards in the United States due to the uncertainty of future profitability in the state.
Compliance with ASC 740 requires the Company to periodically evaluate the necessity of establishing or adjusting a valuation allowance for deferred tax assets depending on whether it is more likely than not that a related tax benefit will be realized in future periods. In evaluating the ability to realize the net deferred tax asset, the Company considers all available evidence, both positive and negative, including past operating results, the existence of cumulative losses in the most recent fiscal years, tax planning strategies that are prudent and feasible, and forecasts of future taxable income. In considering sources of future taxable income, the Company makes certain assumptions and judgments which are based on the plans and estimates used to manage the underlying business. Changes in our assumptions and estimates, as well as changes in tax rates, may materially impact income tax expense for the period.
As of December 31, 2025, Informa TechTarget had a federal gross net operating loss carryforwards of $20.6 million, state net operating loss carryforwards of $3.1 million, and foreign net operating loss carryforwards of $30.3 million, which are mainly attributable to the United Kingdom and can be carried forward indefinitely. The state net operating loss carryforwards of $3.1 million will begin to expire in 2034. The federal net operating loss carryforwards of $20.6 million can be carried forward indefinitely. As of December 31, 2025 Informa TechTarget had a federal tax credit carryforward of $2.6 million. The research and development tax credit carryforward begins to expire in 2044. The utilization of this tax attribute is limited to future taxable income.
Utilization of the net operating loss carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership change limitations that have occurred previously or that could occur in the future. These ownership changes may limit the amount of net operating loss carryforwards that can be utilized annually to offset future taxable income and tax.
The amount of cash taxes paid, net of refunds, by Informa TechTarget during fiscal 2025 is a follows:
|
|
Year Ended December 31, 2025 |
|
|||||
United States |
|
|
|
|
|
|
||
Federal |
|
$ |
4,492 |
|
|
|
56.52 |
% |
State - Massachusetts |
|
|
691 |
|
|
|
8.69 |
% |
Other states and local (each <5%) |
|
|
848 |
|
|
|
10.67 |
% |
Total US |
|
|
6,031 |
|
|
|
75.88 |
% |
|
|
|
|
|
|
|
||
Foreign (>=5% threshold): |
|
|
|
|
|
|
||
Japan |
|
|
900 |
|
|
|
11.32 |
% |
Singapore |
|
|
686 |
|
|
|
8.63 |
% |
Subtotal - significant foreign |
|
|
1,586 |
|
|
|
19.95 |
% |
|
|
|
|
|
|
|
||
Other foreign jurisdictions (each <5%) |
|
|
331 |
|
|
|
4.18 |
% |
Total foreign |
|
|
1,917 |
|
|
|
24.12 |
% |
|
|
|
|
|
|
|
||
Total income taxes paid (net) |
|
$ |
7,948 |
|
|
|
100.00 |
% |
The Company's portion of income taxes for U.S. and certain foreign jurisdictions prior to the Transactions were deemed settled at the date of the Transaction. Cash paid directly to tax authorities for income taxes was $4.0 million in 2024 and was not significant in 2023.
Unrecognized tax benefits
Informa TechTarget conducts operations globally, and, as part of the global business, it files numerous income tax returns. These returns are routinely examined by various taxing authorities. The Company's global tax positions are reviewed on a quarterly basis. Based on these reviews, the results of discussions and resolutions of matters with certain taxing authorities, tax rulings and court decisions and the expiration of statutes of limitations, unrecognized tax benefits are adjusted as necessary.
Informa TechTarget remain subject to U.S. federal income tax examinations for the tax years . The Company recognizes benefits from tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the positions. The tax benefits recognized from such positions are measured as the largest amount of tax benefit that is greater than 50 percent likely to be realized upon settlement.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
|
As of December 31, |
|
|||||
|
2025 |
|
|
2024 |
|
||
Balance at beginning of year |
|
3,008 |
|
|
|
2,819 |
|
Gross increases related to current period tax positions |
|
496 |
|
|
|
268 |
|
Gross reduction related to prior periods tax positions |
|
(362 |
) |
|
|
(79 |
) |
Balance at end of year |
$ |
3,142 |
|
|
$ |
3,008 |
|
As of December 31, 2025 and December 31, 2024, accrued interest related to unrecognized tax benefits was $0.8 million and $0.7 million, respectively. Interest and penalties associated with the unrecognized tax benefits are classified as components of income tax expense.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 11, 2026 | Showing above |
| 2024 | May 28, 2025 | |
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.