Quantum Corporation Annual report [Section 13 and 15(d), not S-K Item 405]

Annual report [Section 13 and 15(d), not S-K Item 405]

INCOME TAXES (Tables)

INCOME TAXES (Tables)

12 Months Ended

Mar. 31, 2025

Pre-tax loss reflected in the consolidated statements of operations for the years ended March 31, 2025 and 2024 is as follows (in thousands):


	Year Ended March 31,
	2025		2024
U.S.	$	(112,416)	$	(40,555)
Foreign	(1,854)		(20)
Total	$	(114,270)	$	(40,575)

Schedule of income tax provision

Income tax provision consists of the following (in thousands):


	Year Ended March 31,
	2025		2024
Current tax expense
Federal	$	—	$	—
State	36		14
Foreign	741		919
Total current tax expense	777		933
Deferred tax expense
Federal	20		18
State	37		21
Foreign	(13)		(261)
Total deferred tax expense (benefit)	44		(222)
Income tax provision	$	821	$	711

Schedule of federal income tax rate reconciliation

The income tax provision differs from the amount computed by applying the federal statutory rate of 21% to loss before income taxes as follows (in thousands):


	For the year ended March 31,
	2025		2024
Expense (benefit) at the federal statutory rate	$	(24,122)	$	(8,507)
Equity compensation	580		1,102
Permanent items	309		768
Foreign taxes	299		264
State income taxes	36		(860)
Valuation allowance	13,907		6,313
Uncertain tax positions	(6,672)		(8,010)


Expiration of attributes	8,427		10,901
Research and development credits	(844)		(1,169)
Warrant fair value adjustments	9,507		(1,093)
Other	(606)		1,002
Income tax provision	$	821	$	711

Schedule of components of deferred tax assets and liabilities

Significant components of deferred tax assets and liabilities are as follows (in thousands):


	As of March 31,
	2025		2024

Deferred tax assets
Loss carryforwards	$	61,466	$	54,280
Deferred revenue	25,895		27,431
Capitalized research and development	28,824		27,785
Tax credits	15,517		15,888
Disallowed interest	19,696		16,572
Other accruals and reserves not currently deductible for tax purposes	3,913		4,685
Lease obligations	2,016		2,269
Inventory	3,779		2,426
Acquired intangibles	1,285		1,344
Accrued warranty expense	277		365
Depreciation	1,755		—
Gross deferred tax assets	164,423		153,045
Valuation allowance	(161,730)		(147,674)
Total deferred tax assets, net of valuation allowance	$	2,693	$	5,371
Deferred tax liabilities
Depreciation	$	—	$	(2,038)
Lease assets	(1,711)		(1,929)
Other	(277)		(1,130)
Total deferred tax liabilities	(1,988)		(5,097)
Net deferred tax assets (liabilities)	$	705	$	274

Reconciliation of gross unrecognized tax benefits

A reconciliation of the gross unrecognized tax benefits is as follows (in thousands):


	For the year ended March 31,
	2025		2024
Beginning Balance	$	88,341	$	96,343
Increase in balances related to tax positions in current period	1,558		2,229


Decrease in balances related to tax positions in prior period	(12)		(1,364)
Decrease in balances due to lapse in statute of limitations	(8,209)		(8,867)

Ending balance	$	81,678	$	88,341