13. Income Taxes

The Company files income tax returns in the U.S., Korea, Japan, Taiwan and various other jurisdictions.

The Company’s Korean subsidiary is the principal operating entity within the consolidated Company. For the nine months ended September 30, 2016 and 2015, no income tax expense or benefit for the Korean subsidiary was recorded due to net loss, net operating loss carry-forwards available to offset taxable income and full valuation allowance for deferred tax assets.

Income tax expenses for the nine months ended September 30, 2016 and 2015 were $1,845 thousand and $1,781 thousand, respectively. The increase in income tax expenses was primarily due to the decrease in profit before income taxes of certain foreign subsidiaries that were able to identify income in those jurisdictions and changes in unrecognized tax benefits related to the lapse of the applicable statute of limitations at the Korean subsidiary, which was mostly offset by changes in deferred tax assets at foreign subsidiaries.