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We also entered into warrant transactions with the counterparties of the 2023 Note Hedge entitling them to acquire shares of our common stock.
−Removed: The warrant transactions could have a dilutive effect on our earnings per share to the extent that the price of our common stock during a given quarterly or annual measurement period exceeds the strike price of the warrants.
+Added: transactions could have a dilutive effect on our earnings per share to the extent that the price of our common stock during a given quarterly or annual measurement period exceeds the strike price of the warrants.
See Note 5 “Debt” to the consolidated financial statements in Part II, Item 8 of this Annual Report for more information.
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A substantial portion of our operations are located in the United States, and the majority of our sales since inception have been made in U.S.
−Removed: Accordingly, our assessment is that we have no material net exposure to foreign currency exchange rate fluctuations at this time.
−Removed: However, as our business in markets outside of the United States continues to increase, we will be exposed to foreign currency exchange risk related to our foreign operations.
+Added: Historically, our exposure to foreign currency fluctuations is more significant with respect to our revenue than our expenses, as a significant portion of our expenses are denominated in U.S.
+Added: dollars, such as cost of sales and operating expenses.
+Added: Changes in foreign currencies impact currency translation and had a slightly negative effect on our revenues and gross profit margins.
+Added: We will be exposed to additional foreign currency exchange risk related to our foreign operations when we begin manufacturing in Malaysia and as our business continues to increase in markets outside of the United States.
Fluctuations in the rate of exchange between the U.S.
−Removed: dollar and foreign currencies, primarily the Australian Dollar, the British Pound, the Canadian Dollar, the Euro and the Malaysian Ringgit, could adversely affect our financial results, including our revenues, revenue growth rates, gross margins, income and losses as well as assets and liabilities.
−Removed: We translate the financial statements of our foreign subsidiaries with functional currencies other than the U.S.
+Added: dollar and foreign currencies, primarily the Australian Dollar, the British Pound, the Canadian Dollar, the Euro, and the Malaysian Ringgit, could adversely affect our financial results, including income and losses as well as assets and liabilities in addition to risks to our revenues, revenue growth rates, and gross profit margins.
+Added: We translate the financial statements of our international subsidiaries with functional currencies other than the U.S.
dollar into the U.S.
dollar for consolidation using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations.
−Removed: We record net gains or losses resulting from the translation of foreign financial statements and the effect of exchange rate changes on intercompany receivables and payables of a long-term nature as a separate component of stockholders’ equity.
−Removed: These adjustments will affect net income only upon sale or liquidation of the underlying investment in foreign subsidiaries.
−Removed: We record exchange rate fluctuations resulting from the translation of the short-term intercompany balances between domestic entities and our foreign subsidiaries as foreign currency transaction gains or losses and include them in interest and other income (expense), net in our consolidated statements of operations.
−Removed: We occasionally enter into foreign currency forward contracts in order to partially offset the impact from fluctuation of the foreign currency rates.
−Removed: As of December 31, 2021, we had foreign currency forward contracts outstanding with a notional amount of $40.0 million.
−Removed: The fair values of these derivatives are based on quoted market prices, which are Level 1 inputs, and the derivative instruments are recorded in other current assets or other current liabilities in our balance sheets consistent with the nature of the instrument at period end.
−Removed: Derivative gains and losses are included in interest and other income (expense), net in our consolidated statements of operations.
+Added: We record net gains or losses resulting from the translation of these financial statements and the effect of exchange rate changes on intercompany receivables and payables of a long-term nature as a separate component of stockholders’ equity.
+Added: These adjustments will affect net income only upon sale or liquidation of the underlying investment in international subsidiaries.
+Added: We also record exchange rate fluctuations resulting from the translation of the short-term intercompany balances between domestic entities and our international subsidiaries as foreign currency transaction gains or losses and include them in interest and other income (expense), net in our consolidated statements of operations.
+Added: We enter into foreign currency forward contracts to hedge monetary assets and liabilities denominated in foreign currencies.
+Added: These forward contracts are not designated as hedging instruments and generally mature in one month.
+Added: The derivative gains and losses are included in interest and other income (expense), net in our consolidated statements of operations.
+Added: See Note 3 “Fair Value Measurements” to the consolidated financial statements in Part II, Item 8 of this Annual Report for more information.
Notional principal amounts provide one measure of the transaction volume outstanding as of period end, but they do not represent the amount of our exposure to market loss.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.