Liberty Energy Inc. 10-Q

Item 3. Quantitative and Qualitative Disclosure about Market Risk Our consolidated financial statements are expressed in U.S. dollars, but, effective January 1, 2021, a portion of our operations is conducted in a currency other than U.S. dollars. The Canadian dollar is the functional currency of the Company’s foreign subsidiary as it is the primary currency within the economic environment in which the subsidiary operates. Changes in the exchange rate can affect our revenues, earnings, and the carrying value of our assets and liabilities in our consolidated balance sheet, either positively or negatively. Adjustments resulting from the translation of the subsidiary’s financial statements are reported in other comprehensive income (loss). For the three and nine months ended September 30, 2024, the Company recorded a foreign currency translation gain of $1.6 million and loss of $3.8 million, respectively, to comprehensive income. For the three and nine months ended September 30, 2023, the Company recorded foreign currency translation losses of $3.1 million and $1.6 million, respectively, to comprehensive income. During the nine months ended September 30, 2024, the Company formed a subsidiary in Australia, and will use the Australian dollar as the functional currency for such subsidiary’s operations. The Australian subsidiary does not have any material assets or liabilities as of September 30, 2024 and did not generate material revenues or expenses during the nine months ended September 30, 2024, as such there was no notable impact of changes in the Australian dollar to U.S. dollar exchange rate in the financial statements of Company as of and for the nine months ended September 30, 2024. Other exposures to market risk have not changed materially since December 31, 2023. For quantitative and qualitative disclosures about market risk, in addition to foreign currency translation, see Part II, Item 7(a), “Quantitative and Qualitative Disclosures About Market Risk,” in the Annual Report.