Quantitative and Qualitative Disclosures about Market Risk
−Removed: Market risk is the potential loss from adverse changes in interest rates, foreign exchange rates, and market prices.
−Removed: Our primary market risk is interest rate risk associated with our long-term debt.
−Removed: We manage our exposure to this risk through established policies and procedures.
−Removed: Our objective is to mitigate potential income statement, cash flow, and market exposures from changes in interest rates.
+Added: Market risk is the potential loss in future earnings, fair values, or cash flows of market risk sensitive instruments resulting from adverse changes in interest rates, foreign currency exchange rates, and market prices.
Interest Rate Risk
−Removed: Our market risk is affected by changes in interest rates.
−Removed: The February 2022 First Lien Loan bears a floating interest rate based on market rates plus an applicable spread.
−Removed: We will be susceptible to fluctuations in interest rates if we do not hedge the interest rate exposure arising from our floating-rate debt, which may adversely impact our financial results.
−Removed: A hypothetical 1% change in interest rates, assuming rates are above our interest rate floor, would have impacted our interest expense by $2.8 million based on amounts outstanding under the February 2022 First Lien Loan during the year ended December 31, 2023.
+Added: Our primary market risk is the interest rate risk associated with our long-term debt (including the 2025 First Lien Loan, which bears a floating interest rate based on market rates plus an applicable spread).
+Added: We manage our exposure to this risk through established policies and procedures aimed at mitigating the potential effect of adverse interest rate changes.
+Added: However, we will be susceptible to interest rate fluctuations if we do not effectively hedge the interest rate exposure arising from our floating-rate debt, which may adversely impact our financial results.
+Added: A hypothetical 1% change in interest rates, assuming rates are above our applicable interest rate floor, would have impacted Interest expense – net in the Consolidated Statements of Operations by $3.4 million for the year ended December 31, 2024 (based on amounts outstanding during 2024 under the 2024 First Lien Loan).
Foreign Currency Exchange Risk
−Removed: Our reporting currency is the U.S.
−Removed: dollar, while certain of our international subsidiaries' functional currency is their local currency.
−Removed: Our international revenue, as well as costs and expenses denominated in foreign currencies, expose us to the risk of fluctuations in foreign currency exchange rates against the U.S.
−Removed: Accordingly, we are subject to foreign currency risk, which may adversely impact our financial results.
−Removed: We are also exposed to foreign exchange rate fluctuations as we translate the financial statements of our foreign subsidiaries into U.S.
+Added: While our reporting currency is the U.S.
+Added: dollar, certain of our international subsidiaries’ functional currency is their local currency.
+Added: Our international revenue, as well as costs and expenses denominated in foreign currencies, expose us to the risk of adverse fluctuations in foreign currency exchange rates against the U.S.
+Added: dollar, which may adversely impact our financial results.
+Added: We are also exposed to foreign currency exchange rate fluctuations as we translate our foreign subsidiaries’ financial statements into U.S.
dollars in consolidation.
−Removed: We have not entered into derivative or hedging transactions, but we may do so in the future if our exposure to foreign currency becomes more significant.
−Removed: Due to fluctuations in exchange rates resulting from the current macroeconomic environment, we may experience negative impacts on the translation adjustments resulting from the conversion of the financial statements of our foreign subsidiaries into U.S.
+Added: Due to foreign currency exchange rate fluctuations resulting from the macroeconomic environment, we may experience negative impacts on the translation adjustments resulting from the conversion of our foreign subsidiaries’ financial statements into U.S.
dollars, as well as the revaluation adjustments on U.S.
dollar denominated intercompany loans.
−Removed: Foreign currency translation adjustment included in the Consolidated Statements of Comprehensive Income (Loss) was $1.2 million during the year ended December 31, 2023.
−Removed: As of December 31, 2023, a hypothetical 10% change in foreign currency exchange rates applicable to our business would have impacted our foreign currency revaluation gain or loss, which is reflected in the Consolidated Statements of Operations, by $4.2 million.
+Added: While we have not entered into derivative or hedging transactions, we may do so in the future.
+Added: During the year ended December 31, 2024, our unrealized foreign currency loss recorded in Other income – net in the Consolidated Statements of Operations was approximately $4.1 million.
+Added: As of December 31, 2024, a hypothetical 10% change in exchange rates applicable to our business would have impacted our foreign currency translation adjustment by $2.4 million.
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.