Company: IRDM
Filing Date: 2025-10-23
Form Type: 10-Q
Source: 0001418819-25-000009
Chunk: 98

Company: Iridium Communications Inc.
Filing Date: 2025-10-23
Form: 10-Q
Item: Part I, Item 8
Chunk 98
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 interest expense.

11

Fair Value of Derivative InstrumentsAs of September 30, 2025 and December 31, 2024, the Company had an asset balance of $23.1 million and $47.3 million, respectively, for the fair value of the Cap and a liability balance of $3.4 million and $5.6 million, respectively, for the fair value of the Cap premium. Both the Cap and the Cap premium are recorded net within other assets on the condensed consolidated balance sheet.During each of the three months ended September 30, 2025 and 2024, the Company incurred $0.8 million in interest expense for the Cap premium, and during each of the nine months ended September 30, 2025 and 2024, the Company incurred $2.5 million in interest expense for the Cap premium. Interest expense was reduced by $7.4 million and $9.8 million for the three months ended September 30, 2025 and 2024, respectively, and $21.9 million and $29.5 million for the nine months ended September 30, 2025 and 2024, respectively, for payments received related to the Cap.Gains and losses resulting from fair value adjustments to the Cap are recorded within accumulated other comprehensive income within the Company’s condensed consolidated balance sheets and reclassified to interest expense on the dates that interest payments become due. Cash flows related to the derivative contracts are included in cash flows from operating activities on the condensed consolidated statements of cash flows. Over the next 12 months, the Company expects any gains or losses for cash flow hedges amortized from accumulated other comprehensive income into earnings to have an immaterial impact on the Company’s consolidated financial statements.The following table presents the amount of unrealized gain or loss and related tax impact associated with the derivative instruments that the Company recorded in its condensed consolidated statements of operations and comprehensive income:Three Months Ended September 30,Nine Months Ended September 30,2025202420252024(In thousands)(In thousands)Unrealized loss, net of tax$(4,575)$(19,401)$(16,791)$(17,518)Tax benefit $1,377 $5,957 $5,061 $5,094 

7. Equity Transactions

Preferred StockThe Company is authorized to issue 2.0 million shares of preferred stock with a par value of $0.0001 per share.