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Item 3 — Quantitative and Qualitative Disclosures About Market Risk
Spire Global, Inc. · 10-Q · Q2 FY2026 · Period ended Jun 30, 2026
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Foreign Currency Exchange Risk
Our results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Euro, the British Pound Sterling, the Singapore Dollar, and the Canadian Dollar, and may be adversely affected in the future due to changes in foreign currency exchange rates. We continue to experience foreign currency fluctuations primarily due to the periodic re-measurement of our foreign currency monetary account balances that are denominated in currencies other than the functional currency of the entities in which they are recorded. Changes in exchange rates may negatively affect our revenue and other results of operations as expressed in U.S. Dollars. We do not currently engage in foreign exchange hedging contracts. As we continue to expand our international presence, we will assess options for mitigating foreign exchange risk.
We have experienced and may continue to experience fluctuations in our net loss as a result of gains or losses related to revaluing certain asset and current liability balances that are denominated in currencies other than the functional currency of the entities in which they are recorded. We had losses of $0.6 million and $2.2 million for the three and six months ended June 30, 2026, respectively, and gains of $7.0 million and $10.8 million for the three and six months ended June 30, 2025, respectively. A hypothetical 10% strengthening or weakening of the U.S. Dollar relative to the currencies in which our revenue and expenses are denominated would have resulted in an increase or decrease in our pre-tax income of approximately $0.5 million for the six months ended June 30, 2026.
Interest Rate Sensitivity
As of June 30, 2026, we had cash and cash equivalents of $38.8 million and short-term marketable securities of $52.9 million. The cash and cash equivalents and short-term marketable securities are held for working capital purposes or strategic investment purposes.
Inflation Risk
We are exposed to inflation risk. Inflationary factors, such as increases in component parts, labor and other overhead expenses, could impair our operating results. Although there has been a significant increase in inflation in recent periods, it has not had a substantial impact on our results of operations for the three and six months ended June 30, 2026 or 2025. However, higher inflation in the future may negatively affect our operating and capital expenditures, which we may be unable to fully pass through to our customers.