{"url_path":"/sec/irm/10-k/2026/item-7a","section_key":"item-7a","section_title":"Item 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-02-12","source_url":"https://www.sec.gov/Archives/edgar/data/1020569/0001020569-26-000013-index.html","accession_number":"0001020569-26-000013","cik":"0001020569","ticker":"IRM","issuer_name":"IRON MOUNTAIN INC","edgar_url":"https://www.sec.gov/Archives/edgar/data/1020569/0001020569-26-000013-index.html","primary_entity_key":"0001020569","primary_entity_name":"IRON MOUNTAIN INC"},"word_count":924,"has_tables":true,"body_markdown":"ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.\n\nCREDIT RISK\n\nFinancial instruments that potentially subject us to credit risk consist principally of cash and cash equivalents (including money market funds and time deposits) and accounts receivable. We had no significant concentrations of liquid investments as of December 31, 2025. As per our risk management investment policy, we limit exposure to concentration of credit risk by limiting the amount invested in any one mutual fund to a maximum of 1% of the fund's total assets or in any one financial institution to a maximum of $75.0 million. As of December 31, 2025, our cash and cash equivalents balance was $158.5 million.\n\nINTEREST RATE RISK\n\nGiven the recurring nature of our revenues and the long-term nature of our asset base, we have the ability and the preference to use long-term, fixed interest rate debt to finance our business at attractive rates, thereby helping to preserve our long-term returns on invested capital. Occasionally, we may use interest rate swaps as a tool to maintain our targeted level of fixed rate debt.\n\nAs of December 31, 2025, approximately 22.0%, or $3,640.4 million, of our total long-term debt outstanding was subject to variable interest rates. If the weighted average variable interest rate on our average variable rate debt outstanding during the year had increased by 1%, our net income for the year ended December 31, 2025 would have been reduced by approximately $41.9 million.\n\nSee Note 5 to Notes to Consolidated Financial Statements included in this Annual Report for a discussion on our interest rate swaps and Note 6 to Notes to Consolidated Financial Statements included in this Annual Report for a discussion of our long-term indebtedness, including the fair values of such indebtedness as of December 31, 2025.\n\nCURRENCY RISK\n\nOur international investments may be subject to risks and uncertainties related to fluctuations in currency valuation. Our reporting currency is the United States dollar. However, our international revenues and expenses are generated in the currencies of the countries in which we operate, primarily the British pound sterling, Euro, Canadian dollar and Australian dollar. Declines in the value of the local currencies in which we are paid relative to the United States dollar will cause revenues in United States dollar terms to decrease and dollar-denominated liabilities to increase in local currency. The impact of currency fluctuations on our earnings is mitigated by the fact that most operating and other expenses are also incurred and paid in the local currency. We also have several intercompany obligations with and between certain of our subsidiaries of differing functional currencies, resulting in foreign transaction gains or losses based on period-end exchange rates.\n\nWe have adopted and implemented a number of strategies to mitigate the risks associated with fluctuations in foreign currency exchange rates. One strategy is to finance certain of our international subsidiaries with debt that is denominated in local currencies, thereby providing a natural hedge. In determining the amount of any such financing, we take into account local tax considerations, among other factors. Another strategy we utilize is for IMI or IMIM to borrow in foreign currencies to hedge our intercompany financing activities. IM UK has financed a portion of its capital needs through the issuance of the UK Revolving Credit Facility, which is denominated in British pounds sterling. Our Australian business has financed a portion of its capital needs through direct borrowings in Australian dollars under the AUD Term Loan. These create a tax efficient natural currency hedge. In addition, IMI has financed a portion of its capital needs through the issuance of the Euro Notes, which are a natural hedge against our net investments in our Euro denominated subsidiaries.\n\nWe have entered into cross-currency swap agreements to hedge the variability of exchange rate impacts between the United States dollar and certain of our functional foreign currencies, including the Euro and the Canadian dollar. These cross-currency swap agreements are designated as a hedge of net investment against certain of our Euro and Canadian dollar denominated subsidiaries and require an exchange of the notional amounts at maturity. These cross-currency swap agreements are marked to market at the end of each reporting period, representing the fair values of the cross-currency swap agreements, and any changes in fair value are recognized as a component of Accumulated other comprehensive items, net. Unrealized gains are recognized as assets, which are recorded as either a component of (i) Prepaid expenses and other or (ii) Other within Other assets, net, while unrecognized losses are recognized as liabilities, which are recorded as either a component of (i) Accrued expenses and other current liabilities or (ii) Other long-term liabilities in our Consolidated Balance Sheets.\n\nSee Note 5 to Notes to Consolidated Financial Statements included in this Annual Report for a discussion on our cross-currency swap agreements.\n\nIRON MOUNTAIN 2025 FORM 10-K\n\n53\n\n[Table of Contents](#iedd667d4faf242cdb7c30fae0f3b3780_10)\n\nPart II\n\nThe impact of devaluation or depreciating currency on an entity depends on the residual effect on the local economy and the ability of an entity to raise prices and/or reduce expenses. Due to our constantly changing currency exposure and the potential substantial volatility of currency exchange rates, we cannot predict the effect of exchange fluctuations on our business. The effect of a change in foreign currency exchange rates on our net investment in foreign subsidiaries is reflected in the \"Accumulated Other Comprehensive Items, net\" component of equity. A 10% depreciation in year-end 2025 functional currencies, relative to the United States dollar, would result in a reduction in our equity of $374.7 million."}