Financial Instruments

12 Months Ended

Dec. 31, 2023

Investments, All Other Investments [Abstract]

Note 15: Financial Instruments

Foreign Currencies

As a multinational business, the Company's transactions are denominated in a variety of currencies. When appropriate, the Company uses forward foreign currency contracts to reduce its overall exposure to the effects of currency fluctuations on its results of operations and cash flows. The Company's policy prohibits trading in currencies for which there are no underlying exposures and entering into trades for any currency to intentionally increase the underlying exposure. The Company primarily hedges existing assets and liabilities associated with transactions currently on its balance sheet, which are undesignated hedges for accounting purposes.

As of December 31, 2023 and 2022, the Company had outstanding foreign exchange contracts with notional amounts of $262.2 million and $272.0 million, respectively. Such contracts were obtained through financial institutions and were scheduled to mature within one to three months from the time of purchase. Management believes that these financial instruments should not subject the Company to increased risks from foreign exchange movements because gains and losses on these contracts should offset gains and losses on the underlying assets, liabilities and transactions to which they are related.

The following schedule summarizes the Company's net foreign exchange positions in U.S. dollars (in millions):


	As of December 31,
	2023			2022
	Buy (Sell)		Notional Amount	Buy (Sell)		Notional Amount
Philippine Peso	47.3		47.3	63.9		63.9
Euro	64.6		64.6	26.0		26.0
Korean Won	(14.3)		14.3	35.7		35.7
Japanese Yen	55.2		55.2	27.0		27.0


Czech Koruna	16.8		16.8	41.7		41.7


Other currencies - Buy	54.4		54.4	66.5		66.5
Other currencies - Sell	(9.6)		9.6	(11.2)		11.2
	$	214.4	262.2	$	249.6	$	272.0

Amounts receivable or payable under the contracts were not material as of December 31, 2023 and 2022, and are included in other current assets or accrued expenses and other current liabilities in the accompanying Consolidated Balance Sheets. For the years ended December 31, 2023, 2022 and 2021, realized and unrealized foreign currency transactions totaled a loss of $7.9 million, $0.7 million and $0.8 million, respectively. The realized and unrealized foreign currency transactions are included in other income (expense) in the Company's Consolidated Statements of Operations and Comprehensive Income.

Cash Flow Hedges

Foreign currency risk

During 2023, the Company entered into foreign currency forward contracts to hedge its exposure to foreign currency exchange rate risk related to future forecasted transactions denominated in certain currencies other than the U.S. Dollar. These contracts generally mature within 12 months and are designated as cash flow hedges for accounting purposes.

As of December 31, 2023, the notional value of outstanding foreign currency forward contracts designated as cash flow hedges was $92.2 million, with a fair value of $0.9 million recorded as other current assets. A loss of $0.1 million was recognized as a component of cost of revenues for the year ended December 31, 2023. The Company did not identify any ineffectiveness with respect to the notional amounts of the foreign currency forward contracts effective as of December 31, 2023.

Interest rate risk

During 2023, the Company terminated its interest rate swap agreements with a notional value of $500 million for fiscal years 2023 and 2024, respectively, received cash proceeds of $27.7 million, net of termination fees, and recognized $6.9 million of other income related to the termination. Approximately $20.7 million was recorded in Accumulated Other Comprehensive Income, which will be recognized to other income through December 2024.

As of December 31, 2022, the Company had interest rate swap agreements for notional amounts of $750.0 million, $500.0 million and $500.0 million for fiscal years 2022, 2023 and 2024, respectively. The fair value of the interest rate swaps totaled $36.0 million as of December 31, 2022, which was classified based on each instrument’s maturity dates.

See Note 17: ''Changes in Accumulated Other Comprehensive Loss'' for the effective amounts related to derivative instruments designated as cash flow hedges affecting accumulated other comprehensive loss and the Consolidated Statements of Operations and Comprehensive Income for the year ended December 31, 2023.

Convertible Note Hedges

The Company entered into convertible note hedges in connection with the issuance of the 0% Notes, 0.50% Notes and 1.625% Notes.

Other

As of December 31, 2023, the Company had no outstanding commodity derivatives, currency swaps, options or equity investments held at subsidiaries or affiliated companies. The Company does not hedge the value of its equity investments in its subsidiaries or affiliated companies.

The Company is exposed to credit-related losses if its hedge counterparties fail to perform their obligations. As of December 31, 2023, the counterparties to the Company's hedge contracts are held at financial institutions which the Company believes to be highly rated, and no credit-related losses are anticipated.