DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

12 Months Ended

Dec. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company uses derivative financial instruments to manage its currency exchange rate risk and its interest rate risk as summarized below. Notional amounts are stated in United States dollar equivalents at spot exchange rates at the respective dates. The Company does not enter into these arrangements for trading or speculation purposes.

	Notional Amount
	As of December 31,
	2024		2023
	(in millions)
Foreign currency forward exchange contracts	$	1,926.9	$	1,460.3
Cross currency swap contracts	300.0		300.0

The following table presents the location and fair value amounts of derivative instruments reported in the consolidated balance sheets (in millions):

		Fair Value
		As of December 31,
	Balance Sheet Location	2024		2023
Derivatives designated as hedging instruments
Assets
Foreign currency contracts	Other current assets	$	47.4	$	16.1
Cross currency swap contracts	Other assets	$	34.7	$	23.4
Liabilities
Foreign currency contracts	Accrued and other liabilities	$	6.4	$	15.2
Derivatives not designated as hedging instruments
Liabilities
Foreign currency contracts	Accrued and other liabilities	$	1.8	$	—

The following table presents the effect of master-netting agreements and rights of offset on the consolidated balance sheets (in millions):

							Gross Amounts Not Offset in the Consolidated Balance Sheet
			Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts Presented in the Consolidated Balance Sheet
December 31, 2024	Gross Amounts						Financial Instruments		Cash Collateral Received		Net Amount
Derivative Assets
Foreign currency contracts	$	47.4	$	—	$	47.4	$	(5.4)	$	—	$	42.0
Cross currency swap contracts	$	34.7	$	—	$	34.7	$	—	$	—	$	34.7
Derivative Liabilities
Foreign currency contracts	$	8.2	$	—	$	8.2	$	(5.4)	$	—	$	2.8
December 31, 2023
Derivative Assets
Foreign currency contracts	$	16.1	$	—	$	16.1	$	(9.4)	$	—	$	6.7
Cross currency swap contracts	$	23.4	$	—	$	23.4	$	—	$	—	$	23.4
Derivative Liabilities
Foreign currency contracts	$	15.2	$	—	$	15.2	$	(9.4)	$	—	$	5.8

The following table presents the effect of derivative and non-derivative hedging instruments on the consolidated statements of operations and consolidated statements of comprehensive income:

	Amount of Gain or (Loss) Recognized in Other Comprehensive Income on Derivative (Effective Portion)
	2024		2023
Cash flow hedges
Foreign currency contracts	$	83.8	$	29.2
Net investment hedges
Cross-currency swap contracts	$	11.3	$	(17.3)

The cross currency swap contracts have an expiration date of June 15, 2028. At maturity of the cross currency swap contracts, the Company will deliver the notional amount of €257.2 million and will receive $300.0 million from the counterparties. The Company receives semi-annual interest payments from the counterparties based on a fixed interest rate until maturity of the agreements.

The following tables present the effect of fair value and cash flow hedge accounting on the consolidated statements of operations:

	Location and Amount of Gain or (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships
	Year Ended December 31, 2024
	Cost of sales		Interest income, net		Other non-operating income, net
Total amounts presented in the consolidated statements of operations	$	(1,117.5)	$	(19.8)	$	68.9
The effects of fair value hedges:
Foreign currency contracts:
Hedged items	—		—		(4.0)
Derivatives designated as hedging instruments	—		—		4.0
Amount excluded from effectiveness testing (amortized)	—		—		0.8
The effects of cash flow hedges:
Foreign currency contracts:
Amount of gain (loss) reclassified from accumulated other comprehensive loss into income	35.8		—		—
The effects of net investment hedges:
Cross currency swap contracts
Amount excluded from effectiveness testing	—		7.0		—
The effects of non-designated hedges:
Foreign currency contracts:	—		—		22.4

	Location and Amount of Gain or (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships
	Year Ended December 31, 2023
	Cost of sales		Interest income, net		Other non-operating income, net
Total amounts presented in the consolidated statements of operations	$	(978.4)	$	(17.6)	$	13.9
The effects of fair value hedges:
Foreign currency contracts:
Hedged items	—		—		(9.2)
Derivatives designated as hedging instruments	—		—		9.2
Amount excluded from effectiveness testing (amortized)	—		—		4.7
The effects of cash flow hedges:
Foreign currency contracts:
Amount of gain (loss) reclassified from accumulated other comprehensive loss into income	58.9		—		—
The effects of net investment hedges:
Cross currency swap contracts
Amount excluded from effectiveness testing	—		6.9		—
The effects of non-designated hedges:
Foreign currency contracts:	—		—		7.4

The Company expects that during 2025 it will reclassify to earnings a $10.7 million gain currently recorded in Accumulated Other Comprehensive Loss. For the years ended December 31, 2024, 2023, and 2022, the Company did not record any gains or losses due to hedge ineffectiveness.