Derivatives and Hedging

9 Months Ended

Sep. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging

Derivatives and Hedging

Derivatives Designated as Hedges

As of September 30, 2021, we had total gross notional amounts of $473 million of foreign currency contracts outstanding (primarily related to the Canadian Dollar, Chinese Yuan, British Pound, Euro, Indian Rupee and Philippine Peso) that were designated as hedges. These foreign currency contracts are of varying duration, none of which extend beyond December 2024. There were no commodity contracts outstanding that were designated as hedges as of September 30, 2021.

The fair values of derivatives designated as hedging instruments follows:

	Asset Derivatives					Liability Derivatives
(in thousands)	Balance Sheet Location	September 30, 2021		December 31, 2020		Balance Sheet Location	September 30, 2021		December 31, 2020
Foreign currency contracts	Other current assets	$	14,831	$	20,004	Other accrued liabilities	$	357	$	4
Foreign currency contracts	Other assets	2,132		2,184		Noncurrent liabilities	93		25
Total		$	16,963	$	22,188		$	450	$	29

The after-tax amount of gain (loss) recognized in OCI associated with derivative instruments designated as cash flow hedges follows:

	3ME September 30,		9ME September 30,
Cash Flow Hedges (in thousands)	2021	2020	2021	2020
Foreign currency contracts	1,530	10,112	7,716	6,115
Commodity contracts	—	—	—	(108)
	1,530	10,112	7,716	6,007

The after-tax amount of gain (loss) reclassified from AOCI into earnings associated with derivative instruments designated as cash flow hedges follows:

		3ME September 30,				9ME September 30,
Cash Flow Hedges (in thousands)	Location of Gain (Loss)	2021		2020		2021		2020
Foreign currency contracts	Cost of revenue	$	3,084	$	943	$	12,585	$	1,482
Commodity contracts	Cost of revenue	—		—		—		(100)
Interest rate contracts	Interest expense	725		(419)		(114)		(1,258)
Total		$	3,809	$	524	$	12,471	$	124

Derivatives Not Designated as Hedges

As of September 30, 2021, we also had total gross notional amounts of $238 million of foreign currency contracts and $25 million of commodity contracts outstanding that were not designated as hedges. The foreign currency contracts primarily related to contract obligations denominated in nonfunctional currencies. The fair value of derivatives not designated as hedges, as well as the associated gains and losses were not material for any period presented.