Derivative Financial Instruments

6 Months Ended

Dec. 31, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Note 7. Derivative Financial Instruments

The Company utilizes foreign currency forward contracts with reputable financial institutions to manage its exposure of fluctuations in foreign currency exchange rates on certain intercompany balances and foreign currency denominated cash, customer receivables and liabilities. The Company does not use derivative financial instruments for speculative or trading purposes. These forward contracts are not designated as hedging instruments for accounting purposes. Principal hedged currencies primarily include the Japanese Yen, Swiss

Franc, and U.S. Dollar. The periods of these forward contracts range up to approximately three months and the notional amounts are intended to be consistent with changes in the underlying exposures. The Company intends to exchange foreign currencies for U.S. Dollars at maturity.

The notional amount of the Company's outstanding forward currency exchange contracts consisted of the following (in thousands):


	December 31, 2022		June 30, 2022
Swiss Franc	$	32,981	$	27,910
Chinese Yuan		1,759		2,524
Euro		1,462		16,307
British Pound		1,618		3,699
Indian Rupee		2,634		3,728
Japanese Yen		17,224		14,167
Total outstanding forward currency exchange contracts	$	57,678	$	68,335

The Company entered into the foreign currency forward contracts on December 31, 2022, and June 30, 2022, respectively, and therefore, there was no amount of gains or losses on those contracts recorded on the unaudited condensed consolidated balance sheets.

The following table provides information about the gain or loss associated with the Company’s derivative financial instruments (in thousands):


	Three Months Ended December 31,						Six Months Ended December 31,
	2022			2021			2022			2021
Foreign currency exchange gain (loss) on forward contracts	$	(213	)	$	(226	)	$	1,446		$	(626	)
Foreign currency transaction gain (loss)		180			(407	)		(1,730	)		(775	)