Financial instruments (Tables)

6 Months Ended

Feb. 28, 2025

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Notional Amounts, Fair Value and Balance Sheet Presentation of Derivative Instruments Outstanding

The notional amounts and fair value of derivative instruments outstanding were as follows (in millions):

February 28, 2025	Notional		Fair Value		Location in Consolidated Condensed Balance Sheets
Derivatives designated as hedges:
Foreign currency forwards	$	281	$	1	Other current assets
Cross currency interest rate swaps	50		2		Other current assets
Cross currency interest rate swaps	250		9		Other non-current assets
Foreign currency forwards	950		4		Accrued expenses and other liabilities
Foreign currency forwards	2		—		Other non-current liabilities
Derivatives not designated as hedges:
Foreign currency forwards	$	455	$	2	Other current assets
Total return swaps	53		—		Other current assets
Total return swaps	158		6		Accrued expenses and other liabilities
Foreign currency forwards	3,205		15		Accrued expenses and other liabilities
Variable prepaid forward contracts	2,190		2,498		Accrued expenses and other liabilities
Variable prepaid forward contracts	106		112		Other non-current liabilities

August 31, 2024	Notional		Fair Value		Location in Consolidated Condensed Balance Sheets
Derivatives designated as hedges:
Cross currency interest rate swaps	$	50	$	1	Other current assets
Foreign currency forwards	7		—		Other current assets
Cross currency interest rate swaps	253		5		Other non-current assets
Foreign currency forwards	4		—		Other non-current assets
Foreign currency forwards	923		15		Accrued expenses and other liabilities
Cross currency interest rate swaps	356		5		Accrued expenses and other liabilities
Foreign currency forwards	2		—		Other non-current liabilities
Derivatives not designated as hedges:
Foreign currency forwards	$	534	$	3	Other current assets
Total return swaps	211		11		Other current assets
Foreign currency forwards	3,606		52		Accrued expenses and other liabilities
Variable prepaid forward contracts	1,185		1,332		Accrued expenses and other liabilities
Variable prepaid forward contracts	2,541		2,587		Other non-current liabilities

Schedule of Derivative Instruments

The terms of the VPF derivative contracts were as follows (in millions):

Transaction date	Prepayment amount		Remaining shares pledged and maximum shares subject to forward sale as of February 28, 2025	Forward settlement date
May 11, 2023	$	644	4.6	Fourth quarter, fiscal 2025
June 15, 2023	325		2.2	Third quarter, fiscal 2025
August 3, 2023	801		5.3	First quarter, fiscal 2026
August 4, 2023	797		—	Third quarter, fiscal 2026 1
November 9, 2023	424		0.5	Fourth quarter, fiscal 2026 1
	$	2,991	12.6

1.During the three months ended February 28, 2025, the Company early settled certain VPF derivative contracts. These contracts, originally scheduled to mature in the third and fourth quarter of fiscal 2026, were net share settled early through the delivery of an aggregate 6.1 million shares of Cencora common stock to financial institutions, with the Company retaining 1.3 million unencumbered shares. As part of the settlement, the Company paid an aggregate cash payment of $20 million to fulfill its obligations under the contracts. The Company recognized a gain of $955 million within Other income (expense), net as a result of the settlement.

Gains and (Losses) due to Changes in Fair Value Recognized in Earnings

The income (expense) due to changes in fair value of derivative instruments was recognized in the Consolidated Condensed Statements of Earnings as follows (in millions):

		Three months ended				Six months ended
	Location in Consolidated Condensed Statements of Earnings 1	February 28, 2025		February 29, 2024		February 28, 2025		February 29, 2024
Total return swap	Selling, general and administrative expenses	$	(7)	$	18	$	5	$	17
Foreign currency forwards	Other income (expense), net	(7)		(26)		84		33
Variable prepaid forward 2	Other income (expense), net	977		(522)		777		(888)

1.Excludes remeasurement gains and losses on economically hedged assets and liabilities.

2.Includes $955 million settlement gain in the three and six months ended February 28, 2025.