Derivative Financial Instruments

9 Months Ended

Sep. 30, 2025

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

6. Derivative Financial Instruments

The Company’s risk management objective is to ensure that business exposures to risks are minimized using the most effective and efficient methods to eliminate, reduce, or transfer such exposures. Operating decisions consider these associated risks and, whenever possible, transactions are structured to avoid or mitigate these risks.

From time to time, the Company enters into FX Forward Contracts to manage the exposure on forecasted transactions denominated in non-functional currencies and to manage the risk of transaction gains and losses associated with assets/liabilities in currencies other than the functional currency of certain subsidiaries. Certain of these FX Forward Contracts are designated as cash flow hedges. To the extent these derivatives are effective in offsetting the variability of the hedged cash flows, changes in the derivatives’ fair value are not included in current earnings but are included in accumulated other comprehensive income (loss) ("AOCI"). These changes in fair value are reclassified into earnings as a component of cost of sales, as applicable, when the forecasted transaction impacts earnings. In addition, if the forecasted transaction is no longer probable, the cumulative change in the derivatives’ fair value is recorded as a component of other income (expense) – net in the period in which the transaction is no longer considered probable of occurring. During the three and nine months ended September 30, 2025, $1.6 million of forecasted transactions were no longer probable of occurring, resulting in a net gain of $0.1 million being recorded to other expense - net in the Condensed Consolidated Statement of Operations. No amounts were recorded related to forecasted transactions no longer being probable during the three and nine months ended September 30, 2024.

The Company had FX Forward Contracts with aggregate notional amounts of $73.8 million and $129.7 million in U.S. dollar equivalent as of September 30, 2025 and December 31, 2024, respectively. The aggregate notional amount outstanding as of September 30, 2025 is scheduled to mature within one year. The FX Forward Contracts purchased are denominated in various foreign currencies. Net unrealized gains (losses), net of income tax, recorded in AOCI were $1.1 million and $(1.7) million as of September 30, 2025 and December 31, 2024, respectively.

The net gains (losses) recorded in the Condensed Consolidated Statements of Operations for FX Forward Contracts for the three and nine months ended September 30, 2025 and 2024 are summarized as follows:

		Three Months Ended September 30,						Nine Months Ended September 30,
	Recognized Location	2025			2024			2025			2024
Designated	Cost of sales	$	2.2		$	0.5		$	3.1		$	(0.8	)
Non-Designated	Other expense - net	$	(2.0	)	$	(0.6	)	$	(2.5	)	$	1.7