Our credit, market, and foreign currency risk management policies are described in Note 17, Financial Instruments and Fair Value Measures, to the Consolidated Financial Statements for the year ended December 31, 2025 included in our 2025 Form 10-K. As of March 31, 2026 and December 31, 2025, we had contracts with aggregate gross notional amounts of $2,172 million and $1,374 million, respectively, to hedge foreign currencies, principally the U.S. Dollar, Swiss Franc, British Pound, Euro, Chinese Yuan, Japanese Yen, Mexican Peso, New Romanian Leu, Czech Koruna, Australian Dollar, and Korean Won.

The FASB’s accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Financial and nonfinancial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The following table sets forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2026 and December 31, 2025:


					Fair Value
	Notional Amounts				Assets					Liabilities
	March 31, 2026		December 31, 2025		March 31, 2026		December 31, 2025			March 31, 2026		December 31, 2025
Designated instruments:
Designated forward currency exchange contracts	$	1,235	$	637	$	24	$	15	(a)	$	11	$	8	(c)
Designated cross-currency swaps	1,775		1,775		—		—		(b)	114		169		(d)
Designated interest-rate swaps	625		625		—		—		(b)	11		16		(d)
Total designated instruments	3,635		3,037		24		15			136		193
Undesignated instruments:

Undesignated forward currency exchange contracts	937		737		1		2		(a)	4		3		(c)
Total undesignated instruments	937		737		1		2			4		3
Total designated and undesignated instruments	$	4,572	$	3,774	$	25	$	17		$	140	$	196

During 2025, the Company entered into float-to-fixed interest rate swap contracts with an aggregate notional amount of $625 million and maturities in January 2028, January 2029, January 2030 and January 2031, of which an interest rate swap contract with a notional amount of $50 million was early settled during 2025. Changes in the fair value of the interest

rate swap contracts are recorded in Accumulated Other Comprehensive Income ("AOCI") and will be reclassified to Interest expense in the Consolidated Interim Statement of Operations upon maturity. Amounts recognized related to the early settlement of the interest rate swap contract were immaterial.

The Company also has outstanding forward currency exchange contracts with maturities up to 18 months and an aggregate notional amount of $1,235 million and $637 million as of March 31, 2026 and December 31, 2025, respectively. These forward currency exchange contracts have been designated as cash flow hedges to mitigate foreign currency exposures primarily on our inventory purchases and manufacturing costs. The gains and losses on the forward currency exchange contracts are recorded in AOCI and reclassified to Cost of goods sold in the Consolidated Interim Statement of Operations when the underlying transactions are recognized in earnings.

In order to mitigate foreign currency risk on its 2032 Senior Notes, the Company entered into fixed-to-fixed cross-currency swap contracts with an aggregate notional amount of €507 million ($550 million) and notional exchanges occurring in May 2027, May 2028, May 2029, and May 2030. Changes in the fair value of the cross-currency swap contracts are recognized in AOCI and reclassified to Non-operating (income) expense in the Consolidated Interim Statement of Operations, based upon changes in the spot rate remeasurement of the underlying debt. The net interest settlements on the cross-currency swap contracts are recorded in Interest expense in the Consolidated Interim Statements of Operations.

The Company has designated cross-currency swaps with aggregate notional amounts of €1,157 million ($1,225 million) as net investment hedges of its Euro-denominated operations. Changes in the fair value of the net investment hedges are recorded in AOCI until the net investment is liquidated or sold. The fair values of the net investment hedges were net liabilities of $87 million and $124 million as of March 31, 2026 and December 31, 2025, respectively. No ineffectiveness has been recorded on the net investment hedges.

The Company has outstanding forward currency exchange contracts with maturities generally up to 3 months and an aggregate notional amount of $937 million and $737 million as of March 31, 2026 and December 31, 2025, respectively. Changes in the fair value of the forward currency exchange contracts are recorded in Non-operating (income) expense in the Consolidated Interim Statements of Operations.

The Company had float-to-fixed interest rate swap contracts that were early settled in 2025. Changes in the fair value of the undesignated interest rate swap contracts were recorded in Interest expense in the Consolidated Interim Statements of Operations.

The following tables present the pretax impact that changes in the fair values of derivatives designated as cash flow hedges and net investment hedges had on OCI, AOCI and earnings:


	Three Months Ended March 31,
		2026		2025
		(Dollars in millions)
Cash flow hedges
Gain (loss) reclassified from AOCI to income:
Cost of goods sold		$	(3)	$	—
Interest expense		—		—
Non-operating (expense) income		(12)		19
Gain (loss) recognized in other comprehensive income (loss)		18		17

Net investment hedges
Gain (loss) recognized in other comprehensive income (loss)		39		(44)

The following table summarizes the pretax gain (loss) that changes in the fair values of derivatives not designated as hedging instruments had on earnings:


		Three Months Ended March 31,
			2026		2025
Contract Type	Location		(Dollars in millions)
Interest rate swaps	Interest expense (1)		$	—	$	—
Forward currency exchange contracts	Non-operating income		9		(10)

(1) Includes interest income of $6 million, partially offset by marked-to-market remeasurement losses of $6 million, for the three months ended March 31, 2025. There were no undesignated interest rate swaps outstanding during 2026.

The foreign currency exchange, interest rate swap and cross-currency swap contracts are valued using market observable inputs. As such, these derivative instruments are classified within Level 2. The assumptions used in measuring the fair value of the cross-currency swap are considered Level 2 inputs, which are based upon market-observable interest rate curves, cross-currency basis curves, credit default swap curves, and foreign exchange rates.

The carrying value of Cash, cash equivalents, and restricted cash, Account receivables and Notes and Other receivables contained in the Consolidated Interim Balance Sheet approximates fair value.


	March 31, 2026				December 31, 2025
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(Dollars in millions)
Term Loan Facilities	$	624	$	635	$	626	$	639
2032 Senior Notes	791		828		790		850