v3.25.2
Fair Value Measurements
 3 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Recurring Fair Value Measurements
The financial instruments measured at fair value in the accompanying condensed consolidated balance sheets consisted of the following at the periods presented below:
Recurring Fair Value Measurements
as of June 30, 2025
Level 1Level 2Total
Assets:
Long-term deferred compensation plan asset$43 $— $43 
Total Assets$43 $— $43 
Liabilities:
Current derivative instruments— 1 1 
Long-term derivative instruments— 2 2 
Long-term deferred compensation plan liability43 — 43 
Total Liabilities$43 $3 $46 
Recurring Fair Value Measurements
as of March 31, 2025
Level 1Level 2Total
Assets:
Current derivative instruments$— $1 $1 
Long-term deferred compensation plan asset35 — 35 
Total Assets$35 $1 $36 
Liabilities:
Current derivative instruments— 1 1 
Long-term derivative instruments— 2 2 
Long-term deferred compensation plan liability35 — 35 
Total Liabilities$35 $3 $38 
The Company did not have any Level 3 assets or liabilities as of June 30, 2025 or March 31, 2025.
Derivatives
The Company utilizes interest rate derivative financial instruments, which were designated as cash flow hedges, to manage its exposure to interest rate risk related to its variable rate debt and reducing volatility of interest expense as the variable-to-fixed interest rate swaps effectively convert a portion of the variable rate debt into fixed interest rate debt. The Company’s outstanding interest rate swaps have a total notional amount of $350 million as of June 30, 2025 and mature from June 30, 2026 to June 30, 2027.
The Company’s interest rate swaps are considered over-the-counter derivatives which are recorded in the condensed consolidated balance sheet on a gross basis at estimated fair value. Fair value is estimated based on the present value of future cash flows using a model-derived valuation that uses Level 2 observable inputs such as interest rate yield curves. The changes in the fair value of interest rate swaps designated as cash flow hedges are recorded in AOCI, net of taxes, and are subsequently reclassified into interest expense, net in the period that the hedged forecasted interest payments are made on the Company's variable-rate debt. Over the next 12 months, the Company estimates that less than $1 million will be reclassified as an increase to interest expense. Cash flows associated with periodic settlements of interest rate swaps are classified as operating activities in the condensed consolidated statement of cash flows.
Deferred Compensation Plans
Investments in this category consist primarily of mutual funds whose fair values are determined by reference to the quoted market price per unit in active markets multiplied by the number of units held without consideration of transaction costs. These assets are recorded in other long-term assets and represent investments held in a consolidated trust to fund the Company's non-qualified deferred compensation plan, which is recorded in other long-term liabilities on our condensed consolidated balance sheets.
Cash, Cash Equivalents and Marketable Securities
The fair value of the Company's cash and cash equivalents, which are Level 1 inputs, approximated its carrying value at June 30, 2025 and March 31, 2025. The Company’s cash and cash equivalent balances presented on the accompanying condensed consolidated balance sheets include $227 million and $802 million of marketable securities in money market funds as of June 30, 2025 and March 31, 2025, respectively.
Long-term Debt
The Company's long-term debt is carried at amortized cost and fair value is disclosed on a quarterly basis. The estimated fair values of debt are determined using quoted prices or other market information obtained from recent trading activity of the debt in markets that are not active (Level 2 inputs). The fair value is corroborated by prices derived from the interest rate spreads of recently completed leveraged loan transactions of a similar credit profile, industry, and terms to that of the Company. The fair value of the Senior Notes are determined using quoted prices or other market information obtained from recent trading activity in the high-yield bond market (Level 2 inputs). The estimated fair value of long-term debt as of June 30, 2025 and March 31, 2025 was $3,957 million and $3,954 million, respectively.
Nonrecurring Fair Value Measurements
As of June 30, 2025 and March 31, 2025, the total of our investments that are accounted for at fair value on a non-recurring basis under the measurement alternative were $99 million and $85 million, respectively. While these assets are not measured at fair value on an ongoing basis, they are subject to fair value adjustments in certain circumstances (e.g., observable price changes or impairment).