v3.26.1
Derivative Instruments and Hedging Activities
 9 Months Ended
Mar. 31, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
As part of our financial risk management program, we use certain derivative financial instruments. We do not enter into derivative transactions for speculative purposes and, therefore, we do not hold any derivative instruments for trading purposes. We account for derivative instruments as a hedge of the related asset, liability, firm commitment or anticipated transaction, when the derivative is specifically designated and qualifies as a hedge of such items. Our objective in managing foreign exchange exposures with derivative instruments is to reduce volatility in cash flow. We measure hedge effectiveness by assessing the changes in the fair value or expected future cash flows of the hedged item.
The fair value of derivatives designated and not designated as hedging instruments in the condensed consolidated balance sheets are as follows:
(in thousands)March 31, 2026
June 30, 2025
Derivatives designated as hedging instruments
Other current assets - range forward contracts$4 $— 
Other current liabilities - range forward contracts— (9)
Total derivatives designated as hedging instruments4 (9)
Derivatives not designated as hedging instruments
Other current assets - currency forward contracts$114 $88 
Other current liabilities - currency forward contracts(26)(72)
Total derivatives not designated as hedging instruments88 16 
Total derivatives$92 $7 
Certain currency forward contracts that hedge significant cross-border intercompany loans are considered as other derivatives and therefore do not qualify for hedge accounting. These contracts are recorded at fair value in the condensed consolidated balance sheets, with the offset to other income, net. Losses (gains) related to derivatives not designated as hedging instruments have been recognized as follows:
Three Months Ended March 31,Nine Months Ended March 31,
(in thousands)2026202520262025
Other income, net $9 $(56)$(11)$(68)
 

CASH FLOW HEDGES
Range forward contracts (a transaction where both a put option is purchased and a call option is sold) are designated as cash flow hedges and hedge anticipated cash flows from cross-border intercompany sales of products and services. Gains and losses realized on these contracts are recorded in accumulated other comprehensive loss and are recognized as a component of cost of goods sold when the underlying sale of products or services is recognized into earnings. The notional amount of the contracts translated into U.S. dollars at March 31, 2026 and June 30, 2025 was $1.2 million and $4.7 million, respectively. The time value component of the fair value of range forward contracts is excluded from the assessment of hedge effectiveness.
The following represents (losses) gains, net of tax, related to cash flow hedges:
Three Months Ended March 31,Nine Months Ended March 31,
(in thousands)2026202520262025
Unrealized (loss) gain recognized in other comprehensive income $(1)$(258)$(197)$827 
No portion of the gains or losses recognized in earnings was due to ineffectiveness and no amounts were excluded from our effectiveness testing for the three and nine months ended March 31, 2026 and 2025.

NET INVESTMENT HEDGES
As of March 31, 2026, we had certain foreign currency-denominated intercompany loans payable with total aggregate principal amounts of ¥240.2 million and €21.2 million, designated as net investment hedges to hedge the foreign exchange exposure of our net investment in our China-based and Euro-based subsidiaries, respectively. As of June 30, 2025, we had ¥82.3 million foreign currency-denominated intercompany loans payable designated as net investment hedges to hedge the foreign exchange exposure of our net investment in our China-based subsidiaries. A loss of $0.1 million and a loss of $1.2 million were recorded as a component of foreign currency translation adjustments in other comprehensive income (loss) for the three months ended March 31, 2026 and 2025, respectively. A loss of $0.7 million and a loss of $0.6 million were recorded as a component of foreign currency translation adjustments in other comprehensive income (loss) for the nine months ended March 31, 2026 and 2025, respectively.
As of March 31, 2026, the foreign currency-denominated intercompany loans payable designated as net investment hedges consisted of:
Instrument
Notional
(EUR and CNY in thousands)(2)
Notional
(USD in thousands)(2)
Maturity
Foreign currency-denominated intercompany loan payable€10,117 $11,638 June 2026
Foreign currency-denominated intercompany loan payable€6,027 $6,934 June 2026
Foreign currency-denominated intercompany loan payable€5,038 $5,796 June 2026
Foreign currency-denominated intercompany loan payable¥84,155 $12,199 September 2026
Foreign currency-denominated intercompany loan payable¥86,954 $12,605 January 2027
Foreign currency-denominated intercompany loan payable¥69,134 $10,022 February 2027
(2) Includes principal and accrued interest.