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FINANCIAL INSTRUMENTS, HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENTS
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FINANCIAL INSTRUMENTS, HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENTS FINANCIAL INSTRUMENTS, HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENTS
Fair value of financial instruments
Equity securities with readily determinable fair values - Balances of equity securities are recorded within other assets, with any changes in fair value recorded within other (income) expense, net. The fair values of equity securities are based upon quoted market prices, which are considered Level 1 inputs.
Long-term borrowings - The estimated fair values of these borrowings are based on recent trades, as reported by a third-party pricing service. Due to the infrequency of trades, these inputs are considered to be Level 2 inputs.
Derivative instruments - The Company’s interest rate swaps, cross-currency swaps and foreign currency forward contracts are valued using broker quotations or market transactions in either the listed or over-the-counter markets. As such, these derivative instruments are included in the Level 2 hierarchy.
Fair value of contingent consideration
Contingent consideration is valued using a probability-weighted expected payment method that considers the timing of expected future cash flows and the probability of whether key elements of the contingent event are completed. The fair value of contingent consideration is valued at each balance sheet date, until amounts become payable, with adjustments recorded within other operating charges in the condensed consolidated statements of operations. Due to the significant unobservable inputs used in the valuations, these liabilities are categorized within Level 3 of the fair value hierarchy.
The table below presents the fair values of our financial instruments measured on a recurring basis by level within the fair value hierarchy at June 30, 2026 and December 31, 2025.
June 30, 2026December 31, 2025
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets:
Prepaid expenses and other current assets:
Interest rate swaps (1)
$— $1 $— $1 $— $— $— $— 
Cross-currency swaps (2)
— 5 — 5 — 5 — 5 
Other assets:
Interest rate swaps (1)
— 1 — 1 — — — — 
Investments in equity securities
1 — — 1 1 — — 1 
Liabilities:
Other accrued liabilities:
Cross-currency swaps (2)
— 32 — 32 — 51 — 51 
Contingent consideration— — 4 4 — — 6 6 
Other liabilities:
Cross-currency swaps (2)
— 37 — 37 — 50 — 50 
Short-term borrowings:
2027 Dollar Senior Notes— 499 — 499 — — — — 
Long-term borrowings:
2029 Dollar Term Loans— 1,344 — 1,344 — 1,481 — 1,481 
2027 Dollar Senior Notes— — — — — 501 — 501 
2029 Dollar Senior Notes— 668 — 668 — 674 — 674 
2031 Dollar Senior Notes— 520 — 520 — 527 — 527 
(1)    Cash flow hedge
(2)    Net investment hedge
The table below presents a roll forward of activity for the Level 3 liabilities for the six months ended June 30, 2026.
Fair Value Using Significant Unobservable Inputs
(Level 3)
Beginning balance at December 31, 2025
$6 
Contingent consideration from business acquisition2 
Payments(1)
Change in fair value(2)
Foreign currency translation(1)
Ending balance at June 30, 2026
$4 
Derivative Financial Instruments
We selectively use derivative instruments to reduce market risk associated with changes in foreign currency exchange rates and interest rates. The use of derivatives is intended for hedging purposes only, and we do not enter into derivative instruments for speculative purposes.
Derivative Instruments Qualifying and Designated as Cash Flow and Net Investment Hedges
The following table sets forth the locations and amounts recognized during the three and six months ended June 30, 2026 and 2025 for the Company's cash flow and net investment hedges.
Three Months Ended
June 30,
20262025
Derivatives in Cash Flow and Net Investment HedgesLocation of (Gain) Loss Recognized in Income on DerivativesNet Amount of Gain Recognized in OCI on DerivativesAmount of Gain Recognized in IncomeNet Amount of Loss Recognized in OCI on DerivativesAmount of Gain Recognized in Income
Interest rate swapsInterest expense, net$(1)$— $— $— 
Cross-currency swaps
Interest expense, net$(4)$(4)$85 $(4)
Six Months Ended
June 30,
20262025
Derivatives in Cash Flow and Net Investment HedgesLocation of (Gain) Loss Recognized in Income on DerivativesNet Amount of Gain Recognized in OCI on DerivativesAmount of Gain Recognized in IncomeNet Amount of Loss Recognized in OCI on DerivativesAmount of Gain Recognized in Income
Interest rate swapsInterest expense, net$(2)$— $— $— 
Cross-currency swaps
Interest expense, net$(38)$(8)$105 $(9)
Over the next 12 months, we expect a gain of $1 million pertaining to cash flow hedges to be reclassified from AOCI into earnings, related to our interest rate swaps.
Derivative Instruments Not Designated as Cash Flow or Net Investment Hedges
We periodically enter into foreign currency forward and option contracts to reduce market risk and hedge our balance sheet exposures and cash flows for subsidiaries with exposures denominated in currencies different from the functional currency of the relevant subsidiary. These contracts have not been designated as hedges and all gains and losses are marked to market through other (income) expense, net in the condensed consolidated statements of operations.
Fair value gains and losses of derivative contracts, as determined using Level 2 inputs, that have not been designated for hedge accounting treatment are recorded in earnings as follows:
Derivatives Not Designated as Hedging
Instruments under ASC 815		Location of Loss (Gain) Recognized in Income on DerivativesThree Months Ended
June 30,		Six Months Ended
June 30,
2026202520262025
Foreign currency forward contractsOther (income) expense, net$4 $(17)$10 $(22)