v3.26.1
DERIVATIVES
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVES
13. DERIVATIVES
In the normal course of the Group’s business operations, the Group is exposed to certain risks, including changes in interest rates and foreign currency rates. In order to manage these risks, the Group uses derivative instruments such as cross-currency interest rate swaps, interest rate swaps, foreign exchange forward contracts, options and other instruments with similar characteristics. None of the Group’s derivative instruments are used for speculative purposes.
Cash flow hedges
Interest rate risk arising from a portion of the Group’s floating interest rate USD First Lien Term Loan B maturing in 2030 and 2032, along with foreign currency risk arising from the Group’s fixed rate USD Senior Secured Notes maturing in 2029 are managed using interest rate swaps and cross-currency interest rate swaps, which are designated as cash flow hedges with the objective of reducing the volatility of interest expense in the case of the USD First Lien Term Loan B and foreign currency risk in the case of fixed rate USD Senior Secured Notes. During the year ended December 31, 2025, the Group also hedged foreign currency risk arising from the Group’s floating interest rate USD First Lien Term Loan B maturing in 2030 and 2032.
Cross-currency interest rate swaps
The cross-currency interest rate swaps designated as a hedge of the foreign currency risk arising from the USD Senior Secured Notes effectively convert the fixed rate USD Senior Secured Notes to fixed rate GBP Senior Secured Notes.
Foreign currency risk is managed by exchanging contractual amounts at exchange rates and interest rates determined at contract inception.
Interest rate swaps
The interest rate swaps designated as a hedge of the interest risk arising from the USD First Lien Term Loan B effectively converts the variable rate term loan into a fixed rate term loan. Interest risk is managed by exchanging contractual amounts at interest rates determined at contract inception.
The following table summarizes the Group's outstanding derivative instruments designated as cash flow hedges:
As of June 30, 2026As of December 31, 2025
Hedged ItemNotional ($ in millions)Expiration dateNotional ($ in millions)Expiration date
Cross-currency interest rate swapsUSD Senior Secured Notes 525April 15, 2028525April 15, 2026
Interest rate swapsTerm Loan B1,984September 30, 2026 to June 30, 20271,994September 30, 2026 to June 30, 2027
Changes in the fair value of the portion of the derivative included in the assessment of hedge effectiveness of cash-flow hedges are recorded in other comprehensive income (loss), until earnings are affected by the variability of cash flows.
The following table summarizes the gains (losses) of the Company’s designated cash flow hedges for the three and six months ended June 30, 2026 and 2025:
Amount of (loss) gain recognized in OCILocation of loss (gain) recognized from AOCI into income (loss)Amount of loss (gain) reclassified from AOCI into net income (loss)
Three Months Ended June 30,
($ in millions)2026202520262025
Cross-currency interest rate swaps(7)(67)Interest expense, net—2
Other income (expense), net*166
Interest rate swaps5 0Interest expense, net(2)(3)
Total(2)(67)(1)65
Amount of gain (loss) recognized in OCILocation of (gain) loss recognized from AOCI into income (loss)Amount of (gain) loss reclassified from AOCI into net income (loss)
Six Months Ended June 30,
($ in millions)2026202520262025
Cross-currency interest rate swaps2(108)Interest expense, net—3
Other income (expense), net*(8)104
Interest rate swaps13(3)Interest expense, net(4)(6)
Total15(111)(12)101
* Included in foreign exchange gain, net, which is a component of other income (expense), net.
The Group expects to reclassify a gain of $8 million from accumulated other comprehensive income (loss) into earnings within the next 12 months.
Fair value hedges
Cross-currency interest rate swaps
Foreign currency risk arising from a portion of the Group's USD Senior Secured Notes due 2031 is managed using receive fixed rate, pay variable rate and pay variable rate, receive variable rate cross-currency interest rate swaps with the objective of reducing the volatility of foreign currency gains and losses. During the year ended December 31, 2025, the Group also hedged foreign currency risk arising from the Group’s floating rate USD First Lien Term Loan B.
Foreign currency risk is eliminated by exchanging contractual amounts at exchange rates which are determined at contract inception.
As of both June 30, 2026 and December 31, 2025, the notional amounts of cross-currency interest rate swaps designated in a fair value hedge of the USD Senior Secured Notes was $1,000 million (maturing June 4, 2027).
The Group recorded a foreign currency loss of $2 million and a gain of $15 million in earnings for the three and six months ended June 30, 2026, respectively (three and six months ended June 30, 2025: $106 million loss and $150 million loss, respectively), which offset the respective foreign currency gain and loss in respect of the USD First Lien Term Loan B and USD Senior Secured Notes, for the three and six months ended June 30, 2026, respectively.
The Group excludes the cross-currency basis spread in the swaps from the hedge effectiveness assessment and recognizes the excluded component into earnings through the periodic interest settlements on the swaps. Changes in the fair value of the excluded components recognized in other comprehensive income (loss) were nil for the three and six months ended June 30, 2026 (three and six months ended June 30, 2025: $3 million loss and $4 million loss, respectively). The amount recognized in earnings in foreign exchange gain, net, which is a component of other income (expense), net was nil and
$1 million loss for three and six months ended June 30, 2026 respectively (three and six months ended June 30, 2025: $2 million loss and $3 million loss, respectively).
Interest rate swaps
Interest rate risk from changes in three month SOFR arising from the fixed rate Senior Secured Notes due 2031 is managed using interest rate swaps that effectively convert the fixed rate senior secured notes into variable rate senior secured notes. Interest risk is managed by exchanging contractual amounts at interest rates determined at swap contract inception.
The notional amount of interest rate swaps designated as fair value hedges of interest rate risk on the USD Senior Secured Notes was $500 million (maturing June 4, 2027) as of June 30, 2026 ($500 million as of December 31, 2025).
The following table presents amounts recorded in long-term debt in the Condensed Consolidated Balance Sheets related to the cumulative basis adjustment for fair value hedges ($ in millions):
As of June 30, 2026As of December 31, 2025
Carrying amount Cumulative basis adjustment included in the carrying amountCarrying amountCumulative basis adjustment included in the carrying amount
Long-term debt$1,642 $(4)$1,648 $3
Net investment hedges
The Group has investments in various subsidiaries with Euro and USD functional currencies. As a result, the Group is exposed to the risk of fluctuations between the Euro and GBP and USD and GBP exchange rates. The Group designated its Euro denominated Term Loan A and Senior Secured Notes due 2029 and 2031 and a portion of its USD Term Loan B (fully discontinued on December 31, 2025) and receive variable rate, pay variable rate cross-currency interest swaps in net investment hedges whereby the Group will receive GBP from, and pay Euro to, the counterparties at exchange rates which are determined at swap contract inception, as a net investment hedge which are intended to mitigate foreign currency exposure related to non-GBP net investments in certain Euro and USD functional subsidiaries.
The following table summarizes the hedging instruments designated in net investment hedge relationships, which were considered highly effective:
As of June 30, 2026As of December 31, 2025
Notional ($ in millions)Expiration dateNotional ($ in millions)Expiration date
Euro denominated debt1,977November 30, 2028 to June 4, 20312,031November 30, 2028 to June 4, 2031
USD denominated debt— —200 November 30, 2030
Cross-currency interest rate swaps990June 4, 20271,017September 30, 2026 to June 30, 2027
Gains (losses) on derivatives designated as net investment hedges recognized in other comprehensive income (loss) for the three and six months ended June 30, 2026 and 2025 are summarized below (in millions):
Gains (losses) recognized in OCI
($ in millions)
Three Months Ended June 30,
20262025
Euro denominated debt28(10)
USD denominated debt— 12
Cross-currency interest rate swaps18(32)
Total46(30)
Gains (losses) recognized in OCI
($ in millions)
Six Months Ended June 30,
20262025
Euro denominated debt25(20)
USD denominated debt— 12
Cross-currency interest rate swaps22(36)
Total47(44)
There were no amounts reclassified out of accumulated other comprehensive income pertaining to the net investment hedges during the three and six months ended June 30, 2026 and 2025 as the Group had not sold or liquidated (or substantially liquidated) any of its hedged subsidiaries.
The following table summarizes the fair value of derivatives as of June 30, 2026 and December 31, 2025:
($ in millions)As of June 30, 2026As of December 31, 2025
Assets 1
Liabilities 2
Assets 1
Liabilities 2
Derivatives designated as cash flow hedges:
Cross-currency interest rate swaps18 (9)7 (43)
Interest rate swaps9 — 1 (2)
Total derivatives designated as cash flow hedges27 (9)8 (45)
Derivatives designated as fair value hedges:
Cross-currency interest rate swaps 17 — 7 (7)
Interest rate swaps6 (1)13 (4)
Total derivatives designated as fair value hedges23 (1)20 (11)
Derivatives designated as net investment hedges:
Cross-currency interest rate swaps 10 (12)15 (30)
Total derivatives designated as net investment hedges10 (12)15 (30)
Total derivatives60 (22)43 (86)
1.Derivative assets are recorded within prepaid expenses and other current assets and other non-current assets in the Condensed Consolidated Balance Sheets
2.Derivative liabilities are recorded within other current liabilities and other non-current liabilities in the Condensed Consolidated Balance Sheets