v3.26.1
Fair Value of Financial Assets and Liabilities
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value of Financial Assets and Liabilities Fair Value of Financial Assets and Liabilities
The following table represents assets and liabilities measured at fair value on a recurring basis. With the exception of the warrants, whose basis for the measurement of fair value is Level 1 - Quoted Prices, the basis for measurement at fair value for all other assets and liabilities is Level 2 – Significant Other Observable Inputs. 
June 30,
2026		December 31,
2025
Assets
Derivatives(1)
$12 $8 
Deferred compensation plan investments in mutual funds13 12 
Total$25 $20 
Liabilities
Derivatives(1)
$22 $10 
Warrant(2)
21 — 
Deferred compensation plan liabilities12 11 
Total$55 $21 
____________
(1)Includes foreign currency derivative contracts. Refer to Note 13 - Financial Instruments for additional information regarding these derivatives.
(2)Refer to Note 16 - Shareholders' Equity of Xerox Holdings for additional information regarding the Warrant Dividend.
We utilize the income approach to measure the fair value for our derivative assets and liabilities. The income approach uses pricing models that rely on market observable inputs such as yield curves, currency exchange rates and forward prices.
The fair value of the warrant liability is determined using the market approach in accordance with ASC 820, and is based on quoted market prices for the identical warrants in an active market at the measurement date, which are derived from observable market prices rather than a valuation model. Accordingly, no unobservable inputs or management assumptions are used in determining the fair value.
Fair value for our deferred compensation plan investments in mutual funds is based on quoted market prices for those funds. Fair value for deferred compensation plan liabilities is based on the fair value of investments corresponding to employees’ investment selections.
Summary of Other Financial Assets and Liabilities
The estimated fair values of our other financial assets and liabilities were as follows:
June 30, 2026December 31, 2025
Carrying
Amount
Fair
Value
Carrying
Amount
Fair
Value
Cash and cash equivalents$495 $495 $512 $512 
Accounts receivable, net1,185 1,185 1,122 1,122 
Short-term debt and current portion of long-term debt(1)
70 74 231 236 
Long-term Debt
Xerox Holdings Corporation1,670 845 1,872 800 
Xerox Corporation2,096 1,613 2,142 1,676 
Xerox - Other Subsidiaries(2)
387 391 2 2 
Long-term debt$4,153 $2,849 $4,016 $2,478 
____________
(1)Includes $12 and $121 of Xerox Corporation related party debt for the period ended June 30, 2026 and December 31, 2025 respectively.
(2)Represents subsidiaries of Xerox Corporation
The fair value amounts for Cash and cash equivalents and Accounts receivable, net, approximate carrying amounts due to the short maturities of these instruments. The fair value of Short-term debt, including the current portion of long-term debt, and Long-term debt was estimated based on the current rates offered to us for debt of similar maturities (Level 2). The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at such date.