v3.26.3
Derivatives and Hedging Instruments
 9 Months Ended
Sep. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivatives and Hedging Instruments Derivatives and Hedging Instruments
In order to limit exposure to risk, the Company maintains derivative instruments with creditworthy institutions to hedge against changing interest rates and foreign currency rate fluctuations. The Company utilizes forward exchange contracts, fixed-to-fixed cross-currency rate swap contracts, fixed-to-floating interest rate swap contracts and other non-derivative hedging instruments
to manage such risk. The Company has designated these instruments as cash flow hedges, net investment hedges, or fair value hedges, as further described below. Derivative instruments maintained by the Company are measured on a recurring basis and are recorded at fair value either as an asset or liability in the consolidated balance sheets (see Note 8).
Cash Flow Hedges
The Company maintains forward exchange contracts, designated as cash flow hedges, to hedge foreign currency exposure to the Indian Rupee. The notional amount of these derivatives was $445 million and $323 million at September 30, 2026 and December 31, 2025, respectively. Based on the amounts recorded in accumulated other comprehensive loss at September 30, 2026, the Company estimates that it will recognize losses of approximately $11 million in cost of processing and services during the next 12 months as foreign exchange forward contracts settle.
The Company previously entered into treasury lock agreements (“Treasury Locks”), designated as cash flow hedges, to manage exposure to fluctuations in benchmark interest rates in anticipation of the issuance of fixed rate debt in connection with the 2019 acquisition and refinancing of certain indebtedness of First Data Corporation and its subsidiaries. Concurrent with the issuance of U.S. dollar-denominated senior notes in 2019, the Treasury Locks were settled resulting in a loss, net of income taxes, and recorded in accumulated other comprehensive loss that is being amortized to earnings over the terms of the originally forecast interest payments. In connection with the early debt extinguishment of a portion of the Company’s 4.400% senior notes due in July 2049 (see Note 10), $4 million and $26 million of unamortized losses associated with the Treasury Locks was recognized within net interest expense in the consolidated statements of income (loss) for the three and nine months ended September 30, 2026. The remaining unamortized balance recorded in accumulated other comprehensive loss related to the Treasury Locks was $53 million and $88 million at September 30, 2026 and December 31, 2025, respectively. Based on the remaining amounts recorded in accumulated other comprehensive loss at September 30, 2026, the Company estimates that it will recognize approximately $11 million in net interest expense during the next 12 months related to settled interest rate hedge contracts.
Net Investment Hedges
To reduce exposure to changes in the value of the Company’s net investments in certain of its foreign currency-denominated subsidiaries due to changes in foreign currency exchange rates, the Company uses fixed-to-fixed cross-currency rate swap contracts and foreign currency-denominated debt as economic hedges of its net investments in such foreign currency-denominated subsidiaries.
The aggregate notional amount of the fixed-to-fixed cross-currency rate swap contracts were as follows:
(In millions)September 30, 2026December 31, 2025
Currency
Euros
940 940 
Singapore Dollars
828 828 
Canadian Dollars405 405 
These fixed-to-fixed cross-currency rate swaps have been designated as net investment hedges to hedge a portion of the Company’s net investment in certain subsidiaries whose functional currencies are the Euro, Singapore Dollar, and Canadian Dollar. The Company has also designated certain of its Euro- and British Pound-denominated senior notes and Euro commercial paper notes as net investment hedges to hedge a portion of its net investment in certain subsidiaries whose functional currencies are the Euro and the British Pound.
In connection with its June 2026 senior notes offering (see Note 10), the Company entered into foreign exchange forward contracts, designated as net investment hedges, to hedge foreign currency exposure between the offering date and the settlement date of the Euro-denominated senior notes. Upon settlement of the senior notes, the forward contracts were terminated, whereby the Company subsequently designated the Euro-denominated debt as a net investment hedge to hedge a portion of its net investment in certain subsidiaries whose functional currencies are the Euro.
Foreign currency transaction gains or losses on the qualifying net investment hedge instruments are recorded as foreign currency translation within other comprehensive income (loss) in the consolidated statements of comprehensive income (loss) and will remain in accumulated other comprehensive loss in the consolidated balance sheets until the sale or complete liquidation of the underlying foreign currency-denominated subsidiaries.
Foreign currency transaction gains (losses), net of income tax, related to net investment hedges that were recorded as foreign currency translation within other comprehensive income (loss) in the consolidated statements of comprehensive income (loss) were as follows:
Three Months Ended
September 30,		Nine Months Ended
September 30,
(In millions)2026202520262025
Cross-currency rate swap contracts
$(3)$11 $10 $(82)
Foreign currency-denominated debt
2 10 87 (313)
Foreign exchange forward contracts— — 10 — 
The Company recorded income tax impacts of $1 million and $(6) million during the three months ended September 30, 2026 and 2025, respectively, and $(35) million and $132 million during the nine months ended September 30, 2026 and 2025, respectively, in other comprehensive income (loss) from the translation of foreign currency-denominated senior notes, Euro commercial paper notes, fixed-to-fixed cross-currency rate swap contracts and foreign exchange forward contracts.
Fair Value Hedges
The Company maintains fixed-to-floating interest rate swap contracts in the aggregate notional amount of $1.5 billion, designated as fair value hedges, to economically change a portion of its fixed rate senior notes to variable rate debt. Net changes in the fair value of the fixed-to-floating rate swaps ($77 million and $99 million loss for the three and nine months ended September 30, 2026, respectively), along with the offsetting change in the fair value of the hedged senior notes, attributable to changes in the designated benchmark interest rate, were recognized in net interest expense within the consolidated statements of income (loss).
The notional amounts of the hedged fixed rate senior notes were as follows:
(In millions)September 30, 2026December 31, 2025
Hedged Notes
5.350% senior notes due March 2031
$175 $— 
5.625% senior notes due August 2033
300 — 
5.150% senior notes due August 2034
500 — 
5.250% senior notes due August 2035
525 — 
In October 2026, the Company entered into fixed-to-floating interest rate swap contracts in the aggregate notional amount of $500 million, designated as fair value hedges, to economically change a portion of its 5.600% senior notes due in March 2033 to variable rate debt.
In September 2026, the Company entered into foreign exchange forward contracts in the notional amounts of 40 million Euro and 180 million Polish Zloty, designated as fair value hedges, to mitigate the spot foreign exchange rate risk on the principal amounts of Euro-denominated and Polish Zloty-denominated intercompany notes. Net changes in the fair value of the foreign exchange forward contracts, along with the offsetting change in the fair value of the intercompany note, attributable to fluctuations in the Euro/Polish Zloty, are recognized in other (expense) income, net within the consolidated statements of income (loss). Net changes in the fair value of the foreign exchange forward contracts were not significant during the three months ended September 30, 2026.
The Company previously maintained a fixed-to-fixed cross-currency rate swap contract in the notional amount of 525 million British Pounds, designated as a fair value hedge, to mitigate the spot foreign exchange rate risk on the principal amount of its British Pound-denominated 2.250% senior notes, which matured in July 2025. Net changes in the fair value of the cross-currency rate swaps ($0.3 million loss and $60 million gain for the three and nine months ended September 30, 2025, respectively), along with the offsetting change in the fair value of the hedged notes, attributable to fluctuations in the respective foreign currency spot rates were recognized in other income (expense), net within the consolidated statements of income (loss).