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v3.26.1

Debt | 6 Months Ended
--- | ---
Jun. 30, 2026
Debt Disclosure [Abstract] |
Debt | DEBT The components of the Company's borrowings were as follows:
(In millions) | Maturity Date |  | June 30, 2026 |  | December 31, 2025
Revolving credit facility (1) | January 2, 2030 |  | $ | 437 |  |  | $ | 38 |
Less: unamortized debt issuance costs |  |  | (1) |  |  | — |
Revolving credit facility, net |  |  | 436 |  |  | 38 |
Senior Secured Term Loan B (2) | January 2, 2032 |  | 691 |  |  | 893 |
Less: unamortized debt issuance costs |  |  | (11) |  |  | (13) |
Senior Secured Term Loan B, net |  |  | 680 |  |  | 880 |
2030 Convertible senior notes (3) | September 15, 2030 |  | 575 |  |  | 575 |
Less: unamortized debt issuance costs |  |  | (15) |  |  | (15) |
Convertible senior notes, net |  |  | 560 |  |  | 560 |
2026 Convertible senior notes | May 15, 2026 |  | — |  |  | 403 |
Less: unamortized debt issuance costs |  |  | — |  |  | (1) |
Convertible senior notes, net |  |  | — |  |  | 402 |
Other (4) |  |  | 3 |  |  | 2 |
Total debt, including current portion |  |  | 1,679 |  |  | 1,882 |
Less: current portion of debt |  |  | 9 |  |  | 412 |
Long-term debt, net |  |  | $ | 1,670 |  |  | $ | 1,470 |
(1) Weighted-average interest rate at June 30, 2026 was 5.19%. (2) Effective interest rate for the Term Loan B (as defined below) for the quarter ended June 30, 2026 was 5.40%. (3) Effective interest rate for the 2030 Notes (as defined below) for the quarter ended June 30, 2026 was 0.93%. (4) Foreign line of credit and other borrowing arrangements. The Company had access to short-term financing of $41 million and $46 million as of June 30, 2026 and December 31, 2025, respectively. Components of interest expense recognized for the Senior Secured Term Loan B (the “Term Loan B”) and the 0.375% Convertible Senior Notes due 2030 (the “2030 Notes”) were as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
(In millions) | 2026 |  | 2025 |  | 2026 |  | 2025
Contractual interest expense, Term Loan B | $ | 12 |  |  | $ | 15 |  |  | $ | 24 |  |  | $ | 29 |
Interest cost related to amortization of issuance costs, Term Loan B | — |  |  | — |  |  | 1 |  |  | 1 |
Total interest expense, Term Loan B | $ | 12 |  |  | $ | 15 |  |  | $ | 25 |  |  | $ | 30 |
Contractual interest expense, the 2030 Notes | $ | 1 |  |  | $ | 1 |  |  | $ | 2 |  |  | $ | 1 |
Interest cost related to amortization of issuance costs, the 2030 Notes | 1 |  |  | — |  |  | 2 |  |  | 1 |
Total interest expense, the 2030 Notes | $ | 2 |  |  | $ | 1 |  |  | $ | 4 |  |  | $ | 2 |
Five-year Revolving Credit Facility On January 2, 2025, the Company executed the Second Amended and Restated Credit Agreement (the “Second A&R Credit Agreement”), which provides for a $1.8 billion revolving credit facility that matures on January 2, 2030. The revolving loans bear interest, at the Company’s option, at (1) the applicable borrowing rate (i.e. SOFR or EURIBOR) (subject to a floor rate of zero), or (2) an alternate base rate (which is the greater of Wells Fargo’s Prime Rate, the Federal Funds Rate plus 0.5%, or SOFR (subject to a floor rate of zero) plus 1.0%), plus, in each case, a margin dependent on the leverage ratio. The Company's credit facility includes restrictive covenants that, if not met, could lead to renegotiation of its credit facility, a requirement to repay its borrowings, and/or a significant increase in its cost of financing. Restrictive covenants include a minimum interest coverage ratio, a maximum leverage ratio, as well as certain events of default. As of June 30, 2026, the Company was in compliance with its restrictive covenants. Senior Secured Term Loan B On January 2, 2025, the Company entered into a $900 million Senior Secured Term Loan B under the Second A&R Credit Agreement (the “Term Loan B”), which matures on January 2, 2032. The Company is required to make quarterly principal repayments equal to 0.25% of the initial Term Loan B. Borrowings under the Term Loan B bear interest at the greater of (1) SOFR (subject to a floor rate of zero) or (2) a floor of 0%, plus an applicable margin of 1.75%. The Notes On September 9, 2025, the Company closed a private offering of $575 million aggregate principal amount of the 2030 Notes to qualified institutional buyers. Interest on the 2030 Notes is payable semi-annually in arrears on March 15 and September 15 of each year at a rate of 0.375% per year. The 2030 Notes will mature on September 15, 2030, unless earlier converted, redeemed or repurchased. The initial conversion rate of the 2030 Notes is 5.3258 shares of the Company’s common stock per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $187.77 per share. This conversion rate is subject to adjustment upon the occurrence of certain specified events. In the second quarter of 2026, the Company’s 0.25% Convertible Senior Notes due 2026 (the “2026 Notes”), which were issued in the second quarter of 2021, matured. The Company satisfied the outstanding principal amount of $403 million through cash repayment at maturity in the second quarter of 2026. Hedge Transactions In connection with the issuance of the 2030 Notes, the Company entered into certain hedge transactions (the “Hedge Transactions”). The Hedge Transactions are expected generally to reduce the potential dilutive effect of the conversion of the 2030 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted 2030 Notes, subject to customary adjustments. The Company paid an aggregate amount of approximately $106 million for the related Hedge Transactions for the 2030 Notes. The Hedge Transactions cover, subject to anti-dilution adjustments, approximately 3.1 million shares of the Company’s common stock with respect to the 2030 Notes. This is the same number of shares initially underlying the 2030 Notes at the strike price of $187.77, subject to customary adjustments. The Hedge Transactions will expire upon the maturity of the 2030 Notes unless earlier exercised or terminated. The Hedge Transactions meet the criteria in ASC 815-40 to be classified within Stockholders’ Equity, and therefore are not revalued after issuance. The Company has made tax elections to integrate the 2030 Notes and the related Hedge Transactions, which results in the Hedge Transactions being deductible as original issue discount interest for tax purposes over the term of the 2030 Notes, with the associated deferred tax assets recorded as adjustments to Additional paid-in capital. Warrant Transactions In connection with the Hedge Transactions, the Company also entered into certain warrant transactions (the “Warrant Transactions”). The Warrant Transactions relate to warrants to acquire, subject to anti-dilution adjustments, approximately 3.1 million shares of the Company’s common stock with respect to the 2030 Notes, at initial strike prices of approximately $283.42 per share. The Company received aggregate proceeds of $51 million from the related Warrant Transactions for the 2030 Notes, with such proceeds partially offsetting the costs of entering into the related Hedge Transactions. The 2030 warrants expire in September 2030. The Company has outstanding warrants related to its 2026 Notes, which were repaid in full during the second quarter of 2026. The warrants expire in August 2026 and are not expected to have a material impact on the Company's financial position, results of operations, or cash flows. If the market value per share of the common stock exceeds the strike price of the warrants, the warrants will have a dilutive effect on our earnings per share, unless the Company elects, subject to certain conditions, to settle the warrants in cash. The warrants meet the criteria in ASC 815-40 to be classified within Stockholders’ Equity, and therefore the warrants are not revalued after issuance.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 942 -SubTopic 210 -Name Accounting Standards Codification -Section S45 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477657/942-210-S45-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef 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