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Derivative Financial Instruments (Tables) | 6 Months Ended
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Jun. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Amounts related to cumulative basis adjustments for fair value hedges | At June 30, 2025 and December 31, 2024, the following amounts were recorded in the Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges:
(Dollars in millions) |  | June 30, 2025 |  | December 31, 2024
Short-term debt: |  |  |  |
Carrying amount of the hedged item |  | $ | (5) |  |  | $ | (13) |
Cumulative hedging adjustments included in the carrying amount — assets/(liabilities) |  | $ | (5) |  |  | $ | (13) |
Long-term debt: |  |  |  |
Carrying amount of the hedged item |  | $ | (6,627) |  |  | $ | (6,497) |
Cumulative hedging adjustments included in the carrying amount — assets/(liabilities) (1) |  | $ | 62 |  |  | $ | 190 |
(1)Includes $(133) million and $(155) million of hedging adjustments on discontinued hedging relationships at June 30, 2025 and December 31, 2024, respectively.
Effect of derivative instruments in the Consolidated Income Statement | The total effects of all fair value hedges, cash flow hedges, net investment hedges and derivatives not designated as hedging instruments are summarized by income and expense line items as follows:
|  | Gains/(Losses) of Total Hedge Activity
|  | Three Months Ended June 30, |  | Six Months Ended June 30,
(Dollars in millions) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Cost of services |  | $ | (4) |  |  | $ | 9 |  |  | $ | (5) |  |  | $ | 14 |
Cost of sales |  | $ | (5) |  |  | $ | 15 |  |  | $ | 2 |  |  | $ | 27 |
Cost of financing |  | $ | 0 |  |  | $ | (4) |  |  | $ | 1 |  |  | $ | (7) |
SG&A expense |  | $ | 114 |  |  | $ | 11 |  |  | $ | 83 |  |  | $ | 85 |
Other (income) and expense (1) |  | $ | 601 |  |  | $ | (140) |  |  | $ | 1,043 |  |  | $ | (427) |
Interest expense |  | $ | 3 |  |  | $ | (19) |  |  | $ | 5 |  |  | $ | (34) |
(1)Primarily driven by currency gains and losses on the company's foreign currency derivatives hedging programs. Refer to note 6, "Other (Income) and Expense," for additional information.
|  | Gains/(Losses) Recognized in Consolidated Income Statement
(Dollars in millions) |  | Consolidated Income Statement Line Item |  | Recognized on Derivatives |  | Attributable to Risk Being Hedged (1)
For the three months ended June 30: |  |  | 2025 |  | 2024 |  | 2025 |  | 2024
Derivative instruments in fair value hedges: (2) |  |  |  |  |  |  |  |  |  |
Interest rate contracts |  | Cost of financing |  | $ | 2 |  |  | $ | (8) |  |  | $ | (5) |  |  | $ | 2 |
|  | Interest expense |  | 13 |  |  | (42) |  |  | (28) |  |  | 10 |
Derivative instruments not designated as hedging instruments: |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Other (income) and expense |  | 165 |  |  | (161) |  |  | N/A |  | N/A
Equity contracts |  | SG&A expense |  | 115 |  |  | 4 |  |  | N/A |  | N/A
Total |  |  |  | $ | 295 |  |  | $ | (207) |  |  | $ | (33) |  |  | $ | 12 |
|  | Gains/(Losses) Recognized in Consolidated Income Statement and Other Comprehensive Income |
|  | Recognized in OCI |  | Consolidated Income Statement Line Item |  | Reclassified from AOCI |  | Amounts Excluded from Effectiveness Testing (3) |
(Dollars in millions) |  |  |  |  |
For the three months ended June 30: |  | 2025 |  | 2024 |  |  | 2025 |  | 2024 |  | 2025 |  | 2024 |
Derivative instruments in cash flow hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate contracts |  | $ | — |  |  | $ | — |  |  | Cost of financing |  | $ | 0 |  |  | $ | (1) |  |  | N/A |  | N/A |
|  |  |  |  |  | Interest expense |  | (3) |  |  | (3) |  |  | N/A |  | N/A |
Foreign exchange contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amount included in the assessment of effectiveness |  | (25) |  |  | 134 |  |  | Cost of services |  | (4) |  |  | 9 |  |  | N/A |  | N/A |
|  |  |  |  |  | Cost of sales |  | (5) |  |  | 15 |  |  | N/A |  | N/A |
|  |  |  |  |  | Cost of financing |  | (1) |  |  | (1) |  |  | N/A |  | N/A |
|  |  |  |  |  | SG&A expense |  | (2) |  |  | 7 |  |  | N/A |  | N/A |
|  |  |  |  |  | Other (income) and expense |  | 466 |  |  | 39 |  |  | N/A |  | N/A |
|  |  |  |  |  | Interest expense |  | (3) |  |  | (5) |  |  | N/A |  | N/A |
Amount excluded from the assessment of effectiveness |  | (57) |  |  | (31) |  |  | Other (income) and expense |  | N/A |  | N/A |  | (30) |  |  | (18) |  |
Instruments in net investment hedges: (4) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amount included in the assessment of effectiveness |  | (1,585) |  |  | 269 |  |  |  |  |  |  |  |  |  |  |  |
Amount excluded from the assessment of effectiveness |  | 0 |  |  | — |  |  | Cost of financing |  | N/A |  | N/A |  | 4 |  |  | 4 |  |
|  |  |  |  |  | Interest expense |  | N/A |  | N/A |  | 24 |  |  | 21 |  |
Total |  | $ | (1,668) |  |  | $ | 372 |  |  |  |  | $ | 449 |  |  | $ | 61 |  |  | $ | (2) |  |  | $ | 6 |  |
(1)The amount includes basis adjustments to the carrying value of the hedged item recorded during the period and amortization of basis adjustments recorded on de-designated hedging relationships during the period. (2)The amount includes changes in clean fair values of the derivative instruments in fair value hedging relationships and the periodic accrual for coupon payments required under these derivative contracts. (3)Amounts excluded from effectiveness testing for both net investment hedges and cash flow hedges of foreign currency debt are amortized to net income on a straight line basis over the life of the relevant hedging instrument. (4)Instruments in net investment hedges include derivative and non-derivative instruments with the amounts recognized in OCI providing an offset to the translation of foreign subsidiaries. N/A - not applicable
|  | Gains/(Losses) Recognized in Consolidated Income Statement
(Dollars in millions) |  | Consolidated Income Statement Line Item |  | Recognized on Derivatives |  | Attributable to Risk Being Hedged (1)
For the six months ended June 30: |  |  | 2025 |  | 2024 |  | 2025 |  | 2024
Derivative instruments in fair value hedges: (2) |  |  |  |  |  |  |  |  |  |
Interest rate contracts |  | Cost of financing |  | $ | 13 |  |  | $ | (35) |  |  | $ | (18) |  |  | $ | 23 |
|  | Interest expense |  | 72 |  |  | (180) |  |  | (101) |  |  | 120 |
Derivative instruments not designated as hedging instruments: |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Other (income) and expense |  | 285 |  |  | (368) |  |  | N/A |  | N/A
Equity contracts |  | SG&A expense |  | 81 |  |  | 75 |  |  | N/A |  | N/A
Total |  |  |  | $ | 451 |  |  | $ | (509) |  |  | $ | (119) |  |  | $ | 143 |
|  | Gains/(Losses) Recognized in Consolidated Income Statement and Other Comprehensive Income
|  | Recognized in OCI |  | Consolidated Income Statement Line Item |  | Reclassified from AOCI |  | Amounts Excluded from Effectiveness Testing (3)
(Dollars in millions) |  |  |  |
For the six months ended June 30: |  | 2025 |  | 2024 |  |  | 2025 |  | 2024 |  | 2025 |  | 2024
Derivative instruments in cash flow hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate contracts |  | $ | — |  |  | $ | — |  |  | Cost of financing |  | $ | (1) |  |  | $ | (1) |  |  | N/A |  | N/A
|  |  |  |  |  | Interest expense |  | (6) |  |  | (7) |  |  | N/A |  | N/A
Foreign exchange contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amount included in the assessment of effectiveness |  | 17 |  |  | 300 |  |  | Cost of services |  | (5) |  |  | 14 |  |  | N/A |  | N/A
|  |  |  |  |  | Cost of sales |  | 2 |  |  | 27 |  |  | N/A |  | N/A
|  |  |  |  |  | Cost of financing |  | (1) |  |  | (2) |  |  | N/A |  | N/A
|  |  |  |  |  | SG&A expense |  | 2 |  |  | 10 |  |  | N/A |  | N/A
|  |  |  |  |  | Other (income) and expense |  | 814 |  |  | (22) |  |  | N/A |  | N/A
|  |  |  |  |  | Interest expense |  | (6) |  |  | (10) |  |  | N/A |  | N/A
Amount excluded from the assessment of effectiveness |  | (158) |  |  | (21) |  |  | Other (income) and expense |  | N/A |  | N/A |  | (56) |  |  | (37) |
Instruments in net investment hedges: (4) |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amount included in the assessment of effectiveness |  | (2,406) |  |  | 881 |  |  |  |  |  |  |  |  |  |  |
Amount excluded from the assessment of effectiveness |  | 11 |  | — |  |  | Cost of financing |  | N/A |  | N/A |  | 8 |  |  | 8 |
|  |  |  |  |  | Interest expense |  | N/A |  | N/A |  | 45 |  |  | 43 |
Total |  | $ | (2,535) |  |  | $ | 1,160 |  |  |  |  | $ | 798 |  |  | $ | 9 |  |  | $ | (3) |  |  | $ | 14 |
(1)The amount includes basis adjustments to the carrying value of the hedged item recorded during the period and amortization of basis adjustments recorded on de-designated hedging relationships during the period.. (2)The amount includes changes in clean fair values of the derivative instruments in fair value hedging relationships and the periodic accrual for coupon payments required under these derivative contracts. (3)Amounts excluded from effectiveness testing for both net investment hedges and cash flow hedges of foreign currency debt are amortized to net income on a straight line basis over the life of the relevant hedging instrument. (4)Instruments in net investment hedges include derivative and non-derivative instruments with the amounts recognized in OCI providing an offset to the translation of foreign subsidiaries. N/A - not applicable

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- Definition Tabular disclosure of the location and amount of derivative instruments and nonderivative instruments designated as hedging instruments reported before netting adjustments, and the amount of gain (loss) on derivative instruments and nonderivative instruments designated and qualified as hedging instruments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4CC -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4CC Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4C -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4C Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4A -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4A Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4A -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4E -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4E + Details
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- Definition Tabular disclosure for fair value hedging instruments of (a) the location and amount of gains and losses reported in the statement of financial performance and (b) the location and fair value amounts of the instruments reported in the statement of financial position. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4E -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4E Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4C -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4C Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4A -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4A Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4B -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-4B + Details
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