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FAIR VALUE MEASUREMENTS
 12 Months Ended
Dec. 31, 2025
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
Fair value is measured based on an exit price, representing the amount that would be received to sell an asset or paid to satisfy a liability in an orderly transaction between market participants. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a fair value hierarchy is established, which categorizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
A summary of financial instruments and contingent consideration recognized at fair value, and the fair value measurements used, is as follows:
(In millions)TotalQuoted prices in active markets for identical assets
(Level 1)		Other observable inputs
(Level 2)		Unobservable inputs
(Level 3)
December 31, 2025    
Cash$622 $622 $— $— 
Short-term investments181 181 — — 
Derivative contract assets
26 — 26 — 
Derivative contract liabilities
(64)— (64)— 
Contingent future payments from acquisition of Resilient Power Systems Inc. (Note 2)(31)— — (31)
December 31, 2024    
Cash$555 $555 $— $— 
Short-term investments1,525 1,525 — — 
Derivative contract assets
28 — 28 — 
Derivative contract liabilities
(44)— (44)— 
Eaton values its financial instruments using an industry standard market approach, in which prices and other relevant information is generated by market transactions involving identical or comparable assets or liabilities.
Other Fair Value Measurements
Long-term debt and the current portion of long-term debt had a carrying value of $9,894 million and fair value of $9,587 million at December 31, 2025 compared to $9,152 million and $8,651 million, respectively, at December 31, 2024. The fair value of Eaton's debt instruments was estimated using prevailing market interest rates on debt with similar creditworthiness, terms and maturities and is considered a Level 2 fair value measurement.
Short-Term Investments
Eaton invests excess cash generated from operations in short-term marketable investments. Short-term investments are recorded at carrying value, which approximates the fair value due to the short-term maturities of these investments. A summary of short-term investments is as follows:
December 31
(In millions)20252024
Time deposits and certificates of deposit with banks$181 $157 
Money market investments— 1,368 
Total short-term investments$181 $1,525