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Financial Instruments (Tables) | 9 Months Ended
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Sep. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Schedule of Fair Value of Derivative Instruments | Derivative instruments were recorded at fair value in the condensed consolidated balance sheets as follows:
| As of September 30, 2024 |  | As of December 31, 2023
| Asset Derivatives |  | Liability Derivatives |  | Asset Derivatives |  | Liability Derivatives
| (in millions)
Derivatives designated as accounting hedges: |  |  |  |  |  |  |
Interest rate contracts | $ | 81 |  |  | $ | 81 |  |  | $ | 120 |  |  | $ | 57 |
Net investment hedge derivative contracts (1) | 166 |  |  | 391 |  |  | 163 |  |  | 382 |
| $ | 247 |  |  | $ | 472 |  |  | $ | 283 |  |  | $ | 439 |
Derivatives not designated as accounting hedges: |  |  |  |  |  |  |
Currency exchange contracts | $ | 210 |  |  | $ | 97 |  |  | $ | 195 |  |  | $ | 134 |
Commodity contracts | 2,093 |  |  | 2,073 |  |  | 1,119 |  |  | 984 |
Interest rate contracts | 1 |  |  | 3 |  |  | — |  |  | 2 |
| $ | 2,304 |  |  | $ | 2,173 |  |  | $ | 1,314 |  |  | $ | 1,120 |
Total fair value | $ | 2,551 |  |  | $ | 2,645 |  |  | $ | 1,597 |  |  | $ | 1,559 |
(1)Net investment hedge derivative contracts consist of cross-currency interest rate swaps, forward contracts and options. We also designate some of our non-U.S. dollar denominated debt to hedge a portion of our net investments in our non-U.S. operations. This debt is not reflected in the table above, but is included in long-term debt discussed in Note 8, Debt and Borrowing Arrangements. Both net investment hedge derivative contracts and non-U.S. dollar denominated debt acting as net investment hedges are also disclosed in the Derivative Volume table and the Hedges of Net Investments in International Operations section appearing later in this footnote.
Fair Value of Offsetting Assets | We recorded the fair value of our derivative instruments in the condensed consolidated balance sheet as follows:
| As of September 30, 2024 | As of December 31, 2023
| (in millions)
Other current assets | $ | 2,225 |  |  | $ | 1,347 |
Other assets | 326 |  |  | 250 |
Other current liabilities | 2,242 |  |  | 1,209 |
Other liabilities | 403 |  |  | 350 |
Fair Value of Offsetting Liabilities | We recorded the fair value of our derivative instruments in the condensed consolidated balance sheet as follows:
| As of September 30, 2024 | As of December 31, 2023
| (in millions)
Other current assets | $ | 2,225 |  |  | $ | 1,347 |
Other assets | 326 |  |  | 250 |
Other current liabilities | 2,242 |  |  | 1,209 |
Other liabilities | 403 |  |  | 350 |
Summary of Derivative Instrument Fair Value Measurement Inputs | The fair values (asset/(liability)) of our derivative instruments were determined using:
| As of September 30, 2024
| Total Fair Value of Net Asset/(Liability) |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
| (in millions)
Currency exchange contracts | $ | 113 |  |  | $ | — |  |  | $ | 113 |  |  | $ | — |
Commodity contracts | 20 |  |  | (69) |  |  | 89 |  |  | — |
Interest rate contracts | (2) |  |  | — |  |  | (2) |  |  | — |
Net investment hedge contracts | (225) |  |  | — |  |  | (225) |  |  | — |
Total derivatives | $ | (94) |  |  | $ | (69) |  |  | $ | (25) |  |  | $ | — |
| As of December 31, 2023
| Total Fair Value of Net Asset/(Liability) |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
| (in millions)
Currency exchange contracts | $ | 61 |  |  | $ | — |  |  | $ | 61 |  |  | $ | — |
Commodity contracts | 135 |  |  | 28 |  |  | 107 |  |  | — |
Interest rate contracts | 61 |  |  | — |  |  | 61 |  |  | — |
Net investment hedge contracts | (219) |  |  | — |  |  | (219) |  |  | — |
Total derivatives | $ | 38 |  |  | $ | 28 |  |  | $ | 10 |  |  | $ | — |
Schedule of Notional Values of Derivative Instruments | The notional values of our hedging instruments were:
| Notional Amount
| As of September 30, 2024 |  | As of December 31, 2023
| (in millions)
Currency exchange contracts: |  |  |
Intercompany loans and forecasted interest payments | $ | 7,712 |  |  | $ | 2,860 |
Forecasted transactions | 9,213 |  |  | 5,550 |
Commodity contracts | 15,467 |  |  | 16,631 |
Interest rate contracts | 5,836 |  |  | 2,384 |
Net investment hedges: |  |  |
Net investment hedge derivative contracts | 8,878 |  |  | 7,456 |
Non-U.S. dollar debt designated as net investment hedges: |  |  |
Euro notes | 3,547 |  |  | 3,516 |
Swiss franc notes | 237 |  |  | 386 |
Canadian dollar notes | 924 |  |  | 453 |
Schedule of Net Investment Hedges | Net investment hedge derivative contract impacts on other comprehensive earnings and net earnings were:
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
| (in millions)
After-tax (loss)/gain on NIH contracts (1) | $ | (250) |  |  | $ | 72 |  |  | $ | (65) |  |  | $ | 89 |
(1)Amounts recorded for unsettled and settled NIH derivative contracts are recorded in the cumulative translation adjustment within other comprehensive earnings. The cash flows from the settled contracts are reported within other investing activities in the condensed consolidated statement of cash flows.
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
| (in millions)
Amounts excluded from the assessment of hedge effectiveness (1) | $ | 45 |  |  | $ | 38 |  |  | $ | 132 |  |  | $ | 110 |
(1)We elected to record changes in the fair value of amounts excluded from the assessment of effectiveness in net earnings within interest and other expense, net. After-tax gains/(losses) related to hedges of net investments in international operations were recorded within the cumulative translation adjustment section of other comprehensive income and were:
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
| (in millions)
Euro notes | $ | (102) |  |  | $ | 82 |  |  | $ | (23) |  |  | $ | 32 |
Swiss franc notes | (18) |  |  | 11 |  |  | 1 |  |  | (5) |
Canadian notes | (9) |  |  | 9 |  |  | 2 |  |  | 1 |
Summary of Economic Hedges | Pre-tax gains/(losses) recorded in net earnings for economic hedges were:
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30, |  | Location of Gain/(Loss) Recognized in Earnings
| 2024 |  | 2023 |  | 2024 |  | 2023 |
| (in millions) |  |
Currency exchange contracts: |  |  |  |  |  |  |  |  |
Intercompany loans and forecasted interest payments | $ | (67) |  |  | $ | — |  |  | $ | 1 |  |  | $ | 47 |  |  | Interest and other expense, net
Forecasted transactions | (13) |  |  | 15 |  |  | 10 |  |  | 44 |  |  | Cost of sales
Forecasted transactions | (1) |  |  | — |  |  | (3) |  |  | 13 |  |  | Interest and other expense, net
Forecasted transactions | 1 |  |  | (3) |  |  | 2 |  |  | (9) |  |  | Selling, general and administrative expenses
Commodity contracts | 14 |  |  | 72 |  |  | 943 |  |  | 176 |  |  | Cost of sales
Equity method investment contracts (1) | — |  |  | 4 |  |  | — |  |  | 7 |  |  | Gain on equity method investment transactions
Total | $ | (66) |  |  | $ | 88 |  |  | $ | 953 |  |  | $ | 278 |  |  |
(1) Equity method investment contracts consisted of the bifurcated embedded derivative option that were a component of the September 20, 2021 €300 million exchangeable bonds issuance and expired on September 20, 2024. Refer to Note 6, Investments.
Schedule of Contingent Consideration | The following is a summary of our contingent consideration liability activity:
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
| (in millions)
Liability at beginning of period | $ | 661 |  |  | $ | 567 |  |  | $ | 680 |  |  | $ | 642 |
Changes in fair value (1) | (350) |  |  | 35 |  |  | (315) |  |  | 50 |
Payments | (93) |  |  | — |  |  | (147) |  |  | (90) |
Liability at end of period | $ | 218 |  |  | $ | 602 |  |  | $ | 218 |  |  | $ | 602 |
Contingent consideration was recorded at fair value in the condensed consolidated balance sheets as follows:
| As of September 30, 2024
| Total Fair Value of Liability |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
| (in millions)
Clif Bar (1) | $ | 218 |  |  | $ | — |  |  | $ | — |  |  | $ | 218 |
Total contingent consideration | $ | 218 |  |  | $ | — |  |  | $ | — |  |  | $ | 218 |
| As of December 31, 2023
| Total Fair Value of Liability |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
| (in millions)
Clif Bar (1) | $ | 548 |  |  | $ | — |  |  | $ | — |  |  | $ | 548 |
Other (2) | 132 |  |  | — |  |  | — |  |  | 132 |
Total contingent consideration | $ | 680 |  |  | $ | — |  |  | $ | — |  |  | $ | 680 |
(1)In connection with the Clif Bar acquisition, we entered into a contingent consideration arrangement that may require us to pay additional consideration to the sellers for achieving certain net revenue, gross profit and EBITDA targets in 2025 and 2026 that exceed our base financial projections for the business implied in the upfront purchase price. The contingent consideration liabilities are recorded at fair value within long-term liabilities. The estimated fair value of the contingent consideration obligation is determined using a Monte Carlo simulation. Significant assumptions used in assessing the fair value of the liability include financial projections for net revenue, gross profit, and EBITDA, as well as discount and volatility rates. Fair value adjustments are primarily recorded in selling, general and administrative expenses in the condensed consolidated statement of earnings. During the three months ended September 30, 2024, the expected forecast for 2025 and 2026 has been updated to reflect recent trends in business performance and market outlook which resulted in a reduction in the fair value of the contingent consideration. (2)The other contingent consideration liabilities were recorded at fair value, with $132 million classified as other current liabilities at December 31, 2023. Fair value adjustments were recorded in selling, general and administrative expenses in the condensed consolidated statement of earnings through the second quarter of 2024. Payments on outstanding amounts as of December 31, 2023 were made in the second and third quarter of 2024, and the majority was classified within cash flows provided by operating activities in the consolidated statement of cash flows.

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