Fair Value Measurements

6 Months Ended

Jun. 30, 2025

We measure our cash equivalents, certain investments, contingent consideration liabilities and foreign exchange forward and option contracts at fair value. Fair value is the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources while unobservable inputs reflect a reporting entity’s pricing based upon their own market assumptions.

The fair value hierarchy consists of the following three levels:

•Level 1 – Inputs are quoted prices in active markets for identical assets or liabilities.

•Level 2 – Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs which are derived principally from or corroborated by observable market data.

•Level 3 – Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.

The following table summarizes the financial assets and (liabilities) measured at fair value on a recurring basis as of June 30, 2025:


(in millions)	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	25	$	—	$	—	$	25
Time deposits	—		246		—		246

Short-term investments:
Time deposits	—		1		—		1
Equity investment security	11		—		—		11


Other current assets:
Foreign exchange forward contracts	—		16		—		16


Other noncurrent assets:
Foreign exchange forward contracts	—		9		—		9
Accrued expenses and other current liabilities:
Foreign exchange forward contracts	—		(9)		—		(9)

Other noncurrent liabilities:
Foreign exchange forward contracts	—		(1)		—		(1)

The following table summarizes the financial assets and (liabilities) measured at fair value on a recurring basis as of December 31, 2024:


(in millions)	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	40	$	—	$	—	$	40
Time deposits	—		991		—		991

Short-term investments:
Time deposits	—		1		—		1
Equity investment security	11		—		—		11


Other current assets:
Foreign exchange forward contracts	—		2		—		2




Accrued expenses and other current liabilities:
Foreign exchange forward contracts	—		(24)		—		(24)

Other noncurrent liabilities:
Foreign exchange forward contracts	—		(13)		—		(13)

During the three months ended March 31, 2024, we made $30 million of payments related to Level 3 contingent consideration liabilities, which reduced the balance of these liabilities to zero. For the three and six months ended June 30, 2025, we did not have any Level 3 contingent consideration liabilities.

We measure the fair value of money market funds based on quoted prices in active markets for identical assets and measure the fair value of our equity investment security based on the published daily net asset value at which investors can freely subscribe to or redeem from the fund. The carrying value of the time deposits approximated fair value as of June 30, 2025 and December 31, 2024.

We estimate the fair value of each foreign exchange forward contract by using a present value of expected cash flows model. This model calculates the difference between the current market forward price and the contracted forward price for each foreign exchange forward contract and applies the difference in the rates to each outstanding contract. The market forward rates include a discount and credit risk factor. We estimate the fair value of each foreign exchange option contract by using a variant of the Black-Scholes model. This model uses present value techniques and reflects the time value and intrinsic value based on observable market rates.

During the six months ended June 30, 2025 and the year ended December 31, 2024, there were no transfers among Level 1, Level 2 or Level 3 financial assets and liabilities.