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Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2024

Investments, All Other Investments [Abstract]

Carrying Amount and Estimated Fair Values of Financial Instruments

The carrying values and the estimated fair values of financial instruments at September 30, 2024 and December 31, 2023 consisted of the following:

			September 30, 2024												December 31, 2023
(DOLLARS IN MILLIONS)			Carrying Value						Fair Value						Carrying Value						Fair Value
LEVEL 1
Cash and cash equivalents(1)			$	567					$	567					$	703					$	703
LEVEL 2
Credit facilities and bank overdrafts(2)			2						2						3						3
Derivatives
Derivative assets(3)			57						57						41						41
Derivative liabilities(3)			167						167						165						165
Commercial paper(2)			—						—						—						—
Long-term debt:
2024 Euro Notes(4)			—						—						552						549
2025 Notes(4)			1,000						966						1,000						924
2026 Euro Notes(4)			892						873						879						835
2027 Notes(4)			1,210						1,112						1,212						1,049
2028 Notes(4)			398						402						398						389
2030 Notes(4)			1,508						1,316						1,508						1,240
2040 Notes(4)			772						575						773						536
2047 Notes(4)			494						421						495						382
2048 Notes(4)			787						736						787						678
2050 Notes(4)			1,568						1,066						1,569						1,029
2024 Term Loan Facility(5)			—						—						270						270
2026 Term Loan Facility(5)			468						468						625						625

_______________________

(1)The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments.

(2)The carrying amount approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments.

(3)The carrying amount approximates fair value as the instruments are marked-to-market and held at fair value on the Consolidated Balance Sheets.

(4)The fair value of the Note is obtained from pricing services engaged by the Company, and the Company receives one price for each security. The fair value provided by the pricing services are estimated using pricing models, where the inputs to those models are based on observable market inputs or recent trades of similar securities. The inputs to the valuation techniques applied by the pricing services are typically benchmark yields, benchmark security prices, credit spreads, reported trades and broker-dealer quotes, all with reasonable levels of transparency.

(5)The carrying amount approximates fair value as the Term Loans were assumed at fair value and the interest rate is reset frequently based on current market rates.

Derivative Instruments Notional Amount Outstanding

The following table shows the notional amount of the Company’s derivative instruments outstanding as of September 30, 2024 and December 31, 2023:

(DOLLARS IN MILLIONS)			September 30, 2024						December 31, 2023
Foreign currency contracts(1)			$	(3,478)					$	(1,400)
Commodity contracts(1)			10						7
Cross currency swaps			1,400						1,400

_______________________

(1)Foreign currency contracts and commodity contracts are presented net of contracts bought and sold.

Derivative Instruments Measured at Fair Value

The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected on the Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023:

			September 30, 2024
(DOLLARS IN MILLIONS)			Fair Value of Derivatives Designated as Hedging Instruments						Fair Value of Derivatives Not Designated as Hedging Instruments						Total Fair Value
Derivative assets(1)
Foreign currency contracts			$	—					$	57					$	57
Total derivative assets			$	—					$	57					$	57
Derivative liabilities(2)
Foreign currency contracts			$	—					$	3					$	3
Cross currency swaps			164						—						164
Total derivative liabilities			$	164					$	3					$	167

			December 31, 2023
(DOLLARS IN MILLIONS)			Fair Value of Derivatives Designated as Hedging Instruments						Fair Value of Derivatives Not Designated as Hedging Instruments						Total Fair Value
Derivative assets(1)
Foreign currency contracts			$	—					$	41					$	41
Total derivative assets			$	—					$	41					$	41
Derivative liabilities(2)
Foreign currency contracts			$	—					$	4					$	4
Cross currency swaps			161						—						161
Total derivative liabilities			$	161					$	4					$	165

 _______________________

(1)Derivative assets are recorded to Prepaid expenses and other current assets on the Consolidated Balance Sheets.

(2)Derivative liabilities are recorded to Other current liabilities and Other liabilities on the Consolidated Balance Sheets.

Derivative Instruments Which Were Not Designated as Hedging Instruments

The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments on the Consolidated Statements of Income and Comprehensive Income (Loss) for the three and nine months ended September 30, 2024 and 2023:

			Amount of Gain (Loss) Recognized in Income on Derivative Settlements												Amount of Gain (Loss) Recognized in Income on Changes in Fair Value									Location of Gain (Loss) Recognized in Income on Derivative
(DOLLARS IN MILLIONS)			Three Months Ended September 30,												Three Months Ended September 30,
			2024						2023						2024						2023
Foreign currency contracts(1)			$	62					$	(26)					$	80					$	(40)		Other expense (income), net
Total			$	62					$	(26)					$	80					$	(40)
			Amount of Gain (Loss) Recognized in Income on Derivative Settlements												Amount of Gain (Loss) Recognized in Income on Changes in Fair Value									Location of Gain (Loss) Recognized in Income on Derivative
(DOLLARS IN MILLIONS)			Nine Months Ended September 30,												Nine Months Ended September 30,
			2024						2023						2024						2023
Foreign currency contracts(1)			$	21					$	(23)					$	16					$	(29)		Other expense (income), net
Commodity contracts			(1)						—						—						—			Cost of sales
Total			$	20					$	(23)					$	16					$	(29)

_______________________

(1)The foreign currency contract net gains (losses) offset any recognized gains (losses) arising from the revaluation of the related intercompany loans during the same respective periods.

Derivative Instruments Designated as Cash Flow and Net Investment Hedging Instruments

The following table shows the effect of the Company’s derivative and non-derivative instruments designated as cash flow and net investment hedging instruments, net of tax, on the Consolidated Statements of Income and Comprehensive Income (Loss) for the three and nine months ended September 30, 2024 and 2023:

			Amount of Gain (Loss) Recognized in OCI on Derivative and Non-Derivative (Effective Portion)												Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (“AOCI”) into Income (Effective Portion)						Amount of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)
			Three Months Ended September 30,																		Three Months Ended September 30,
(DOLLARS IN MILLIONS)			2024						2023												2024						2023
Derivatives in Cash Flow Hedging Relationships:
Commodity contracts			$	1					$	—					Cost of sales						$	1					$	—
Derivatives in Net Investment Hedging Relationships:
Cross currency swaps			(38)						22						N/A						—						—
Non-Derivatives in Net Investment Hedging Relationships:
2024 Euro Notes			—						15						N/A						—						—
2026 Euro Notes			(28)						25						N/A						—						—
Total			$	(65)					$	62											$	1					$	—

			Amount of Gain (Loss) Recognized in OCI on Derivative and Non-Derivative (Effective Portion)												Location of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)						Amount of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)
			Nine Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023												2024						2023
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts			$	(7)					$	—					N/A						$	—					$	—
Commodity contracts			2						—						Cost of sales						1						—
Derivatives in Net Investment Hedging Relationships:
Cross currency swaps			(2)						(11)						N/A						—						—
Non-Derivatives in Net Investment Hedging Relationships:
2024 Euro Notes			3						4						N/A						—						—
2026 Euro Notes			(8)						7						N/A						—						—
Total			$	(12)					$	—											$	1					$	—

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Tabular disclosure of the effective portion of the gains and losses on derivative instruments designated (and non-derivative instruments) designated and qualifying in cash flow hedges and net investment hedges that was recognized in other comprehensive income (loss) during the current period.

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Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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-Topic 820
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-Name Accounting Standards Codification
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Tabular disclosure of the notional amounts of outstanding derivative positions.

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Tabular disclosure of derivative instrument not designated or qualifying as hedging instrument.

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