v3.25.4
Derivative Financial Instruments (Tables)
 12 Months Ended
Dec. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Amounts related to cumulative basis adjustments for fair value hedges
At December 31, 2025 and 2024, the following amounts were recorded in the Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges:
($ in millions)
At December 31:20252024
Short-term debt
Carrying amount of the hedged item$— $(13)
Cumulative hedging adjustments included in the carrying amount—assets/(liabilities)— (13)
Long-term debt
Carrying amount of the hedged item(6,656)(6,497)
Cumulative hedging adjustments included in the carrying amount—assets/(liabilities) (1)
36 190
(1)Includes $(114) million and $(155) million of hedging adjustments on discontinued hedging relationships at December 31, 2025 and 2024, respectively.
Effect of derivative instruments in the Consolidated Income Statement
The total effects of all fair value hedges, cash flow hedges, net investment hedges and derivatives not designated as hedging instruments are summarized by income and expense line items as follows:
($ in millions)
(Gains)/Losses of Total Hedge Activity
For the year ended December 31:202520242023
Cost of services$27 $(22)$5 
Cost of sales15 (40)(22)
Cost of financing(2)10 11 
SG&A expense(170)(151)(165)
Other (income) and expense(641)515 (17)
Interest expense(13)51 54 
($ in millions)
(Gain)/Loss Recognized in Consolidated Income Statement
Consolidated
Income Statement
Line Item		Recognized on
Derivatives
Attributable to Risk
Being Hedged (1)
For the year ended December 31:202520242023202520242023
Derivative instruments in fair value hedges (2)
       
Interest rate contractsCost of financing$(11)$41 $17 $22 $(19)$2 
Interest expense(59)208 83 118 (97)11 
Derivative instruments not designated as hedging instruments
Foreign exchange contractsOther (income) and expense(116)390 192 N/A N/AN/A
Equity contractsSG&A expense(176)(135)(153)N/A N/AN/A
Other (income) and expense— — — N/A N/AN/A
Total $(362)$504 $140 $140 $(116)$13 
(1)The amount includes basis adjustments to the carrying value of the hedged item recorded during the period and amortization of basis adjustments recorded on de-designated hedging relationships during the period.
(2)The amount includes changes in clean fair values of the derivative instruments in fair value hedging relationships and the periodic accrual for coupon payments required under these derivative contracts.
N/A–Not applicable
($ in millions)
Effect of Derivatives Recognized in Consolidated Income Statement and Other Comprehensive Income
(Gains)/Losses
For the year ended Gains/(Losses)
Recognized in OCI 		Consolidated
Income Statement
Line Item		Reclassified
from AOCI
Amounts Excluded from
Effectiveness Testing (1)
December 31:202520242023202520242023202520242023
Derivative instruments in cash flow hedges      
Interest rate contracts$— $— $— Cost of financing$2 $2 $3 N/AN/AN/A
Interest expense11 13 15 N/AN/AN/A
Foreign exchange contracts
Amount included in the assessment of effectiveness175 405 213 Cost of services27 (22)5 N/AN/AN/A
  Cost of sales15 (40)(22)N/AN/AN/A
Cost of financing2 4 11 N/AN/AN/A
SG&A expense6 (16)(12)N/AN/AN/A
 
Other (income) and expense
(633)48 (239)N/AN/AN/A
Interest expense12 19 51 N/AN/AN/A
Amount excluded from the assessment of effectiveness(240)(16)(6)Other (income) and expenseN/A N/AN/A108 77 29 
Instruments in net investment hedges (2)
Foreign exchange contracts
Amount included in the assessment of effectiveness(2,120)1,354 (397)
Amount excluded from the assessment of effectiveness22 4 — Cost of financingN/AN/AN/A(18)(18)(22)
Interest expenseN/AN/AN/A(96)(91)(105)
Total$(2,163)$1,747 $(190)$(557)$7 $(189)$(5)$(32)$(98)
(1)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.
(2)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