v3.25.3
Derivative and Hedging Instruments
 12 Months Ended
Sep. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative and Hedging Instruments
Note 13—Derivative and Hedging Instruments
The following table shows the aggregate notional amount of the Company’s derivative instruments:
September 30,
20252024
 (in millions)
Designated as hedging instruments
$9,399 $11,736 
Not designated as hedging instruments
2,497 1,913 
Total$11,896 $13,649 
The following table shows the Company’s derivative instruments at gross fair value:
September 30,
Balance Sheet Location20252024
(in millions)
Assets
Designated as Hedging Instruments:
Foreign exchange forward contracts
Prepaid expenses and other current assets
$45 $49 
Cross-currency swaps
Other assets
— 36 
Not Designated as Hedging Instruments:
Foreign exchange forward contractsPrepaid expenses and other current assets17 18 
Total
$62 $103 
Liabilities
Designated as Hedging Instruments:
Foreign exchange forward contracts
Accrued liabilities$196 $74 
Cross-currency swaps
Accrued liabilities and other liabilities
58 2 
Interest rate swaps(1)
Accrued liabilities and other liabilities
50 133 
Not Designated as Hedging Instruments:
Foreign exchange forward contracts
Accrued liabilities15 17 
Total
$319 $226 
(1)These interest rate swaps were designated as fair value hedges on a portion of the outstanding senior notes. As of September 30, 2025 and 2024, the carrying value of the hedged senior notes was $2.4 billion and $3.9 billion, respectively.
For fiscal 2025, 2024 and 2023, the Company recognized a net increase (decrease) in earnings related to excluded forward points from forward contracts designated as net investment hedges and interest differentials from swap agreements of ($45) million, ($94) million and $(25) million, respectively.
Cash flow hedges. For fiscal 2025, 2024 and 2023, the Company recognized pre-tax net gains (losses) in other comprehensive income (loss) related to cash flow hedges of ($172) million, ($38) million and ($126) million, respectively. As of September 30, 2025, the amount of pre-tax net gains (losses) included in accumulated other comprehensive income (loss) that is expected to be reclassified into the consolidated statements of operations within the next 12 months was ($157) million.
Net investment hedges. For fiscal 2025, 2024 and 2023, the Company recognized pre-tax net gains (losses) as foreign currency translation adjustment in other comprehensive income (loss) related to net investment hedges of ($459) million, ($321) million and ($445) million, respectively. As of September 30, 2025 and 2024, the amount included in accumulated other comprehensive income (loss) was ($176) million and $182 million, respectively.
Credit and market risks. The Company’s derivative instruments are subject to both credit and market risk. The Company monitors the credit worthiness of the counterparties to its derivative instruments and does not consider the risks of counterparty nonperformance to be significant. The Company mitigates this risk by entering into master netting agreements, and such agreements require each party to post collateral against its net liability position with the respective counterparty. As of September 30, 2025, the Company received collateral of $45 million from counterparties, which is included in accrued liabilities on the consolidated balance sheets, and posted collateral of $192 million, which is included in prepaid expenses and other current assets on the consolidated balance sheets. Notwithstanding the Company’s efforts to manage foreign exchange risk, there can be no absolute assurance that its hedging activities will adequately protect against the risks associated with foreign currency fluctuations. As of September 30, 2025, credit and market risks related to derivative instruments were not considered significant.