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Item 3. Quantitative and Qualitative Disclosures About Market Risk

2026-05-28 compared with 2025-12-04 · 42 added, 30 removed, 57 unchanged (56% of the section changed)

6 unchanged sentences

The expanding global scope of our business exposes us to the risk of fluctuations in foreign currency markets, including emerging markets.

This exposure is the result of selling in multiple currencies, operating in countries where the functional currency is the local currency and growth in our international investments, including data center expansion, costs associated with third-party infrastructure providers and additional headcount in foreign countries.

This exposure is the result of selling in multiple currencies, operating in countries where the functional currency is the local currency and growth in our international investments, including infrastructure expansion, costs associated with third-party infrastructure providers and additional headcount in foreign countries.

Specifically, our results of operations and cash flows are subject to fluctuations in the following currencies:

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Our foreign currency exposures typically arise from selling annual and multi-year subscriptions in multiple currencies, customer accounts receivable, intercompany transfer pricing arrangements and other intercompany transactions.

Our foreign currency management objective is to minimize the effect of fluctuations in foreign exchange rates on selected assets or liabilities without exposing us to additional risk associated with transactions that could be regarded as speculative.

Our foreign currency management objective is to minimize the effect of fluctuations in foreign exchange rates on selected assets or liabilities and forecasted revenue without exposing us to additional risk associated with transactions that could be regarded as speculative.

We pursue our objective by utilizing foreign currency forward contracts to offset foreign exchange risk.

Our foreign currency forward contracts are generally short-term in duration.

We neither use these foreign currency forward contracts for trading purposes nor do we currently designate these forward contracts as hedging instruments under the relevant accounting and financial reporting guidelines.

Accordingly, we record the fair values of these contracts as of the end of our reporting period to our condensed consolidated balance sheets with changes in fair values recorded to our condensed consolidated statements of operations.

For minimizing the effect of foreign exchange rates on assets or liabilities we record the fair values of these contracts as of the end of our reporting period to our consolidated balance sheets with changes in fair values recorded to our consolidated statements of operations.

We enter into foreign currency forward contracts, which we designate as cash flow hedges, to manage the volatility in cash flows associated with forecasted revenue denominated in certain currencies other than the U.S.

For contracts qualifying as cash flow hedges, the derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income (loss) and subsequently reclassified into earnings in the same period the forecasted transaction affects earnings.

All of our foreign currency forward contracts mature within twelve months.

These forward contracts reduce, but not entirely eliminate, the impact of currency exchange rate movements in the current period.

Given the short duration of the forward contracts, the amount recorded is not significant.

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Fluctuations in foreign currencies impact the amount of total assets, liabilities, revenues, operating expenses and cash flows that we repor t for our foreign subsidiaries upon the translation of these amounts into USD .

Total revenue during the three months ended October 31, 2025 was positively impacted by approximately one percent due to fluctuations in foreign currencies compared to the three months ended October 31, 2024.

In addition, fluctuations in foreign currencies positively impacted our current remaining performance obligation growth rate as of October 31, 2025 by approximately one percent compared to what we would have reported as of October 31, 2024 using constant currency rates.

Total revenue during the three months ended April 30, 2026 were positively impacted by approximately two percent due to fluctuations in foreign currencies compared to the three months ended April 30, 2025.

In addition, fluctuations in foreign currencies positively impacted our current remaining performance obligation growth rate as of April 30, 2026 by approximately one percent compared to what we would have reported as of April 30, 2025 using constant currency rates.

Interest Rate Sensitivity

As of October 31, 2025, we had cash, cash equivalents and marketable securities totaling $11.3 billion.

This amount was invested primarily in money market funds, time deposits, corporate notes and bonds, government securities and other debt securities with credit ratings of at least BBB or better.

As of April 30, 2026, we had cash, cash equivalents and marketable securities totaling $11.8 billion.

This amount was invested primarily in money market funds, time deposits, corporate notes and bonds, government securities and other debt securities with credit ratings of BBB or better.

The cash, cash equivalents and marketable securities are held for general corporate purposes, including share repurchases, dividend payments, acquisitions of, or investments in, complementary businesses, services or technologies, working capital and capital expenditures.

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Our fixed-income portfolio is also subject to interest rate risk.

An immediate increase or decrease in interest rates of 100 basis points at October 31, 2025 could result in a $34 million market value reduction or increase of the same amount.

An immediate increase or decrease in interest rates of 100 basis points at April 30, 2026 could result in a $50 million market value reduction or increase of the same amount.

This estimate is based on a sensitivity model that measures market value changes when changes in interest rates occur.

in the value of our investment securities caused by a change in interest rates (gains or losses on the carrying value) are recorded in comprehensive income, net, and are realized only if we sell the underlying securities.

Fluctuations in the value of our investment securities caused by a change in interest rates (gains or losses on the carrying value) are recorded in comprehensive income, net, and are realized only if we sell the underlying securities.

At January 31, 2026, we had cash, cash equivalents and marketable securities totaling $9.6 billion.

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We maintain debt obligations that are subject to market interest risk, as follows (in millions):

Instrument Maturity Date Principal Outstanding as of October 31, 2025 Interest Terms Contractual Interest Rate

364-Day Informatica Credit Agreement (1) N/A (1) 0 Floating N/A

Three-Year Informatica Credit Agreement (2) N/A (2) 0 Floating N/A

Revolving Loan Credit Agreement October 2029 0 Floating N/A

2028 Senior Notes April 2028 1,500 Fixed 3.70

2028 Senior Sustainability Notes July 2028 1,000 Fixed 1.50

2031 Senior Notes July 2031 1,500 Fixed 1.95

2041 Senior Notes July 2041 1,250 Fixed 2.70

2051 Senior Notes July 2051 2,000 Fixed 2.90

2061 Senior Notes July 2061 1,250 Fixed 3.05

(1) The 364-Day Informatica Credit Agreement was funded in November 2025 upon the acquisition of Informatica and matures in November 2026.

(2) The Three-Year Informatica Credit Agreement was funded in November 2025 upon the acquisition of Informatica and matures in November 2028.

Upon the acquisition of Informatica in November 2025, the borrowings under the Informatica Credit Agreements bear interest at a fluctuating rate per annum equal to, at our option, an alternate base rate or term Secured Overnight Financing Rate (“SOFR”), in each case, plus an applicable margin calculated based on our credit ratings.

We will also pay to the lenders under the Informatica Credit Agreements certain customary fees, including undrawn commitment fees.

As of October 31, 2025, there were no outstanding borrowings under the Informatica Credit Agreements.

Instrument Maturity Date Principal Outstanding as of April 30, 2026 Interest Terms Contractual Interest Rate

March 2028 Senior Notes March 2028 3,500 Fixed 4.50%

April 2028 Senior Notes April 2028 1,500 Fixed 3.70

July 2028 Senior Sustainability Notes July 2028 1,000 Fixed 1.50

March 2029 Senior Notes March 2029 4,250 Fixed 4.65

Revolving Loan Credit Agreement

October 2029 0 Floating N/A

2026 Term Loan Credit Agreement (1) March 2031 6,000 Floating 4.26

July 2031 Senior Notes July 2031 1,500 Fixed 1.95

September 2031 Senior Notes September 2031 3,750 Fixed 4.90

March 2033 Senior Notes March 2033 2,750 Fixed 5.20

March 2036 Senior Notes March 2036 4,500 Fixed 5.55

July 2041 Senior Notes July 2041 1,250 Fixed 2.70

March 2046 Senior Notes March 2046 1,500 Fixed 6.40

July 2051 Senior Notes July 2051 2,000 Fixed 2.90

March 2056 Senior Notes March 2056 3,750 Fixed 6.55

July 2061 Senior Notes July 2061 1,250 Fixed 3.05

March 2066 Senior Notes March 2066 1,000 Fixed 6.70

(1) The contractual interest rate represents the weighted-average for the period outstanding.

Any borrowings under our Revolving Loan Credit Agreement bear interest, at our option, at a base rate plus a spread of 0.00% or an adjusted benchmark rate plus a spread of 0.50% to 0.85%, in each case, with such spread being determined based on our credit rating.

We are also obligated to pay an ongoing commitment fee on undrawn amounts.

As of October 31, 2025, there was no outstanding borrowing amount under the Credit Facility.

As of April 30, 2026, there was no outstanding borrowing amount under the Credit Facility.

The borrowings under the 2026 Term Loan Credit Agreement bear interest at a fluctuating rate per annum equal to, at our option, an alternate base rate or an adjusted Term Secured Overnight Financing Rate (“SOFR”), in each case, plus an applicable margin calculated based on our credit ratings.

As of April 30, 2026, the entire $6.0 billion principal amount was outstanding under the 2026 Term Loan Credit Agreement.

In March 2026, we issued the March 2026 Notes with an aggregate principal of $25.0 billion and maturities ranging from 2028 to 2066.

While these notes do not expose us to risk from fluctuating interest rates, the fair value of this fixed-rate debt may be impacted by future changes in interest rates.

Generally, the fair value of our fixed-rate debt will decrease as interest rates rise and increase as interest rates fall.

The bank counterparties to our derivative contracts potentially expose us to credit-related losses in the event of their nonperformance.

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Strategic Investments

As of October 31, 2025, our strategic investment portfolio consisted of in vestments in over 400 companies with a combined carrying value of $6.4 billion, including three privately held investments with carrying values that were individually greater than five percent of the total strategic investments portfolio and represented 32 percent of the portfolio in aggregate.

The following table sets forth additional information regarding active equity investments within our strategic investment portfolio as of October 31, 2025 and excludes exited investments (in millions):

Investment Type Capital Invested Unrealized Gains (Cumulative) Unrealized Losses (Cumulative) Carrying Value as of October 31, 2025

As of April 30, 2026, our strategic investment portfolio consisted of in vestments in over 450 companies with a combined carrying value of $7.8 billion, including two privately held investments with carrying values that were individually greater than five percent of the total strategic investments portfolio and represented 37 percent of the portfolio in aggregate.

The following table sets forth additional information regarding active equity investments within our strategic investment portfolio as of April 30, 2026 and excludes exited investments (in millions):

Investment Type Capital Invested Unrealized Gains (Cumulative) Unrealized Losses (Cumulative) Carrying Value as of April 30, 2026

Publicly held equity securities $ 3 $ 1 $ (1) $ 3

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The particular securities we hold, and their rights and preferences relative to other securities within the capital structure of a company, may impact the magnitude by which our investment value moves in relation to changes in the total fair value of that company.

For example, our five largest privately held equity securities represent $2.5 billion in total strategic investments as of October 31, 2025.

For example, our five largest privately held equity securities represent $3.7 billion in total strategic investments as of April 30, 2026.

If the enterprise value of the companies in which we hold those securities decreased by ten percent, the carrying value of our investment portfolio would decline by approximately $316 million.

6 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk