Certain of the Company’s foreign operations expose the Company to fluctuations of foreign exchange rates. These fluctuations may impact the value of the Company’s cash receipts and payments in terms of the functional currency of the transacting party. The Company’s primary exposure results from the foreign currency impact of intercompany sales of inventory to regional entities by the Company’s centralized procurement legal entity. These intercompany sales are denominated in the functional currency of the regional entities, primarily the Euro, the British Pound, and the Australian dollar, while the functional currency of the centralized procurement legal entity is the U.S. dollar. This introduces foreign exchange risk on the revenues recorded for such intercompany sales. The Company enters into foreign currency forward contracts to manage its exposure to fluctuations in foreign exchange rates. These contracts are entered into with large, reputable financial institutions that are monitored for counterparty credit risks.

For the Company’s foreign currency forward contracts that are designated and qualify as cash flow hedges, the gains or losses on the effective portion of such hedges are recorded in accumulated other comprehensive income and subsequently reclassified in the period during which the hedged transaction affects earnings within revenue in the consolidated statements of operations (i.e., when control of the inventory is passed to third-party customers and revenue is recognized). The change in fair value of the components excluded from the assessment of effectiveness, including changes in the spot-forward differential and counterparty non-performance risk, will also be recognized within revenue in the consolidated statements of operations.

The Company currently also has foreign currency forward contracts that are not designated as hedges and the changes in fair value of such derivatives are recognized in current period earnings. As of December 31, 2024, the impact on our condensed consolidated financial statements was not significant.


In thousands	December 31, 2024						September 30, 2024
In thousands	Notional Value		Other Current Assets		Other Current Liabilities		Notional Value		Other Current Assets		Other Current Liabilities
Foreign currency forward contracts	$	83,167	$	2,131	$	—	$	106,650	$	—	$	5,498

The gains or losses resulting from changes in fair value of the Company’s cash flow hedges recognized in accumulated other comprehensive income (loss) for the three months ended December 31, 2024 and 2023 are as follows:

The amounts recognized within “Revenue” in the condensed consolidated statements of operations with respect to the Company’s cash flow hedges for the three months ended December 31, 2024 and 2023 are as follows:


In thousands	December 31, 2024
Beginning balance	$	(6,276)
Amount recognized in accumulated other comprehensive income (loss)	7,865
Amount reclassified from accumulated other comprehensive income (loss) into earnings	328
Ending balance	$	1,917