NCR Atleos CorpNATL
NCR Atleos Corp Fair Value Disclosure
14. FAIR VALUE OF ASSETS AND LIABILITIES
Assets and Liabilities Measured at Fair Value on a Recurring Basis
Assets and liabilities recorded at fair value on a recurring basis as of December 31, 2025 and 2024 are set forth as follows:
| December 31, 2025 | |||||||||||||||||
| Fair Value Measurements Using | |||||||||||||||||
| In millions | Location within the Consolidated Balance Sheets | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
| Assets: | |||||||||||||||||
| Foreign exchange contracts | Other current assets | $ | 1 | — | $ | 1 | — | ||||||||||
| Debt securities | Other assets | 9 | — | 9 | — | ||||||||||||
| Total | $ | 10 | $ | — | $ | 10 | $ | — | |||||||||
| Liabilities: | |||||||||||||||||
| Foreign exchange contracts | Other current liabilities | $ | 1 | — | $ | 1 | — | ||||||||||
| Interest rate swap contracts | Other current liabilities / Other liabilities | 24 | $ | — | 24 | $ | — | ||||||||||
| Total | $ | 25 | $ | — | $ | 25 | $ | — | |||||||||
| December 31, 2024 | |||||||||||||||||
| Fair Value Measurements Using | |||||||||||||||||
| In millions | Location within the Consolidated Balance Sheets | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
| Assets: | |||||||||||||||||
| Foreign exchange contracts | Other current assets | $ | 1 | — | $ | 1 | — | ||||||||||
| Interest rate swap contracts | Other current assets / Other assets | 12 | — | 12 | — | ||||||||||||
| Debt securities | Other assets | 6 | — | 6 | — | ||||||||||||
| Total | $ | 19 | $ | — | $ | 19 | $ | — | |||||||||
| Liabilities: | |||||||||||||||||
| Interest rate swap contracts | Other current liabilities / Other liabilities | $ | 17 | $ | — | $ | 17 | $ | — | ||||||||
| Total | $ | 17 | $ | — | $ | 17 | $ | — | |||||||||
Foreign exchange contracts are valued using the market approach based on observable market transactions of forward rates and are classified within Level 2 of the valuation hierarchy.
Interest rate swap contracts are valued using an income model based on disparity between variable and fixed interest rates, the scheduled balance of underlying principal outstanding, yield curves, and other information readily available in the market. We incorporate credit valuation adjustments in our fair value measurements to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we consider the impact of netting and any applicable credit enhancements. We measure the credit risk of our derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio.
Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments utilize Level 3 inputs to evaluate the likelihood of both our own default and counterparty default. As of December 31, 2025, we determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives and therefore, the valuations are classified within Level 2 of the fair value hierarchy.
Our available for sale debt securities represent convertible notes issued by a Canadian corporation in which we have an equity investment. The debt securities are valued using a binomial lattice model based on factors such as stock price of the issuer, principal outstanding, coupon rate, volatility, credit spread, risk-free rate and other market data. As such, the debt securities are classified within Level 2 of the fair value hierarchy. The associated unrealized losses recorded in AOCI are not material.
Assets Measured at Fair Value on a Non-recurring Basis
We measure certain assets, including intangible assets and cost and equity method investments, at fair value on a nonrecurring basis using significant unobservable inputs (Level 3). These assets are initially recognized at fair value and adjusted when deemed to be impaired. We review the carrying values of investments when events and circumstances warrant, and consider all available evidence in evaluating whether declines in fair value are other-than-temporary. We carry equity investments in privately-held companies at cost or at fair value when we recognize an other-than-temporary impairment charge. No material impairment charges or nonrecurring fair value adjustments were recorded during the years ended December 31, 2025, 2024 or 2023.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Mar 3, 2025 | |
| 2023 | Mar 26, 2024 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.