NIQ Global Intelligence plcNIQ
NIQ Global Intelligence plc Fair Value Disclosure
11. FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company’s financial instruments primarily consist of cash and cash equivalents, trade receivable, accounts payable, outstanding indebtedness, derivative instruments and benefit plan assets. The fair value of the Company’s benefit plan assets is disclosed in Note 15. “Pension and Other Post-Retirement Benefits”. The carrying value of the Company’s financial instruments approximates fair value due to the short-term nature of the instruments, except for outstanding indebtedness, derivative instruments and other financial instruments as further discussed below.
Debt Instruments
The fair value of the Company’s debt instruments is measured using observable market information which would be considered Level 2 in the fair value hierarchy. The following table sets forth the carrying value and fair value amounts of the Company’s term loans:
| December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||
(in millions) | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||||||||
Term Loans(1)(2) | $ | 3,586.1 | $ | 3,599.5 | $ | 3,786.7 | $ | 3,798.6 | |||||||||||||||
(1)The carrying value of the term loans is presented on a gross basis and excludes unamortized debt discounts.
(2)The reported carrying values of other debt instruments approximate their fair values.
Derivative Instruments
The Company is exposed to cash flow interest rate risk on floating-rate debt under its Credit Agreement and periodically uses interest rate swaps, interest rate caps and interest rate collars to hedge this exposure. The Company is also exposed to fluctuations in foreign currency under its Credit Agreement as certain debt obligations are denominated in a currency other than an entity’s functional currency. The Company uses cross-currency swaps as a hedge of both the foreign currency and interest rate exposures. The interest rate derivative instruments and cross-currency swaps have expiration dates through February 2028 and February 2029, respectively, and are designated as hedges for accounting purposes.
The Company also uses cross-currency swaps to hedge foreign currency risk of its net investments in certain foreign subsidiaries. These cross-currency swaps have expiration dates through February 2029 and are designated as net investment hedges for accounting purposes.
The Company uses foreign exchange forward contracts to minimize the effect of fluctuating foreign-currency denominated accounts on its earnings, which are not designated as hedges for accounting purposes. As such, gains and losses from changes in fair value are recorded directly to earnings as a component of foreign currency exchange gain (loss), net. In December 2024, the Company settled its outstanding foreign exchange contracts prior to the expiration of their contractual maturities, resulting in the receipt of cash proceeds totaling approximately $20.8 million, which are included in operating activities in the consolidated statement of cash flows. In April 2025, the Company entered into new foreign exchange forward contracts designated as cash flow hedges for accounting purposes, with the exception of its euro currency hedges, which are not fully designated as hedges for accounting purposes. The foreign exchange forward contracts have expiration dates through November 2026.
For derivatives designated as hedges for accounting purposes, the Company reports the after-tax gain or loss from the effective portion of the hedge as a component of accumulated other comprehensive (loss) income and reclassifies it into earnings in the same period or periods in which the hedged transaction affects earnings and within the same income statement line item as the impact of the hedged transaction.
The Company regularly monitors the creditworthiness of its counterparties to ensure no issues exist that could affect the value of its derivatives. Since the counterparties to derivative instruments have investment-grade credit ratings, the Company considers the counterparty risk to be remote.
In November 2023 and July 2024, the Company settled outstanding interest rate derivative contracts and outstanding cross-currency swaps prior to the expiration of their contractual maturities through March 2025 and February 2026, respectively, resulting in the receipt of cash proceeds totaling approximately $48.3 million and $3.3 million, respectively, which are included in operating activities in the consolidated statements of cash flows. As these settled contracts were designated as hedges, the associated gains are a component of accumulated other comprehensive (loss) income and will be reclassified into earnings as the original hedged transaction affects earnings. The Company reclassified gains of $10.7 million, $34.1 million and $5.6 million for the years ended December 31, 2025, 2024 and 2023, respectively.
The following table presents the notional amounts of the Company’s outstanding derivative instruments:
| December 31, | |||||||||||
| (in millions) | 2025 | 2024 | |||||||||
| Derivatives designated as cash flow hedges | |||||||||||
| Interest rate contracts | $ | 2,034.0 | $ | 1,943.3 | |||||||
| Cross-currency swaps | 529.3 | 196.8 | |||||||||
| Foreign exchange forward contracts | 65.4 | — | |||||||||
| Derivatives designated as net investment hedges | |||||||||||
| Cross-currency swaps | $ | 469.2 | $ | 288.5 | |||||||
| Derivatives not designated as hedging instruments | |||||||||||
| Cross-currency swaps | $ | 140.4 | $ | — | |||||||
| Foreign exchange forward contracts | 158.4 | — | |||||||||
The following table sets forth the fair value amounts of derivatives presented in the consolidated financial statements:
| December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||
(in millions) | Derivative assets | Derivative liabilities | Derivative assets | Derivative liabilities | |||||||||||||||||||
| Derivatives designated as cash flow hedges | |||||||||||||||||||||||
| Interest rate contracts | $ | 0.4 | $ | 3.4 | $ | 0.3 | $ | 9.3 | |||||||||||||||
Cross-currency swaps | 5.6 | 84.8 | 7.1 | 5.5 | |||||||||||||||||||
| Foreign exchange forward contracts | 0.2 | 1.4 | — | — | |||||||||||||||||||
| $ | 6.2 | $ | 89.6 | $ | 7.4 | $ | 14.8 | ||||||||||||||||
| Derivatives designated as net investment hedges | |||||||||||||||||||||||
Cross-currency swaps | $ | 1.6 | $ | 10.5 | $ | 3.8 | $ | 5.9 | |||||||||||||||
| Derivatives not designated as hedging instruments | |||||||||||||||||||||||
| Foreign exchange forward contracts | 0.6 | 0.7 | — | — | |||||||||||||||||||
| Total derivatives | $ | 8.4 | $ | 100.8 | $ | 11.2 | $ | 20.7 | |||||||||||||||
| As reported in the Consolidated Balance Sheets | |||||||||||||||||||||||
| Prepaid expenses and other current assets | $ | 8.1 | $ | — | $ | 11.1 | $ | — | |||||||||||||||
| Other noncurrent assets | 0.3 | — | 0.1 | — | |||||||||||||||||||
| Other current liabilities | — | 30.1 | — | 6.6 | |||||||||||||||||||
| Other noncurrent liabilities | — | 70.7 | — | 14.1 | |||||||||||||||||||
| $ | 8.4 | $ | 100.8 | $ | 11.2 | $ | 20.7 | ||||||||||||||||
The fair value of derivative instruments is measured using observable market information. These inputs would be considered Level 2 in the fair value hierarchy. While all of the Company's derivative instruments are subject to master netting arrangements with its counterparties, assets and liabilities related to these contracts are presented on a gross basis within the consolidated financial statements.
The following tables present the gains (losses) on the Company’s interest rate contracts, cross-currency swaps and foreign exchange forward contracts:
(in millions) | Beginning Accumulated Other Comprehensive Gain (Loss) | Amount of gains (losses) recognized, net of tax | Amount of gains (losses) reclassified into income, net of tax | Ending Accumulated Other Comprehensive Gain (Loss) | |||||||||||||||||||
Year Ended December 31, 2025: | |||||||||||||||||||||||
| Designated as cash flow hedges: | |||||||||||||||||||||||
Interest rate contracts | $ | 0.8 | $ | 0.5 | $ | 4.5 | $ | (3.2) | |||||||||||||||
Cross-currency swaps | (3.9) | (64.7) | (62.0) | (6.6) | |||||||||||||||||||
| Foreign exchange forward contracts | — | (0.8) | 0.3 | (1.1) | |||||||||||||||||||
| Designated as net investment hedges: | |||||||||||||||||||||||
Cross-currency swaps | $ | (1.9) | $ | (6.6) | $ | — | $ | (8.5) | |||||||||||||||
Year Ended December 31, 2024: | |||||||||||||||||||||||
| Designated as cash flow hedges: | |||||||||||||||||||||||
Interest rate contracts | $ | 26.7 | $ | 15.5 | $ | 41.4 | $ | 0.8 | |||||||||||||||
Cross-currency swaps | (2.3) | 18.5 | 20.1 | (3.9) | |||||||||||||||||||
| Designated as net investment hedges: | |||||||||||||||||||||||
Cross-currency swaps | $ | — | $ | (1.9) | $ | — | $ | (1.9) | |||||||||||||||
Year Ended December 31, 2023: | |||||||||||||||||||||||
| Designated as cash flow hedges: | |||||||||||||||||||||||
Interest rate contracts | $ | 64.5 | $ | 2.0 | $ | 39.8 | $ | 26.7 | |||||||||||||||
Cross-currency swaps | — | 2.1 | 4.4 | (2.3) | |||||||||||||||||||
The following table presents amounts recognized in foreign currency exchange gain (loss), net on the Company’s foreign exchange forward contracts:
| Year Ended December 31, | |||||||||||||||||
(in millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Derivatives not designated as hedging instruments | |||||||||||||||||
| Foreign exchange forward contracts | $ | 0.1 | $ | 31.3 | $ | (6.2) | |||||||||||
Warrant
Prior to the Reorganization, the Company’s Warrant was held by AI PAVE, an entity that was not previously consolidated in Dutch Holdings’ financial statements. As part of the Reorganization, NIQ Global Intelligence plc retrospectively recast its historical financial statements to present the consolidated results of Dutch Holdings and the AI PAVE Entities on a combined consolidated basis with those of NIQ Global Intelligence plc. See Note 2. “Summary of Significant Accounting Policies” for further detail.
At initial recognition, the Warrant was recorded at fair value and classified as a liability due to a contingent repurchase feature triggered by a change of control event, including an IPO. The liability was remeasured at each reporting date using the Black-Scholes valuation model, with changes in the fair value recorded as a component of nonoperating expense, net. The valuation incorporated unobservable inputs, qualifying the Warrant as a Level 3 instrument under the fair value hierarchy.
Upon the IPO, the Warrant converted to represent the right to subscribe for up to 17,725,122 ordinary shares of NIQ Global Intelligence plc at an exercise price of $16.93 per share, and the contingent repurchase obligation ceased pursuant to the terms of the Warrant. Consequently, the Warrant was reclassified from a liability to permanent equity on the consolidated balance sheets at a fair value of $231.1 million. As the Warrant is no longer subject to remeasurement, future changes in fair value will not be recognized.
The following table presents a reconciliation of the liability-classified Warrant prior to reclassification to equity:
| Year Ended December 31, | |||||||||||
(in millions) | 2025 | 2024 | |||||||||
Balance at beginning of period | $ | 191.4 | $ | 116.2 | |||||||
| Change in fair value | 39.7 | 75.2 | |||||||||
Reclassification to equity | (231.1) | — | |||||||||
Balance at end of period | $ | — | $ | 191.4 | |||||||
The level 3 fair value inputs used in the valuation of the liability-classified Warrant were as follows:
| July 24, 2025 (date of IPO) | December 31, 2024 | ||||||||||
Volatility | 32.4% | 31.5% | |||||||||
Risk-free rate | 4.7% | 4.8% | |||||||||
| Discount for lack of marketability | —% | 7.5% | |||||||||
Term (in years) | 15.6 | 16.2 | |||||||||
Phantom Awards
In connection with the Advent Acquisition on March 5, 2021, the Company, Advent and entities created to own the Company implemented a share-based employee compensation plan which permits the grant of certain share-based awards to certain employees, directors and non-employees (the “2021 Plan”). Pursuant to the 2021 Plan, awards were issued in the form of phantom shares (“Phantom Awards”) of AI PAVE. Prior to the IPO, the Phantom Awards were eligible to be cash-settled upon a change in control event or IPO and would otherwise expire if no such event occurred prior to the eighth anniversary of the grant date. Upon the IPO and pursuant to its terms, the Phantom Awards became eligible for settlement in cash or shares of the Company’s ordinary shares beginning on the second anniversary of the IPO and thereafter as such awards continue to vest in accordance with their original terms.
Upon the IPO, the Phantom Awards were classified as a liability and measured based on the Company’s share price at the closing of the IPO. This input would be considered Level 1 in the fair value hierarchy. The Company remeasures the associated liability of the Phantom Awards at fair value at each reporting period until settlement and periodically reassesses the classification of the awards based on changes in facts and circumstances. As of November 2025, the majority of the Phantom Awards could only be settled in Ordinary Shares and therefore no longer met the criteria for liability-classification. These Phantom Awards were reclassified from liability to permanent equity on the consolidated balance sheets at a fair value of $18.1 million based on the Company’s share price on the date of the reclassification.
See Note 16. “Share-Based Compensation” for further detail on the share-based compensation attributed to the Phantom Awards.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.