Sensata Technologies Holding plcST
Sensata Technologies Holding plc Fair Value Disclosure
Fair Value Measures
Our assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy in accordance with FASB ASC Topic 820. The levels of the fair value hierarchy are described below:
•Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets and liabilities that we have the
ability to access at the measurement date.
•Level 2 inputs utilize inputs, other than quoted prices included in Level 1, that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals.
•Level 3 inputs are unobservable inputs for the asset or liability, allowing for situations where there is little, if any, market activity for the asset or liability.
Measured on a Recurring Basis
Our assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024 are shown in the below table.
As of December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Assets measured at fair value: | |||||||||||
Cash equivalents (Level 1) | $ | 406.1 | $ | 243.6 | |||||||
Foreign currency forward contracts (Level 2) | 18.3 | 19.1 | |||||||||
Commodity forward contracts (Level 2) | 21.2 | 1.5 | |||||||||
| Total assets measured at fair value | $ | 445.6 | $ | 264.2 | |||||||
| Liabilities measured at fair value: | |||||||||||
Foreign currency forward contracts (Level 2) | $ | 17.4 | $ | 27.6 | |||||||
Commodity forward contracts (Level 2) | 0.3 | 1.3 | |||||||||
| Total liabilities measured at fair value | $ | 17.7 | $ | 28.9 | |||||||
Refer to Note 2: Significant Accounting Policies for additional information related to the methods used to estimate the fair value of our financial instruments and Note 19: Derivative Instruments and Hedging Activities for additional information related to the inputs used to determine these fair value measurements and the nature of the risks that these derivative instruments are intended to mitigate. Cash equivalents consist of U.S. Government Treasury money market funds and are classified as Level 1 as they are exchange traded in an active market.
Although we have determined that the majority of the inputs used to value our derivative instruments fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to appropriately reflect both our own non-performance risk and the respective counterparties' non-performance risk in the fair value measurement. As of December 31, 2025 and 2024, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivatives in their entirety are classified in Level 2 in the fair value hierarchy.
Measured on a Nonrecurring Basis
In the third quarter of 2025, impairment indicators were identified that suggested the carrying value of the Dynapower reporting unit could exceed its fair value. The primary indicators of impairment were a lower outlook within certain markets that the reporting unit operates in following recent tax legislation being enacted, and a strategic shift to focus on other markets. This revised outlook led to downward revisions of forecasted future cash flows. We evaluated the goodwill of the Dynapower reporting unit for impairment using a combination of a market-based valuation method and an income approach that discounts forecasted cash flows. As these assumptions were largely unobservable, the estimated fair values fall within Level 3 of the fair value hierarchy. A change in our cash flow forecast or the discount rate used would result in an increase or decrease in our calculated fair value. We determined that our Dynapower reporting unit was impaired, and in the third quarter of 2025, we recorded a $225.7 million non-cash impairment charge. If Dynapower does not achieve the forecasted future cash flows, there is a possibility that additional impairments of the remaining $4.1 million of goodwill may be recognized in the future.
In the third quarter of 2024, we determined that our Dynapower reporting unit was impaired, and we recorded a $150.1 million non-cash impairment charge. In the fourth quarter of 2023, we determined that our Insights reporting unit was impaired and we recorded a $321.7 million non-cash impairment charge. Refer to Note 11: Goodwill and Other Intangible Assets, Net for additional information.
As of December 31, 2025, no events or changes in circumstances occurred that would have triggered the need for an additional impairment review of goodwill or other indefinite-lived intangible assets. We evaluated our goodwill for impairment as of October 1, 2025 using a qualitative analysis that considered events and circumstances affecting the fair value of each reporting unit, including macroeconomic conditions, market conditions, industry trends, cost factors, financial performance, and other relevant qualitative factors. The results did not indicate a need to perform quantitative analysis, as we determined that it is more likely than not that the fair value of each of our reporting units exceeded their respective carrying values. Refer to Note 11: Goodwill and Other Intangible Assets, Net for additional information.
Financial Instruments Not Recorded at Fair Value
The following table presents the carrying values and fair values of financial instruments not recorded at fair value in the consolidated balance sheets as of December 31, 2025 and 2024. All fair value measures presented are categorized within Level 2 of the fair value hierarchy.
As of December 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
Carrying Value (1) | Fair Value | Carrying Value (1) | Fair Value | ||||||||||||||||||||
4.0% Senior Notes | $ | 646.0 | $ | 632.2 | $ | 1,000.0 | $ | 915.0 | |||||||||||||||
4.375% Senior Notes | $ | 450.0 | $ | 439.8 | $ | 450.0 | $ | 410.6 | |||||||||||||||
5.875% Senior Notes | $ | 500.0 | $ | 507.9 | $ | 500.0 | $ | 485.0 | |||||||||||||||
3.75% Senior Notes | $ | 750.0 | $ | 703.1 | $ | 750.0 | $ | 652.5 | |||||||||||||||
6.625% Senior Notes | $ | 500.0 | $ | 523.8 | $ | 500.0 | $ | 497.5 | |||||||||||||||
__________________________
(1) Excluding any related debt discounts, premiums, and deferred financing costs.
We also hold trade accounts receivables and payables, for which the fair value approximates the carrying value due to their short-term nature.
As of December 31, 2025 and 2024, we held equity investments under the measurement alternative of $7.3 million and $6.1 million, respectively, which are presented in other assets in the consolidated balance sheets. In the year ended December 31, 2024, we adjusted the carrying value of one of these equity investments as a result of an observable price change in the first quarter of 2024, resulting in a loss of $14.8 million.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 28, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 13, 2023 | |
| 2021 | Feb 10, 2022 | |
| 2020 | Feb 12, 2021 | |
| 2019 | Feb 11, 2020 | |
| 2018 | Feb 6, 2019 | |
| 2017 | Feb 1, 2018 | |
| 2016 | Feb 2, 2017 | |
| 2015 | Feb 2, 2016 | |
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.