Derivative Instruments and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2021

Derivative Instruments, Gain (Loss) [Line Items]

Summary of Fair Value of Derivative Financial Instruments

All financial derivative instruments are carried at their fair value on the balance sheet. The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the unaudited condensed consolidated balance sheets as of December 31, 2020 and September 30, 2021.

	Asset Derivatives
	As of December 31, 2020			As of September 30, 2021
(in thousands)	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments:
Foreign exchange contracts	Other current assets	$	648	Other current assets	$	229
Total foreign exchange contracts		$	648		$	229

	Liability Derivatives
(in thousands)	As of December 31, 2020			As of September 30, 2021
Derivatives not designated as hedging instruments:
Interest rate swaps	Other current liabilities	$	7,302	Other current liabilities	$	6,500
Interest rate swaps	Other liabilities		4,222	Other liabilities		—
Total interest rate swaps		$	11,524		$	6,500

Summary of Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income

The tables below present the effect of cash flow hedge accounting on Accumulated Other Comprehensive Income for the three and nine months ended September 30, 2020 and 2021.

	Three Months Ended September 30,					Three Months Ended September 30,
(in thousands)	2020		2021			2020		2021
Derivatives in Hedging Relationships	Amount of Gain or (Loss) Recognized in OCI on Derivative (Included Component)				Location of Gain or (Loss) Reclassified from Accumulated OCI into Income	Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Included Component)
					Cost of revenues	$	12	$	35
Foreign exchange contracts	$	423	$	41	Selling general and administrative		14		24
Total	$	423	$	41		$	26	$	59

	Nine Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2020		2021				2020		2021
Derivatives in Hedging Relationships	Amount of Gain or (Loss) Recognized in OCI on Derivative (Included Component)					Location of Gain or (Loss) Reclassified from Accumulated OCI into Income	Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Included Component)
						Cost of revenues	$	12	$	139
Foreign exchange contracts	$	423	$	(143	)	Selling general and administrative		14		101
Total	$	423	$	(143	)		$	26	$	240

	Three Months Ended September 30,					Three Months Ended September 30,
(in thousands)	2020		2021			2020		2021
Derivatives in Hedging Relationships	Amount of Gain or (Loss) Recognized in OCI on Derivative (Excluded Component)				Location of Gain or (Loss) Reclassified from Accumulated OCI into Income	Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Excluded Component)
					Cost of revenues	$	75	$	30
Foreign exchange contracts	$	11	$	69	Selling general and administrative		102		22
Total	$	11	$	69		$	177	$	52

	Nine Months Ended September 30,					Nine Months Ended September 30,
(in thousands)	2020		2021			2020		2021
Derivatives in Hedging Relationships	Amount of Gain or (Loss) Recognized in OCI on Derivative (Excluded Component)				Location of Gain or (Loss) Reclassified from Accumulated OCI into Income	Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Excluded Component)
					Cost of revenues	$	75	$	120
Foreign exchange contracts	$	11	$	319	Selling general and administrative		102		139
Total	$	11	$	319		$	177	$	259

Summary of Financial Derivative Instruments on Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

The tables below present the effect of the Company’s financial derivative instruments on the unaudited condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2020 and 2021.

	Three Months Ended September 30,
	2020				2021
(in thousands)	Selling General, and Administrative		Cost of Revenues		Selling General, and Administrative		Cost of Revenues
Total amounts of income and expense line items in which the effects of fair value or cash flow hedges are recorded	$	25,391	$	55,112	$	84,983	$	82,638
Gain or (loss) on cash flow hedging relationships
Foreign exchange contracts:
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income		14		12		24		35
Amount excluded from effectiveness testing recognized in earnings		93		83		22		30

 

	Nine Months Ended September 30,
	2020				2021
(in thousands)	Selling General, and Administrative		Cost of Revenues		Selling General, and Administrative		Cost of Revenues
Total amounts of income and expense line items in which the effects of fair value or cash flow hedges are recorded	$	86,848	$	153,458	$	153,194	$	225,798
Gain or (loss) on cash flow hedging relationships
Foreign exchange contracts:
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income		14		12		101		139
Amount excluded from effectiveness testing recognized in earnings		93		83		139		120

Summary of Derivative Financial Instruments that are not Designated as Hedging Instruments

The table below presents the effect of the Company’s derivative financial instruments that are not designated as hedging instruments in the unaudited condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2020 and 2021.

		Three Months Ended September 30,
(in thousands)		2020			2021
Derivatives Not Designated as Hedging Instruments	Location of (Gain) or Loss Recognized in Income on Derivative	Amount of (Gain) or Loss Recognized in Income on Derivative
Interest rate swaps	(Gain) loss on interest rate swaps	$	(49	)	$	112
Foreign exchange contracts	Selling general and administrative		(9	)		—
Foreign exchange contracts	Cost of revenues		(8	)		1
Total		$	(66	)	$	113

 

		Nine Months Ended September 30,
(in thousands)		2020			2021
Derivatives Not Designated as Hedging Instruments	Location of (Gain) or Loss Recognized in Income on Derivative	Amount of (Gain) or Loss Recognized in Income on Derivative
Interest rate swaps	(Gain) loss on interest rate swaps	$	9,604		$	199
Foreign exchange contracts	Selling general and administrative		(9	)		(20	)
Foreign exchange contracts	Cost of revenues		(8	)		(28	)
Total		$	9,587		$	151

Designated as Hedging Instrument [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Summary of Company's Outstanding Derivatives

As of September 30, 2021, the Company had the following outstanding foreign currency derivatives that were used to hedge its foreign exchange risks:

Foreign Currency Derivative	Number of Instruments		Notional Sold		Notional Purchased
Currency forward agreements		3		4.2 million USD		331.0 million INR

Not Designated as Hedging Instrument [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Summary of Company's Outstanding Derivatives

As of September 30, 2021, the Company had the following outstanding derivative that was not designated as a hedge in qualifying hedging relationships:

Product	Number of Instruments		Effective Date		Maturity Date		Notional
Interest Rate Swap		1		June 30, 2021		June 30, 2022	$	308.0 million USD