XML 48 R21.htm IDEA: XBRL DOCUMENT v3.22.4
Derivative Instruments and Hedging Activities
 12 Months Ended
Dec. 31, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities
Cash Flow Hedges of Foreign Exchange Risk
The Company is exposed to fluctuations in various foreign currencies against its functional currency, the USD. Specifically, the Company is exposed to, has historically hedged, and may hedge in the future, third-party expenses denominated in Indian rupees (“INR”). These transactions expose the Company to exchange rate fluctuations between USD and INR and the Company has used foreign currency forward agreements to manage its exposure to fluctuations in the USD-INR exchange rate. This involves fixing the USD-INR exchange rate for delivery of a specified amount of INR on a specified date. The currency forward agreements are cash settled in USD for their fair value at or close to their settlement date.
For derivatives designated and that qualify as cash flow hedges of foreign exchange risk for accounting purposes, the gain or loss on the derivative is recorded in Accumulated other comprehensive income (“OCI”). The earnings recognition of excluded components is presented in the same income statement line item as the earnings effect of the hedged transaction. All contracts have historically had maturities of less than 12 months.
As of December 31, 2021 and 2022, the Company did not have any outstanding foreign currency derivatives to hedge its foreign exchange risks.
Non-designated Derivatives
Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements and other identified risks but do not meet the strict hedge accounting requirements and/or the Company has not elected to apply hedge accounting.
To reduce exposure to variability in expected future cash outflows on variable rate debt attributable to the changes in LIBOR, the Company has historically entered into interest rate swaps to economically offset a portion of this risk and may do so in the future.
Additionally, the Company electively de-designates currency forward agreements previously designated as cash flow hedges prior to their maturity due to administrative constraints.
Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings.
As of December 31, 2021, the Company had the following outstanding derivative that was not designated as a hedge in qualifying hedging relationships:
ProductNumber of InstrumentsEffective DateMaturity DateNotional
Interest Rate Swap1June 30, 2021June 30, 2022
$306.9 million USD
As of December 31, 2022, the Company did not have any outstanding derivatives that were not designated as a hedge in qualifying hedge relationships.
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 consolidated balance sheets as of December 31, 2021 and 2022.

Liability Derivatives
(in thousands)As of December 31, 2021As of December 31, 2022
Derivatives not designated as hedging instruments:
Interest rate swapsOther current liabilities$4,102 Other current liabilities$— 
Interest rate swapsOther liabilities— Other liabilities— 
Total interest rate swaps$4,102 $— 
The tables below present the effect of cash flow hedge accounting on Accumulated Other Comprehensive (Loss) Income (“OCI”) for the periods presented:
Year Ended December 31,Year Ended December 31,
(in thousands)202020212022202020212022
Derivatives in Hedging RelationshipsAmount of Gain or (Loss) Recognized in OCI on Derivative (Included Component)Location of Gain or (Loss) Reclassified from Accumulated OCI into IncomeAmount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Included Component)
Cost of revenues$29 $146 $— 
Foreign exchange contracts$520 $(177)$— Selling general and administrative51 102 — 
Total$520 $(177)$— $80 $248 $— 
Year Ended December 31,Year Ended December 31,
(in thousands)202020212022202020212022
Derivatives in Hedging RelationshipsAmount of Gain or (Loss) Recognized in OCI on Derivative (Excluded Component)Location of Gain or (Loss) Reclassified from Accumulated OCI into IncomeAmount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Excluded Component)
Cost of revenues$120 $128 $— 
Foreign exchange contracts$532 $332 $— Selling general and administrative214 144 — 
Total$532 $332 $— $334 $272 $— 
The table below presents the effect of the Company’s derivative financial instruments on the Consolidated Statements of Operations and Comprehensive (Loss) Income for the periods presented:
Year Ended
December 31, 2020December 31, 2021December 31, 2022
Selling General, and AdministrativeCost of RevenuesSelling General, and AdministrativeCost of RevenuesSelling General, and AdministrativeCost of Revenues
(in thousands)
Total amounts of income and expense line items in which the effects of fair value or cash flow hedges are recorded$122,554 $217,310 $198,700 $313,155 $175,459 $407,683 
Gain or (loss) on cash flow hedging relationships
Foreign exchange contracts:
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income$51 $29 $102 $146 $— $— 
Amount excluded from effectiveness testing recognized in earnings214 120 144 128 — — 
The table below presents the effect of the Company’s derivative financial instruments that are not designated as hedging instruments in the Consolidated Statements of Operations and Comprehensive (Loss) Income for the periods presented below:
Year Ended
(in thousands)December 31, 2020December 31, 2021December 31, 2022
Derivatives Not Designated as Hedging Instruments Location of Gain (Loss) Recognized in Income on DerivativeAmount of Gain (Loss) Recognized in Income on Derivative
Interest rate swaps(Loss) gain on interest rate swaps$(9,451)$(31)$297 
Foreign exchange contractsSelling, general and administrative28 24 — 
Foreign exchange contractsCost of revenues15 34 — 
Total$(9,408)$27 $297