Derivative Instruments

6 Months Ended

Jul. 02, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative InstrumentsThe Company’s foreign currency risk management strategy is principally designed to mitigate the potential financial impact of changes in the value of transactions and balances denominated in foreign currencies resulting from changes in foreign currency exchange rates. The Company enters into economic hedges utilizing foreign currency forward contracts with maturities that do not exceed approximately three months to manage the exposure to fluctuations in foreign currency exchange rates arising primarily from foreign-denominated receivables and payables. The gains and losses on these derivatives are intended to be offset by the changes in the fair value of the assets and liabilities being hedged. These economic hedges are not designated as hedging instruments for hedge accounting treatment.

The Company had the following outstanding forward contracts (in thousands):

	July 2, 2023			December 31, 2022
Currency	Notional Value	USD Equivalent		Notional Value	USD Equivalent
Derivatives Not Designated as Hedging Instruments:
Euro	32,500	$	35,371	60,000	$	64,174
Chinese Renminbi	70,000	9,665		55,000	7,619
Mexican Peso	120,000	6,979		185,000	9,480
Hungarian Forint	1,950,000	5,671		1,590,000	4,238
British Pound	3,540	4,467		3,445	4,161
Japanese Yen	600,000	4,159		700,000	5,281
Canadian Dollar	1,750	1,321		1,730	1,278
Swiss Franc	—	—		1,120	1,218

Information regarding the fair value of the outstanding forward contracts was as follows (in thousands):

	Asset Derivatives					Liability Derivatives
	Balance	Fair Value				Balance	Fair Value
	Sheet Location	July 2, 2023		December 31, 2022		Sheet Location	July 2, 2023		December 31, 2022
Derivatives Not Designated as Hedging Instruments:
Economic hedge forward contracts	Prepaid expenses and other current assets	$	118	$	27	Accrued expenses	$	31	$	479

The following table presents the gross activity for all derivative assets and liabilities which were presented on a net basis on the Consolidated Balance Sheets due to the right of offset with each counterparty (in thousands):

Asset Derivatives					Liability Derivatives
	July 2, 2023		December 31, 2022			July 2, 2023		December 31, 2022
Gross amounts of recognized assets	$	118	$	27	Gross amounts of recognized liabilities	$	31	$	479
Gross amounts offset	—		—		Gross amounts offset	—		—
Net amount of assets presented	$	118	$	27	Net amount of liabilities presented	$	31	$	479

Information regarding the effect of derivative instruments on the consolidated financial statements was as follows (in thousands):

	Location in Financial Statements	Three-months Ended				Six-months Ended
		July 2, 2023		July 3, 2022		July 2, 2023		July 3, 2022
Derivatives Not Designated as Hedging Instruments:
Gains (losses) recognized in current operations	Foreign currency gain (loss)	$	859	$	6,191	$	(612)	$	7,930