ZBH · 8-K · 20260805PR335108
FX / Currency Headwinds
ZIMMER BIOMET HOLDINGS, INC. · 2026-08-05 · Importance 40 · Surprise 56 · No source text
Zimmer Biomet operates globally and identifies exposure to foreign-exchange movements across the euro, Swiss franc, Japanese yen, British pound, Chinese renminbi, and numerous other currencies. In 2025, foreign-currency remeasurement of monetary assets and liabilities produced $14.2 million of losses, compared with $26.1 million in 2024. The company designated 100% of its euro and Swiss franc notes as net-investment hedges and had cross-currency swaps with notional amounts of ¥54.1 billion and CHF290 million at December 31, 2025. Outstanding forward contracts to purchase U.S. dollars totaled $1.5996 billion and those to purchase Swiss francs totaled $433.3 million, with maturities from January 2026 through April 2028.
Key facts
- As of December 31, 2025, notional amounts of outstanding forward contracts entered into with third parties to purchase U.S. Dollars were $1,599.6 million and to purchase Swiss Francs were $433.3 million; these derivatives mature from January 2026 through April 2028. source
- Based on foreign currency exchange rates at the end of 2025, foreign currency is expected to have a 0.5 percent positive impact on year-over-year net sales growth in 2026. source
- Net investment hedge gains (losses) recognized in AOCI: Euro Notes ($236.0) million, Swiss Notes ($13.3) million, Cross-currency interest rate swaps ($22.5) million; total ($271.8) million loss for 2025. source
- Derivatives designated as cash flow hedges had a net unrealized gain of $40.7 million (pre-tax) at December 31, 2025, or $36.5 million after taxes, deferred in AOCI; $30.7 million (pre-tax) expected to be reclassified to earnings in cost of products sold over next twelve months. source
- Gains from derivatives not designated as hedging instruments recognized in other income (expense), net: $2.6 million in 2025, $10.5 million in 2024, $4.4 million in 2023. source
- At December 31, 2025, receive-fixed-rate, pay-fixed-rate cross-currency interest rate swaps outstanding notional amounts: Japanese Yen 54.1 billion and Swiss Franc 290 million. source
- Total amounts of income and expense line items presented in statements of earnings in which effects of fair value, cash flow and net investment hedges are recorded for 2025: Cost of products sold $2,493.7 million and Interest Expense, net ($292.8) million. source
- In the year ended December 31, 2025, Euro 225 million of cross-currency swaps matured at a loss of $8.0 million and Swiss Franc 75 million matured at a loss of $18.6 million. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| operating_income | positive | probable | +0.7% | Derivatives designated as cash flow hedges had a net unrealized gain of $40.7 million (pre-tax) at December 31, 2025, or $36.5 million… |
| net_income | negative | realized | -0.4% | Gains from derivatives not designated as hedging instruments recognized in other income (expense), net: $2.6 million in 2025, $10.5… |
| revenue | positive | probable | +0.3% | Based on foreign currency exchange rates at the end of 2025, foreign currency is expected to have a 0.5 percent positive impact on… |
| liability | unclear | contingent | — | At December 31, 2025, receive-fixed-rate, pay-fixed-rate cross-currency interest rate swaps outstanding notional amounts: Japanese Yen… |