We are exposed to market risks, which arise during the normal course of business from changes in interest rates and foreign currency exchange rates. On a selected basis, we use derivative financial instruments to manage or hedge certain of these risks. All hedging transactions are authorized and executed pursuant to written guidelines and procedures. We apply FASB ASC Topic 815, Derivatives and Hedging, or ASC 815, which established accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. All derivatives, whether designated in hedging relationships or not, are required to be recorded on the balance sheet at fair value. If the derivative is designated as a fair-value hedge, the changes in the fair value of the derivative and the underlying hedged item are recognized concurrently in earnings. If the derivative is designated as a cash flow hedge, changes in the fair value of the derivative are recorded in other comprehensive income (loss) and are recognized in the condensed consolidated statements of income (loss) when the hedged item affects earnings. ASC 815 defines the requirements for designation and documentation of hedging relationships as well as ongoing effectiveness assessments in order to use hedge accounting. For a derivative that does not qualify as a hedge, changes in fair value are recognized concurrently in earnings. A discussion of our primary market risk exposures and derivatives is presented below. Foreign Exchange Risk We transact business globally and are subject to risks associated with changes in foreign exchange rates. Our objective is to minimize the impact to earnings and cash flow associated with foreign exchange rate fluctuations. We enter into foreign exchange derivatives in the ordinary course of business primarily to reduce exposure to currency fluctuations attributable to intercompany transactions, translation of local currency earnings, inventory purchases subject to foreign currency exposure, and to partially mitigate the impact of foreign currency rate fluctuations. Due to volatility in foreign exchange markets, our current strategy, in general, is to hedge some of the significant exposures on a short-term basis. We will continue to monitor the foreign exchange markets and evaluate our hedging strategy accordingly. With the exception of our foreign currency forward contracts relating to forecasted inventory purchases and intercompany management fees discussed below, all of our foreign exchange contracts are designated as freestanding derivatives for which hedge accounting does not apply. The changes in the fair value of the derivatives not qualifying as cash flow hedges are included in general and administrative expenses within our condensed consolidated statements of income (loss). The foreign currency forward contracts and option contracts designated as freestanding derivatives are primarily used to hedge foreign currency-denominated intercompany transactions and to partially mitigate the impact of foreign currency fluctuations. The fair value of foreign exchange derivative contracts is based on third-party quotes. Our foreign currency derivative contracts are generally executed on a monthly basis. We also purchase foreign currency forward contracts in order to hedge forecasted inventory transactions and intercompany management fees that are designated as cash flow hedges and are subject to foreign currency exposures. We applied the hedge accounting rules as required by ASC 815 for these hedges. These contracts allow us to buy and sell certain currencies at specified contract rates. As of June 30, 2026 and December 31, 2025, the aggregate notional amounts of these contracts outstanding were approximately $114.1 million and $75.4 million, respectively. As of June 30, 2026, the outstanding contracts were expected to mature over the next fifteen months. Our derivative financial instruments are recorded on the condensed consolidated balance sheets at fair value based on quoted market rates. For the forecasted inventory transactions, the forward contracts are used to hedge forecasted inventory transactions over specific months. Changes in the fair value of these forward contracts designated as cash flow hedges, excluding forward points, are recorded as a component of accumulated other comprehensive loss within shareholders’ deficit, and are recognized in cost of sales within our condensed consolidated statement of income (loss) during the period which approximates the time the hedged inventory is sold. We also hedge forecasted intercompany management fees over specific months. Changes in the fair value of these forward contracts designated as cash flow hedges, excluding forward points, are recorded as a component of accumulated other comprehensive loss within shareholders’ deficit, and are recognized in general and administrative expenses within our condensed consolidated statement of income (loss) during the period when the hedged item and underlying transaction affect earnings. As of June 30, 2026, we recorded assets at fair value of $0.2 million and liabilities at fair value of $5.5 million relating to all outstanding foreign currency contracts designated as cash flow hedges. As of December 31, 2025, we recorded assets at fair value of zero and liabilities at fair value of $4.5 million relating to all outstanding foreign currency contracts designated as cash flow hedges. These hedges remained effective as of June 30, 2026 and December 31, 2025. As of both June 30, 2026 and December 31, 2025, the majority of our outstanding foreign currency forward contracts related to freestanding derivatives had maturity dates of less than twelve months with the majority of freestanding derivatives expiring within one month. 58 The following table provides information about the details of all foreign currency forward contracts that were outstanding as of June 30, 2026: Weighted- Average Contract Rate Notional Amount Fair Value Gain (Loss) (in millions, except weighted-average contract rate) As of June 30, 2026 Buy British pound sell Euro 0.86 $ 28.4 $ 0.1 Buy British pound sell U.S. dollar 1.33 3.3 — Buy Chinese yuan sell U.S. dollar 6.80 36.5 0.1 Buy Czech koruna sell U.S. dollar 20.79 3.7 (0.1 ) Buy Danish krone sell U.S. dollar 6.43 2.6 — Buy Euro sell Australian dollar 1.64 0.8 — Buy Euro sell Brazilian real 5.91 0.8 — Buy Euro sell British pound 0.87 2.6 — Buy Euro sell Canadian dollar 1.62 0.7 — Buy Euro sell Chilean peso 1,042.11 0.7 — Buy Euro sell Chinese yuan 7.79 1.0 — Buy Euro sell Hong Kong dollar 8.96 5.1 — Buy Euro sell Indian rupee 108.27 7.4 — Buy Euro sell Indonesian rupiah 20,476.92 2.8 — Buy Euro sell Kazakhstani tenge 567.53 18.1 (0.5 ) Buy Euro sell Korean won 1,758.33 1.0 — Buy Euro sell Mexican peso 21.03 151.0 (5.5 ) Buy Euro sell Peruvian nuevo sol 3.93 10.8 (0.1 ) Buy Euro sell Polish zloty 4.25 1.3 — Buy Euro sell Swiss franc 0.92 61.5 0.3 Buy Euro sell Taiwan dollar 36.64 1.1 — Buy Euro sell U.S. dollar 1.16 77.2 (0.9 ) Buy Euro sell Vietnamese dong 30,483.21 16.8 (0.3 ) Buy Hong Kong dollar sell Euro 9.10 1.0 — Buy Hong Kong dollar sell U.S. dollar 7.83 1.0 — Buy Hungarian forint sell U.S. dollar 302.08 1.3 — Buy Indonesian rupiah sell U.S. dollar 18,058.95 15.0 0.1 Buy Korean won sell U.S. dollar 1,529.31 5.4 (0.1 ) Buy Mexican peso sell Euro 20.04 14.2 — Buy Mexican peso sell U.S. dollar 17.31 77.1 (0.9 ) Buy Norwegian krone sell U.S. dollar 9.52 5.3 (0.2 ) Buy Polish zloty sell Euro 4.29 3.2 — Buy Polish zloty sell U.S. dollar 3.66 9.3 (0.3 ) Buy Romanian leu sell Euro 5.25 14.8 — Buy Swedish krona sell U.S. dollar 9.36 4.1 (0.1 ) Buy Swiss franc sell U.S. dollar 0.79 62.6 (1.3 ) Buy Taiwan dollar sell U.S. dollar 31.58 22.0 (0.2 ) Buy U.S. dollar sell Brazilian real 5.21 1.2 — Buy U.S. dollar sell British pound 1.34 18.0 0.1 Buy U.S. dollar sell Colombian peso 3,447.39 0.7 — Buy U.S. dollar sell Euro 1.16 185.8 2.5 Buy U.S. dollar sell Indian rupee 95.30 13.9 (0.1 ) Buy U.S. dollar sell Mexican peso 17.32 19.5 0.2 Buy U.S. dollar sell Polish zloty 3.66 0.9 — Buy U.S. dollar sell Romanian leu 4.52 11.7 0.2 Buy U.S. dollar sell Singapore dollar 1.29 4.6 — Buy U.S. dollar sell Swedish krona 9.35 0.7 — Buy U.S. dollar sell Taiwan dollar 31.58 1.3 — Total forward contracts $ 929.8 $ (7.0 ) The majority of our foreign subsidiaries designate their local currencies as their functional currencies. See Liquidity and Capital Resources — Cash and Cash Equivalents in Part I, Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of this Quarterly Report on Form 10-Q for further discussion of our foreign subsidiary cash and cash equivalents. 59 Interest Rate Risk As of June 30, 2026, the aggregate annual maturities of the 2026 Credit Facility were expected to be $5.6 million for the remainder of 2026, $11.3 million for 2027, $11.3 million for 2028, $11.3 million for 2029, $11.3 million for 2030, and $309.2 million thereafter. As of June 30, 2026, the fair values of the 2026 Term Loan A and 2026 Revolving Credit Facility were approximately $221.9 million and $135.0 million, respectively, and the carrying values were $221.9 million and $135.0 million, respectively. As of December 31, 2025, the fair value of the 2024 Term Loan B was approximately $376.5 million, and the carrying value was $346.3 million. There were no outstanding borrowings on the 2024 Revolving Credit Facility as of December 31, 2025. The 2026 Credit Facility bears variable interest rates, and the 2024 Credit Facility bore variable interest rates. As of June 30, 2026, the weighted-average interest rate for borrowings under the 2026 Credit Facility and the 2024 Credit Facility for the applicable outstanding period was 8.88%. As of December 31, 2025, the weighted-average interest rate for borrowings under the 2024 Credit Facility was 11.64%. Since our 2026 Credit Facility is based on variable interest rates, if interest rates were to increase or decrease by 1% for the year and our borrowing amounts on our 2026 Credit Facility remained constant, our annual interest expense could increase or decrease by approximately $3.6 million, respectively. In April 2026, the 2029 Secured Notes were fully redeemed. As of December 31, 2025, the fair value of the 2029 Secured Notes was approximately $888.1 million and the carrying value was $774.1 million. The 2029 Secured Notes paid interest at a fixed rate of 12.250% per annum payable semiannually in arrears on April 15 and October 15 of each year, beginning on October 15, 2024. As of June 30, 2026, the fair value of the 2033 Secured Notes was approximately $816.2 million and the carrying value was $785.7 million. The 2033 Secured Notes pay interest at a fixed rate of 7.750% per annum payable semiannually in arrears on May 1 and November 1 of each year, beginning on November 1, 2026. The 2033 Secured Notes mature on May 1, 2033, unless redeemed or repurchased in accordance with their terms prior to such date. The 2033 Secured Notes are recorded at their carrying value and their fair value is used only for disclosure purposes, so an increase or decrease in interest rates would not have any impact to our condensed consolidated financial statements; however, if interest rates were to increase or decrease by 1%, their fair value could decrease by approximately $40.5 million or increase by approximately $43.6 million, respectively. As of June 30, 2026, the fair value of the 2028 Convertible Notes was approximately $320.3 million and the carrying value was $274.2 million. As of December 31, 2025, the fair value of the 2028 Convertible Notes was approximately $301.7 million, and the carrying value was $273.4 million. The 2028 Convertible Notes pay interest at a fixed rate of 4.25% per annum payable semiannually in arrears on June 15 and December 15 of each year, beginning on June 15, 2023. Unless redeemed, repurchased or converted in accordance with their terms prior to such date, the 2028 Convertible Notes mature on June 15, 2028. As of June 30, 2026, the fair value of the 2029 Notes was approximately $562.9 million and the carrying value was $596.8 million. As of December 31, 2025, the fair value of the 2029 Notes was approximately $565.6 million and the carrying value was $596.3 million. The 2029 Notes pay interest at a fixed rate of 4.875% per annum payable semiannually in arrears on June 1 and December 1 of each year, beginning on December 1, 2021. The 2029 Notes mature on June 1, 2029, unless redeemed or repurchased in accordance with their terms prior to such date. The 2029 Notes are recorded at their carrying value and their fair value is used only for disclosure purposes, so an increase or decrease in interest rates would not have any impact to our condensed consolidated financial statements; however, if interest rates were to increase or decrease by 1%, their fair value could decrease by approximately $14.4 million or increase by approximately $14.9 million, respectively. 60