{"url_path":"/sec/nice/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 Quantitative and Qualitative Disclosures About Market Risk.","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-02-26","source_url":"https://www.sec.gov/Archives/edgar/data/1003935/0001003935-26-000010-index.html","accession_number":"0001003935-26-000010","cik":"0001003935","ticker":"NICE","issuer_name":"NICE Ltd.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1003935/0001003935-26-000010-index.html","primary_entity_key":"0001003935","primary_entity_name":"NICE Ltd."},"word_count":831,"has_tables":true,"body_markdown":"Item 11.    Quantitative and Qualitative Disclosures About Market Risk.\n\nGeneral\n\nMarket risks relating to our operations result primarily from weak economic conditions in the markets in which we sell our products and changes in interest and exchange rates. To manage the volatility related to the latter exposure, we may enter into various derivative transactions. Our objective is to reduce, where it is deemed appropriate to do so, fluctuations in earnings and cash flows associated with changes in currency exchange rates. It is our policy and practice to use derivative financial instruments only to manage such exposures. We do not use financial instruments for trading purposes and we are not a party to any leveraged derivative.\n\n96\n\nForeign Currency Exchange Risk\n\nWe conduct our business primarily in U.S. dollars but also in the currencies of Israel, the U.K., the E.U., India and Philippines, as well as other currencies. Thus, we are exposed to foreign exchange fluctuations, primarily in NIS, GBP, EUR, INR and PHP. We monitor foreign currency exposure and from time to time we may use various instruments to preserve the value of sale transactions and commitments, however, this cannot assure us protection against risks of currency fluctuations. For more information regarding foreign currency related risks, please refer to Item 3, “Key Information - Risk Factors -General Risks Factors” of this annual report. We use currency forward contracts and option contracts in order to protect against the increase in value of forecasted non-dollar currency cash flows and to hedge future anticipated payments.\n\nAs of December 31, 2025, we had outstanding currency forward contracts to hedge payroll, facilities expenses and lease obligations, denominated in NIS, INR, PHP and ,COP in the total amount of approximately $218.50 million. The fair value adjustment of those contracts was approximately $6.8 million. These transactions were for a period of up to one year.\n\nThe following table details the balance sheet exposure (i.e., the difference between assets and liabilities) in our main foreign currencies, as of December 31, 2025, against the relevant functional currency.\n\nFunctional currencies\n\n(In U.S. dollars in millions)\n\nUSDGBPCADMXNAUDSGD\n\nForeign currencies\n\nUSD$40 $51 $4 $(4)$11 \n\nGBP$25 $— $— $— $— \n\nEUR$(12)$6 $— $— $(1)$— \n\nCAD$49 $(1)$— $— $— \n\nAUD$11 $(1)$— $— $16 $— \n\nMXN$7 $— $— $— $— \n\nCHF$— $— $— $— $— $— \n\nJPY$2 $— $— $— $— $— \n\nINR$8 $— $— $— $— $— \n\nSGD$2 $— $— $— $— \n\nHKD$(4)$— $— $— $— $— \n\nNIS$(12)$— $— $— $— $— \n\nPHP$— $— $— $— $— $— \n\nBRL$— $— $— $— $— $— \n\nOther currencies$(20)$2 $— $— $— $4 \n\n97\n\nThe table below presents the fair value of firmly committed transactions for lease obligations denominated in currencies other than the U.S. dollar, which is our reporting currency:\n\n(In U.S. dollars in millions)\n\nNew Israeli ShekelOther currencies *Total\n\nLess than 1 year$(5)$(5)$(10)\n\n1-3 years$(9)$(9)$(18)\n\n3-5 years$(8)$(6)$(14)\n\nOver 5 years$(7)$(2)$(9)\n\nTotal$(29)$(22)$(51)\n\n*    Other currencies include the following currencies: AUD, EUR, GBP, INR, JPY, PHP, COP and SGD.\n\nInterest Rate Risk\n\nWe are subject to interest rate risk on our investments and on our borrowings.\n\nOn August 24, 2020, we issued $460 million aggregate principal amount of 0% exchangeable senior notes due 2025.\n\nThe 2020 Notes fully matured on Sep 15, 2025 and were settled in cash in the amount of $460 million. There was no conversion value over the principal amount.\n\nOur investments are exposed to market risk due to fluctuations in interest rates, which may affect our interest income and the fair market value of our marketable securities portfolio.\n\nOur short term investment portfolio consists of investment-grade corporate debentures, U.S. Government agencies and U.S. treasuries. As of December 31, 2025, 10.3% of our portfolio was in such securities and the remainder was in dollar deposits.\n\nWe invest in dollar deposits with U.S. banks, European banks, Israeli banks and money market funds. As of December 31, 2025, 5% of our portfolio was in such deposits. Since these investments are for short periods, interest income is sensitive to changes in interest rates.\n\nThe weighted average duration of the securities portfolio, as of December 31, 2025, is 0.88 years. The securities in our marketable securities portfolio are rated generally as A+ according to Standard and Poor’s rating or A1, according to Moody’s rating. Securities representing 8% of the marketable securities portfolio are rated as AAA; securities representing 39% of the marketable securities portfolio are rated as AA; securities representing 50% of the marketable securities portfolio are rated as A; securities representing 3% of the marketable securities portfolio are rated as BBB+\n\nThe table below presents the fair value of marketable securities which are subject to risk of changes in interest rate, segregated by maturity dates (in U.S. dollars, in millions):\n\nAmortized CostEstimated fair value\n\nUp to 1 year1-3 years4-7 yearsTotalUp to 1 year1-3 years4-7 yearsTotal\n\nCorporate debentures19.015.9—34.919.116.0—35.0\n\nU.S. treasuries1.51.5—3.01.51.5—3.0\n\nU.S. government agencies————————\n\nTotal20.517.4—37.920.617.5—38.0\n\nOther risks and uncertainties that could affect actual results and outcomes are described in Item 3, “Key Information – Risk Factors” in this annual report.\n\n98"}