NIKE Inc

NOTE 3 — FAIR VALUE MEASUREMENTS

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including derivatives, equity securities and available-for-sale debt securities.

The following tables present information about the Company's financial assets measured at fair value on a recurring basis as of February 28, 2025 and May 31, 2024, and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement:

As of February 28, 2025, the Company held $845 million of available-for-sale debt securities with maturity dates within one year and $947 million with maturity dates greater than one year and less than five years in Short-term investments on the Unaudited Condensed Consolidated Balance Sheets. The fair value of the Company's available-for-sale debt securities approximates their amortized cost.

Included in Interest expense (income), net was interest income related to the Company's investment portfolio of $97 million and $113 million for the three months ended February 28, 2025 and February 29, 2024, respectively, and $314 million and $304 million for the nine months ended February 28, 2025 and February 29, 2024, respectively.

The following tables present information about the Company's derivative assets and liabilities measured at fair value on a recurring basis and indicate the level in the fair value hierarchy in which the Company classifies the fair value measurement:

(1)If the derivative instruments had been netted on the Unaudited Condensed Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $99 million as of February 28, 2025. As of that date, the Company received $262 million of cash collateral and $37 million of securities from various counterparties on the derivative asset balance. No collateral was posted on the derivative liability balance as of February 28, 2025.

(1)If the derivative instruments had been netted on the Consolidated Balance Sheets, the asset and liability positions each would have been reduced by $142 million as of May 31, 2024. As of that date, the Company received $112 million of cash collateral from various counterparties on the derivative asset balance and posted $10 million cash collateral on the derivative liability balance.

For additional information related to the Company's derivative financial instruments and credit risk, refer to Note 8 — Risk Management and Derivatives.

The carrying amounts of other current financial assets and other current financial liabilities approximate fair value.

FINANCIAL ASSETS AND LIABILITIES NOT RECORDED AT FAIR VALUE

The Company's Long-term debt is recorded at adjusted cost, net of unamortized premiums, discounts, debt issuance costs and interest rate swap fair value adjustments. The fair value of long-term debt is estimated based upon quoted prices for similar instruments or quoted prices for identical instruments in inactive markets (Level 2). The fair value of the Company's Long-term debt was approximately $7,825 million at February 28, 2025 and $7,631 million at May 31, 2024.

In March 2025, subsequent to the end of the third quarter of fiscal 2025, the Company repaid the $1.0 billion aggregate principal amount outstanding of its 2.40% notes due 2025 at maturity.