FAIR VALUE MEASUREMENTS

9 Months Ended

Aug. 29, 2025

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis

The fair value of our financial assets and liabilities at August 29, 2025 was determined using the following inputs:


(in millions)	Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
Assets:
Cash equivalents:
Corporate debt securities	$	607	$	—	$	607	$	—

Money market funds	3,389		3,389		—		—

Time deposits	46		46		—		—


Short-term investments:
Asset-backed securities	1		—		1		—
Corporate debt securities	700		—		700		—





U.S. Treasury securities	257		—		257		—
Prepaid expenses and other current assets:
Foreign currency derivatives	16		—		16		—
Interest rate swap derivatives	5		—		5		—

Other assets:
Deferred compensation plan assets	329		329		—		—
Foreign currency derivatives	4		—		4		—
Interest rate swap derivatives	92		—		92		—
Total assets	$	5,446	$	3,764	$	1,682	$	—


Liabilities:
Accrued expenses and other current liabilities:

Foreign currency derivatives	$	151	$	—	$	151	$	—
Interest rate swap derivatives	19		—		19		—
Other liabilities:
Foreign currency derivatives	31		—		31		—

Total liabilities	$	201	$	—	$	201	$	—

The fair value of our financial assets and liabilities at November 29, 2024 was determined using the following inputs:


(in millions)	Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
Assets:
Cash equivalents:
Corporate debt securities	$	41	$	—	$	41	$	—
Money market funds	6,726		6,726		—		—

Time deposits	57		57		—		—
U.S. Treasury securities	2		—		2		—
Short-term investments:
Asset-backed securities	4		—		4		—
Corporate debt securities	120		—		120		—



U.S. agency securities	11		—		11		—
U.S. Treasury securities	138		—		138		—
Prepaid expenses and other current assets:
Foreign currency derivatives	105		—		105		—
Other assets:
Deferred compensation plan assets	283		283		—		—

Foreign currency derivatives	24		—		24		—
Total assets	$	7,511	$	7,066	$	445	$	—


Liabilities:
Accrued expenses and other current liabilities:

Foreign currency derivatives	$	9	$	—	$	9	$	—
Other liabilities:

Foreign currency derivatives	2		—		2		—
Total liabilities	$	11	$	—	$	11	$	—

See Note 3 for further information regarding the fair value of our financial instruments.

Our fixed income available-for-sale debt securities consist of high quality, investment grade securities from diverse issuers with a weighted average credit rating of AA. We value these securities based on pricing from independent pricing vendors who use matrix pricing valuation techniques including market approach methodologies that model information generated by market transactions involving identical or comparable assets, as well as discounted cash flow methodologies. Inputs include quoted prices in active markets for identical assets or inputs other than quoted prices that are observable either directly or indirectly in determining fair value, including benchmark yields, issuer spreads off benchmark yields, interest rates and U.S. Treasury or swap curves. We therefore categorize all of our fixed income available-for-sale securities as Level 2. We perform routine procedures such as comparing prices obtained from multiple independent sources to ensure that appropriate fair values are recorded.

The fair values of our money market funds, time deposits and deferred compensation plan assets, which consist of money market and other mutual funds, are based on quoted prices in active markets at the measurement date.

Our over-the-counter foreign currency and interest rate swap derivatives are valued using pricing models and discounted cash flow methodologies based on observable foreign exchange and interest rate data at the measurement date.

Our other current financial assets and current financial liabilities have fair values that approximate their carrying values.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

The fair value of our senior notes was $6.16 billion as of August 29, 2025, excluding the associated interest rate swaps, based on observable market prices in less active markets and categorized as Level 2. See Note 13 for further details regarding our debt.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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-Topic 820
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 940
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+ Details

ADOBE INC. 10-Q