Annual report [Section 13 and 15(d), not S-K Item 405]

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

v3.26.1
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
 12 Months Ended
Mar. 28, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
Summary of Derivative Financial Instruments

All of VF’s outstanding derivative financial instruments at March 2026 are foreign currency exchange forward contracts. Although derivatives meet the criteria for hedge accounting at the inception of the hedging relationship, a limited number of derivative contracts intended to hedge assets and liabilities are not designated as hedges for accounting purposes.
The notional amounts of all outstanding foreign currency exchange forward contracts were $3.1 billion at both March 2026 and March 2025, consisting primarily of contracts hedging
exposures to the euro, British pound, Canadian dollar, Chinese renminbi, Mexican peso, Swiss franc, Taiwan dollar, Swedish krona, Polish zloty, South Korean won and Japanese yen. These derivative contracts have maturities up to 20 months.
During the year ended March 2025, VF settled interest rate swap contracts that were in place to hedge the cash flow risk of interest payments on the variable-rate DDTL Agreement. The DDTL was prepaid on October 4, 2024.
The following table presents outstanding derivatives on an individual contract basis:
   Fair Value of Derivatives
with Unrealized Gains		 Fair Value of Derivatives
with Unrealized Losses
(In thousands) March 2026 March 2025 March 2026 March 2025
Derivatives Designated as Hedging Instruments:
Cash flow foreign exchange contracts $ 28,122  $ 32,608  $ (48,711) $ (29,847)
Derivatives Not Designated as Hedging Instruments:
Foreign exchange contracts 792  1,763  (12) (156)
Total derivatives $ 28,914  $ 34,371  $ (48,723) $ (30,003)
VF records and presents the fair values of all of its derivative assets and liabilities in the Consolidated Balance Sheets on a gross basis, even though they are subject to master netting agreements. If VF were to offset and record the asset and liability balances on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Consolidated Balance Sheets as of March 2026 and 2025 would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
  March 2026 March 2025
(In thousands) Derivative
Asset		 Derivative
Liability		 Derivative
Asset		 Derivative
Liability
Gross amounts presented in the Consolidated Balance Sheets $ 28,914  $ (48,723) $ 34,371  $ (30,003)
Gross amounts not offset in the Consolidated Balance Sheets (12,453) 12,453  (13,592) 13,592 
Net amounts $ 16,461  $ (36,270) $ 20,779  $ (16,411)
Derivatives are classified as current or noncurrent based on maturity dates, as follows:
(In thousands) March 2026 March 2025
Derivative Instruments Balance Sheet Location
Foreign exchange contracts Other current assets (Note 6) $ 17,800  $ 32,290 
Foreign exchange contracts Accrued liabilities (Note 14) (46,231) (19,810)
Foreign exchange contracts Other assets (Note 11) 11,114  2,081 
Foreign exchange contracts Other liabilities (Note 16) (2,492) (10,193)
Cash Flow Hedges
VF primarily uses foreign currency exchange forward contracts to hedge a portion of the exchange risk for its forecasted sales, inventory purchases, operating costs and certain intercompany transactions, including sourcing and management fees and royalties. The Company also used interest rate swap contracts to hedge against a portion of the exposure related to its interest payments on its variable-rate debt, which was prepaid on October 4, 2024. The effects of cash flow hedging included in VF’s Consolidated Statements of Comprehensive Income (Loss) and Consolidated Statements of Operations are summarized as follows:
(In thousands)

Cash Flow Hedging Relationships
 Gain (Loss) on Derivatives Recognized in Accumulated OCL
Year Ended March
2026 2025 2024
Foreign exchange contracts $ (85,191) $ 15,810  $ (15,538)
Interest rate contracts —  301  7,605 
Total $ (85,191) $ 16,111  $ (7,933)
Gain (Loss) Reclassified from Accumulated OCL into Net Income (Loss)
(In thousands) Year Ended March
Cash Flow Hedging Relationships Location of Gain (Loss) 2026 2025 2024
Foreign exchange contracts Revenues $ 2,425  $ (29,941) $ (5,004)
Foreign exchange contracts Cost of goods sold (25,986) (3,192) 15,703 
Foreign exchange contracts SG&A expenses (303) (518) 3,437 
Foreign exchange contracts Other income (expense), net 4,305  (1,688) (253)
Interest rate contracts Interest expense 108  445  108 
Interest rate contracts Income (loss) from discontinued operations, net of tax —  2,299  4,130 
Total $ (19,451) $ (32,595) $ 18,121 
Derivative Contracts Not Designated as Hedges
VF uses foreign currency exchange contracts to manage foreign currency exchange risk on third-party and intercompany accounts receivable and payable, as well as third-party and intercompany borrowings and interest payments. These contracts are not designated as hedges, and are recorded at fair value in the Consolidated Balance Sheets. Changes in the fair values of these instruments are recognized directly in earnings. Gains or losses on these contracts largely offset the net transaction losses or gains on the related assets and liabilities. In the case of derivative contracts executed on foreign currency exposures that are no longer probable of occurring, VF de-designates these hedges and the fair value changes of these instruments are also recognized directly in earnings. During the year ended March 2024, certain derivative contracts were de-designated as the related hedged forecasted transactions were no longer deemed probable of occurring. Accordingly, the Company reclassified amounts from accumulated OCL and recognized an $8.8 million loss in cost of goods sold during the year ended March 2024. There were no material reclassifications in the other periods presented. The changes in the fair value of derivative contracts not designated as hedges, recognized as gains or losses in VF's Consolidated Statements of Operations were not material for the years ended March 2026, 2025 and 2024.
Other Derivative Information
At March 2026, accumulated OCL included $53.0 million of pre-tax net deferred losses for foreign currency exchange contracts that are expected to be reclassified to earnings during the next 12 months. The amounts ultimately reclassified to earnings will depend on exchange rates in effect when outstanding derivative contracts are settled.
Net Investment Hedge
The Company has designated its euro-denominated fixed-rate notes, which represented €1.5 billion in aggregate principal as of March 2026, as a net investment hedge of VF’s investment in
certain foreign operations. In the year ended March 2026, VF de-designated the aggregate principal of its €500.0 million euro-denominated fixed-rate notes due 2026, that were redeemed in February 2026, and entered into a fair value hedging relationship as discussed in the “Fair Value Hedge” section below. As a result of the de-designation, VF recognized $7.7 million of expense in the other income (expense), net line item in the Consolidated Statement of Operations for the year ended March 2026.
Because this debt qualified as a non-derivative hedging instrument, foreign currency transaction gains or losses of the debt are deferred in the foreign currency translation and other component of accumulated OCL as an offset to the foreign currency translation adjustments on the hedged investments. During the years ended March 2026, 2025 and 2024, the Company recognized an after-tax loss of $108.6 million, an after-tax loss of $4.6 million and an after-tax gain of $21.6 million, respectively, in other comprehensive income (loss) related to the net investment hedge transaction. Any amounts deferred in accumulated OCL will remain until the hedged investment is sold or substantially liquidated.
Fair Value Hedge
The Company has designated a €500.0 million foreign currency exchange forward contract as a fair value hedge of the principal value of euro-denominated fixed-rate notes due 2026, through its redemption in February 2026. Gains and losses related to the spot component of the hedge are recognized in other income (expense), net with offsetting gains and losses on the hedged recognized liability. Gains and losses related to hedge components excluded from the effectiveness assessment (forward points) are amortized under a systematic and rational method to other income (expense) over the life of the hedge. The revaluation of the excluded component is reported in other comprehensive income (loss). As of March 2026, the company recognized a gain of $11.0 million from the foreign currency remeasurement related to the spot component of the derivative and a loss of $3.1 million from the amortization of the excluded component in other income (expense).