Company: ALGN
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001097149-25-000064
Chunk: 12

Company: ALIGN TECHNOLOGY INC
Filing Date: 2025-08-06
Form: 10-Q
Item: Item 1
Chunk 12
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 of 2024, we recorded a $6 million increase to the carrying value of our investment, which increased the total carrying value of our investment in Heartland to $156 million. On December 19, 2024 and June 5, 2025, we entered into Subscription Agreements (the “Smile Doctors Subscription Agreements”) with New SD Holding Company, L.P. (“SD Holding Company”). Pursuant to the Smile Doctors Subscription Agreements we acquired less than a 3% equity interest in SD Holding Company through the purchase of Class A Common Units for $40 million in total. SD Holding Company owns a controlling interest, through intermediary entities, in Smile Doctors, LLC. Based on a review of the relevant facts and circumstances, primarily observable transactions for identical investments, we determined that no adjustments to the carrying values of our investments were necessary for the three or six months ended June 30, 2025. Our investments in privately held companies in which we can exercise significant influence are accounted for as equity method investments. We have elected to account for our equity method investments under the fair value option. The carrying value of our investments in equity securities and equity method investments are reported in our Condensed Consolidated Balance Sheets as Other assets and any price adjustments or impairment, if any, are recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations. 

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Derivatives Not Designated as Hedging InstrumentsWe enter into foreign currency forward contracts to minimize the short-term impact of foreign currency exchange rate fluctuations on certain assets and liabilities. These forward contracts are classified within Level 2 of the fair value hierarchy. As a result of the settlement of foreign currency forward contracts, we recognized a net loss of $27.1 million and a net gain of $7.5 million, during the three months ended June 30, 2025 and 2024, respectively, and a net loss of $38.6 million and a net gain $27.2 million, respectively, during the six months ended June 30, 2025 and 2024. Recognized gains and losses from the settlement of foreign currency forward contracts are recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations. As of June 30, 2025 and December 31, 2024, the fair value of outstanding foreign exchange forward contracts was not material.

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The following tables present the gross notional value of all our foreign exchange forward contracts outstanding as of June