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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________________________________________________________________________________________________ 
FORM 10-Q
______________________________________________________________________________________________________________________ 
(Mark One)
ý☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SeptemberJune 30, 20172021
OR
¨☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission File Number 001-34652
______________________________________________________________________________________________________________________ 
SENSATA TECHNOLOGIES HOLDING N.V.PLC
(Exact Namename of Registrantregistrant as Specifiedspecified in Its Charter)its charter)
_____________________________________ 
_________________________________________________________________________________ 
England and Wales98-1386780
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
THE NETHERLANDS98-0641254
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
Jan Tinbergenstraat 80, 7559 SP Hengelo
The Netherlands
31-74-357-8000
(Address of Principal Executive Offices, including Zip Code)(Registrant’s Telephone Number, Including Area Code)
529 Pleasant Street
Attleboro, Massachusetts, 02703, United States
(Address of principal executive offices, including zip code)
+1 (508) 236 3800
(Registrant's telephone number, including area code)
Not applicable
(Former name, former address and former fiscal year, if changed since last report.report)
_____________________________________ 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of exchange on which registered
Ordinary Shares - nominal value €0.01 per shareSTNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by sectionSection 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý☒    No  ¨☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes ý☒    No  ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act (Check one):
Act.
Large accelerated filer☒Accelerated filer☐
Large accelerated filerýAccelerated filer¨
Non-accelerated filer¨☐(Do not check if a smaller reporting company)Smaller reporting company¨☐
Emerging growth company¨☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨☐ No ý☒
As of October 13, 2017, 171,296,417July 15, 2021, 158,374,184 ordinary shares were outstanding.


Table of Contents

TABLE OF CONTENTS
PART I
Item 1.
3
4
5
6
7
78
Item 2.
2223
Item 3.
3037
Item 4.
3037
PART II
Item 1.
3138
Item 1A.
3138
Item 2.
3138
Item 3.
3138
Item 6.
3239
3340
 

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PART I—FINANCIAL INFORMATION


Item 1.Financial Statements.
Item 1.Financial Statements.
SENSATA TECHNOLOGIES HOLDING N.V.PLC
Condensed Consolidated Balance Sheets
(In thousands, except per share amounts)
(unaudited)
September 30,
2017		 December 31,
2016		June 30,
2021		December 31,
2020
Assets   Assets
Current assets:   Current assets:
Cash and cash equivalents$612,972
 $351,428
Cash and cash equivalents$1,861,769 $1,861,980 
Accounts receivable, net of allowances of $12,561 and $11,811 as of September 30, 2017 and December 31, 2016, respectively569,881
 500,211
Accounts receivable, net of allowances of $20,223 and $19,033 as of June 30, 2021 and December 31, 2020, respectivelyAccounts receivable, net of allowances of $20,223 and $19,033 as of June 30, 2021 and December 31, 2020, respectively694,317 576,647 
Inventories447,486
 389,844
Inventories503,641 451,005 
Prepaid expenses and other current assets100,935
 100,002
Prepaid expenses and other current assets117,401 90,340 
Total current assets1,731,274
 1,341,485
Total current assets3,177,128 2,979,972 
Property, plant and equipment, net735,924
 724,046
Property, plant and equipment, net801,342 803,825 
Goodwill3,005,464
 3,005,464
Goodwill3,308,939 3,111,349 
Other intangible assets, net of accumulated amortization of $1,727,644 and $1,607,269 as of September 30, 2017 and December 31, 2016, respectively958,972
 1,075,431
Other intangible assets, net of accumulated amortization of $2,211,355 and $2,145,634 as of June 30, 2021 and December 31, 2020, respectivelyOther intangible assets, net of accumulated amortization of $2,211,355 and $2,145,634 as of June 30, 2021 and December 31, 2020, respectively892,521 691,549 
Deferred income tax assets26,678
 20,695
Deferred income tax assets79,625 84,785 
Other assets79,625
 73,855
Other assets158,803 172,722 
Total assets$6,537,937
 $6,240,976
Total assets$8,418,358 $7,844,202 
Liabilities and shareholders’ equity   Liabilities and shareholders’ equity
Current liabilities:   Current liabilities:
Current portion of long-term debt, capital lease and other financing obligations$13,176
 $14,643
Current portion of long-term debt, finance lease and other financing obligationsCurrent portion of long-term debt, finance lease and other financing obligations$7,281 $757,205 
Accounts payable324,119
 299,198
Accounts payable473,932 393,907 
Income taxes payable27,031
 23,889
Income taxes payable25,663 19,215 
Accrued expenses and other current liabilities263,611
 245,566
Accrued expenses and other current liabilities330,056 324,830 
Total current liabilities627,937
 583,296
Total current liabilities836,932 1,495,157 
Deferred income tax liabilities404,575
 392,628
Deferred income tax liabilities301,471 259,857 
Pension and other post-retirement benefit obligations36,192
 34,878
Pension and other post-retirement benefit obligations44,146 48,002 
Capital lease and other financing obligations, less current portion29,990
 32,369
Finance lease and other financing obligations, less current portionFinance lease and other financing obligations, less current portion27,220 27,931 
Long-term debt, net3,224,684
 3,226,582
Long-term debt, net4,213,830 3,213,747 
Other long-term liabilities32,034
 29,216
Other long-term liabilities81,311 94,022 
Total liabilities4,355,412
 4,298,969
Total liabilities5,504,910 5,138,716 
Commitments and contingencies (Note 10)


Commitments and contingencies (Note 12)Commitments and contingencies (Note 12)00
Shareholders’ equity:   Shareholders’ equity:
Ordinary shares, €0.01 nominal value per share, 400,000 shares authorized; 178,437 shares issued2,289
 2,289
Treasury shares, at cost, 7,140 and 7,557 shares as of September 30, 2017 and December 31, 2016, respectively(290,894) (306,505)
Ordinary shares, €0.01 nominal value per share, 177,069 shares authorized, and 174,005 and 173,266 shares issued as of June 30, 2021 and December 31, 2020, respectivelyOrdinary shares, €0.01 nominal value per share, 177,069 shares authorized, and 174,005 and 173,266 shares issued as of June 30, 2021 and December 31, 2020, respectively2,229 2,220 
Treasury shares, at cost, 15,631 shares as of June 30, 2021 and December 31, 2020Treasury shares, at cost, 15,631 shares as of June 30, 2021 and December 31, 2020(784,596)(784,596)
Additional paid-in capital1,658,574
 1,643,449
Additional paid-in capital1,789,863 1,759,668 
Retained earnings862,954
 636,841
Retained earnings1,936,427 1,777,729 
Accumulated other comprehensive loss(50,398) (34,067)Accumulated other comprehensive loss(30,475)(49,535)
Total shareholders’ equity2,182,525
 1,942,007
Total shareholders’ equity2,913,448 2,705,486 
Total liabilities and shareholders’ equity$6,537,937
 $6,240,976
Total liabilities and shareholders’ equity$8,418,358 $7,844,202 


The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING N.V.PLC
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(unaudited)
 
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Net revenue$992,660 $576,505 $1,935,188 $1,350,774 
Operating costs and expenses:
Cost of revenue658,285 412,443 1,293,634 978,849 
Research and development42,913 30,239 78,869 64,692 
Selling, general and administrative86,821 64,730 163,944 141,951 
Amortization of intangible assets34,857 32,743 66,921 65,835 
Restructuring and other charges, net5,029 38,218 9,611 42,716 
Total operating costs and expenses827,905 578,373 1,612,979 1,294,043 
Operating income/(loss)164,755 (1,868)322,209 56,731 
Interest expense, net(45,213)(40,808)(89,256)(80,211)
Other, net1,012 1,576 (38,385)(10,705)
Income/(loss) before taxes120,554 (41,100)194,568 (34,185)
Provision for/(benefit from) income taxes7,638 1,441 27,919 (75)
Net income/(loss)$112,916 $(42,541)$166,649 $(34,110)
Basic net income/(loss) per share$0.71 $(0.27)$1.05 $(0.22)
Diluted net income/(loss) per share$0.71 $(0.27)$1.05 $(0.22)
 For the three months ended For the nine months ended
 September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Net revenue$819,054
 $789,798
 $2,466,199
 $2,413,892
Operating costs and expenses:       
Cost of revenue527,432
 508,944
 1,601,190
 1,574,763
Research and development34,002
 31,601
 97,032
 95,240
Selling, general and administrative75,972
 75,046
 227,256
 224,637
Amortization of intangible assets40,317
 50,562
 121,578
 151,572
Restructuring and special charges1,329
 837
 18,768
 3,167
Total operating costs and expenses679,052
 666,990
 2,065,824
 2,049,379
Profit from operations140,002
 122,808
 400,375
 364,513
Interest expense, net(40,263) (41,176) (120,578) (125,201)
Other, net3,112
 (726) 7,190
 4,892
Income before taxes102,851
 80,906
 286,987
 244,204
Provision for income taxes14,816
 11,121
 47,759
 48,297
Net income$88,035
 $69,785
 $239,228
 $195,907
Basic net income per share:$0.51
 $0.41
 $1.40
 $1.15
Diluted net income per share:$0.51
 $0.41
 $1.39
 $1.14

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING N.V.PLC
Condensed Consolidated Statements of Comprehensive IncomeIncome/(Loss)
(In thousands)
(unaudited)
 
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Net income/(loss)$112,916 $(42,541)$166,649 $(34,110)
Other comprehensive income/(loss):
Cash flow hedges1,398 (5,167)15,676 (24,501)
Defined benefit and retiree healthcare plans1,672 1,672 3,384 5,014 
Other comprehensive income/(loss)3,070 (3,495)19,060 (19,487)
Comprehensive income/(loss)$115,986 $(46,036)$185,709 $(53,597)
 For the three months ended For the nine months ended
 September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Net income$88,035
 $69,785
 $239,228
 $195,907
Other comprehensive loss, net of tax:       
Deferred loss on derivative instruments, net of reclassifications(6,784) (8,485) (17,820) (25,010)
Defined benefit and retiree healthcare plans274
 24
 1,489
 291
Other comprehensive loss(6,510) (8,461) (16,331) (24,719)
Comprehensive income$81,525
 $61,324
 $222,897
 $171,188

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING N.V.PLC
Condensed Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
For the nine months ended For the six months ended
September 30, 2017 September 30, 2016 June 30, 2021June 30, 2020
Cash flows from operating activities:   Cash flows from operating activities:
Net income$239,228
 $195,907
Adjustments to reconcile net income to net cash provided by operating activities:   
Net income/(loss)Net income/(loss)$166,649 $(34,110)
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Depreciation82,014
 77,649
Depreciation62,833 65,288 
Amortization of deferred financing costs and original issue discounts5,528
 5,501
Gain on sale of assets(1,180) —
Amortization of debt issuance costsAmortization of debt issuance costs3,426 3,263 
Share-based compensation15,106
 13,279
Share-based compensation11,475 9,590 
Amortization of inventory step-up to fair value—
 2,319
Loss on debt financingLoss on debt financing30,066 0 
Amortization of intangible assets121,578
 151,572
Amortization of intangible assets66,921 65,835 
Deferred income taxes11,836
 15,706
Deferred income taxes(7,070)1,500 
Unrealized loss on hedges and other non-cash items5,844
 660
Changes in operating assets and liabilities, net of effects of acquisitions:   
Loss on litigation judgmentLoss on litigation judgment0 41,314 
Unrealized loss on derivative instruments and otherUnrealized loss on derivative instruments and other12,700 8,035 
Changes in operating assets and liabilities, net of the effects of acquisitions:Changes in operating assets and liabilities, net of the effects of acquisitions:
Accounts receivable, net(69,670) (65,373)Accounts receivable, net(97,906)114,162 
Inventories(58,476) (20,624)Inventories(45,664)17,871 
Prepaid expenses and other current assets(19,251) 2,320
Prepaid expenses and other current assets(8,280)14,790 
Accounts payable and accrued expenses40,144
 33,371
Accounts payable and accrued expenses68,764 (99,467)
Income taxes payable3,142
 (6,361)Income taxes payable6,448 (34,368)
Other(3,564) (9,575)Other(2,431)(3,431)
Net cash provided by operating activities372,279
 396,351
Net cash provided by operating activities267,931 170,272 
Cash flows from investing activities:   Cash flows from investing activities:
Acquisition of CST, net of cash received—
 4,688
Acquisitions, net of cash receivedAcquisitions, net of cash received(421,951)0 
Additions to property, plant and equipment and capitalized software(103,536) (94,584)Additions to property, plant and equipment and capitalized software(63,572)(56,697)
Investment in equity securities—
 (50,000)
Proceeds from the sale of assets8,862
 751
Investment in debt and equity securitiesInvestment in debt and equity securities(6,444)(5,817)
Other(3,000) —
Other2,862 2,019 
Net cash used in investing activities(97,674) (139,145)Net cash used in investing activities(489,105)(60,495)
Cash flows from financing activities:   Cash flows from financing activities:
Proceeds from exercise of stock options and issuance of ordinary shares5,332
 3,306
Proceeds from exercise of stock options and issuance of ordinary shares17,957 1,146 
Payment of employee restricted stock tax withholdingsPayment of employee restricted stock tax withholdings(7,948)(2,314)
Proceeds from borrowings on debtProceeds from borrowings on debt1,001,875 400,000 
Payments on debt(14,459) (297,698)Payments on debt(757,889)(4,604)
Payments to repurchase ordinary shares(2,817) (4,672)Payments to repurchase ordinary shares0 (35,175)
Payments of debt issuance costs(137) (518)
Other(980) —
Net cash used in financing activities(13,061) (299,582)
Payments of debt financing costsPayments of debt financing costs(33,032)0 
Net cash provided by financing activitiesNet cash provided by financing activities220,963 359,053 
Net change in cash and cash equivalents261,544
 (42,376)Net change in cash and cash equivalents(211)468,830 
Cash and cash equivalents, beginning of period351,428
 342,263
Cash and cash equivalents, beginning of period1,861,980 774,119 
Cash and cash equivalents, end of period$612,972
 $299,887
Cash and cash equivalents, end of period$1,861,769 $1,242,949 

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENSATA TECHNOLOGIES HOLDING N.V.PLC
Condensed Consolidated Statements of Changes in Shareholders' Equity
(In thousands)
(unaudited)
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
 NumberAmountNumberAmount
Balance as of March 31, 2021173,533 $2,223 (15,631)$(784,596)$1,775,320 $1,831,241 $(33,545)$2,790,643 
Surrender of shares for tax withholding— — (132)(7,727)— — — (7,727)
Stock options exercised208 3 — — 8,167 — — 8,170 
Vesting of restricted securities396 5 — — — (5)— 0 
Retirement of ordinary shares(132)(2)132 7,727 — (7,725)— 0 
Share-based compensation— — — — 6,376 — — 6,376 
Net income— — — — — 112,916 — 112,916 
Other comprehensive income— — — — — — 3,070 3,070 
Balance as of June 30, 2021174,005 $2,229 (15,631)$(784,596)$1,789,863 $1,936,427 $(30,475)$2,913,448 
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
 NumberAmountNumberAmount
Balance as of December 31, 2020173,266 $2,220 (15,631)$(784,596)$1,759,668 $1,777,729 $(49,535)$2,705,486 
Surrender of shares for tax withholding— — (136)(7,948)— — — (7,948)
Stock options exercised467 6 — — 18,720 — — 18,726 
Vesting of restricted securities408 5 — — — (5)— 0 
Retirement of ordinary shares(136)(2)136 7,948 — (7,946)— 0 
Share-based compensation— — — — 11,475 — — 11,475 
Net income— — — — — 166,649 — 166,649 
Other comprehensive income— — — — — — 19,060 19,060 
Balance as of June 30, 2021174,005 $2,229 (15,631)$(784,596)$1,789,863 $1,936,427 $(30,475)$2,913,448 
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
 NumberAmountNumberAmount
Balance as of March 31, 2020172,596 $2,212 (15,631)$(784,596)$1,731,884 $1,624,773 $(36,476)$2,537,797 
Surrender of shares for tax withholding— — (83)(2,299)— — — (2,299)
Stock options exercised21 1 — — 436 — — 437 
Vesting of restricted securities310 3 — — — (3)— 0 
Retirement of ordinary shares(83)(1)83 2,299 — (2,298)— 0 
Share-based compensation— — — — 3,506 — — 3,506 
Net loss— — — — — (42,541)— (42,541)
Other comprehensive loss— — — — — — (3,495)(3,495)
Balance as of June 30, 2020172,844 $2,215 (15,631)$(784,596)$1,735,826 $1,579,931 $(39,971)$2,493,405 
 Ordinary SharesTreasury SharesAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal Shareholders’ Equity
 NumberAmountNumberAmount
Balance as of December 31, 2019172,561 $2,212 (14,733)$(749,421)$1,725,091 $1,616,357 $(20,484)$2,573,755 
Surrender of shares for tax withholding— — (83)(2,314)— — — (2,314)
Stock options exercised55 1 — — 1,145 — — 1,146 
Vesting of restricted securities311 3 — — — (3)— 0 
Repurchase of ordinary shares— — (898)(35,175)— — — (35,175)
Retirement of ordinary shares(83)(1)83 2,314 — (2,313)— 0 
Share-based compensation— — — — 9,590 — — 9,590 
Net loss— — — — — (34,110)— (34,110)
Other comprehensive loss— — — — — — (19,487)(19,487)
Balance as of June 30, 2020172,844 $2,215 (15,631)$(784,596)$1,735,826 $1,579,931 $(39,971)$2,493,405 
The accompanying notes are an integral part of these condensed consolidated financial statements.
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SENSATA TECHNOLOGIES HOLDING PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share amounts, or unless otherwise noted)
(unaudited)
1. Business Description and Basis of Presentation
Description of Business
The accompanying unaudited condensed consolidated financial statements reflect the financial position, results of operations, comprehensive income,income/(loss), cash flows, and cash flowschanges in shareholders' equity of Sensata Technologies Holding N.V. ("Sensata N.V.")plc, a public limited company incorporated under the laws of England and Wales, and its wholly-owned subsidiaries, collectively referred to as the "Company," "Sensata," "we," "our," or "us."
Sensata N.V. is incorporated under the laws of the Netherlands and conducts its operations through subsidiary companies that operate business and product development centers primarily in the United States (the "U.S."), the Netherlands, Belgium, China, Germany, Japan, South Korea, and the United Kingdom (the "U.K."); and manufacturing operations primarily in China, Malaysia, Mexico, Bulgaria, France, Germany, the U.K., and the U.S. We organize our operations into two businesses, Performance Sensing and Sensing Solutions.
On September 28, 2017, the board of directors of Sensata N.V. unanimously approved a plan to change our parent company’s location of incorporation from the Netherlands to the U.K. To effect this change, the shareholders of Sensata N.V. will be asked to approve a cross-border merger between Sensata N.V. and Sensata Technologies Holding plc (“Sensata U.K.”), a newly formed, public limited company incorporated under the laws of England and Wales, with Sensata U.K. being the surviving entity (the “Merger”). If approved by our shareholders, we would expect to complete the Merger during the first quarter of 2018, which would result in Sensata U.K. becoming the publicly-traded parent of the subsidiary companies that are currently controlled by Sensata N.V.
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States ("U.S.") generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q. Accordingly, these interim financial statements do not include all of the information and note disclosures required by U.S. GAAP for complete financial statements. The accompanying financial information reflects all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the interim period results. The results of operations for the three and nine months ended September 30, 2017 are not necessarily indicative of the results to be expected for the full year, nor were the results of operations of the comparable periods in 2016 necessarily representative of those actually experienced for the full year 2016. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2016.
All intercompany balances and transactions have been eliminated.2020 (the "2020 Annual Report").
All U.S. dollar ("USD") and share amounts presented, except per share amounts, are stated in thousands, unless otherwise indicated.
Certain reclassifications have been made to prior periods to conform to current period presentation.
2. New Accounting Standards
In May 2014, the Financial Accounting Standards Board (the "FASB")There are no recently issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606), which creates one Accounting Standards Codification ("ASC") Topic (FASB ASC 606, Revenue from Contracts with Customers)accounting standards that replaceshave been adopted in the current guidance found in FASB ASC 605, Revenue Recognition, and various other revenue accounting standards for specialized transactions and industries. FASB ASU No. 2014-09 outlines a comprehensive five-step revenue recognition model based on the principle that an entity should recognize revenue to depict the transfer of promised goodsperiod or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. FASB ASU No. 2014-09 may be applied using either a full retrospective approach, under which all years included in the financial statements will be presented under the revised guidance,adopted in future periods that have had or a modified retrospective approach, under which financial statements will be prepared under the revised guidance for the year of adoption, but not for prior years. Under the latter method, entities will recognize a cumulative catch-up adjustmentare expected to the opening balance of retained earnings at the effective date for contracts that still require performance by the entity.

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In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date, which defers the effective date of FASB ASU No. 2014-09 by one year. FASB ASU No. 2014-09 is now effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods. We have developed an implementation plan to adopt this new guidance. As part of this plan, we are currently assessing the impact of the new guidance on our financial position and results of operations. Based on our procedures performed to date, nothing has come to our attention that would indicate that the adoption of FASB ASU No. 2014-09 will have a material impact on our consolidated financial position or results of operations. However, we will continue to evaluate this assessment through the remainder of 2017. In addition, the adoption of FASB ASU No. 2014-09 requires new disclosures related to revenue recognition, which we are continuing to evaluate. We intend to adopt FASB ASU No. 2014-09 on January 1, 2018 using the modified retrospective transition method.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which establishes new accounting and disclosure requirements for leases. FASB ASU No. 2016-02 requires lessees to classify most leases as either finance or operating leases and to initially recognize a lease liability and right-of-use asset. Entities may elect to account for certain short-term leases (with a term of 12 months or less) using a method similar to the current operating lease model. The statements of operations will include, for finance leases, separate recognition of interest on the lease liability and amortization of the right-of-use asset and for operating leases, a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis. At December 31, 2016, we were contractually obligated to make future payments of $69.8 million under our operating lease obligations in existence as of that date, primarily related to long-term facility leases. While we are in the early stages of our implementation process for FASB ASU No. 2016-02, and have not yet determined its impact on our consolidated financial statements, these leases would potentially be required to be presented on the balance sheet in accordance with the requirements of FASB ASU No. 2016-02. FASB ASU No. 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, with early adoption permitted. FASB ASU No. 2016-02 must be applied using a modified retrospective approach, which requires recognition and measurement of leases at the beginning of the earliest period presented, with certain practical expedients available.
In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815), which changes both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results, in order to better align an entity’s risk management activities and financial reporting for hedging relationships. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. FASB ASU No. 2017-12 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, with early adoption permitted. We are still evaluating the impact that this guidance will have on our consolidated financial statements, and we have not yet determined whether we will early adopt FASB ASU No. 2017-12.
3. Inventories
The components of inventories as of September 30, 2017 and December 31, 2016 were as follows:
 September 30,
2017		 December 31,
2016
Finished goods$191,165
 $169,304
Work-in-process91,569
 74,810
Raw materials164,752
 145,730
Inventories$447,486
 $389,844
4. Shareholders' Equity
Treasury Shares
Ordinary shares repurchased by us are recorded at cost, as treasury shares, and result in a reduction of shareholders' equity. We reissue treasury shares as part of our share-based compensation programs. The cost of reissued shares is determined using the first-in, first-out method. During the nine months ended September 30, 2017, we reissued 0.5 million treasury shares, and as a result, we recognized a reduction in Retained earnings of $13.1 million.

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Accumulated Other Comprehensive LossRevenue Recognition
The following is a roll forward of the components of Accumulated other comprehensive loss for the nine months ended September 30, 2017:
  Cash Flow Hedges Defined Benefit and Retiree Healthcare Plans Accumulated Other Comprehensive Loss
Balance as of December 31, 2016 $23
 $(34,090) $(34,067)
Other comprehensive loss before reclassifications, net of tax (25,078) —
 (25,078)
Amounts reclassified from accumulated other comprehensive loss, net of tax 7,258
 1,489
 8,747
Net current period other comprehensive (loss)/income (17,820) 1,489
 (16,331)
Balance as of September 30, 2017 $(17,797) $(32,601) $(50,398)
The details of the amounts reclassified from Accumulated other comprehensive losstables presents net revenue disaggregated by segment and end market for the three and ninesix months ended SeptemberJune 30, 20172021 and 2016 are as follows:2020:
For the three months ended June 30, 2021For the three months ended June 30, 2020
Performance SensingSensing SolutionsTotalPerformance SensingSensing SolutionsTotal
Automotive$518,367 $12,052 $530,419 $286,499 $7,279 $293,778 
HVOR (1)
223,485 0 223,485 98,708 0 98,708 
Industrial0 105,474 105,474 0 79,264 79,264 
Appliance and HVAC (2)
0 63,187 63,187 0 43,689 43,689 
Aerospace0 32,793 32,793 0 27,193 27,193 
Other0 37,302 37,302 0 33,873 33,873 
Total$741,852 $250,808 $992,660 $385,207 $191,298 $576,505 
________________________
(1)    Heavy vehicle and off-road
(2)    Heating, ventilation and air conditioning
For the six months ended June 30, 2021For the six months ended June 30, 2020
Performance SensingSensing SolutionsTotalPerformance SensingSensing SolutionsTotal
Automotive$1,055,080 $23,552 $1,078,632 $724,202 $15,515 $739,717 
HVOR401,284 0 401,284 229,694 0 229,694 
Industrial0 195,949 195,949 0 159,863 159,863 
Appliance and HVAC0 123,103 123,103 0 89,085 89,085 
Aerospace0 65,470 65,470 0 69,317 69,317 
Other0 70,750 70,750 0 63,098 63,098 
Total$1,456,364 $478,824 $1,935,188 $953,896 $396,878 $1,350,774 
8
           
  Amount of Loss/(Gain) Reclassified from Accumulated Other Comprehensive Loss Affected Line in Condensed Consolidated Statements of Operations
  For the three months ended For the nine months ended 
Component September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016 
Derivative instruments designated and qualifying as cash flow hedges          
Foreign currency forward contracts $4,075
 $(2,771) $(3,678) $(15,075) 
Net revenue (1)
Foreign currency forward contracts 1,953
 4,834
 13,356
 14,857
 
Cost of revenue (1)
Total, before taxes 6,028
 2,063
 9,678
 (218) Income before taxes
Income tax effect (1,507) (514) (2,420) 55
 Provision for income taxes
Total, net of taxes $4,521
 $1,549
 $7,258
 $(163) Net income
           
Defined benefit and retiree healthcare plans $297
 $(5) $1,557
 $324
 
Various (2)
Income tax effect (23) 29
 (68) (33) Provision for income taxes
Total, net of taxes $274
 $24
 $1,489
 $291
 Net income
(1)See Note 12, "Derivative Instruments and Hedging Activities," for additional details on amounts to be reclassified in the future from Accumulated other comprehensive loss.
(2)Amounts related to defined benefit and retiree healthcare plans reclassified from Accumulated other comprehensive loss affect the Cost of revenue, Research and development, and Selling, general and administrative ("SG&A") expense line items in the condensed consolidated statements of operations. The amounts reclassified are included in the computation of net periodic benefit cost. See Note 8, "Pension and Other Post-Retirement Benefits," for additional details of net periodic benefit cost.

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4. Share-Based Payment Plans
The following table presents the components of non-cash compensation expense related to our equity awards for the three and six months ended June 30, 2021 and 2020:
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Stock options$305 $53 $765 $2,542 
Restricted securities6,071 3,453 10,710 7,048 
Share-based compensation expense$6,376 $3,506 $11,475 $9,590 
Equity Awards
At our Annual General Meeting held on May 27, 2021, our shareholders approved the Sensata Technologies Holding plc 2021 Equity Incentive Plan (the "2021 Equity Plan"), which replaced the Sensata Technologies Holding plc First Amended and Restated 2010 Equity Incentive Plan (the "2010 Equity Plan"). The 2021 Equity Plan is substantially similar to the 2010 Equity Plan with some updates based on changes in law and current practices. The purpose of the 2021 Equity Plan is to promote the long-term growth, profitability, and interests of the Company and its shareholders by aiding us in attracting and retaining employees, officers, consultants, advisors, and non-employee directors capable of assuring our future success. All awards granted subsequent to this approval were made under the 2021 Equity Plan.
We granted the following restricted stock units ("RSUs" and each, an "RSU") and performance-based restricted stock units ("PRSUs" and each, a "PRSU") under the 2021 Equity Plan and 2010 Equity Plan during the six months ended June 30, 2021:
Awards Granted To:Type of AwardNumber of Units Granted (in thousands)Percentage of PRSUs Awarded that May VestWeighted Average Grant Date Fair Value
Directors
RSU (1)(5)
27 N/A$58.63 
Various executives and employees
RSU (2)(4)
370 N/A$58.37 
Various executives and employees
PRSU (3)(4)
236 0.0% - 200.0%$58.20 
________________________
(1)    These RSUs cliff vest one year from the grant date (May 2022).
(2)    RSUs vest ratably over three years, one-third per year beginning on the first anniversary of the grant date. These RSUs will fully vest on various dates between February 2024 and June 2024.
(3)    ThesePRSUs vest on various dates between April 2024 and May 2024. The number of units that ultimately vest is dependent on the achievement of certain performance criteria.
(4)    Primarily granted under the 2010 Equity Plan.
(5)    Primarily granted under the 2021 Equity Plan.
5. Restructuring and SpecialOther Charges, Net
Restructuring and special charges for the three and nine months ended SeptemberOn June 30, 2017 were $1.3 million and $18.8 million, respectively, which related primarily2020, in response to the closing of our facility in Minden, Germany that was partpotential long-term impact of the acquisitionglobal financial and health crisis caused by the coronavirus ("COVID-19") pandemic on our business, we committed to a plan to reorganize our business (the “Q2 2020 Global Restructure Program”), consisting of voluntary and involuntary reductions-in-force and certain subsidiariessite closures. The Q2 2020 Global Restructure Program was commenced in order to align our cost structure to the then anticipated future demand outlook. As of Custom Sensors & Technologies Ltd. ("CST"), facility exitJune 30, 2021, we have recorded cumulative costs of $30.1 million over the life of the plan, of which $27.4 million related to a limited number of other line movesseverance charges and $2.7 million related to facility and exit activities, and severance costs related tocosts. We have completed a majority of the terminationactions contemplated under the Q2 2020 Global Restructure Program.
Reductions in force under the Q2 2020 Global Restructure Program have impacted approximately 560 positions as of a limited number of employees. Charges related toJune 30, 2021. When the closing of our facility in Minden, Germany for the three and nine months ended September 30, 2017 consisted of (i) severance charges of $0.0 million and $8.4 million, respectively, and (ii) facility exit costs of $1.3 million and $2.4 million, respectively.
Restructuring and special charges for the three and nine months ended September 30, 2016 were $0.8 million and $3.2 million, respectively,remaining contemplated reduction-in-force actions are completed, which consisted primarily of facility exit costs related to the relocation of manufacturing lines from our facility in the Dominican Republic to a manufacturing facility in Mexico, and severance charges recorded in connection with acquired businesses and the termination of a limited number of employees. We completed the cessation of manufacturing in our Dominican Republic facilityis expected in the third quarter of 2016.2021, the total reductions in force are expected to be approximately 840 positions, reflecting total severance charges of between $27.0 million and $29.0 million. In addition, we expect total facility and exit costs incurred over the life of the Q2 2020 Global Restructure Program to be between $6.0 million and $8.0 million. We expect to settle these charges with cash on hand.
Changes
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We expect that when fully completed, restructuring actions taken under the Q2 2020 Global Restructure Program will have impacted our business segments and corporate functions as follows:
Reductions-in-ForceSite Closures
(Dollars in millions)PositionsMinimumMaximumMinimumMaximum
Performance Sensing170 $9.3 $10.0 $3.0 $4.0 
Sensing Solutions280 8.0 8.0 3.0 4.0 
Corporate and other (1)
390 9.7 11.0 0 0 
Total840 $27.0 $29.0 $6.0 $8.0 

(1)    The majority of these positions relate to engineering and manufacturing operations, which are allocated to corporate and other. However, these restructuring actions will benefit the results of Performance Sensing and Sensing Solutions as well.
Charges recognized in the three and six months ended June 30, 2021 and 2020 resulting from the Q2 2020 Global Restructure Program are presented by impacted segment below. However, as noted in Note 17: Segment Reporting, restructuring and other charges, net are excluded from segment operating income. Approximately $1.0 million and $2.0 million of these charges in the three and six months ended June 30, 2021, respectively, relate to site closures in Sensing Solutions. Approximately $0.3 million of these charges in the three and six months ended June 30, 2021 relate to site closures in Performance Sensing.
For the three months endedFor the six months ended
June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Performance Sensing$507 $7,609 $803 $7,609 
Sensing Solutions1,612 7,181 3,140 7,181 
Corporate and other1,711 9,330 1,711 9,330 
Restructuring and other charges$3,830 $24,120 $5,654 $24,120 
The following table presents the components of restructuring and other charges, net for the three and six months ended June 30, 2021 and 2020:
For the three months endedFor the six months ended
June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Q2 2020 Global Restructure Program charges$3,830 $24,120 $5,654 $24,120 
Other restructuring charges
Severance costs, net (1)
407 0 593 3,897 
Facility and other exit costs625 0 1,291 0 
Other (2)
167 14,098 2,073 14,699 
Restructuring and other charges, net$5,029 $38,218 $9,611 $42,716 

(1)    Severance costs, net (excluding those related to the Q2 2020 Global Restructure Program) for the six months ended June 30, 2020 were related to termination benefits arising from the shutdown and relocation of an operating site in Northern Ireland.
(2)    Other charges in the three and six months ended June 30, 2020 included a charge of $12.1 million resulting from a prejudgment interest-related award granted by the court on behalf of Wasica Finance GmbH ("Wasica") in intellectual property litigation in the second quarter of 2020. We settled this litigation with Wasica in the third quarter of 2020.
The following table presents a rollforward of the severance portion of our restructuring liability duringobligations for the ninesix months ended SeptemberJune 30, 2017 were as follows:2021.
Q2 2020 Global Restructure ProgramOtherTotal
Balance at December 31, 2020$10,842 $4,037 $14,879 
Charges, net of reversals3,623 593 4,216 
Payments(4,931)(2,888)(7,819)
Foreign currency remeasurement(103)32 (71)
Balance at June 30, 2021$9,431 $1,774 $11,205 
  Severance
Balance at December 31, 2016 $17,350
Charges, net of reversals 11,747
Payments (20,072)
Impact of changes in foreign currency exchange rates 1,529
Balance at September 30, 2017 $10,554
6. Debt
Our long-term debt and capital lease and other financing obligations as of September 30, 2017 and December 31, 2016 consisted of the following:
  Maturity Date September 30,
2017		 December 31,
2016
Term Loan October 14, 2021 $927,794
 $937,794
4.875% Senior Notes October 15, 2023 500,000
 500,000
5.625% Senior Notes November 1, 2024 400,000
 400,000
5.0% Senior Notes October 1, 2025 700,000
 700,000
6.25% Senior Notes February 15, 2026 750,000
 750,000
Less: discount   (15,812) (17,655)
Less: deferred financing costs   (29,971) (33,656)
Less: current portion   (7,327) (9,901)
Long-term debt, net   $3,224,684
 $3,226,582
       
Capital lease and other financing obligations   $35,839
 $37,111
Less: current portion   (5,849) (4,742)
Capital lease and other financing obligations, less current portion   $29,990
 $32,369
As of September 30, 2017, there was $415.3 million of availability under our $420.0 million revolving credit facility, net of $4.7 million in letters of credit. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of September 30, 2017, no amounts had been drawn against these outstanding letters of credit, which are scheduled to expire on various dates in 2017 and 2018.

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Accrued Interest
Accrued interest associated with our outstanding debt is includedThe severance liability as a component of AccruedJune 30, 2021 was entirely recorded in accrued expenses and other current liabilities in theon our condensed consolidated balance sheets. Assheet.
6. Other, Net
The following table presents the components of Septemberother, net for the three and six months ended June 30, 20172021 and December 31, 2016, accrued interest totaled $45.7 million and $36.8 million, respectively.2020:
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Currency remeasurement gain/(loss) on net monetary assets$1,988 $(1,097)$511 $456 
(Loss)/gain on foreign currency forward contracts(1,419)417 (2,377)(3,364)
Gain/(loss) on commodity forward contracts1,186 5,427 33 (148)
Loss on debt refinancing0 0 (30,066)0 
Net periodic benefit cost, excluding service cost(2,268)(2,516)(4,678)(6,897)
Other1,525 (655)(1,808)(752)
Other, net$1,012 $1,576 $(38,385)$(10,705)
7. Income Taxes
We recorded a Provision forThe following table presents the provision for/(benefit from) income taxes for the three and six months ended SeptemberJune 30, 20172021 and 2016 of $14.8 million and $11.1 million, respectively, and2020:
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Provision for/(benefit from) income taxes$7,638 $1,441 $27,919 $(75)
The increase in total tax for the ninethree months ended SeptemberJune 30, 20172021 compared to the three months ended June 30, 2020 was primarily due to the increase in pre-tax profits. The increase in total tax for the six months ended June 30, 2021 compared to the six months ended June 30, 2020 was predominantly due to the overall increase in income/(loss) before taxes as impacted by the mix of profits in the various jurisdictions in which we operate as well as the nonrecurrence of the benefit recorded in the first quarter of 2020 as a result of the Coronavirus Aid, Relief, and 2016Economic Security Act (the "CARES Act").
In response to the global financial and health crisis caused by COVID-19, the U.S. federal government enacted the CARES Act on March 27, 2020. Federal limitations on interest deductions were reduced in connection with this legislation, and we recorded a deferred tax benefit of $47.8$7.5 million and $48.3 million, respectively. in the three months ended March 31, 2020, as we were able to utilize additional interest expense that was previously subject to a valuation allowance.
The Provision forprovision for/(benefit from) income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in non-U.S. tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings; and (2) deferred tax expense (or benefit), which relates torepresents adjustments in book-to-tax basis differences primarily duerelated to the step-up(a) book versus tax basis in fair value of fixed and intangible assets, including goodwill, acquired(b) changes in connection with business combination transactions, and the utilization of net operating losses.loss carryforwards, (c) changes in tax rates, and (d) changes in our assessment of the realizability of our deferred tax assets.
During
8. Net Income/(Loss) per Share
Basic and diluted net income/(loss) per share are calculated by dividing net income/(loss) by the number of basic and diluted weighted-average ordinary shares outstanding during the period. For the three and ninesix months ended SeptemberJune 30, 2016, we recognized a benefit from income taxes2021 and 2020 the weighted-average ordinary shares outstanding used to calculate basic and diluted net income/(loss) per share were as follows:
 For the three months endedFor the six months ended
June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Basic weighted-average ordinary shares outstanding158,208 157,186 157,986 157,392 
Dilutive effect of stock options (1)
670 0 689 0 
Dilutive effect of unvested restricted securities (1)
466 0 612 0 
Diluted weighted-average ordinary shares outstanding159,344 157,186 159,287 157,392 

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Table of $5.1 millionContents

(1)    In the three and $3.7 million,six months ended June 30, 2020, potential ordinary shares of approximately 66 thousand and 200 thousand, respectively, related to stock options and approximately 353 thousand and 403 thousand, respectively, related to unvested restricted securities were excluded from the changecalculation of diluted weighted-average ordinary shares outstanding as a result of the net loss incurred in those periods.
Certain potential ordinary shares were excluded from our U.S. valuation allowance associated with the acquisitioncalculation of CST,diluted weighted-average ordinary shares outstanding because either they would have had an anti–dilutive effect on net income/(loss) per share or they related to equity awards that were contingently issuable for which deferred tax liabilitiesthe contingency had not been satisfied. These potential ordinary shares were established related primarily toas follows:
For the three months endedFor the six months ended
June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Anti-dilutive shares excluded8 2,959 7 2,172 
Contingently issuable shares excluded1,089 1,251 1,020 923 
9. Inventories
The following table presents the step-upcomponents of tangible assets for book purposes.inventories as of June 30, 2021 and December 31, 2020:
June 30, 2021December 31, 2020
Finished goods$161,378 $170,488 
Work-in-process98,194 87,006 
Raw materials244,069 193,511 
Inventories$503,641 $451,005 
8.
10. Pension and Other Post-Retirement Benefits
We provide various pension and other post-retirement benefit plans for current and former employees, including defined benefit, defined contribution, and retiree healthcare benefit plans.
The components of net periodic benefit cost/(credit) associated with our defined benefit and retiree healthcare plans for the three months ended SeptemberJune 30, 20172021 and 20162020 were as follows:
 U.S. Plans Non-U.S. Plans  
 Defined Benefit Retiree Healthcare Defined Benefit Total
 September 30, September 30, September 30, September 30,
 2017 2016 2017 2016 2017 2016 2017 2016
Service cost$—
 $—
 $21
 $25
 $661
 $697
 $682
 $722
Interest cost385
 332
 80
 94
 273
 298
 738
 724
Expected return on plan assets(527) (659) —
 —
 (230) (249) (757) (908)
Amortization of net loss291
 118
 8
 46
 64
 42
 363
 206
Amortization of prior service (credit)—
 —
 (334) (334) (1) (18) (335)��(352)
Loss on settlement269
 140
 —
 —
 —
 1
 269
 141
Net periodic benefit cost/(credit)$418
 $(69) $(225) $(169) $767
 $771
 $960
 $533

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 U.S. PlansNon-U.S. Plans 
 Defined BenefitRetiree HealthcareDefined BenefitTotal
 20212020202120202021202020212020
Service cost$0 $0 $2 $3 $1,325 $939 $1,327 $942 
Interest cost120 206 21 36 401 396 542 638 
Expected return on plan assets(226)(293)0 0 (179)(172)(405)(465)
Amortization of net loss401 300 0 9 462 359 863 668 
Amortization of prior service (credit)/cost0 0 (159)(197)13 3 (146)(194)
Loss on settlement1,414 310 0 0 0 1,559 1,414 1,869 
Net periodic benefit cost/(credit)$1,709 $523 $(136)$(149)$2,022 $3,084 $3,595 $3,458 
The components of net periodic benefit cost/(credit) associated with our defined benefit and retiree healthcare plans for the ninesix months ended SeptemberJune 30, 20172021 and 20162020 were as follows:
 U.S. PlansNon-U.S. Plans 
 Defined BenefitRetiree HealthcareDefined BenefitTotal
 20212020202120202021202020212020
Service cost$0 $0 $4 $5 $2,303 $1,708 $2,307 $1,713 
Interest cost240 473 42 73 805 711 1,087 1,257 
Expected return on plan assets(452)(726)0 0 (357)(346)(809)(1,072)
Amortization of net loss802 595 0 19 921 595 1,723 1,209 
Amortization of prior service (credit)/cost0 0 (318)(393)16 5 (302)(388)
Loss on settlement2,979 4,332 0 0 0 1,559 2,979 5,891 
Net periodic benefit cost/(credit)$3,569 $4,674 $(272)$(296)$3,688 $4,232 $6,985 $8,610 
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 U.S. Plans Non-U.S. Plans  
 Defined Benefit Retiree Healthcare Defined Benefit Total
 September 30, September 30, September 30, September 30,
 2017 2016 2017 2016 2017 2016 2017 2016
Service cost$—
 $—
 $64
 $76
 $1,917
 $2,003
 $1,981
 $2,079
Interest cost1,214
 1,109
 239
 283
 784
 887
 2,237
 2,279
Expected return on plan assets(1,617) (2,006) —
 —
 (677) (714) (2,294) (2,720)
Amortization of net loss854
 355
 32
 142
 202
 89
 1,088
 586
Amortization of prior service (credit)/cost—
 —
 (1,001) (1,001) (3) 8
 (1,004) (993)
Loss on settlement1,473
 730
 —
 —
 —
 1
 1,473
 731
Net periodic benefit cost/(credit)$1,924
 $188
 $(666) $(500) $2,223
 $2,274
 $3,481
 $1,962
9. Share-Based Payment Plans
Share-Based Compensation Expense
The table below presents non-cash compensation expense related to our equity awards, which is recorded within SG&A expenseComponents of net periodic benefit cost/(credit) other than service cost are presented in other, net in the condensed consolidated statements of operations, duringoperations. Refer to Note 6: Other, Net.
11. Debt
Our long-term debt, finance lease, and other financing obligations as of June 30, 2021 and December 31, 2020 consisted of the identified periods:
following:
 For the three months ended For the nine months ended
 September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Stock options$1,575
 $1,621
 $5,055
 $5,547
Restricted securities3,522
 3,136
 10,051
 7,732
Share-based compensation expense$5,097
 $4,757
 $15,106
 $13,279
Maturity DateJune 30, 2021December 31, 2020
Term LoanSeptember 20, 2026$453,780 $456,096 
4.875% Senior NotesOctober 15, 2023500,000 500,000 
5.625% Senior NotesNovember 1, 2024400,000 400,000 
5.0% Senior NotesOctober 1, 2025700,000 700,000 
6.25% Senior NotesFebruary 15, 20260 750,000 
4.375% Senior NotesFebruary 15, 2030450,000 450,000 
3.75% Senior NotesFebruary 15, 2031750,000 750,000 
4.0% Senior NotesApril 15, 20291,000,000 0 
Less: discount, net of premium(6,097)(9,605)
Less: deferred financing costs(29,224)(28,114)
Less: current portion(4,629)(754,630)
Long-term debt, net$4,213,830 $3,213,747 
Finance lease and other financing obligations$29,872 $30,506 
Less: current portion(2,652)(2,575)
Finance lease and other financing obligations, less current portion$27,220 $27,931 
Share-Based Compensation AwardsRevolving Credit Facility
As of June 30, 2021, we had $416.1 million available under our $420.0 million revolving credit facility (the "Revolving Credit Facility"), net of $3.9 million of obligations in respect of outstanding letters of credit issued thereunder. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of June 30, 2021, 0 amounts had been drawn against these outstanding letters of credit.
6.25% Senior Notes redemption
On February 3, 2021, we announced that we intended to redeem in full the $750.0 million aggregate principal amount outstanding on our 6.25% senior notes due 2026 (the "6.25% Senior Notes"). On February 15, 2021, the “make-whole” premium with respect to the 6.25% Senior Notes expired. Accordingly, we reflected the 6.25% Senior Notes as a current liability on our consolidated balance sheet as of December 31, 2020.
We grant share-based compensation awards forredeemed the 6.25% Senior Notes on March 5, 2021 in accordance with the terms of the indenture under which vesting is subject only to continued employmentthe 6.25% Senior Notes were issued and the passageterms of time (optionsthe notice of redemption at a redemption price equal to 103.125% of the aggregate principal amount of the outstanding 6.25% Senior Notes, plus accrued and restricted stock unitsunpaid interest to (but not including) the redemption date. In addition to the $750.0 million aggregate principal amount outstanding, at redemption we paid the $23.4 million premium and $2.6 million accrued interest.
4.0% Senior Notes
On March 29, 2021, our indirect, wholly-owned subsidiary, Sensata Technologies B.V. ("RSUs" and each an "RSU")STBV"), completed the issuance and sale of $750.0 million aggregate principal amount of 4.0% senior notes due 2029 (the "4.0% Senior Notes"). The 4.0% Senior Notes were issued under an indenture dated as wellof March 29, 2021 among STBV, as those for which vesting also depends on the attainmentissuer, The Bank of certain performance criteria (performance-based optionsNew York Mellon, as trustee (the "Trustee"), and performance-based restricted stock units ("PRSUs" and each a "PRSU"our guarantor subsidiaries (the "Guarantors") named therein (the "4.0% Senior Notes Indenture").

The 4.0% Senior Notes Indenture contains covenants that limit the ability of STBV and its subsidiaries to, among other things: incur liens; engage in sale and leaseback transactions; with respect to any subsidiary of STBV, incur indebtedness without such subsidiary’s guaranteeing the 4.0% Senior Notes; or consolidate, merge with, or sell, assign, convey, transfer, lease, or otherwise dispose of all or substantially all of their properties or assets to, another person. These covenants are subject to important exceptions and qualifications set forth in the 4.0% Senior Notes Indenture.
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The 4.0% Senior Notes bear interest at 4.0% per year and mature on April 15, 2029. Interest is payable semi-annually on April 15 and October 15 of each year, commencing on October 15, 2021. The 4.0% Senior Notes are guaranteed by each of STBV's wholly-owned subsidiaries that is a borrower or guarantor under the senior secured credit facilities (the "Senior Secured Credit Facilities") of STBV's wholly-owned subsidiary Sensata Technologies, Inc. ("STI") and the issuer or a guarantor under our existing senior notes as follows: STBV's 4.875% Senior Notes due 2023, 5.625% Senior Notes due 2024, and 5.0% Senior Notes due 2025; and STI's 4.375% Senior Notes due 2030 and 3.75% Senior Notes due 2031.
At any time, and from time to time, prior to April 15, 2024, STBV may redeem the 4.0% Senior Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the 4.0% Senior Notes being redeemed, plus a “make whole” premium, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. At any time on or after April 15, 2024, STBV may redeem the 4.0% Senior Notes, in whole or in part, at the following prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, up to but excluding the redemption date.
Period beginning April 15,Price
2024102.000 %
2025101.000 %
2026 and thereafter100.000 %
In addition, at any time prior to April 15, 2024, STBV may redeem up to 40% of the principal amount of the outstanding 4.0% Senior Notes (including additional 4.0% Senior Notes, if any, that may be issued after March 29, 2021) with the net cash proceeds of certain equity offerings at a redemption price (expressed as a percentage of principal amount) of 104.00%, plus accrued and unpaid interest, if any, up to but excluding the redemption date, provided that at least 60% of the aggregate principal amount of the 4.0% Senior Notes (including additional 4.0% Senior Notes, if any) remains outstanding immediately after each such redemption.
Upon the occurrence of certain changes in control, each holder of the 4.0% Senior Notes will have the right to require STBV to repurchase the 4.0% Senior Notes at 101% of their principal amount plus accrued and unpaid interest, if any, up to but excluding the date of repurchase.
Upon changes in certain tax laws or treaties, or any change in the official application, administration, or interpretation thereof, STBV may, at its option, redeem the 4.0% Senior Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, up to but excluding the redemption date, premium, if any, and all Additional Amounts (as defined in the 4.0% Senior Notes Indenture), if any, then due and which will become due on the date of redemption.
On April 8, 2021, STBV completed the issuance and sale of an additional $250.0 million in aggregate principal amount of 4.0% Senior Notes (the “Additional Notes”). The Additional Notes were priced at 100.75% and were issued pursuant to the 4.0% Senior Notes Indenture, as supplemented by the First Supplemental Indenture, dated as of April 8, 2021, among STBV, the Guarantors, and the Trustee. The Additional Notes are consolidated and form a single class with the $750.0 million aggregate principal amount of 4.0% Senior Notes issued by STBV on March 29, 2021 (the “Initial Notes”). The Additional Notes have the same terms as the Initial Notes, other than with respect to the date of issuance and the issue price.
We grantedintend to use the following options undernet proceeds from the Sensata Technologies Holding N.V. 2010 Equity Incentive Plan (the "2010 Equity Plan") duringissuance and sale of the nine months ended September4.0% Senior Notes and the Additional Notes for general corporate purposes, which may include working capital, capital expenditures, the acquisition of other companies, businesses, or assets, strategic investments, the refinancing or repayment of debt, and share repurchases.
Accounting for Debt Financing Transactions
We account for our debt financing transactions as disclosed in Note 2: Significant Accounting Policies of the audited consolidated financial statements and notes thereto included in our 2020 Annual Report.
In connection with the redemption of the 6.25% Senior Notes, we recorded a loss of $30.1 million, which included $23.4 million in premiums paid, with the remaining loss representing write-off of debt discounts and deferred financing costs. In connection with the issuance of the 4.0% Senior Notes, we recognized $9.6 million of deferred financing costs, which are presented as a reduction of long-term debt on our condensed consolidated balance sheets and $1.7 million of issuance premiums, which are presented as an addition to long-term debt on our condensed consolidated balance sheets.
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Accrued Interest
Accrued interest associated with our outstanding debt is included as a component of accrued expenses and other current liabilities in the condensed consolidated balance sheets. As of June 30, 2017:2021 and December 31, 2020, accrued interest totaled $46.1 million and $53.6 million, respectively.
Options Granted to Number of Options Granted (in thousands) Weighted- Average Grant Date Fair Value Vesting Period
Various executives and employees 387 $14.50 25% per year over four years
We granted the following RSUs and PRSUs under the 2010 Equity Plan during the nine months ended September 30, 2017:
Awards Granted to Type of Award Number of Units Granted (in thousands) 
Percentage of PRSUs Awarded That May Vest

 Weighted- Average Grant Date Fair Value
Various executives and employees 
RSU (1)
 147 N/A $43.67
Directors 
RSU (1)
 34 N/A $41.10
Various executives and employees 
PRSU (2)
 183 0.0% - 172.5% $43.67
Various executives and employees 
PRSU (2)
 53 0.0% - 200.0% $43.33
(1)
RSUs granted during the nine months ended September 30, 2017 vest on various dates between June 2018 and July 2020.
(2)
PRSUs granted during the nine months ended September 30, 2017 vest on various dates between April and May 2020, with the amount ultimately vesting within the range shown in the table above, dependent on the extent to which certain performance criteria are met.
Option Exercises
During the nine months ended September 30, 2017, 266 stock options were exercised, all of which were settled with shares reissued from treasury.
10.12. Commitments and Contingencies
Legal Proceedings and Claims
We are regularly involved in a number of claims and litigation matters that arise in the ordinary course of business. Most of our litigation matters are third-party claims for property damage allegedly caused by our products but some involve allegations of personal injury or wrongful death. Although it is not feasible to predict the outcome of these matters, based upon our experience and current information known to us, we do not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on our resultresults of operations, financial position, and/or cash flows.

13. Shareholders' Equity
Treasury Shares
From time to time, our Board of Directors has authorized various share repurchase programs, which may be modified or terminated by the Board at any time. We currently have an authorized $500.0 million share repurchase program under which approximately $302.3 million remained available as of June 30, 2021. On April 2, 2020, we announced a temporary suspension of this share repurchase program, which will remain on hold until we determine that market conditions warrant continuation of the program.
Accumulated Other Comprehensive Loss
The components of accumulated other comprehensive loss for the six months ended June 30, 2021 were as follows:
Cash Flow HedgesDefined Benefit and Retiree Healthcare PlansAccumulated Other Comprehensive Loss
Balance at December 31, 2020$(6,733)$(42,802)$(49,535)
Other comprehensive income before reclassifications, net of tax11,871 0 11,871 
Reclassifications from accumulated other comprehensive loss, net of tax3,805 3,384 7,189 
Other comprehensive income15,676 3,384 19,060 
Balance at June 30, 2021$8,943 $(39,418)$(30,475)
The amounts reclassified from accumulated other comprehensive loss for the three and six months ended June 30, 2021 and 2020 were as follows:
For the three months ended June 30,For the six months ended June 30,Affected Line in Condensed Consolidated Statements of Operations
Component2021202020212020
Derivative instruments designated and qualifying as cash flow hedges:
Foreign currency forward contracts$3,433 $(6,392)$7,840 $(13,015)
Net revenue (1)
Foreign currency forward contracts(2,024)193 (2,767)(1,575)
Cost of revenue (1)
Total, before taxes1,409 (6,199)5,073 (14,590)Income/(loss) before taxes
Income tax effect(352)1,550 (1,268)3,648 Provision for/(benefit from) income taxes
Total, net of taxes$1,057 $(4,649)$3,805 $(10,942)Net income/(loss)
Defined benefit and retiree healthcare plans$2,131 $2,343 $4,400 $6,712 
Other, net (2)
Income tax effect(459)(671)(1,016)(1,698)Provision for/(benefit from) income taxes
Total, net of taxes$1,672 $1,672 $3,384 $5,014 Net income/(loss)
__________________________
(1)    Refer to Note 15: Derivative Instruments and Hedging Activities for additional information on amounts to be reclassified from accumulated other comprehensive loss in future periods.
(2)    Refer to Note 10:Pension and Other Post-Retirement Benefits for additional information on net periodic benefit cost/(credit).
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11.14. Fair Value Measures
Our assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy in accordance with FASB ASC 820, Fair Value Measurement.
Measured on a Recurring Basis
The following table presents information aboutfair values of our assets and liabilities measured at fair value on a recurring basis as of SeptemberJune 30, 20172021 and December 31, 2016, aggregated by2020 are shown in the levelbelow table. All fair value measures presented are categorized in Level 2 of the fair value hierarchy within which those measurements fell:hierarchy.
 June 30, 2021December 31, 2020
Assets
Foreign currency forward contracts$17,789 $16,163 
Commodity forward contracts5,479 8,902 
Total$23,268 $25,065 
Liabilities
Foreign currency forward contracts$7,667 $24,660 
Commodity forward contracts2,016 310 
Total$9,683 $24,970 
 September 30, 2017 December 31, 2016
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
Assets           
Foreign currency forward contracts$—
 $8,869
 $—
 $—
 $32,757
 $—
Commodity forward contracts—
 4,847
 —
 —
 2,639
 —
Total$—
 $13,716
 $—
 $—
 $35,396
 $—
Liabilities           
Foreign currency forward contracts$—
 $31,911
 $—
 $—
 $27,201
 $—
Commodity forward contracts—
 1,666
 —
 —
 3,790
 —
Total$—
 $33,577
 $—
 $—
 $30,991
 $—
Refer to Note 15: Derivative Instruments and Hedging Activities for additional information related to our forward contracts.
Measured on a Nonrecurring Basis
We evaluated our goodwill and other indefinite-lived intangible assets for impairment as of October 1, 20162020 and determined that these assetsthey were not impaired. As of SeptemberDuring the six months ended June 30, 2017,2021, no events or changes in circumstances occurred that would have triggered the need for an additional impairment review of goodwill or indefinite-lived intangiblethese assets.
A long-lived asset, which includes Property, plant, and equipment ("PP&E"), is considered held for sale when it meets certain criteria described in FASB ASC 360, Property, Plant, and Equipment. A long-lived asset classified as held for sale is initially measured at the lower of its carrying amount or fair value less cost to sell, and a loss is recognized for any initial adjustment of the asset's carrying amount to its fair value less cost to sell in the period the held for sale criteria are met. In the period that a long-lived asset is considered held for sale it is presented within Prepaid expenses and other current assets on our balance sheet where it remains until it is either sold or no longer meets the held for sale criteria. For comparative purposes, the prior year carrying amount of a long-lived asset considered held for sale is presented within Other assets on our balance sheet.
In the first quarter of 2017, we determined that one of our facilities met the held for sale criteria and recorded it at its fair value less costs to sell of $1.7 million (which approximated its net carrying value at that time). In the third quarter of 2017, we sold the asset for an immaterial gain.
The fair value of assets held for sale is considered to be a Level 3 fair value measurement and is determined based on the use of appraisals, input from market participants, our experience selling similar assets, internally developed cash flow models, or a combination thereof.

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Financial Instruments Not Recorded at Fair Value
The following table presents the carrying values and fair values of financial instruments not recorded at fair value in the condensed consolidated balance sheets as of SeptemberJune 30, 20172021 and December 31, 2016:2020. All fair value measures presented are categorized in Level 2 of the fair value hierarchy.
 June 30, 2021December 31, 2020
 
Carrying Value (1)
Fair Value
Carrying Value (1)
Fair Value
Liabilities
Term Loan$453,780 $453,780 $456,096 $454,955 
4.875% Senior Notes$500,000 $533,750 $500,000 $538,750 
5.625% Senior Notes$400,000 $444,000 $400,000 $448,000 
5.0% Senior Notes$700,000 $777,000 $700,000 $777,000 
6.25% Senior Notes$0 $0 $750,000 $778,125 
4.375% Senior Notes$450,000 $473,625 $450,000 $487,125 
3.75% Senior Notes$750,000 $740,625 $750,000 $776,250 
4.0% Senior Notes$1,000,000 $1,010,000 $0 $0 

 September 30, 2017 December 31, 2016
 
Carrying
Value (1)
 Fair Value 
Carrying
Value (1)
 Fair Value
  Level 1 Level 2 Level 3  Level 1 Level 2 Level 3
Liabilities               
Term Loan$927,794
 $—
 $932,433
 $—
 $937,794
 $—
 $942,483
 $—
4.875% Senior Notes$500,000
 $—
 $525,000
 $—
 $500,000
 $—
 $514,375
 $—
5.625% Senior Notes$400,000
 $—
 $440,000
 $—
 $400,000
 $—
 $417,752
 $—
5.0% Senior Notes$700,000
 $—
 $736,750
 $—
 $700,000
 $—
 $686,000
 $—
6.25% Senior Notes$750,000
 $—
 $819,375
 $—
 $750,000
 $—
 $786,098
 $—
(1)    Carrying value excludes    Excluding any related debt discounts, or premiums, and deferred financing costs.
The fair values of the Term Loan and senior notes are primarily determined using observable prices in markets where these instruments are generally not traded on a daily basis.
Cash and cash equivalents accounts receivable, and accounts payable are carried at their cost, which approximates fair value because of their short-term nature.
In March 2016,addition to the above, we acquired $50.0 millionhold certain equity investments that do not have readily determinable fair values for which we use the measurement alternative prescribed in Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 321, Investments - Equity Securities. Such investments are measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of Series B Preferred Stockthe same issuer. There were no impairments or changes resulting from observable transactions for any of these investments and no adjustments were made to their carrying values.
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Refer to the table below for the carrying values of equity investments using the measurement alternative, which are presented as a component of other assets in the condensed consolidated balance sheets.
June 30, 2021December 31, 2020
Quanergy$50,000 $50,000 
Other15,000 15,000 
Total$65,000 $65,000 
On June 22, 2021, Quanergy Systems, Inc., ("Quanergy") announced that it had entered into a definitive business combination agreement with CITIC Capital Acquisition Corp (NYSE: CCAC). Upon closing of the business combination, which we recognized as a cost methodis expected to be in the second half of 2021, subject to customary closing conditions, the combined company is expected to be listed on the New York Stock Exchange ("NYSE") under the ticker symbol QNGY. We have assessed our investment in Quanergy based on our balance sheet. Asthe proposed terms of September 30, 2017, the fair value of this asset has not been estimated, asbusiness combination agreement and concluded that there arewere no indicators of impairment and it is not practicableas of June 30, 2021. Subsequent to estimate its fair value dueclosing, we will mark our investment to the restricted marketability of this investment.market each reporting period.
12.15. Derivative Instruments and Hedging Activities
Hedges of Foreign Currency Risk
We are exposed to fluctuations in various foreign currencies against our functional currency, the U.S. dollar. We use foreign currency forward agreements to manage this exposure. We currently have outstanding foreign currency forward contracts that qualify as cash flow hedges intended to offset the effect of exchange rate fluctuations on forecasted sales and certain manufacturing costs. We also have outstanding foreign currency forward contracts that are intended to preserve the economic value of foreign currency denominated monetary assets and liabilities; these instruments are not designated for hedge accounting treatment in accordance with FASB ASC 815, Derivatives and Hedging. Foreign currency forward contracts not designated as hedges are not speculative and are used to manage our exposure to foreign exchange movements.
For the three and ninesix months ended SeptemberJune 30, 20172021 and 2016,2020, amounts excluded from the ineffective portionassessment of the changes in the fair valueeffectiveness of our foreign currency forward agreementscontracts that are designated as cash flow hedges waswere not material and no amounts were excluded from the assessment of effectiveness.material. As of SeptemberJune 30, 2017,2021, we estimateestimated that $18.4$9.2 million of net lossesgains will be reclassified from Accumulatedaccumulated other comprehensive loss to earnings during the twelve-month period ending SeptemberJune 30, 2018.2022.

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As of SeptemberJune 30, 2017,2021, we had the following outstanding foreign currency forward contracts:
Notional
(in millions)		Effective Date(s)Maturity Date(s)Index (Exchange Rates)Weighted-Average Strike Rate
Hedge
Designation (1)
14.0 EURJune 28, 2021July 30, 2021Euro ("EUR") to USD1.19 USDNot designated
370.4 EURVarious from August 23, 2019 to June 22, 2021Various from July 30, 2021 to June 30, 2023EUR to USD1.19 USDCash flow hedge
696.0 CNYJune 23, 2021July 30, 2021USD to Chinese Renminbi ("CNY")6.51 CNYNot designated
520.8 CNYVarious from November 5, 2020 to January 5, 2021Various from July 30, 2021 to December 31, 2021USD to CNY6.66 CNYCash flow hedge
450.0 JPYJune 28, 2021July 30, 2021USD to Japanese Yen ("JPY")110.82 JPYNot designated
Notional
(in millions)
20,066.7 KRW		Effective Date(s)Maturity Date(s)IndexWeighted- Average Strike RateHedge Designation
65.0 EURSeptember 27, 2017October 31, 2017Euro to U.S. Dollar Exchange Rate1.18 USDNot designated
461.6 EURVarious from April 2015August 23, 2019 to September 2017June 22, 2021Various from October 2017July 30, 2021 to December 2019May 31, 2023Euro to U.S. Dollar Exchange Rate1.14 USDDesignated
500.0 CNYSeptember 26, 2017October 31, 2017U.S. Dollar to Chinese Renminbi Exchange Rate6.68 CNYNot designated
132.0 CNYVarious in February 2017Various from October to December 2017U.S. Dollar to Chinese Renminbi Exchange Rate7.05 CNYDesignated
110.0 JPYSeptember 27, 2017October 31, 2017U.S. Dollar to Japanese Yen Exchange Rate112.80 JPYNot designated
237.0 JPYJanuary 5, 2017Various from October to December 2017U.S. Dollar to Japanese Yen Exchange Rate113.71 JPYDesignated
45,258.3 KRWVarious from April 2015 to September 2017Various from October 2017 to August 2019U.S. Dollar to Korean Won Exchange Rate("KRW")1,140.771,143.12 KRWDesignatedCash flow hedge
36.5
26.0 MYRVarious from April 2015 to November 2016June 23, 2021Various from October 2017 to October 2018July 30, 2021U.S. DollarUSD to Malaysian Ringgit Exchange Rate("MYR")4.194.14 MYRDesignatedNot designated
182.0
423.0 MXNSeptember 27, 2017June 28, 2021October 31, 2017July 30, 2021U.S. DollarUSD to Mexican Peso Exchange Rate("MXN")18.2419.92 MXNNot designated
2,166.83,215.0 MXNVarious from April 2015August 23, 2019 to September 2017June 22, 2021Various from October 2017July 30, 2021 to August 2019June 30, 2023U.S. DollarUSD to Mexican Peso Exchange RateMXN19.9422.41 MXNDesignatedCash flow hedge
44.55.6 GBPVarious from April 2015 to September 2017June 28, 2021Various from October 2017 to August 2019July 30, 2021British Pound Sterling ("GBP") to U.S. Dollar Exchange RateUSD1.39 USDNot Designated
51.3 GBPVarious from August 23, 2019 to June 22, 2021Various from July 30, 2021 to June 30, 2023GBP to USD1.33 USDDesignatedCash flow hedge
The notional amounts above represent the total quantities we have outstanding over the remaining contracted periods._________________________
Hedges of Commodity Risk
Our objective in using commodity forward contracts is to offset a portion of our exposure to the potential change in prices associated with certain commodities used in the manufacturing of our products, including silver, gold, nickel, aluminum, copper, platinum, and palladium. The terms of these forward contracts fix the price at a future date for various notional amounts associated with these commodities. These(1)    Derivative financial instruments are not designated for hedge accounting treatment in accordance with FASB ASC 815. Commodity forward contracts not designated as hedges are not speculative and are used to manage our exposure to commodity price movements.currency exchange rate risk. They are intended to preserve economic value, and they are not used for trading or speculative purposes.
We
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Hedges of Commodity Risk
As of June 30, 2021, we had the following outstanding commodity forward contracts, none of which were designated as derivativesfor hedge accounting treatment in qualifying hedging relationships, as of September 30, 2017:
accordance with FASB ASC Topic 815, Derivatives and Hedging:
CommodityNotionalRemaining Contracted PeriodsWeighted-Average Strike Price Per Unit
Silver1,109,455929,084 troy oz.October 2017July 2021 - August 2019June 2023$17.6924.51
Gold12,1508,943 troy oz.October 2017July 2021 - August 2019June 2023$1,269.401,819.10
Nickel287,659202,117 poundsOctober 2017July 2021 - August 2019June 2023$4.687.44
Aluminum5,554,3702,870,170 poundsOctober 2017July 2021 - August 2019June 2023$0.840.97
Copper7,394,0182,842,272 poundsOctober 2017July 2021 - August 2019June 2023$2.543.76
Platinum8,0369,540 troy oz.October 2017July 2021 - August 2019June 2023$996.801,045.46
Palladium1,9271,256 troy oz.October 2017July 2021 - August 2019June 2023$759.112,457.28
The notional amounts above represent the total quantities we have outstanding over the remaining contracted periods.

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Financial Instrument Presentation
The following table presents the fair values of our derivative financial instruments and their classification in the condensed consolidated balance sheets as of SeptemberJune 30, 20172021 and December 31, 2016:2020:
Asset Derivatives Liability Derivatives
 Fair Value Fair Value Asset DerivativesLiability Derivatives
Balance Sheet Location September 30, 2017 December 31, 2016 Balance Sheet Location September 30, 2017 December 31, 2016 Balance Sheet LocationJune 30, 2021December 31, 2020Balance Sheet LocationJune 30, 2021December 31, 2020
Derivatives designated as hedging instruments        Derivatives designated as hedging instruments
Foreign currency forward contractsPrepaid expenses and other current assets $6,909
 $24,796
 Accrued expenses and other current liabilities $23,838
 $20,990
Foreign currency forward contractsPrepaid expenses and other current assets$14,875 $11,281 Accrued expenses and other current liabilities$6,928 $18,834 
Foreign currency forward contractsOther assets 1,956
 5,693
 Other long-term liabilities 7,327
 3,814
Foreign currency forward contractsOther assets2,860 4,728 Other long-term liabilities284 5,182 
Total $8,865
 $30,489
 $31,165
 $24,804
Total$17,735 $16,009 $7,212 $24,016 
Derivatives not designated as hedging instruments        Derivatives not designated as hedging instruments
Commodity forward contractsPrepaid expenses and other current assets $4,173
 $2,097
 Accrued expenses and other current liabilities $1,400
 $2,764
Commodity forward contractsPrepaid expenses and other current assets$5,041 $7,598 Accrued expenses and other current liabilities$1,216 $149 
Commodity forward contractsOther assets 674
 542
 Other long-term liabilities 266
 1,026
Commodity forward contractsOther assets438 1,304 Other long-term liabilities800 161 
Foreign currency forward contractsPrepaid expenses and other current assets 4
 2,268
 Accrued expenses and other current liabilities 746
 2,397
Foreign currency forward contractsPrepaid expenses and other current assets54 154 Accrued expenses and other current liabilities455 644 
Total $4,851
 $4,907
 $2,412
 $6,187
Total$5,533 $9,056 $2,471 $954 
These fair value measurements arewere all categorized within Level 2 of the fair value hierarchy.
The following tables present the effect of our derivative financial instruments on the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income/(loss) for the three months ended SeptemberJune 30, 20172021 and 2016:2020:
Derivatives designated as
hedging instruments		Amount of Deferred (Loss)/Gain Recognized in Other Comprehensive Income/(Loss)Location of Net (Loss)/Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income/(Loss)Amount of Net (Loss)/Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income/(Loss)
2021202020212020
Foreign currency forward contracts$(6,353)$(5,954)Net revenue$(3,433)$6,392 
Foreign currency forward contracts$6,808 $5,267 Cost of revenue$2,024 $(193)
Derivatives not designated as
hedging instruments		Amount of Gain/(Loss) Recognized in Net Income/(Loss)Location of Gain/(Loss) Recognized in Net Income/(Loss)
20212020
Commodity forward contracts$1,186 $5,427 Other, net
Foreign currency forward contracts$(1,419)$417 Other, net
18
Derivatives designated as
hedging instruments
 Amount of Deferred (Loss)/Gain Recognized in Other Comprehensive Loss Location of Net (Loss)/Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income Amount of Net (Loss)/Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income
  September 30, 2017 September 30, 2016   September 30, 2017 September 30, 2016
Foreign currency forward contracts $(16,688) $(6,929) Net revenue $(4,075) $2,771
Foreign currency forward contracts $1,614
 $(6,450) Cost of revenue $(1,953) $(4,834)
Derivatives not designated as
hedging instruments
 Amount of Gain/(Loss) Recognized in Net Income Location of Gain/(Loss) Recognized in Net Income
  September 30, 2017 September 30, 2016  
Commodity forward contracts $2,956
 $1,318
 Other, net
Foreign currency forward contracts $(3,865) $(3,827) Other, net

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The following tables present the effect of our derivative financial instruments on the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income/(loss) for the ninesix months ended SeptemberJune 30, 20172021 and 2016:2020:
Derivatives designated as
hedging instruments		Amount of Deferred Gain/(Loss) Recognized in Other Comprehensive Income/(Loss)Location of Net (Loss)/Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income/(Loss)Amount of Net (Loss)/Gain Reclassified from Accumulated Other Comprehensive Loss into Net Income/(Loss)
2021202020212020
Foreign currency forward contracts$12,446 $6,590 Net revenue$(7,840)$13,015 
Foreign currency forward contracts$3,383 $(24,363)Cost of revenue$2,767 $1,575 
Derivatives designated as
hedging instruments
 Amount of Deferred (Loss)/Gain Recognized in Other Comprehensive Loss Location of Net Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Net Income Amount of Net Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Net Income
  September 30, 2017 September 30, 2016   September 30, 2017 September 30, 2016
Foreign currency forward contracts $(56,479) $(12,810) Net revenue $3,678
 $15,075
Foreign currency forward contracts $23,041
 $(20,319) Cost of revenue $(13,356) $(14,857)
Derivatives not designated as
hedging instruments
 Amount of Gain/(Loss) Recognized in Net Income Location of Gain/(Loss) Recognized in Net IncomeDerivatives not designated as
hedging instruments		Amount of Gain/(Loss) Recognized in Net Income/(Loss)Location of Gain/(Loss) Recognized in Net Income/(Loss)
 September 30, 2017 September 30, 2016  
Derivatives not designated as
hedging instruments		Derivatives not designated as
hedging instruments		20212020Location of Gain/(Loss) Recognized in Net Income/(Loss)
 $6,439
 $12,049
 Other, net$33 $(148)
Foreign currency forward contracts $(10,542) $(7,912) Other, netForeign currency forward contracts$(2,377)$(3,364)Other, net
Credit Risk Related Contingent Features
We have agreements with certain of our derivative counterparties that contain a provision whereby if we default on our indebtedness and where repayment of the indebtedness has been accelerated by the lender, then we could also be declared in default on our derivative obligations.
As of SeptemberJune 30, 2017,2021, the termination value of outstanding derivatives in a liability position, excluding any adjustment for non-performance risk, was $33.8$9.7 million. As of SeptemberJune 30, 2017,2021, we have nothad 0t posted any cash collateral related to these agreements. If we breach any of the default provisions on any of our indebtedness as described above, we could be required to settle our obligations under the derivative agreements at their termination values.
13. Other, Net16. Acquisitions
Other, net consistedOn February 11, 2021, we entered into a securities purchase agreement (the "SPA") to acquire all of the outstanding equity interests of Xirgo Technologies, LLC ("Xirgo"), a leading provider of telematics and data insight, headquartered in Camarillo, California. The transaction contemplated by the SPA closed on April 1, 2021 for an aggregate cash purchase price of $408.7 million, subject to certain post-closing items. The product offerings and technology of Xirgo will augment our existing portfolio in advancing our Sensata Insights megatrend initiative. We expect to integrate Xirgo into our Performance Sensing reportable segment.
The following gains/(losses)table summarizes the preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed:
Net working capital, excluding cash$11,536 
Property, plant and equipment1,427 
Goodwill184,260 
Other intangible assets249,612 
Other assets508 
Deferred income tax liabilities(45,506)
Other long-term liabilities(292)
Fair value of net assets acquired, excluding cash and cash equivalents401,545 
Cash and cash equivalents7,117 
Fair value of net assets acquired$408,662 
The allocation of purchase price of Xirgo is preliminary, and is based on management’s judgments after evaluating several factors, including preliminary valuation assessments of tangible and intangible assets. The final allocation of the purchase price to the assets acquired will be completed when the final valuations are completed. The preliminary goodwill recognized as a result of this acquisition was approximately $184.3 million, which represents future economic benefits expected to arise from synergies from combining operations and the extension of existing customer relationships. The amount of goodwill recorded that is expected to be deductible for tax purposes is not material.
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In connection with the allocation of purchase price to the assets acquired and liabilities assumed, we identified certain definite-lived intangible assets. The following table presents the acquired intangible assets, their estimated fair values, and weighted-average lives:
Acquisition Date Fair ValueWeighted-Average Lives (years)
Acquired definite-lived intangible assets
Customer relationships$198,540 15
Completed technologies44,130 10
Tradenames6,930 11
Other12 1
Total definite-lived intangible assets acquired$249,612 14
The definite-lived intangible assets were valued using the income approach. We used the relief-from-royalty method to value completed technologies and tradenames, and we used the multi-period excess earnings method to value customer relationships. These valuation methods incorporate assumptions including expected discounted future cash flows resulting from either the future estimated after-tax royalty payments avoided as a result of owning the completed technologies or the future earnings related to existing customer relationships.
17. Segment Reporting
We operate in, and report financial information for, the three and nine months ended September 30, 2017 and 2016:
 For the three months ended For the nine months ended
 September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Currency remeasurement gain on net monetary assets$3,989
 $1,707
 $11,010
 $550
Loss on foreign currency forward contracts(3,865) (3,827) (10,542) (7,912)
Gain on commodity forward contracts2,956
 1,318
 6,439
 12,049
Other32
 76
 283
 205
Other, net$3,112
 $(726) $7,190
 $4,892
14. Segment Reporting
We organize our business into twofollowing 2 reportable segments,segments: Performance Sensing and Sensing Solutions,Solutions. The Performance Sensing reportable segment consists of 2 operating segments, Automotive and HVOR, each of which meet the criteria for aggregation in FASB ASC Topic 280, Reportable Segments. The Sensing Solutions reportable segment is also an operating segment.
Our operating segments are businesses that we manage as components of an enterprise, for which separate financial information is evaluated regularly by our chief operating decision maker in deciding how to allocate resources and assess performance.

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An operating segment’s performance is primarily evaluated based on Segment profit,segment operating income, which excludes amortization expense,of intangible assets, restructuring and specialother charges, net, certain costs associated with our strategic megatrend initiatives, and certain corporate costs/costs or credits not associated with the operations of the segment, including share-based compensation expense and a portion of depreciation expense associated with assets recorded in connection with acquisitions. In addition, an operating segment’s performance excludes results from discontinued operations, if any. Corporate and other costs excluded from an operating segment’s performance are separately stated below and also include costs that are related to functional areas, such as finance, information technology, legal, and human resources.
We believe that Segment profit,segment operating income, as defined above, is an appropriate measure for evaluating the operating performance of our segments. However, this measure should be considered in addition to, and not as a substitute for, or superior to, profit from operationsoperating income or other measures of financial performance prepared in accordance with U.S. GAAP. The accounting policies of each of our reporting segments are materially consistent with those in the summary of significant accounting policies as described in Note 2, "Significant2: Significant Accounting Policies" of the audited consolidated financial statements and notes thereto included in our 2020 Annual Report on Form 10-K for the year ended December 31, 2016.Report.
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The following table presents Netnet revenue and Segment profitsegment operating income for the reportedreportable segments and other operating results not allocated to the reportedreportable segments for the three and ninesix months ended SeptemberJune 30, 20172021 and 2016:2020:
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Net revenue:
Performance Sensing$741,852 $385,207 $1,456,364 $953,896 
Sensing Solutions250,808 191,298 478,824 396,878 
Total net revenue$992,660 $576,505 $1,935,188 $1,350,774 
Segment operating income (as defined above):
Performance Sensing$202,064 $60,756 $397,908 $195,802 
Sensing Solutions76,549 55,787 143,443 112,316 
Total segment operating income278,613 116,543 541,351 308,118 
Corporate and other(73,972)(47,450)(142,610)(142,836)
Amortization of intangible assets(34,857)(32,743)(66,921)(65,835)
Restructuring and other charges, net(5,029)(38,218)(9,611)(42,716)
Operating income/(loss)164,755 (1,868)322,209 56,731 
Interest expense, net(45,213)(40,808)(89,256)(80,211)
Other, net1,012 1,576 (38,385)(10,705)
Income/(loss) before taxes$120,554 $(41,100)$194,568 $(34,185)
21
 For the three months ended For the nine months ended
 September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Net revenue:       
Performance Sensing$603,932
 $584,650
 $1,825,904
 $1,797,395
Sensing Solutions215,122
 205,148
 640,295
 616,497
Total net revenue$819,054
 $789,798
 $2,466,199
 $2,413,892
Segment profit (as defined above):       
Performance Sensing$162,655
 $155,228
 $483,491
 $453,540
Sensing Solutions72,372
 67,314
 209,911
 198,737
Total segment profit235,027
 222,542
 693,402
 652,277
Corporate and other(53,379) (48,335) (152,681) (133,025)
Amortization of intangible assets(40,317) (50,562) (121,578) (151,572)
Restructuring and special charges(1,329) (837) (18,768) (3,167)
Profit from operations140,002
 122,808
 400,375
 364,513
Interest expense, net(40,263) (41,176) (120,578) (125,201)
Other, net3,112
 (726) 7,190
 4,892
Income before taxes$102,851
 $80,906
 $286,987
 $244,204
15. Net Income per Share
Basic and diluted net income per share are calculated by dividing Net income by the number of basic and diluted weighted-average ordinary shares outstanding during the period. For the three and nine months ended September 30, 2017 and 2016, the weighted-average ordinary shares outstanding for basic and diluted net income per share were as follows:
 For the three months ended For the nine months ended
 September 30,
2017		 September 30,
2016		 September 30,
2017		 September 30,
2016
Basic weighted-average ordinary shares outstanding171,269
 170,840
 171,116
 170,656
Dilutive effect of stock options618
 431
 567
 504
Dilutive effect of unvested restricted securities358
 207
 340
 199
Diluted weighted-average ordinary shares outstanding172,245
 171,478
 172,023
 171,359
Net income and net income per share are presented in the condensed consolidated statements of operations.

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Certain potential ordinary shares were excluded from our calculation of diluted weighted-average ordinary shares outstanding because they would have had an anti-dilutive effect on net income per share or because they related to share-based awards that were contingently issuable, for which the contingency had not been satisfied. These potential ordinary shares are as follows:
 For the three months ended For the nine months ended
 September 30,
2017		 September 30,
2016		 September 30,
2017		 September 30,
2016
Anti-dilutive shares excluded1,584
 1,355
 1,635
 1,418
Contingently issuable shares excluded884
 735
 783
 632

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CAUTIONARY STATEMENT FOR PURPOSES OF THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995Cautionary Statements Concerning Forward-Looking Statements
This report containsQuarterly Report on Form 10-Q, including any documents incorporated by reference herein, includes "forward-looking statements" within the meaning of Section 27A of the Private Securities Litigation Reform Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act). All statements, other than statements of historical facts included in this report, are1995. These forward-looking statements includingrelate to analyses and other information concerning our possible or assumedthat are based on forecasts of future results or operations,and estimates of amounts not yet determinable. These forward-looking statements also relate to our future prospects, developments, and business strategies, financing plans, competitive position, potential growth opportunities, potential operation performance, improvements, acquisitions, divestitures, the effects of competition, and the effects of future legislation or regulations. Forward-lookingstrategies. These forward-looking statements are typicallymay be identified by use of termsterminology such as "may," "believe,"will," "could," "should," "expect," "anticipate," "intend,"believe," "estimate," "predict," "project," "target,"forecast," "goal,"continue," "intend," "plan," "should," "will," "predict," "guidance," "potential," "forecast," "outlook," "could," "budget," "objectives," "strategy" and similar expressions that conveyterms or phrases, or the uncertaintynegative of future events or outcomes.such terminology, including references to assumptions. However, these terms are not the exclusive means of identifying such statements.
Forward-looking statements involve risks,contained herein, or in other statements made by us, are made based on management’s expectations and beliefs concerning future events impacting us. These statements are subject to uncertainties and assumptions. Actualother important factors relating to our operations and business environment, all of which are difficult to predict, and many of which are beyond our control, that could cause our actual results mayto differ materially from those matters expressed in theseor implied by forward-looking statements. Investors should not place undue reliance on any forward-looking statements. We do not have any intention or obligation to update forward-looking statements after we file this report except as required by law.
Although we believe that theour plans, intentions, and expectations reflected in, or suggested by, such forward-looking statements are reasonable, this information is based upon assumptionswe can give no assurances that any of the events anticipated by these forward-looking statements will occur or, if any of them do, what impact they will have on our results of operations and anticipated resultsfinancial condition.
We believe that are subject to numerous uncertainties and risks. Thethe following and other risksimportant factors, among others (including those described in greater detail in “Part 1. Item 1A.1A: Risk Factors”Factors, included in our 2020 Annual Report on Form 10-K forReport), could affect our future performance and the fiscal year ended December 31, 2016, couldliquidity and value of our securities and cause our actual results to differ materially from those expressed inor implied by forward-looking statements:statements made by us or on our behalf:
conditions affecting•Future risks and existing uncertainties associated with the COVID-19 pandemic, which continues to have a significant adverse impact on our business and operations including: (i) full or partial shutdowns of our facilities as mandated by government decrees, (ii) limited ability to adjust certain costs due to government actions, (iii) significant travel restrictions and “work-from-home” orders limiting the availability of our workforce, (iv) supplier constraints and supply-chain interruptions, (v) logistics challenges and limitations, (vi) reduced demand for our products infrom certain customers, (vii) uncertainties associated with a protracted economic slowdown that could negatively affect the industries we serve, particularly the automotive industry;
competition and pricing pressure;
raw material availability, quality, and cost;
financial condition of and relationships with,our customers and vendors;suppliers, and (viii) uncertainties and volatility in the global capital markets;
reliance on third-party suppliers;
•instability and changes to current policies by the U.S. government;
changes in tax rates;
conditions in the global markets, we operate inincluding regulatory, political, economic, governmental, and serve, includingmilitary matters, such as the impact of the anticipated exit of the United Kingdom (the "U.K.") from the European Union;Union (the "EU");
•adverse conditions or competition in the industries upon which we are dependent, including the automotive industry;
•losses and costs as a result of intellectual property, product liability, warranty, and recall claims;
•market acceptance of new product introductions and product innovations;
•inability to realize all of the revenue or achieve anticipated gross margins from products subject to existing purchase orders for which we are currently engaged in development;
•supplier interruption or non-performance, limiting our access to manufactured components or raw materials;
•risks associated with current and future acquisitions and divestitures;related to the acquisition or disposition of businesses, or the restructuring of our business;
•labor disputesdisruptions or increased labor costs;
global risks of business interruptions, such as natural disasters and political, economic, and military instability;•competitive pressure from customers that could require us to reduce prices or result in reduced demand;
risks associated with •security breaches, cyber theft of our intellectual property, and other disruptions to our information technology infrastructure;infrastructure, or improper disclosure of confidential, personal, or proprietary data;
risks related to compliance with current and future laws and regulations;
•our ability to protect our intellectual property rights;attract and retain key senior management and qualified technical, sales, and other personnel;
•foreign currency risks, of litigation;changes in socioeconomic conditions, or changes to monetary and fiscal policies;
•our level of indebtedness, and abilityor our inability to operate withinmeet debt service obligations or comply with the limitations imposed by our debt instruments; and
various risks associated with being a Dutch corporation.
There may be other risks and uncertainties that we are unable to predict at this time or that we currently do not expect that may cause actual results to differ materially from thosecovenants contained in any forward-looking statementsthe credit agreement and senior notes indentures;
•changes to current policies, such as trade tariffs, by various governments worldwide;
•risks related to the potential for goodwill impairment;
•the impact of challenges by taxing authorities of our historical and future tax positions or our allocation of taxable income among our subsidiaries, unfavorable developments in taxation sentiments in countries where we may makedo business, and that may affect our operatingchallenges to the sovereign taxation regimes of EU member states by the European Commission and financial performance.the Organization for Economic Co-operation and Development;

•changes to, or inability to comply with, various regulations, including tax laws, import/export regulations, anti-bribery laws, environmental, health, and safety laws, and other governmental regulations; and
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•risks related to our domicile in the U.K.
In addition, the extent to which the COVID-19 pandemic will continue to impact our business and financial results going forward will be dependent on future developments, such as the length and severity of the crisis, the potential resurgence of the crisis, future government actions in response to the crisis and the overall impact of the COVID-19 pandemic on the global economy and capital markets, among many other factors, all of which remain highly uncertain and unpredictable.
All forward-looking statements attributable to us or persons acting on our behalf speak only as of the date of this Quarterly Report on Form 10-Q and are expressly qualified in their entirety by the cautionary statements contained in this Quarterly Report on Form 10-Q. We undertake no obligation to update or revise forward-looking statements that may be made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. We urge readers to review carefully the risk factors described in our 2020 Annual Report and in the other documents that we file with the U.S. Securities and Exchange Commission (the "SEC"). You can read these documents at www.sec.gov or on our website at www.sensata.com.
Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the audited consolidated financial statements and notes thereto included in our 2020 Annual Report, on Form 10-K for the year ended December 31, 2016, filed with the U.S. Securities and Exchange CommissionSEC on February 2, 2017,12, 2021, and the unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q.
Overview
The COVID-19 pandemic caused widespread disruptions to our company, employees, customers, suppliers, and communities in fiscal year 2020. In the first quarter of 2020, these disruptions were primarily limited to our manufacturing operations in China. In the second quarter of 2020, we experienced the full scope and impact of disruptions related to the COVID-19 pandemic globally. These disruptions included, depending on the specific location, full or partial shutdowns of our facilities as mandated by government decrees, limited ability to adjust certain costs due to government actions, significant travel restrictions and “work-from-home” orders limiting the availability of our workforce, supplier constraints and material supply-chain interruptions, logistics challenges and limitations, and reduced demand from certain customers. Reduced demand, in addition to elevated logistics costs, government mandates, and actions to safeguard our employees, contributed to lower margins in the second quarter of 2020.
We acted early in the pandemic to reduce our cost structure while continuing to invest in megatrends that are shaping our end markets that we believe will enable us to deliver long-term sustainable growth. As a result, we have continued to capitalize on rapidly improving markets and supported our customers as they have returned to higher levels of production late in 2020 and during the first half of 2021.
2021 interim results
The economic recovery we experienced during the second half of 2020 continued through the first half of 2021. Improved market results, combined with our response to increased demand, drove net revenue growth of 72.2% and 43.3% in the three and six months ended June 30, 2021, respectively, compared to the three and six months ended June 30, 2020. This represented 1,140 basis points and 940 basis points, respectively, of market outgrowth. We use the term "market outgrowth" to describe the impact of an increasing quantity and value of our products used in customer systems and applications. It is only loosely correlated to normal unit demand fluctuations in the markets we serve.
In the three months ended June 30, 2021, Performance Sensing net revenue increased 92.6% and Sensing Solutions net revenue increased 31.1% from the three months ended June 30, 2020. In the six months ended June 30, 2021, Performance Sensing net revenue increased 52.7% and Sensing Solutions net revenue increased 20.6% from the six months ended June 30, 2020. Our automotive and HVOR businesses delivered market outgrowth of 990 basis points and 2,850 basis points, respectively, in the three months ended June 30, 2021 and market outgrowth of 940 basis points and 1,840 basis points, respectively, in the six months ended June 30, 2021. Refer to Results of Operations—Net Revenue included elsewhere in this Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") for additional discussion.
In the three months ended June 30, 2021, operating income/(loss) increased $166.6 million to $164.8 million, compared to $(1.9) million in the three months ended June 30, 2020. In the six months ended June 30, 2021, operating income increased $265.5 million to $322.2 million, compared to $56.7 million in the six months ended June 30, 2020. These improved results were due in large part to increased revenues, improved gross margins, and lower restructuring charges, partially offset by elevated costs related to the global semiconductor chip shortage, higher spend to support megatrend growth initiatives, and
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increased incentive compensation aligned to improved financial performance. Refer to Results of Operations—Operating costs and expenses included elsewhere in this MD&A for additional discussion of our improved operating costs and expenses.
In the three months ended June 30, 2021, net income/(loss) increased $155.5 million to $112.9 million, compared to $(42.5) million in the three months ended June 30, 2020. In the six months ended June 30, 2021, net income/(loss) increased $200.8 million to $166.6 million, compared to $(34.1) million in the six months ended June 30, 2020. This increase was primarily a result of improved operating results, partially offset by higher taxes as discussed at Results of Operations—Provision for/(benefit from) income taxes and, for the six month period, by the loss on redemption of the 6.25% Senior Notes as discussed at Results of Operations—Other, net.
Forward-looking information
For the full year 2021, while a degree of market uncertainty remains, in particular with respect to the impact of the industry-wide semiconductor shortage, we are anticipating a continuation of improved and stable economic and business conditions. We are also anticipating a return to normal seasonality, which includes sequentially lower revenue in the third quarter as compared to the second quarter and sequentially flat revenue in the fourth quarter as compared to the third quarter. We continue to expect to deliver industry-leading margins for our shareholders, while also increasing investments in our growth opportunities and our people. Our targeted market outgrowth for the automotive business is 400-600 basis points. Our targeted market outgrowth for the HVOR business is 600-800 basis points. For the past three and a half years, on average, we have delivered market outgrowth in our automotive and HVOR businesses of 615 basis points and 950 basis points, respectively, at or above the top of those ranges.
Automotive production is expected to rebound sharply this year from last year, but at a pace slightly lower than expected in April given production slowdowns caused by the global semiconductor shortage. Global automotive production for the full year 2021 is now expected to grow 9% from the prior year, according to third party forecasts. While low inventory levels at our automotive customers, especially in North America, will lead to growth in 2021, we expect production slowdowns attributed to the global semiconductor chip shortage to continue for the remainder of the year.
One headwind affecting our outlook for the second half of 2021 is the expected impact from the global semiconductor shortage facing the automotive supply chain, as well as other sectors, due in part to large-scale shutdowns early in 2020 caused by the COVID-19 pandemic. Semiconductors are the technology used to make microchips, and this shortage has resulted in paused production on certain vehicles and increased costs to procure microchips. This shortage has impacted our margins in the first half of 2021, and we believe it will continue to have an adverse impact on our operating costs in the remainder of fiscal year 2021.
Megatrends
We continue to demonstrate progress in our megatrend initiatives as we increase our investments to pursue these large, fast-growing markets driven by secular trends. We intend to expand our solutions for these areas organically as well as through acquisitions and third party collaborations. We see numerous opportunities to utilize our strong financial position, engineering capabilities, supply chain, and customer relationships to meaningfully enlarge our addressable markets.
Our automotive addressable market is large today and growing rapidly. Applications in internal combustion vehicles make up most of our current automotive addressable market, which is expected to continue to grow over the next 10 years, even with the shift in type of vehicles produced. In addition, while the Electrification applications that we serve represent a smaller market today, these applications are expected to grow very rapidly until they become an even larger opportunity for us than internal combustion engines by 2030. As a result, we’re expecting a doubling of our automotive addressable market by 2030.
The rapid introduction of new electric vehicles provides a healthy tailwind for our revenue growth. Our content in electric vehicles represents a 20% uplift in content value as compared to internal combustion vehicles of a similar class. This content uplift is derived from the broad array of our sensors and other components that we design into battery electric vehicles, in many cases using the same underlying technology product families that we use in internal combustion vehicles. Additionally, certain sensors carry over directly from internal combustion vehicles, such as brake pressure and tire pressure sensors. We also build additional sensors or devices unique to electric vehicles, such as contactors and electric motor position sensors. We are broadening and deepening our product portfolio to support this expanding segment. In the first quarter, we completed the acquisition of Lithium Balance to add battery management systems to our product capabilities.
In addition, we achieved a meaningful milestone in our Electrification megatrend initiative when we agreed to a joint venture with Churod Electronics ("Churod") on April 8, 2021. This joint venture extends our electrical protection capabilities to mass-market electric vehicles and other electrified equipment worldwide and expands our contactor capabilities in the automotive market to vehicles that have shorter ranges and longer charging times, which are more common in Asia. This enables us to offer
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a broader electrification solution set for electric vehicle manufacturers globally. The joint venture will provide medium-voltage contactors to transportation original equipment manufacturers ("OEMs") in China, and we will sell the product line to customers elsewhere in the world. Churod will contribute access to its ceramic, high-levitation contactor intellectual property. These contactors are optimized for medium-voltage applications in the 150 amp to 400 amp range common in mass-market vehicles. They will also dedicate engineering resources and contribute manufacturing equipment to the joint venture. Sensata will contribute $9.5 million and will dedicate application engineers and salespeople. We expect this joint venture to close in the third quarter of 2021.
Our Electrification megatrend initiative not only represents a market opportunity in electric vehicles, but also electrified heavy vehicles and the charging infrastructure necessary to support this ecosystem. We see additional opportunities in industrial and grid applications, some of which are more nascent today. Sensata is already a leading provider of high-voltage protection on electric vehicles and charging infrastructure and we seek to be the partner of choice for heavy vehicle and industrial OEMs transitioning to electrified solutions as well. We also intend to participate in other areas of the evolving market that enable Electrification to become more widespread.
In support of our Insights megatrend initiative, on April 1, 2021, we acquired Xirgo, a leading telematics and data insights provider for fleet management across the transportation and logistics segments. Refer to the section Sensata Insights below for additional information.
We believe that the overall market environment may continue to provide opportunities to further strengthen our portfolio through strategically important, value-creating acquisitions and/or joint ventures. In addition, we are pursuing new technology collaborations and partnerships with third parties to expand our capabilities and accelerate our megatrend growth.
Sensata Insights
On April 1, 2021, we completed the acquisition of Xirgo, headquartered in Camarillo, California, for $409 million. This acquisition represents a meaningful milestone in our Insights megatrend initiative, greatly expanding our ability to provide data insights to transportation and logistics customers, as well as adding a new customer base for these solutions. Xirgo brings a comprehensive suite of telematics and asset tracking devices, cloud-based data insight solutions, as well as emerging sensing applications and data services. This acquisition is consistent with our strategy to move beyond serving vehicle OEMs and engage with the broader transportation and logistics ecosystem. Xirgo is complementary to, and meaningfully extends, our organic Insights solutions for commercial fleet managers, adding cargo, container, and light-vehicle fleet management to our heavy vehicle OEM and fleet focus. We are branding these offerings, which serve our Insights megatrend initiative, as Sensata Insights. Refer to Note 16: Acquisitions of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for additional information in the acquisition of Xirgo.
The Insights initiative is expected to generate more than $100 million in annualized revenue in 2021 and grow in excess of 20% per year over the next several years. We already have committed orders for 100% of the revenue we expect the Insights initiative to generate for the remainder of 2021.
Liquidity
We have sufficient cash to take advantage of strategic opportunities as they arise. At December 31, 2020, we had cash and cash equivalents of $1,862.0 million. In the six months ended June 30, 2021, we generated operating cash flows of $267.9 million, ending the quarter on June 30, 2021 with cash and cash equivalents of $1,861.8 million. In the first quarter of 2021, we used the flexibility provided by our large cash balance to lower our cost of capital and extend our debt maturity by redeeming the 6.25% Senior Notes and issuing the 4.0% Senior Notes. Refer to Overview—Debt Transactions below for additional discussion of these transactions. On April 1, 2021, we used $401.5 million, net of $7.1 million of cash received, to acquire Xirgo, which will help advance our Insights initiative. Refer to Overview—Sensata Insights above for additional discussion of this acquisition. In addition, on April 8, 2021, we took advantage of continued favorability in the capital markets and issued an additional $250.0 million of 4.0% Senior Notes, priced at 100.75%.
Debt Transactions
On March 5, 2021, we redeemed the $750.0 million aggregate principal amount outstanding on the 6.25% Senior Notes. The redemption was at a price of 103.125% of principal, resulting in additional payment of $23.4 million upon redemption. We recorded a loss of $30.1 million as a result of this transaction, consisting primarily of the premium payment and write-off of deferred financing costs. Subsequently, on March 29, 2021, we issued $750.0 million aggregate principal amount of 4.0% Senior Notes, at par, and on April 8, 2021, we issued an additional $250.0 million of 4.0% Senior Notes at a price of 100.75%. The combined effect of these transactions was to extend the average maturity of our debt profile and lower our total cost of fixed debt. Refer to Note 11: Debt of our condensed consolidated financial statements, included elsewhere in this Quarterly
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Report on Form 10-Q, for additional information on these transactions and our overall debt. Proceeds from the 4.0% Senior Notes will be used for general corporate purposes, to fund future acquisitions and our capital deployment strategy, and for future debt repayments.
Q2 2020 Global Restructure Program
On June 30, 2020, in response to the potential long-term impact of the COVID-19 pandemic on our business, we commenced the Q2 2020 Global Restructure Program, consisting of voluntary and involuntary reductions-in-force and certain site closures, in order to align our cost structure to the then anticipated future demand outlook. We have completed a majority of the actions contemplated under the Q2 2020 Global Restructure Program as of June 30, 2021.
Including charges of $5.7 million in the first half of 2021, we have recognized charges of $30.1 million since inception of the Q2 2020 Global Restructure Program, of which $27.4 million have been severance charges and $2.7 million have been facility exit costs. As of June 30, 2021, our severance liability related to the Q2 2020 Global Restructure Program was $9.4 million, which is presented in accrued expenses and other current liabilities of our condensed consolidated balance sheets. We expect to settle these charges with cash on hand.
Reductions in force under the Q2 2020 Global Restructure Program have impacted approximately 560 positions as of June 30, 2021. When the remaining contemplated reduction-in-force actions are completed, which is expected in the third quarter of 2021, the total reductions in force are expected to be approximately 840 positions, reflecting total severance charges of between $27.0 million and $29.0 million. In addition, we expect total facility and exit costs incurred over the life of the Q2 2020 Global Restructure Program to be between $6.0 million and $8.0 million. We expect to settle these charges with cash on hand.
Results of Operations
The tablestable below presentpresents our historical results of operations, in millions of dollars and as a percentage of net revenue, for the three and ninesix months ended SeptemberJune 30, 20172021 compared to the three and ninesix months ended SeptemberJune 30, 2016.2020. We have derived the results of operations from the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Amounts and percentages in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not addappear to recalculate due to the effect of rounding.
Three Months Ended September 30, 2017 Compared to
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
AmountMargin*AmountMargin*AmountMargin*AmountMargin*
Net revenue:
Performance Sensing$741.9 74.7 %$385.2 66.8 %$1,456.4 75.3 %$953.9 70.6 %
Sensing Solutions250.8 25.3 191.3 33.2 478.8 24.7 396.9 29.4 
Net revenue992.7 100.0 576.5 100.0 1,935.2 100.0 1,350.8 100.0 
Operating costs and expenses827.9 83.4 578.4 100.3 1,613.0 83.3 %1,294.0 95.8 %
Operating income/(loss)164.8 16.6 (1.9)(0.3)322.2 16.7 56.7 4.2 
Interest expense, net(45.2)(4.6)(40.8)(7.1)(89.3)(4.6)(80.2)(5.9)
Other, net1.0 0.1 1.6 0.3 (38.4)(2.0)(10.7)(0.8)
Income/(loss) before taxes120.6 12.1 (41.1)(7.1)194.6 10.1 (34.2)(2.5)
Provision for/(benefit from) income taxes7.6 0.8 1.4 0.2 27.9 1.4 (0.1)(0.0)
Net income/(loss)$112.9 11.4 %$(42.5)(7.4)%$166.6 8.6 %$(34.1)(2.5)%
__________________________
*     Represents the Three Months Ended September 30, 2016amount presented divided by total net revenue.
Net Revenue
 For the three months ended
 September 30, 2017 September 30, 2016
($ in millions)Amount 
Percent of Net
Revenue
 Amount 
Percent of Net
Revenue
Net revenue:       
Performance Sensing$603.9
 73.7 % $584.7
 74.0 %
Sensing Solutions215.1
 26.3
 205.1
 26.0
Net revenue819.1
 100.0
 789.8
 100.0
Operating costs and expenses:       
Cost of revenue527.4
 64.4
 508.9
 64.4
Research and development34.0
 4.2
 31.6
 4.0
Selling, general and administrative76.0
 9.3
 75.0
 9.5
Amortization of intangible assets40.3
 4.9
 50.6
 6.4
Restructuring and special charges1.3
 0.2
 0.8
 0.1
Total operating costs and expenses679.1
 82.9
 667.0
 84.5
Profit from operations140.0
 17.1
 122.8
 15.5
Interest expense, net(40.3) (4.9) (41.2) (5.2)
Other, net3.1
 0.4
 (0.7) (0.1)
Income before taxes102.9
 12.6
 80.9
 10.2
Provision for income taxes14.8
 1.8
 11.1
 1.4
Net income$88.0
 10.7 % $69.8
 8.8 %
Net revenue
Net revenue for the three months ended SeptemberJune 30, 20172021 increased $29.3 million, or 3.7%,72.2% compared to $819.1 million from $789.8 million for the three months ended SeptemberJune 30, 2016. This2020 largely due to improved market results and our continued outperformance relative to those markets. Excluding an increase in net revenue was composed of a 3.3% increase in Performance Sensing and a 4.9% increase in Sensing Solutions. Excluding a 0.1% increase dueattributed to changes in foreign currency exchange rates organicand an increase of 4.4% due to the acquisition of Xirgo, net revenue growth was 3.6% when compared tofor the three months ended SeptemberJune 30, 2016.2021 increased 62.9% on an organic basis. This organic revenue increase represents market outgrowth of 1,140 basis points. We are continuing to monitor all of our end markets and customers to ensure that our resources are balanced against forecasts and prioritized against critical growth opportunities. Organic revenue growth (or decline), discussed throughout this MD&A, is a non-GAAP financial measure.measure not presented in accordance with U.S. GAAP. Refer to
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the section entitled Non-GAAP Financial Measures below for furtheradditional information onrelated to our use of this measure.organic revenue growth (or decline).
Net revenue for the six months ended June 30, 2021 increased 43.3% compared to the six months ended June 30, 2020 largely due to improved market results and our continued outperformance relative to those markets. Excluding an increase of 3.8% attributed to changes in foreign currency exchange rates and an increase of 1.9% due to the effect of the acquisition of Xirgo, net revenue for the six months ended June 30, 2021 increased 37.6% on an organic basis. This organic revenue increase represents a market outgrowth of 940 basis points.
Performance Sensing
Performance Sensing net revenue for the three months ended SeptemberJune 30, 20172021 increased $19.3 million, or 3.3%,92.6% compared to $603.9 million from $584.7 million for the three months ended SeptemberJune 30, 2016.2020. Excluding a 0.2%an increase dueof 5.8% attributed to changes in foreign currency exchange rates and an increase of 6.6% due to the effect of the acquisition of Xirgo, Performance Sensing net revenue for the three months ended June 30, 2021 increased 80.2% on an organic basis. Both Automotive and HVOR contributed to these results as discussed below.
Automotive net revenue growth was 3.1% whenfor the three months ended June 30, 2021 grew 80.9% compared to the three months ended SeptemberJune 30, 2016.2020. Excluding growth of 6.0% attributed to changes in foreign currency exchange rates, automotive net revenue for the three months ended June 30, 2021 grew 74.9% on an organic basis. Although automotive production was lower than expected, due to the semiconductor chip shortage, it increased significantly from the abnormally low levels experienced in the second quarter of 2020, which contributed to the organic growth. Further, amid the significant production increases, we continued to outperform the automotive end market, delivering 990 basis points of market outgrowth. Lastly, OEM efforts to replenish inventory channels also partly contributed to our organic revenue growth in the quarter.
HVOR net revenue for the three months ended June 30, 2021 grew 126.4% compared to the three months ended June 30, 2020. Excluding growth of 5.0% attributed to changes in foreign currency exchange rates and growth of 25.7% related to the acquisition of Xirgo, HVOR net revenue for the three months ended June 30, 2021 grew 95.7% on an organic basis. Similar to automotive, HVOR market production improved significantly from the prior year period despite being adversely impacted by the semiconductor chip shortage. In addition, HVOR delivered 2,850 basis points of market outgrowth in the quarter, demonstrating the continued ability to outperform end markets, due in part to growth in China related to adoption of the NS6 emissions as well as a wave of electromechanical operator controls being installed in new off-road equipment.
Performance Sensing net revenue for the six months ended June 30, 2021 increased 52.7% compared to the six months ended June 30, 2020. Excluding an increase of 4.3% attributed to changes in foreign currency exchange rates and an increase of 2.7% due to the effect of the acquisition of Xirgo, Performance Sensing net revenue for the six months ended June 30, 2021 increased 45.7% on an organic basis. Both Automotive and HVOR contributed to these results as discussed below.
Automotive net revenue for the six months ended June 30, 2021 grew 45.7% compared to the the six months ended June 30, 2020. Excluding growth of 4.4% attributed to changes in foreign currency exchange rates, automotive net revenue for the six months ended June 30, 2021 grew 41.3% on an organic basis. This organic revenue growthincrease is primarily due to recovery of customer production combined with our continued outperformance relative to the automotive market, which was primarily drivenled by our heavy vehicle off road ("HVOR") business, including content growth, most notablycontinued new product launches in powertrain and emissions, safety, and electrification-related applications and systems. Excluding the effects of OEM efforts to replenish inventory channels, Automotive outgrew its end markets by 940 basis points in the constructionsix months ended June 30, 2021.
HVOR net revenue for the six months ended June 30, 2021 grew 74.7% compared to the six months ended June 30, 2020. Excluding growth of 3.8% attributed to changes in foreign currency exchange rates and agriculture markets,growth of 11.1% due to the effect of the acquisition of Xirgo, HVOR net revenue for the six months ended June 30, 2021 grew 59.8% on an organic basis. This organic revenue increase is primarily due to recovery of customer production combined with our continued outperformance relative to the HVOR markets. Our China on-road truck business continued to achieve better than expected growth, primarily from the adoption of NS6 emissions regulations as well as market growth, principallythe benefit from a wave of electromechanical operator controls being installed in new off-road equipment. Excluding the effects of OEM efforts to replenish inventory channels, HVOR outgrew its end markets by 1,840 basis points in the on-road truck markets in North America and China. In general, regulatory requirements for safer vehicles, higher fuel efficiency, and lower emissions, such as the Corporate Average Fuel Economy ("CAFE") requirements in the U.S., "Euro 6d" requirements in Europe, and "China National 6" requirements in Asia, as well as consumer demand for operator productivity and convenience,six months ended June 30, 2021.

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drive the need for advancements in engine management, safety features, efficiency, and operator controls that in turn can lead to a growing demand for our sensors.Sensing Solutions
Sensing Solutions net revenue for the three months ended SeptemberJune 30, 20172021 increased $10.0 million, or 4.9%,31.1% compared to $215.1 million from $205.1 million for the three months ended SeptemberJune 30, 2016.2020. Excluding a 0.3% decline duegrowth of 3.1% attributed to changes in foreign currency exchange rates, organic revenue growth was 5.2% when compared to the three months ended September 30, 2016. The organic revenue growth was primarily due to market strength across all of our key end-markets, particularly in China, as well as content growth, primarily in the heating, ventilation and air-conditioning ("HVAC") and industrial markets.
Cost of revenue
Cost ofSensing Solutions net revenue for the three months ended SeptemberJune 30, 20172021 grew 28.0% on an organic basis. The increase in net revenue was driven by continued growth in industrial markets (particularly HVAC), new electrification launches, and 2016supply chain restocking.
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Sensing Solutions net revenue for the six months ended June 30, 2021 increased 20.6% compared to the six months ended June 30, 2020. Excluding growth of 2.6% attributed to changes in foreign currency exchange rates, Sensing Solutions net revenue for the six months ended June 30, 2021 grew 18.0% on an organic basis. The increase in net revenue was $527.4 million (64.4%mainly driven by continued growth in industrial markets (particularly HVAC), new electrification launches, and supply chain restocking, partially offset by aerospace market weakness in the first quarter of 2021.
Operating costs and expenses
Operating costs and expenses for the three and six months ended June 30, 2021 and 2020 are presented, in millions of dollars and as a percentage of net revenue)revenue, in the following table. Amounts and $508.9 million (64.4%percentages in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.
 For the three months endedFor the six months ended
 June 30, 2021June 30, 2020June 30, 2021June 30, 2020
AmountMargin*AmountMargin*AmountMargin*AmountMargin*
Operating costs and expenses:
Cost of revenue$658.3 66.3 %$412.4 71.5 %$1,293.6 66.8 %$978.8 72.5 %
Research and development42.9 4.3 30.2 5.2 78.9 4.1 64.7 4.8 
Selling, general and administrative86.8 8.7 64.7 11.2 163.9 8.5 142.0 10.5 
Amortization of intangible assets34.9 3.5 32.7 5.7 66.9 3.5 65.8 4.9 
Restructuring and other charges, net5.0 0.5 38.2 6.6 9.6 0.5 42.7 3.2 
Total operating costs and expenses$827.9 83.4 %$578.4 100.3 %$1,613.0 83.3 %$1,294.0 95.8 %
__________________________
*     Represents the amount presented divided by total net revenue.
Cost of revenue
For the three months ended June 30, 2021, cost of revenue as a percentage of net revenue), respectively.revenue decreased from the three months ended June 30, 2020, primarily as a result of improvement of various factors that drove cost of revenue as a percentage of revenue up in the second quarter of 2021 (primarily related to the COVID-19 pandemic) such as volume declines and productivity headwinds from our manufacturing facilities running at lower than normal capacity. These favorable impacts on cost of revenue as a percentage of revenue were partially offset by (1) the impacts of the microchip shortage, (2) the turnaround of the positive impact in the second quarter of 2020 of temporary salary and furlough cost savings implemented in the second quarter of 2020 in response to the COVID-19 pandemic, and (3) the unfavorable effect of changes in foreign currency exchange rates.
For the six months ended June 30, 2021, cost of revenue as a percentage of net revenue decreased from the six months ended June 30, 2020, primarily as a result of (1) improvement of various factors that drove cost of revenue as a percentage of revenue up in the first half of 2020 (primarily related to the COVID-19 pandemic) such as volume declines and productivity headwinds from our manufacturing facilities running at lower than normal capacity and (2) the impact in the first half of 2021 of ongoing savings resulting from cost reduction activities taken in fiscal year 2020. In addition, the first half of 2020 included a $29.2 million loss related to a judgment against us in intellectual property litigation with Wasica, which we settled in the third quarter of 2020. These favorable impacts on cost of revenue as a percentage of revenue were partially offset by (1) the impacts of the microchip shortage, (2) the turnaround of the positive impact in the first half of 2020 of temporary salary and furlough cost savings implemented in the second quarter of 2020 in response to the COVID-19 pandemic, and (3) the unfavorable effect of changes in foreign currency exchange rates.
Research and development expense
ResearchFor the three months ended June 30, 2021, research and development ("R&D") expense forincreased $12.7 million (41.9%) from the three months ended SeptemberJune 30, 20172020, primarily as a result of (1) increased investments in our megatrend initiatives and 2016 was $34.0(2) the unfavorable effect of changes in foreign currency exchange rates.
For the six months ended June 30, 2021, R&D expense increased $14.2 million (21.9%) from the six months ended June 30, 2020, primarily as a result of (1) increased investments in our megatrend initiatives and (2) the unfavorable effect of changes in foreign currency exchange rates.
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Megatrend investments during the three and six months ended June 30, 2021 were $13.8 million and $31.6$26.2 million, respectively.respectively, an increase of $7.1 million and $13.0 million, respectively, from the three and six months ended June 30, 2020. We investcurrently expect approximately $50 million to $55 million in R&Dmegatrend-related spend in 2021 to supportdesign and develop differentiated sensor-rich and data insight solutions to enter new platformmarkets, develop new business models, and technology developments, both in our recently acquired and existing businesses, in order to drive future revenue growth. The level of R&D expense is related to the number of products in development, the stage of such productsdesign new product categories in the development process, the complexityfast-growing and transformational megatrend vectors of the underlying technology, the potential scale of the product upon successful commercialization,Electrification and the level of our exploratory research.Sensata Insights solutions.
Selling, general and administrative expense
Selling,For the three months ended June 30, 2021, selling, general and administrative ("SG&A") expense forincreased $22.1 million to $86.8 million (8.7% of revenue) from $64.7 million (11.2% of revenue) in the three months ended SeptemberJune 30, 2017 and 2016 was $76.0 million and $75.0 million, respectively.2020. The increase in SG&A expense consistsis primarily a result of all expenditures incurred(1) higher incentive compensation aligned to improved financial performance, (2) incremental SG&A expense related to acquired businesses, including related transaction costs, (3) increased selling expenses attributed to organic revenue growth, (4) the unfavorable impact of changes in connection withforeign currency exchange rates, and (5) the salesturnaround impact of cost savings actions taken in the second quarter of 2020, including temporary salary reductions and marketingfurloughs, partially offset by (1) the impact on the second quarter of 2021 of ongoing savings resulting from cost reduction activities taken in fiscal year 2020 and (2) the 2020 completion of a project related to enhancements and improvements of our products, as well as administrative overhead costs. These costs are fixed or variableglobal operating processes to increase productivity and the resulting reduction in nature, and we may at times experienceprofessional fees.
For the six months ended June 30, 2021, SG&A expense increased or decreased variable costs for reasons other than increased or decreased net revenue. As$22.0 million to $163.9 million (8.5% of revenue) from $142.0 million (10.5% of revenue) in the six months ended June 30, 2020. The increase in SG&A expense is primarily a result of (1) higher incentive compensation aligned to improved financial performance, (2) incremental SG&A expense will not necessarily remain consistent asrelated to acquired businesses, including related transaction costs, (3) the unfavorable impact of changes in foreign currency exchange rates, (4) increased selling expenses attributed to organic revenue growth, and (5) the turnaround impact of cost savings actions taken in the second quarter of 2020, including temporary salary reductions and furloughs, and savings from repositioning actions, partially offset by (1) the impact on the second quarter of 2021 of ongoing savings resulting from cost reduction activities taken in fiscal year 2020 and (2) the 2020 completion of a percentageproject related to enhancements and improvements of revenue.our global operating processes to increase productivity and the resulting reduction in professional fees.
Amortization of intangible assets
Amortization expense associated with definite-lived intangible assets forFor the three and six months ended SeptemberJune 30, 20172021, amortization expense increased 6.5% and 2016 was $40.3 million1.6%, respectively, from the three and $50.6 million, respectively. Definite-lived intangible assets are amortized on an economic benefit basis accordingsix months ended June 30, 2020 primarily due to increased intangibles from recent acquisitions partially offset by the useful liveseffect of the assets, or on a straight-line basis if a pattern of economic benefits cannot be reliably determined. In general, the economic benefit of an intangible asset is concentrated towardsamortization method.
Restructuring and other charges, net
For the beginning of that intangible asset's useful life. Amortization expensethree and six months ended June 30, 2021, restructuring and other charges, net decreased as certain intangible assets, primarily$33.2 million (86.8%) and $33.1 million (77.5%) from the three and six months ended June 30, 2020. In the three and six months ended June 30, 2021, we incurred $3.8 million and $5.7 million in charges, respectively, related to the Sensors & Controls and High Temperature Sensing acquisitions in 2006 and 2011, respectively, are at, or are nearing, the endQ2 2020 Global Restructure Program, declines of their useful lives.
Restructuring and special charges
Restructuring and special charges for the three months ended September 30, 2017 and 2016 were $1.3$20.3 million and $0.8$18.5 million, respectively. respectively, from the prior periods. Refer to Overview—Q2 2020 Global Restructure Program elsewhere in this MD&A for additional discussion on this program.
The remaining decrease in restructuring and specialother charges, for the three months ended September 30, 2017 consisted primarily of facility exit costs of $1.3 million related to the closing of our facility in Minden, Germany that was part of the acquisition of certain subsidiaries of Custom Sensors & Technologies Ltd. ("CST"). The restructuring and special charges for the three months ended September 30, 2016 consisted primarily of facility exit costs related to the relocation of manufacturing lines from our facility in the Dominican Republic to a manufacturing facility in Mexico, and severance charges recorded in connection with acquired businesses and the termination of a limited number of employees. We completed the cessation of manufacturing in our Dominican Republic facility in the third quarter of 2016.
Interest expense, net
Interest expense, net for the three months ended September 30, 2017 and 2016 was $40.3 million and $41.2 million, respectively.
Other, net
Other, net for the three months ended September 30, 2017 and 2016 represented a net gain of $3.1 million and a net loss of $0.7 million, respectively. The change in Other, net, relates to fluctuationsa $12.1 million charge recorded in foreign currency exchange rates, netthe second quarter of any offsetting hedge gain or loss and fluctuations2020 resulting from a prejudgment interest-related award granted by the court on behalf of Wasica in commodity prices relative to the strike prices on outstanding forward contracts.intellectual property litigation. Refer to Note 13, "Other,5: Restructuring and Other Charges, Net" of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for a detail of the components of Other,additional information on our restructuring and other charges, net.

Operating income/(loss)
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Provision for income taxes
Provision for income taxes forIn the three months ended SeptemberJune 30, 2017 and 2016 was $14.82021, operating income/(loss) increased $166.6 million and $11.1to $164.8 million respectively. The provision for income taxes consists of current tax expense, which relates primarily to our profitable operations in non-U.S. tax jurisdictions and withholding taxes on interest and royalty income, and deferred tax expense, which relates to adjustments in book-to-tax basis differences primarily related to the step-up in fair value of fixed and intangible assets, including goodwill, acquired in connection with business combination transactions, and the utilization(16.6% of net operating losses.
The changerevenue) compared to $(1.9) million ((0.3%) of net revenue) in the provision for income taxesthree months ended June 30, 2020. The increase was primarily due to a changehigher volume, improved gross margins, and lower restructuring costs. These improvements were partially offset by increases in other operating costs and expenses, driven primarily by elevated costs related to the semiconductor chip shortage, higher incentive compensation aligned to improved financial performance, increased megatrend spending, and the turnaround effect of temporary salary reductions and furloughs taken in the amountsecond quarter 2020.
In the six months ended June 30, 2021, operating income increased $265.5 million to $322.2 million (16.7% of net revenue) compared to $56.7 million (4.2% of net revenue) in the six months ended June 30, 2020. The increase was primarily due to higher volume, improved gross margins, and distribution of income recorded in various jurisdictions, the impact of changes in foreign currency exchange rates, and a change in our U.S. valuation allowance associated with the acquisition of CST, for which deferred tax liabilitieslower restructuring costs. These improvements were establishedpartially offset by elevated costs related primarily to the step-upsemiconductor chip shortage, higher incentive compensation aligned to improved financial performance, increased megatrend spending, and the turnaround effect of tangible assetstemporary salary reductions and furloughs taken in the second quarter 2020.
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We expect that the microchip shortage will increase our operating costs in the third quarter of 2021, compared to the third quarter of 2020. If the impacts of this shortage are more severe than we expect, it could result in deterioration of our results, potentially for book purposes, for which we recorded a benefit from income taxes of $5.1 million duringlonger period than currently anticipated.
Interest expense, net
For the three months ended SeptemberJune 30, 2016.
Nine Months Ended September 30, 2017 Compared to2021, interest expense, net increased $4.4 million (10.8%) from the Nine Months Ended September 30, 2016
 For the nine months ended
 September 30, 2017 September 30, 2016
($ in millions)Amount 
Percent of Net
Revenue
 Amount 
Percent of Net
Revenue
Net revenue:       
Performance Sensing$1,825.9
 74.0 % $1,797.4
 74.5 %
Sensing Solutions640.3
 26.0
 616.5
 25.5
Net revenue2,466.2
 100.0
 2,413.9
 100.0
Operating costs and expenses:       
Cost of revenue1,601.2
 64.9
 1,574.8
 65.2
Research and development97.0
 3.9
 95.2
 3.9
Selling, general and administrative227.3
 9.2
 224.6
 9.3
Amortization of intangible assets121.6
 4.9
 151.6
 6.3
Restructuring and special charges18.8
 0.8
 3.2
 0.1
Total operating costs and expenses2,065.8
 83.8
 2,049.4
 84.9
Profit from operations400.4
 16.2
 364.5
 15.1
Interest expense, net(120.6) (4.9) (125.2) (5.2)
Other, net7.2
 0.3
 4.9
 0.2
Income before taxes287.0
 11.6
 244.2
 10.1
Provision for income taxes47.8
 1.9
 48.3
 2.0
Net income$239.2
 9.7 % $195.9
 8.1 %
Net revenue
Net revenue for the ninethree months ended SeptemberJune 30, 2017 increased $52.3 million, or 2.2%, to $2,466.2 million from $2,413.9 million for the nine months ended September 30, 2016. This increase in net revenue was composed of a 1.6% increase in Performance Sensing and 3.9% increase in Sensing Solutions. Excluding a 1.4% decline due to changes in foreign currency exchange rates, particularly related to the Euro and Chinese Renminbi, organic revenue growth was 3.6% when compared to the nine months ended September 30, 2016. Organic revenue growth is a non-GAAP financial measure. Refer to the section entitled Non-GAAP Financial Measures for further information on our use of this measure.
Performance Sensing net revenue for the nine months ended September 30, 2017 increased $28.5 million, or 1.6%, to $1,825.9 million from $1,797.4 million for the nine months ended September 30, 2016. Excluding a 1.6% decline due to changes in foreign currency exchange rates, particularly related to the Euro and Chinese Renminbi, organic revenue growth was 3.2% when compared to the nine months ended September 30, 2016. This organic revenue growth was primarily driven by our HVOR business,2020, primarily as a result of content growth in(1) interest expense on the construction4.0% Senior Notes, which were issued on March 29, 2021 and agriculture markets,April 8, 2021 and (2) interest expense on the 3.75% Senior Notes, which were issued on August 17, 2020, partially offset by the reduced interest expense related to our March 5, 2021 redemption of the 6.25% Senior Notes. For the six months ended June 30, 2021, interest expense, net increased $9.0 million (11.3%) from the six months ended June 30, 2020, primarily as well asa result of (1) interest expense on the on-road truck markets in North America3.75% Senior Notes and China. In addition, we believe that(2) interest expense on the major end-markets within HVOR have been recovering, including4.0% Senior Notes, partially offset by the North American Class 8 truck market, which has been particularly weak in prior quarters and

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represents a significant partreduced interest impact of our HVOR business. Our automotive end-marketsredemption of the 6.25% Senior Notes. Refer to Overview—Debt Transactions elsewhere in Asia, primarily in China, experienced growth from both content and an expanding market.
Sensing Solutions net revenuethis MD&A for the nine months ended September 30, 2017 increased $23.8 million, or 3.9%, to $640.3 million from $616.5 million for the nine months ended September 30, 2016. Excluding a 0.7% decline due to changes in foreign currency exchange rates, particularlyadditional information related to the Chinese Renminbi, organic revenue growth was 4.6% when compared to the nine months ended September 30, 2016. The organic revenue growth was primarily due to market strength across all of our key end-markets, particularly in China, as well as content growth in our HVAC and industrial markets.
Cost of revenue
Cost of revenue for the nine months ended September 30, 2017 and 2016 was $1,601.2 million (64.9% of net revenue) and $1,574.8 million (65.2% of net revenue), respectively.
Research and development expense
R&D expense for the nine months ended September 30, 2017 and 2016 was $97.0 million and $95.2 million, respectively. We invest in R&D to support new platform and technology developments, both in our recently acquired and existing businesses, in order to drive future revenue growth. The level of R&D expense is related to the number of products in development, the stage of such products in the development process, the complexity of the underlying technology, the potential scale of the product upon successful commercialization, and the level of our exploratory research.
Selling, general and administrative expense
SG&A expense for the nine months ended September 30, 2017 and 2016 was $227.3 million and $224.6 million, respectively. SG&A expense consists of all expenditures incurred in connection with the sales and marketing of our products, as well as administrative overhead costs. These costs are fixed or variable in nature, and we may at times experience increased or decreased variable costs for reasons other than increased or decreased net revenue. As a result, SG&A expense will not necessarily remain consistent as a percentage of revenue.
Amortization of intangible assets
Amortization expense associated with definite-lived intangible assets for the nine months ended September 30, 2017 and 2016 was $121.6 million and $151.6 million, respectively. Definite-lived intangible assets are amortized on an economic benefit basis according to the useful lives of the assets, or on a straight-line basis if a pattern of economic benefits cannot be reliably determined. In general, the economic benefit of an intangible asset is concentrated towards the beginning of that intangible asset's useful life. Amortization expense decreased as certain intangible assets, primarily related to the Sensors & Controls and High Temperature Sensing acquisitions in 2006 and 2011, respectively, are at, or are nearing, the end of their useful lives.
Restructuring and special charges
Restructuring and special charges for the nine months ended September 30, 2017 and 2016 were $18.8 million and $3.2 million, respectively. The restructuring and special charges for the nine months ended September 30, 2017 consisted primarily of severance charges of $8.4 million and facility exit costs of $2.4 million recorded in connection with the closing of our facility in Minden, Germany that was part of the acquisition of CST, facility exit costs related to a limited number of other line moves and exit activities, and severance costs related to the termination of a limited number of employees. The restructuring and special charges for the nine months ended September 30, 2016 consisted primarily of facility exit costs related to the relocation of manufacturing lines from our facility in the Dominican Republic to a manufacturing facility in Mexico, and severance charges recorded in connection with acquired businesses and the termination of a limited number of employees. We completed the cessation of manufacturing in our Dominican Republic facility in the third quarter of 2016.
Interest expense, net
Interest expense, net for the nine months ended September 30, 2017 and 2016 was $120.6 million and $125.2 million, respectively.these transactions.
Other, net
Other, net primarily includes currency remeasurement gains and losses on net monetary assets, gains and losses on foreign currency and commodity forward contracts not designated as hedging instruments, losses related to debt refinancing, and the portion of our net periodic benefit cost excluding service cost. In the three months ended June 30, 2021, other, net represented a net gain of $1.0 million, a decrease of $0.6 million compared to $1.6 million in the three months ended June 30, 2020. In the six months ended June 30, 2021, other, net represented a net loss of $38.4 million, an increase of $27.7 million compared to a net loss of $10.7 million in the six months ended June 30, 2020.
The increase in net loss for the ninesix months ended SeptemberJune 30, 2017 and 2016 represented net gains2021 was driven primarily by the loss of $7.2$30.1 million and $4.9 million, respectively. The changerecorded in Other, net relates to fluctuations in foreign currency exchange rates netthe first quarter of any offsetting hedge gain or loss and fluctuations in commodity prices relative2021 related to the strike prices on outstanding forward contracts.redemption of the 6.25% Senior Notes. Refer to Overview—Debt Transactions included elsewhere in this MD&A for additional information related to the redemption of the 6.25% Senior Notes. Refer to Note 13,

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"6: Other, Net" of our condensed consolidated financial statements, included elsewhere in this Quarterly Report on Form 10-Q, for a detail of the components of Other,more detailed information on amounts included in other, net.
Provision forfor/(benefit from) income taxes
Provision for income taxes forFor the ninethree months ended SeptemberJune 30, 2017 and 2016 was $47.8 million and $48.3 million, respectively. The2021, provision for income taxes increased $6.2 million from the three months ended June 30, 2020, predominantly related to the overall increase in income before tax as impacted by the mix of profits in the various jurisdictions in which we operate.
For the six months ended June 30, 2021, the provision for/(benefit from) income taxes increased $28.0 million from the six months ended June 30, 2020, predominantly related to the overall increase in income before tax as impacted by the mix of profits in the various jurisdictions in which we operate, as well as the nonrecurrence of the benefit recorded in the first quarter of 2020 as a result of the enactment of the CARES Act, which was enacted by the U.S. federal government on March 27, 2020 in response to the global financial and health crisis caused by the COVID-19 pandemic. In connection with this legislation, federal limitations on interest deductions were reduced and we recorded a deferred tax benefit of $7.5 million in the six months ended June 30, 2020, as we were able to utilize additional interest expense that was previously subject to a valuation allowance.
The provision for/(benefit from) income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in non-U.S. tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes on interestrelated to management fees, royalties, and royalty income,the repatriation of foreign earnings; and (2) deferred tax expense (or benefit), which relates torepresents adjustments in book-to-tax basis differences primarily related to the step-up(a) book versus tax basis in fair value of fixed and intangible assets, including goodwill, acquired(b) changes in connection with business combination transactions, and the utilization of net operating losses.
The change in the provision for income taxes was primarily due to a change in the amount and distribution of income recorded in various jurisdictions, the impact ofloss carryforwards, (c) changes in foreign currency exchangetax rates, and a change(d) changes in our U.S. valuation allowance associated withassessment of the acquisitionrealizability of certain subsidiaries of CST, for whichour deferred tax liabilities were established related primarily to the step-up of tangible assets for book purposes, for which we recorded a benefit from income taxes of $3.7 million during the nine months ended September 30, 2016.assets.
Non-GAAP Financial Measures
This Quarterly Report on Form 10-Q includes references tosection provides additional information regarding certain non-GAAP financial measures, including organic revenue growth (or decline), adjusted operating income, adjusted operating margin, adjusted net income, adjusted earnings per share ("EPS"), free cash flow, net leverage ratio, and adjusted earnings before interest, taxes, depreciation, and amortization ("EBITDA"), which is aare used by our management, Board of Directors, and investors. We use these non-GAAP financial measure. measures internally to make operating and strategic decisions, including the preparation of our annual operating plan, evaluation of our overall business performance, and as a factor in determining compensation for certain employees. 
The use of our non-GAAP financial measures have limitations. They should be considered as supplemental in nature and are not intended to be considered in isolation from, or as an alternative to, reported net revenue growth (or decline), operating income, operating margin, net income, diluted EPS, operating cash flows, segment operating margin, total debt, finance lease,
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and other financing obligations, or EBITDA, respectively, calculated in accordance with U.S. GAAP. In addition, our measures of organic revenue growth (or decline), adjusted operating income, adjusted operating margin, adjusted net income, adjusted EPS, free cash flow, net leverage ratio, and adjusted EBITDA may not be the same as, or comparable to, similar non-GAAP financial measures presented by other companies.
Organic revenue growth (or decline)
Organic revenue growth (or decline) is defined as the reported percentage change in net revenue, calculated in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"),GAAP, excluding the period-over-period impact of acquisitions, net of exited businesses that occurred within the previous 12 months and the effect of differences in foreign currency exchange rates betweenrate differences as well as the currentnet impact of material acquisitions and prior period.divestitures for the 12-month period following the respective transaction date(s).
We believe that organic revenue growth (or decline) provides investors with helpful information with respect to our operating performance, and we use organic revenue growth (or decline) to evaluate our ongoing operations andas well as for internal planning and forecasting purposes. We believe that organic revenue growth (or decline) provides useful information in evaluating the results of our business because it excludes items that we believe are not indicative of ongoing performance or that we believe impact comparability with the prior yearprior-year period.
However, organic revenue growth should be consideredAdjusted operating income (or loss), adjusted operating margin, adjusted net income (or loss), and adjusted EPS
We define adjusted operating income (or loss) as supplementaloperating income (or loss) determined in nature andaccordance with U.S. GAAP, excluding certain non-GAAP adjustments which are described below. Adjusted operating margin is not intended to be considered in isolation or as a substitute forcalculated by dividing adjusted operating income (or loss) by net revenue growth preparedcalculated in accordance with U.S. GAAP. In addition,We define adjusted net income (or loss) as follows: net income (or loss) determined in accordance with U.S. GAAP, excluding certain non-GAAP adjustments which are described in Non-GAAP Adjustments below. Adjusted EPS is calculated by dividing adjusted net income (or loss) by the number of diluted weighted-average ordinary shares outstanding in the period.
Management uses adjusted operating income (or loss), adjusted operating margin, adjusted net income (or loss), and adjusted EPS as measures of operating performance, for planning purposes (including the preparation of our measureannual operating budget), to allocate resources to enhance the financial performance of organic revenue growth may not beour business, to evaluate the sameeffectiveness of our business strategies, in communications with our Board of Directors and investors concerning our financial performance, and as or comparable to, similarfactors in determining compensation for certain employees. We believe investors and securities analysts also use these non-GAAP financial measures in their evaluation of our performance and the performance of other similar companies. These non-GAAP financial measures are not measures of liquidity.
Free cash flow
Free cash flow is defined as net cash provided by/(used in) operating activities less additions to property, plant and equipment and capitalized software. We believe free cash flow is useful to management and investors as a measure of cash generated by business operations that will be used to repay scheduled debt maturities and can be used to, among other things, fund acquisitions, repurchase ordinary shares, and (or) accelerate the repayment of debt obligations.
Adjusted EBITDA
Adjusted EBITDA represents net income (or loss), determined in accordance with U.S. GAAP, excluding interest expense, net, provision for (or benefit from) income taxes, depreciation expense, amortization of intangible assets, and the following non-GAAP adjustments, if applicable: (1) restructuring related and other, (2) financing and other transaction costs, (3) deferred loss or gain on derivative instruments, and (4) step-up inventory amortization. Refer to Non-GAAP Adjustments below for additional discussion of these adjustments.
Net leverage ratio
Net leverage ratio represents net debt (total debt, finance lease and other financing obligations less cash and cash equivalents) divided by last twelve months ("LTM") adjusted EBITDA. We believe that the net leverage ratio is a useful measure to management and investors in understanding trends in our overall financial condition.
Non-GAAP adjustments
Many of our non-GAAP adjustments relate to a series of strategic initiatives developed by our management aimed at better positioning us for future revenue growth and an improved cost structure. These initiatives have been modified from time to time to reflect changes in overall market conditions and the competitive environment facing our business. These initiatives include, among other items, acquisitions, divestitures, restructurings of certain business, supply chain, or corporate activities, and
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various financing transactions. We describe these adjustments in more detail below, each of which is net of current tax impacts, as applicable.
•Restructuring related and other: includes charges, net related to certain restructuring and other exit activities as well as other costs (or income) that we believe are either unique or unusual to the identified reporting period, and that we believe impact comparisons to prior period operating results. Such costs include charges related to optimization of our manufacturing processes to increase productivity. This type of activity occurs periodically, however each action is unique, discrete, and driven by various facts and circumstances. Such amounts are excluded from internal financial statements and analyses that management uses in connection with financial planning, and in its review and assessment of our operating and financial performance, including the performance of our segments. Restructuring related and other does not, however, include charges related to the integration of acquired businesses, including such charges that are recognized as restructuring and other charges, net in the consolidated statements of operations.
•Financing and other transaction costs: includes losses or gains related to debt financing transactions, losses or gains related to the divestiture of a business, losses or gains related to the termination of a long-term unfavorable supply agreement, and costs incurred, including for legal, accounting, and other professional services, that are directly related to an acquisition, divestiture, or equity financing transaction.
•Deferred loss or gain on derivative instruments: includes unrealized losses or gains on derivative instruments that do not qualify for hedge accounting as well as the impact of commodity prices on our raw material costs relative to the strike price on our commodity forward contracts.
•Step-up depreciation and amortization: includes depreciation and amortization expense associated with the step-up in fair value of assets acquired in connection with a business combination (e.g., property, plant and equipment, definite-lived intangible assets, and inventory).
•Deferred taxes and other tax related: includes adjustments for book-to-tax basis differences due primarily to the step-up in fair value of fixed and intangible assets and goodwill, the utilization of net operating losses, and adjustments to our valuation allowance in connection with certain acquisitions and tax law changes. Other tax related items include certain adjustments to unrecognized tax positions and withholding tax on repatriation of foreign earnings.
•Amortization of debt issuance costs. We adjust our results recorded in accordance with U.S. GAAP by the amortization of debt issuance costs, which are deferred as a contra-liability against our long-term debt, net on the consolidated balance sheets and which are reflected in interest expense on our consolidated statements of operations.
•Where applicable, the current tax effect of non-GAAP adjustments.
Our definition of adjusted net income (or loss) excludes the deferred provision for (or benefit from) income taxes and other tax related items described above. As we treat deferred income taxes as an adjustment to compute adjusted net income (or loss), the deferred income tax effect associated with the reconciling items presented below would not change adjusted net income for any period presented.
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Non-GAAP reconciliations
The following tables provide reconciliations of certain financial measures calculated in accordance with U.S. GAAP to the related non-GAAP financial measures for the periods presented. Refer to Non-GAAP Adjustments section above for additional information on these adjustments. Amounts and percentages have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding.
 For the three months ended June 30, 2021For the three months ended June 30, 2020
(Dollars in millions, except per share amounts)Operating IncomeOperating MarginNet IncomeDiluted EPSOperating (Loss)/IncomeOperating MarginNet (Loss)/IncomeDiluted EPS
Reported (GAAP)$164.8 16.6 %$112.9 $0.71 $(1.9)(0.3)%$(42.5)$(0.27)
Non-GAAP adjustments:
Restructuring related and other5.7 0.6 6.9 0.04 40.8 7.1 33.6 0.21 
Financing and other transaction costs2.5 0.3 1.3 0.01 3.6 0.6 3.6 0.02 
Step-up depreciation and amortization33.7 3.4 33.7 0.21 31.9 5.5 31.9 0.20 
Deferred loss/(gain) on derivative instruments2.6 0.3 1.1 0.01 0.5 0.1 (4.9)(0.03)
Amortization of debt issuance costs— — 1.7 0.01 — — 1.6 0.01 
Deferred taxes and other tax related— — (6.2)(0.04)— — 4.4 0.03 
Total adjustments44.6 4.5 38.4 0.24 76.9 13.3 70.2 0.45 
Adjusted (non-GAAP)$209.3 21.1 %$151.4 $0.95 $75.0 13.0 %$27.7 $0.18 
 For the six months ended June 30, 2021For the six months ended June 30, 2020
(Dollars in millions, except per share amounts)Operating IncomeOperating MarginNet IncomeDiluted EPSOperating IncomeOperating MarginNet (Loss)/IncomeDiluted EPS
Reported (GAAP)$322.2 16.7 %$166.6 $1.05 $56.7 4.2 %$(34.1)$(0.22)
Non-GAAP adjustments:
Restructuring related and other10.3 0.5 14.2 0.09 84.6 6.3 71.8 0.45 
Financing and other transaction costs7.1 0.4 34.1 0.21 5.4 0.4 5.4 0.03 
Step-up depreciation and amortization63.4 3.3 63.4 0.40 64.2 4.8 64.2 0.41 
Deferred gain on derivative instruments4.4 0.2 3.3 0.02 0.8 0.1 1.0 0.01 
Amortization of debt issuance costs— — 3.4 0.02 — — 3.3 0.02 
Deferred taxes and other tax related— — 3.9 0.02 — — (0.5)0.00 
Total adjustments85.2 4.4 122.3 0.77 154.9 11.5 145.0 0.92 
Adjusted (non-GAAP)$407.4 21.1 %$289.0 $1.81 $211.7 15.7 %$110.9 $0.70 
The following table provides a reconciliation of net cash provided by operating activities in accordance with U.S. GAAP to free cash flow.
For the six months ended June 30,
(in millions)20212020
Net cash provided by operating activities$267.9 $170.3 
Additions to property, plant and equipment and capitalized software(63.6)(56.7)
Free cash flow$204.4 $113.6 
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The following table provides a reconciliation of net income/(loss) in accordance with U.S. GAAP to Adjusted EBITDA.
For the three months ended June 30For the six months ended June 30
(in millions)LTM2021202020212020
Net income/(loss)$365.0 $112.9 $(42.5)$166.6 $(34.1)
Interest expense, net180.8 45.2 40.8 89.3 80.2 
Provision for/(benefit from) income taxes29.3 7.6 1.4 27.9 (0.1)
Depreciation expense123.2 31.6 30.6 62.8 65.3 
Amortization of intangible assets130.6 34.9 32.7 66.9 65.8 
EBITDA829.1 232.3 63.1 413.6 177.1 
Non-GAAP Adjustments
Restructuring related and other22.2 7.0 42.7 14.4 85.3 
Financing and other transaction costs38.6 1.7 3.6 37.6 5.4 
Deferred (gain)/loss on derivative instruments(3.5)1.4 (4.9)4.4 1.0 
Adjusted EBITDA$886.4 $242.4 $104.5 $470.0 $268.7 
The following table provides a reconciliation of total debt, finance lease, and other companies.financing obligations in accordance with U.S. GAAP to net leverage ratio.
(in millions)June 30, 2021December 31, 2020
Current portion of long-term debt, finance lease and other financing obligations$7.3 $757.2 
Finance lease and other financing obligations, less current portion27.2 27.9 
Long-term debt, net4,213.8 3,213.7 
Total debt, finance lease, and other financing obligations4,248.3 3,998.9 
Less: discount(6.1)(9.6)
Less: deferred financing costs(29.2)(28.1)
Total gross indebtedness4,283.7 4,036.6 
Less: cash and cash equivalents1,861.8 1,862.0 
Net Debt$2,421.9 $2,174.6 
Adjusted EBITDA (LTM)$886.4 $685.1 
Net leverage ratio2.73.2
Liquidity and Capital Resources
WeAs of June 30, 2021 and December 31, 2020, we held cash and cash equivalents of $613.0 million and $351.4 million at September 30, 2017 and December 31, 2016, respectively, of which $174.0 million and $37.8 million, respectively, was held in the Netherlands, $7.0 million and $5.7 million, respectively, was held by U.S. subsidiaries, and $432.0 million and $307.9 million, respectively, was held by other foreign subsidiaries. following regions (amounts have been calculated based on unrounded numbers; accordingly, certain amounts may not appear to recalculate due to the effect of rounding):
(In millions)June 30, 2021December 31, 2020
United Kingdom$26.4 $25.3 
United States33.2 17.2 
The Netherlands1,516.6 1,514.1 
China231.9 185.2 
Other53.7 120.2 
Total$1,861.8 $1,862.0 
The amount of cash and cash equivalents held in the Netherlands and in our U.S. and other foreign subsidiariesthese geographic regions fluctuates throughout the year due to a variety of factors, includingsuch as our use of intercompany loans and dividends and the timing of cash receipts and disbursements in the normal course of business.

Our earnings are not considered to be permanently reinvested in certain jurisdictions in which they were earned. We recognize a deferred tax liability on these unremitted earnings to the extent the remittance of such earnings cannot be recovered in a tax-free manner.
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Cash Flows:
The table below summarizes our primary sources and uses of cash for the ninesix months ended SeptemberJune 30, 20172021 and 2016.2020. We have derived thethis summarized statements of cash flows from the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Amounts in the table below have been calculated based on unrounded numbers. Accordingly, certain amounts may not addappear to recalculate due to the effect of rounding.
 For the six months ended
(In millions)June 30, 2021June 30, 2020
Net cash provided by/(used in):
Operating activities:
Net income/(loss) adjusted for non-cash items$347.0 $160.7 
Changes in operating assets and liabilities, net(79.1)9.6 
Operating activities267.9 170.3 
Investing activities(489.1)(60.5)
Financing activities221.0 359.1 
Net change$(0.2)$468.8 
 For the nine months ended
(in millions)September 30, 2017 September 30, 2016
Net cash provided by/(used in):   
Operating activities:   
Net income adjusted for non-cash items$480.0
 $462.6
Changes in operating assets and liabilities, net of effects of acquisitions(107.7) (66.2)
Operating activities372.3
 396.4
Investing activities(97.7) (139.1)
Financing activities(13.1) (299.6)
Net change$261.5
 $(42.4)
Operating activities. Net cash provided by operating activities forincreased in the ninesix months ended SeptemberJune 30, 2017 and 2016 was $372.3 million and $396.4 million, respectively. The decrease in cash provided by operating activities relates2021 primarily due to a build up of inventory to support anticipated line moves, higher cash paidnet income adjusted for interest, and higher cash paid related to severance obligations,non-cash items, partially offset by improved operating profitability. Thethe impact of changes in working capital. Changes in working capital in the six months ended June 30, 2021 were primarily driven by higher cash paid for interest relatesaccounts receivable balances reflecting higher revenue in the second quarter of 2021 compared to the 6.25% Senior Notes, for which interest payments are due semi-annually on February 15second quarter of 2020. In addition, during the six months ended June 30, 2021, we built raw material and August 15work-in process inventory to address higher demand compared to the prior year. These changes were partially offset by increased accounts payable and accrued expenses, in part related to our increased cost of each year. The payment made on February 15, 2016 did not represent payment for a full six-month period, as the 6.25% Senior Notes were issued on November 27, 2015.revenue and inventory.
Investing activities. Net cash used in investing activities increased in the six months ended June 30, 2021 primarily due to $422.0 million cash paid for the nine months ended September 30, 2017acquisitions of Lithium Balance and 2016 was $97.7 million and $139.1 million, respectively, which included $103.5 million and $94.6 million, respectively, in capital expenditures.Xirgo. In 2017,fiscal year 2021, we anticipate capital expenditures of approximately $130$160.0 million to $150$170.0 million, which we expect to be funded withfrom cash on hand.
Financing activities. In the six months ended June 30, 2021, net cash provided by operating activities. Net cash used in investingfinancing activities fordecreased primarily due to the nineimpact of debt financing transactions. In the six months ended SeptemberJune 30, 2016 also included an investment2021 we issued $1.0 billion of $50.04.0% Senior Notes compared to a drawdown of $400.0 million on the Revolving Credit Facility in the six months ended June 30, 2020. In addition, in the six months ended June 30, 2021, we redeemed the $750.0 million aggregate principal amount outstanding on the 6.25% Senior Notes. Further, we did not repurchase any ordinary shares in the six months ended June 30, 2021, compared to ordinary share repurchases of $35.2 million in preferred stockthe first half of Quanergy Systems, Inc.
Financing activities. Net cash used2020. This decline is the result of our temporary suspension of share repurchases on April 2, 2020. Refer to Capital Resources—Share repurchase programs for additional discussion. We will resume the share repurchase program when market conditions are favorable to do so. This decline related to share repurchases was partially offset by a $23.4 million premium paid on the redemption of the 6.25% Senior Notes, and $9.6 million of costs paid in financing activities forconnection with the nine months ended September 30, 2017 and 2016 was $13.1 million and $299.6 million, respectively, which consisted primarilyissuance of $14.5 million and $297.7 million, respectively, in payments on debt.the 4.0% Senior Notes.
Indebtedness and Liquidity:Liquidity
Our liquidity requirements are significant due to our highly leveraged nature. As of SeptemberJune 30, 2017,2021, we had $3,313.6 million$4.3 billion in gross indebtedness, which includes capitalfinance lease and other financing obligations and excludesexcluded debt discounts and deferred financing costs.

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A summary2021, we redeemed our 6.25% Senior Notes and issued the 4.0% Senior Notes, reducing our cost of capital and extending the maturity profile of our indebtedness asdebt. Refer to Overview—Debt Transactions included elsewhere in this MD&A for additional discussion of September 30, 2017 is as follows:these transactions.
Capital Resources
(in thousands)Maturity Date September 30, 2017
Term LoanOctober 14, 2021 $927,794
4.875% Senior NotesOctober 15, 2023 500,000
5.625% Senior NotesNovember 1, 2024 400,000
5.0% Senior NotesOctober 1, 2025 700,000
6.25% Senior NotesFebruary 15, 2026 750,000
Less: discount  (15,812)
Less: deferred financing costs  (29,971)
Less: current portion  (7,327)
Long-term debt, net  $3,224,684
    
Capital lease and other financing obligations  $35,839
Less: current portion  (5,849)
Capital lease and other financing obligations, less current portion  $29,990
Senior Secured Credit Facilities
AsThe credit agreement governing our secured credit facility (as amended, the "Credit Agreement") provides for the Senior Secured Credit Facilities consisting of September 30, 2017, there was $415.3 million of availability underthe Term Loan, the Revolving Credit Facility, netand incremental availability (the "Accordion") under which additional secured credit facilities could be issued under certain circumstances.
Sources of $4.7 million in letters of credit. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of September 30, 2017, no amounts had been drawn against these outstanding letters of credit, which are scheduled to expire on various dates in 2017 and 2018.
Capital Resourcesliquidity
Our sources of liquidity include cash on hand, cash flows from operations, and available capacity under the Revolving Credit Facility. In addition, our senior secured credit facilities provide for incremental facilities (the "Accordion"),As of June 30, 2021, we had $416.1 million available under which additional term loans may be issued or the capacity of the Revolving Credit Facility, may be increased.net of $3.9 million of
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obligations related to outstanding letters of credit issued thereunder. Outstanding letters of credit are issued primarily for the benefit of certain operating activities. As of SeptemberJune 30, 2017, $230.0 million remained available for issuance2021, no amounts had been drawn against these outstanding letters of credit. Availability under the Accordion.Accordion varies each period based on our attainment of certain financial metrics as set forth in the terms of the Credit Agreement and the indentures under which our senior notes were issued (the "Senior Notes Indentures"). As of June 30, 2021, availability under the Accordion was approximately $1.0 billion.
We believe, based on our current level of operations as reflected in our results of operations for the three and nine months ended September 30, 2017, and taking into consideration the restrictions and covenants discussed below,included in the Credit Agreement and Senior Notes Indentures, that thesethe sources of liquidity described above will be sufficient to fund our operations, capital expenditures, ordinary share repurchases (if and when resumed), and debt service for at least the next twelve months. However, we cannot make assurances that our business will generate sufficient cash flows from operations or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. Further, our highly leveragedhighly-leveraged nature may limit our ability to procure additional financing in the future.
Our ability to raise additional financing, and our borrowing costs, may be impacted by short- and long-term debt ratings assigned by independent rating agencies, which are based, in significant part, on our performance as measured by certain credit metrics such as interest coverage and leverage ratios. As of OctoberJuly 23, 2017,2021, Moody’s Investors Service’s corporate credit rating for Sensata Technologies B.V. ("STBV")STBV was Ba2 with a stable outlook, and Standard & Poor’s corporate credit rating for STBV was BB+ with a stable outlook. The Standard & Poor’s corporate credit rating represents an upgrade, effective on October 23, 2017, from the previous rating of BB with a positive outlook. Any future downgrades to STBV's credit ratings may increase our future borrowing costs but will not reduce availability under the Credit Agreement.
Restrictions and Covenants
The Credit Agreement provides that if our credit agreement datedsenior secured net leverage ratio exceeds a specified level we are required to use a portion of our excess cash flow, as defined in the Credit Agreement, generated by operating, investing, or financing activities to prepay some or all of May 12, 2011 (as amended, the "Credit Agreement")outstanding borrowings under the Senior Secured Credit Facilities. The Credit Agreement also requires mandatory prepayments of the outstanding borrowings under the Senior Secured Credit Facilities upon certain asset dispositions and casualty events, in each case subject to certain reinvestment rights, and upon the incurrence of certain indebtedness (excluding any permitted indebtedness). These provisions were not triggered during the six months ended June 30, 2021.
The Credit Agreement and the indentures under which our senior notes were issuedSenior Notes Indentures contain restrictions and covenants that limit the ability of our wholly-owned subsidiary, STBV, and certain of its subsidiaries to, among other things, incur subsequent indebtedness, sell assets, make capital expenditures, pay dividends, and make other restricted payments. For a full discussion of these restrictions and covenants, refer to Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capital Resources," included in our 2020 Annual Report on Form 10-K forReport. These restrictions and covenants, which are subject to important exceptions and qualifications set forth in the year ended December 31, 2016.
Credit Agreement and Senior Notes Indentures, were taken into consideration when we established our share repurchase programs and will be evaluated periodically with respect to future potential funding of those programs. As of SeptemberJune 30, 2017,2021, we believe we were in compliance with all covenants and default provisions under our credit arrangements.
Share repurchase programs
From time to time, our Board of Directors has authorized various share repurchase programs, which may be modified or terminated by our Board at any time. We currently have an authorized $500.0 million share repurchase program under which approximately $302.3 million remained available as of June 30, 2021. On April 2, 2020, we announced a temporary suspension of this share repurchase program, which will remain on hold until we determine that market conditions warrant continuation of the program.
Recently Issued Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (the "FASB")There are no recently issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606), which creates one Accounting Standards Codification ("ASC")

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Topic (FASB ASC 606, Revenue from Contracts with Customers)accounting standards that replaceshave been adopted in the current guidance found in FASB ASC 605, Revenue Recognition, and various other revenue accounting standards for specialized transactions and industries. FASB ASU No. 2014-09 outlines a comprehensive five-step revenue recognition model based on the principle that an entity should recognize revenue to depict the transfer of promised goodsperiod or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. FASB ASU No. 2014-09 may be applied using either a full retrospective approach, under which all years included in the financial statements will be presented under the revised guidance,adopted in future periods that have had or a modified retrospective approach, under which financial statements will be prepared under the revised guidance for the year of adoption, but not for prior years. Under the latter method, entities will recognize a cumulative catch-up adjustmentare expected to the opening balance of retained earnings at the effective date for contracts that still require performance by the entity.
In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date, which defers the effective date of FASB ASU No. 2014-09 by one year. FASB ASU No. 2014-09 is now effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods. We have developed an implementation plan to adopt this new guidance. As part of this plan, we are currently assessing the impact of the new guidance on our financial position and results of operations. Based on our procedures performed to date, nothing has come to our attention that would indicate that the adoption of FASB ASU No. 2014-09 will have a material impact on our consolidated financial position or results of operations. However, we will continue to evaluate this assessment through the remainder of 2017. In addition, the adoption of FASB ASU No. 2014-09 requires new disclosures related to revenue recognition, which we are continuing to evaluate. We intend to adopt FASB ASU No. 2014-09 on January 1, 2018 using the modified retrospective transition method.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which establishes new accounting and disclosure requirements for leases. FASB ASU No. 2016-02 requires lessees to classify most leases as either finance or operating leases and to initially recognize a lease liability and right-of-use asset. Entities may elect to account for certain short-term leases (with a term of 12 months or less) using a method similar to the current operating lease model. The statements of operations will include, for finance leases, separate recognition of interest on the lease liability and amortization of the right-of-use asset and for operating leases, a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis. At December 31, 2016, we were contractually obligated to make future payments of $69.8 million under our operating lease obligations in existence as of that date, primarily related to long-term facility leases. While we are in the early stages of our implementation process for FASB ASU No. 2016-02, and have not yet determined its impact on our consolidated financial statements, these leases would potentially be required to be presented on the balance sheet in accordance with the requirements of FASB ASU No. 2016-02. FASB ASU No. 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, with early adoption permitted. FASB ASU No. 2016-02 must be applied using a modified retrospective approach, which requires recognition and measurement of leases at the beginning of the earliest period presented, with certain practical expedients available.
In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815), which changes both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results, in order to better align an entity’s risk management activities and financial reporting for hedging relationships. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. FASB ASU No. 2017-12 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, with early adoption permitted. We are still evaluating the impact that this guidance will have on our consolidated financial statements, and we have not yet determined whether we will early adopt FASB ASU No. 2017-12.
Critical Accounting Policies and Estimates
For a discussion of the critical accounting policies that require the use of significant judgments and estimates by management, refer to Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates,"Estimates" included in our 2020 Annual Report on Form 10-K for the year ended December 31, 2016.

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Item 3.Quantitative and Qualitative Disclosures About Market Risk.
There have been noItem 3.Quantitative and Qualitative Disclosures About Market Risk.
No significant changes to our market risk have occurred since December 31, 2016.2020. For a discussion of market riskrisks affecting us, refer to Part II, Item 7A—"Quantitative and Qualitative Disclosures About Market Risk,"Risk" included in our 2020 Annual Report on Form 10-K for the year ended December 31, 2016.Report.
Item 4.Controls and Procedures.
Item 4.Controls and Procedures.
The required certifications of our Chief Executive Officer, Chief Financial Officer, and Chief FinancialAccounting Officer are included as exhibits to this Quarterly Report on Form 10-Q. The disclosures set forth in this Item 4 contain information concerning the evaluation of our disclosure controls and procedures and changes in internal control over financial reporting referred to in these certifications. These certifications should be read in conjunction with this Item 4 for a more complete understanding of the matters covered by the certifications.
Evaluation of Disclosure Controls and Procedures
With the participation of our Chief Executive Officer, Chief Financial Officer, and Chief FinancialAccounting Officer, we have evaluated the effectiveness of our disclosure controls and procedures as of SeptemberJune 30, 2017.2021. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of SeptemberJune 30, 2017,2021, our Chief Executive Officer, Chief Financial Officer, and Chief FinancialAccounting Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the ninethree months ended SeptemberJune 30, 20172021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
There are inherent limitations to the effectiveness of any system of internal control over financial reporting. Accordingly, even an effective system of internal control over financial reporting can only provide reasonable assurance with respect to financial statement preparation and presentation in accordance with U.S. generally accepted accounting principles.GAAP. Our internal controls over financial reporting are subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of our systems, the possibility of human error, and the risk of fraud. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may be inadequate because of changes in conditions and the risk that the degree of compliance with policies or procedures may deteriorate over time.

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PART II—OTHER INFORMATION
Item 1.Legal Proceedings.
As discussed in Part I, Item 3—"1.Legal Proceedings," in our Annual Report on Form 10-K for the year ended December 31, 2016, weProceedings.
We are regularly involved in a number of claims and litigation matters that arise in the ordinary course of business. Most of our litigation matters are third-party claims related to patent infringement allegations or for property damage allegedly caused by our products, but some involve allegations of personal injury or wrongful death. From time to time, we are also involved in disagreements with vendors and customers. Although it is not feasible to predict the outcome of these matters, based upon our experience and current information known to us, we do not expect the outcome of these matters, either individually or in the aggregate, to have a material adverse effect on our resultresults of operations, financial position,condition, or cash flows.
Item 1A.Risk Factors.
Item 1A.Risk Factors.
Information regarding risk factors appears in Part I, Item 1A—"1A: Risk Factors", included in our 2020 Annual Report on Form 10-K for the year ended December 31, 2016.Report. There have been no material changes to the risk factors disclosed therein.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.
Issuer Purchases of Equity Securities
PeriodTotal 
Number
of Shares
Purchased (in shares)		Weighted-Average 
Price
Paid per Share		Total Number of
Shares Purchased as Part of Publicly
Announced Plan or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Programs
(in millions)
April 1 through April 30, 2021121,076 $58.57 — $302.3 
May 1 through May 31, 20218,030 $58.50 — $302.3 
June 1 through June 30, 20212,817 $59.03 — $302.3 
Quarter total131,923 $58.58 — $302.3 
__________________________
(1)     The number of ordinary shares presented were withheld upon the vesting of restricted securities to cover payment of employee withholding tax. These withholdings took place outside of a publicly announced repurchase plan.
Period 
Total 
Number
of Shares
Purchased (in shares)
 
Weighted-Average 
Price
Paid per Share
 Total Number of
Shares Purchased as Part of Publicly
Announced Plan or Programs		 
Approximate Dollar Value of Shares that
May Yet Be 
Purchased
Under the Plan or Programs (in millions)
July 1 through July 31, 2017 2,117
(1) 
$45.03
 —
 $250.0
August 1 through August 31, 2017 —
 $—
 —
 $250.0
September 1 through September 30, 2017 —
 $—
 —
 $250.0
Total 2,117
 $45.03
 —
 $250.0
 __________________
(1)
Pursuant to the "withhold to cover" method for collecting and paying withholding taxes for our employees upon the vesting of restricted securities, we withheld from certain employees the shares noted in the table above to cover such tax withholdings. These transactions took place outside of a publicly-announced repurchase plan. The weighted-average price per share listed in the above table is the weighted-average of the fair market prices at which we calculated the number of shares withheld to cover tax for the employees.
Item 3.Defaults Upon Senior Securities.
Item 3.Defaults Upon Senior Securities.
None.

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Item 6.Exhibits.
Item 6.Exhibit No.Exhibits.
Description
Exhibit No.3.1Description
3.1
4.1
Sixth Supplemental Indenture dated as of October 10, 2017, amending the indenture dated as of April 17, 2013 pursuant to which the 4.875% Senior Notes were issued, among Sensata Technologies B.V., the guarantors party thereto and The Bank of New York Mellon, as trusteeplc (incorporated by reference to Exhibit 4.13.1 of the Registrant's Current Report on Form 8-K filed on October 13, 2017)March 28, 2018).
4.2
10.1
4.310.2
4.431.1
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2
32.131.3
32.1
101101.INSThe following materials fromInline XBRL Instance Document - the Registrant's Quarterly Report on Form 10-Q forinstance document does not appear in the quarterly period ended September 30, 2017, formatted inInteractive Data File because its XBRL (eXtensible Business Reporting Language): (i)tags are embedded within the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Income, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) Notes to the Condensed Consolidated Financial Statements.Inline XBRL document.
101.SCHInline XBRL Taxonomy Extension Schema Document. *
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document. *
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document. *
101.LABInline XBRL Taxonomy Extension Label Linkbase Document. *
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document. *
104Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
___________________________
*    Filed herewith

†    Indicates management contract or compensatory plan, contract, or arrangement


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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Date: October 24, 2017
SENSATA TECHNOLOGIES HOLDING N.V.
July 27, 2021
SENSATA TECHNOLOGIES HOLDING PLC
/s/ Martha SullivanJeffrey Cote
(Martha Sullivan)Jeffrey Cote)
President and Chief Executive Officer and President
(Principal Executive Officer)
/s/ Paul Vasington
(Paul Vasington)
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
/s/ Maria Freve
(Maria Freve)
Vice President and Chief Accounting Officer
(Principal Accounting Officer)



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