Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We actively monitor market conditions and developments specific to the securities in which we invest. We believe that we take a conservative approach to investing our funds in that we invest only in highly rated securities and diversify our portfolio of investments. While we believe we take prudent measures to mitigate investment-related risks, such risks cannot be fully eliminated because of market circumstances that are outside our control.

Our investments consist of instruments that meet quality standards that are consistent with our investment policy. This policy specifies that, except for direct obligations of the U.S. government, securities issued by agencies of the U.S. government, and money market funds, we diversify our investments by limiting our holdings with any individual issuer. We do not hold derivative financial instruments or European sovereign debt in our portfolio of investments. See Note 2 and Note 3 to the consolidated financial statements in Item 8 of this Annual Report for a summary of the amortized cost and fair value of our investments by type of issue.

Our cash equivalents and investments are subject to market risk due to changes in interest rates. Interest rate movements affect the interest income we earn on cash equivalents and investments and the fair value of those investments. At July 31, 2026, our cash equivalents and investments totaled $5.7 billion. Total interest income for fiscal 2026 was $180 million. If the Federal Reserve Target Rate had increased by 25 basis points from the level of July 31, 2026, the fair value of our investments at that date would have decreased by approximately $2 million. If the Federal Reserve Target Rate had increased by 100 basis points from the level of July 31, 2026, the value of our investments at that date would have decreased by approximately $9 million.

As of July 31, 2026, we had an aggregate principal amount of $6.75 billion in fixed rate senior unsecured notes with varying maturity dates. We carry the senior unsecured notes at face value less unamortized discount and unamortized debt issuance costs on our consolidated balance sheets. Since these notes bear interest at fixed rates, a hypothetical change in interest rates would not impact the interest expense on the senior unsecured notes. However, the fair value of the senior unsecured notes fluctuates when interest rates change. See Note 2 and Note 7 to the consolidated financial statements in Item 8 of this Annual Report for more information.

As of July 31, 2026, we had an aggregate principal amount of $970 million in variable rate borrowings outstanding on our secured revolving credit facilities. Advances under the secured revolving credit facilities accrue interest indexed to a designated Secured Overnight Financing Rate (SOFR) plus a margin that varies by facility. Consequently, our interest expense fluctuates with changes in the general level of this interest rate. A hypothetical increase in interest rates of 50 basis points on our outstanding balance of variable rate secured revolving credit facilities as of July 31, 2026 would not materially impact annual interest expense.

On January 9, 2026, we terminated our amended and restated credit agreement dated February 5, 2024, and entered into a credit agreement with certain lenders providing for a $2.2 billion unsecured revolving credit facility that expires on January 9, 2031 (2026 Credit Facility). Under our established commercial paper program, we may issue and sell unsecured short-term promissory notes (commercial paper) up to $2.2 billion outstanding at any time. As of July 31, 2026, no amounts were outstanding under the 2026 Credit Facility or the commercial paper program. At any time, we are exposed to interest rate fluctuation risk to the extent of our borrowings on our unsecured credit facility, under our commercial paper program, or other debt.

See Note 7 to the consolidated financial statements in Item 8 of this Annual Report for more information on our debt.

Foreign Currency Translation Risk

The functional currencies of our international operating subsidiaries are generally the local currencies. We translate the assets and liabilities of our foreign subsidiaries at the exchange rates in effect on the balance sheet date. We translate the revenue, costs, and expenses of our foreign subsidiaries at the average rates of exchange in effect during the period. We include translation gains and losses in the stockholders’ equity section of our consolidated balance sheets. We include net gains and losses resulting from foreign exchange transactions in interest and other income in our consolidated statements of operations.

Since we translate foreign currencies, primarily related to foreign currencies in Canada, India, the United Kingdom, and Israel, into U.S. dollars for financial reporting purposes, currency fluctuations can have an impact on our financial results. The historical impact of currency fluctuations on our financial results has generally been immaterial. We believe that our exposure to currency exchange fluctuation risk is not material because our global subsidiaries invoice customers and satisfy their financial obligations almost exclusively in their local currencies. We believe the impact of currency fluctuations will continue to be immaterial in the foreseeable future due to the reasons cited above. As of July 31, 2026 and for the year then ended, we did not engage in foreign currency hedging activities.