Investments

9 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Our investments consist of (in millions):


	June 30, 2023		September 30, 2022
Fixed income securities	$	0.6	$	12.6
Equity securities (level 1)	863.9		928.8
Equity securities (other)	81.4		76.4
Other	56.7		50.8
Total investments	1,002.6		1,068.6
Less: Short-term investments (1)	(0.6)		(12.6)
Long-term investments	$	1,002.0	$	1,056.0

(1) Short-term investments are included in Other current assets in the Consolidated Balance Sheet.

Equity Securities

Equity securities (level 1) consist of 6,070,905 and 8,879,717 shares of PTC Inc. ("PTC") common stock (the "PTC Shares") at June 30, 2023, and September 30, 2022, respectively. The PTC Shares are classified as level 1 in the fair value hierarchy, as described below, and are recognized at fair value in the Consolidated Balance Sheet using the most recent closing price of PTC common stock quoted on Nasdaq.

Equity securities (other) consist of various securities that do not have a readily determinable fair value, which we account for using the measurement alternative under U.S. GAAP. These securities are recorded at the investment cost, less impairment, plus or minus observable price changes (in orderly transactions) of an identical or similar investment of the same issuer in the Consolidated Balance Sheet. Observable price changes are classified as level 2 in the fair value hierarchy, as described below. The carrying values at June 30, 2023, and September 30, 2022, include cumulative upward adjustments from observed price changes of $17.2 million.

We record gains and losses on investments within the Change in fair value of investments line in the Consolidated Statement of Operations. The gains and losses on investments we recorded for the following periods were (in millions):


	Three Months Ended June 30,				Nine Months Ended June 30,
	2023		2022		2023		2022
Net gain (loss) on equity securities (level 1)	$	86.4	$	(8.4)	$	290.4	$	(136.0)
Net gain on equity securities (other)	—		3.2		—		11.9
Equity method loss on Other investments	(0.7)		—		(1.1)		(14.2)
Change in fair value of investments	85.7		(5.2)		289.3		(138.3)

Total net realized gain on equity securities	36.9		12.7		89.8		12.9
Total net unrealized gain (loss) on equity securities	$	49.5	$	(17.9)	$	200.6	$	(137.0)

U.S. GAAP defines fair value as the price that would be received for an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability. U.S. GAAP also classifies the inputs used to measure fair value into the following hierarchy:


Level 1:						Quoted prices in active markets for identical assets or liabilities.


Level 2:						Quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.


Level 3:						Unobservable inputs for the asset or liability.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. We did not have any transfers between levels of fair value measurements during the period presented.