4.Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities

Our marketable investment securities, restricted cash and cash equivalents, and other investment securities consisted of the following:


	As of
	September 30,		December 31,
	2017		2016
	(In thousands)
Marketable investment securities:
Current marketable investment securities:
Trading	$	47,856	$	—
Other		54,506		3,833
Total current marketable investment securities		102,362		3,833
Restricted marketable investment securities (1)		71,919		81,679
Total marketable investment securities		174,281		85,512

Restricted cash and cash equivalents (1)		403		681

Other investment securities:
Other investment securities - equity method		112,381		25,098
Other investment securities - cost method		—		8,150
Total other investment securities		112,381		33,248

Total marketable investment securities, restricted cash and cash equivalents, and other investment securities	$	287,065	$	119,441

(1)

Restricted marketable investment securities and restricted cash and cash equivalents are included in “Restricted cash, cash equivalents and marketable investment securities” on our Condensed Consolidated Balance Sheets.

Marketable Investment Securities

Our marketable investment securities portfolio consists of various debt and equity instruments, all of which are classified as available-for-sale, except as specified below. See Note 2 for further information.

Current Marketable Investment Securities - Trading

We had an investment in non-marketable preferred shares of a non-public company, which was accounted for as a cost method investment and included in “Other investment securities” on our Condensed Consolidated Balance Sheets. During the three months ended September 30, 2017, our non-marketable preferred shares converted into common shares in conjunction with the issuer’s initial public offering, and accordingly we classified the new securities to “Marketable investment securities” on our Condensed Consolidated Balance Sheets. We have elected to account for these common shares as trading securities with changes in fair value reported each period as unrealized gains or losses in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). As of September 30, 2017, the fair value of our investment was approximately $48 million, and we recognized a pre-tax unrealized gain of approximately $40 million for the change in the fair value of the investment during the three months ended September 30, 2017, which was recorded in “Other, net” within “Other Income (Expense).”

Current Marketable Investment Securities - Other

Our current marketable investment securities portfolio includes investments in equity securities and/or various debt instruments including, among others, commercial paper, corporate securities and U.S. treasury and/or agency securities.

Commercial paper consists mainly of unsecured short-term, promissory notes issued primarily by corporations with maturities ranging up to 365 days. Corporate securities consist of debt instruments issued by corporations with various maturities normally less than 18 months. U.S. Treasury and agency securities consist of debt instruments issued by the federal government and other government agencies.

Restricted Cash, Cash Equivalents and Marketable Investment Securities

As of September 30, 2017 and December 31, 2016, our restricted marketable investment securities, together with our restricted cash and cash equivalents, included amounts required as collateral for our letters of credit.

Other Investment Securities

We have strategic investments in certain debt and equity securities that are included in noncurrent “Other investment securities” on our Condensed Consolidated Balance Sheets and accounted for using the cost, equity and/or available-for-sale methods of accounting. Certain of our equity method investments are detailed below.

NagraStar L.L.C. As a result of the completion of the Share Exchange on February 28, 2017, we own a 50% interest in NagraStar L.L.C. (“NagraStar”), a joint venture that is our primary provider of encryption and related security systems intended to assure that only authorized customers have access to our programming.

Invidi Technologies Corporation. In November 2016, we, DIRECTV, LLC, a wholly-owned indirect subsidiary of AT&T Inc., and Cavendish Square Holding B.V., an affiliate of WPP plc, entered into a series of agreements to acquire Invidi Technologies Corporation (“Invidi”), an entity that provides proprietary software for the addressable advertising market. The transaction closed in January 2017.

Our ability to realize value from our strategic investments in securities that are not publicly traded depends on the success of the issuers’ businesses and their ability to obtain sufficient capital, on acceptable terms or at all, and to execute their business plans. Because private markets are not as liquid as public markets, there is also increased risk that we will not be able to sell these investments, or that when we desire to sell them we will not be able to obtain fair value for them.

Unrealized Gains (Losses) on Marketable Investment Securities

As of September 30, 2017 and December 31, 2016, we had accumulated net unrealized losses of less than $1 million. These amounts, net of related tax effect, were losses of less than $1 million. All of these amounts are included in “Accumulated other comprehensive income (loss)” within “Total stockholder’s equity (deficit).” The components of our available-for-sale investments are summarized in the table below.



	As of September 30, 2017								As of December 31, 2016
	Marketable								Marketable
	Investment		Unrealized						Investment		Unrealized
	Securities		Gains		Losses		Net		Securities		Gains		Losses		Net
	(In thousands)
Debt securities (including restricted):
U.S. Treasury and agency securities	$	75,638	$	—	$	(39)	$	(39)	$	81,982	$	13	$	(132)	$	(119)
Commercial paper		7,340		—		(1)		(1)		—		—		—		—
Corporate securities		42,811		13		(37)		(24)		3,530		3		—		3
Other		636		—		—		—		—		—		—		—
Total	$	126,425	$	13	$	(77)	$	(64)	$	85,512	$	16	$	(132)	$	(116)

As of September 30, 2017, restricted and non-restricted marketable investment securities included debt securities of $119 million with contractual maturities within one year and $7 million with contractual maturities extending longer than one year through and including five years. Actual maturities may differ from contractual maturities as a result of our ability to sell these securities prior to maturity.

Fair Value Measurements

Our investments measured at fair value on a recurring basis were as follows:


	As of
	September 30, 2017								December 31, 2016
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents (including restricted)	$	380,049	$	27,117	$	352,932	$	—	$	702,331	$	4,126	$	698,205	$	—

Debt securities (including restricted):
U.S. Treasury and agency securities	$	75,638	$	75,638	$	—	$	—	$	81,982	$	81,982	$	—	$	—
Commercial paper		7,340		—		7,340		—		—		—		—		—
Corporate securities		42,811		—		42,811		—		3,530		—		3,530		—
Other		636		—		636		—		—		—		—		—

Equity Securities		47,856		47,856		—		—		—		—		—		—
Total	$	174,281	$	123,494	$	50,787	$	—	$	85,512	$	81,982	$	3,530	$	—

During the nine months ended September 30, 2017, we had no transfers in or out of Level 1 and Level 2 fair value measurements.

Gains and Losses on Sales and Changes in Carrying Amounts of Investments

“Other, net” within “Other Income (Expense)” included on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) is as follows:


	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
Other, net:	2017		2016		2017		2016
	(In thousands)
Marketable investment securities - gains (losses) on sales/exchanges	$	—	$	—	$	1,803	$	32,322
Marketable investment securities - unrealized gains (losses) on trading securities		39,706		—		39,706		—
Other		553		1,331		2,175		684
Total	$	40,259	$	1,331	$	43,684	$	33,006