Marketable Securities

All of the cash equivalents and marketable securities are classified as “available-for-sale” securities. Investments in both fixed and floating rate interest earning instruments carry a degree of interest rate risk. Fixed rate debt securities may have their market value adversely impacted due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Due in part to these factors, our future investment income may fall short of expectations due to changes in interest rates or if the decline in fair value of our publicly traded debt or equity investments is judged to be other-than-temporary. We may suffer losses in principal if we are forced to sell securities that decline in market value due to changes in interest rates. However, because any debt securities we hold are classified as “available-for-sale,” no gains or losses are realized in our consolidated statement of income due to changes in interest rates unless such securities are sold prior to maturity or unless declines in market values are determined to be other-than-temporary. These securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income, a component of shareholders’ equity, net of tax.

The following is a summary of cash equivalents and marketable securities at January 25, 2015 and January 26, 2014:



	January 25, 2015
	Amortized Cost		Unrealized Gain		Unrealized Loss			Estimated Fair Value
	(In thousands)
Corporate debt securities	$	2,184,925	$	2,600	$	(1,214	)	$	2,186,311
Debt securities of United States government agencies	749,630		917		(227		)	750,320
Debt securities issued by United States Treasury	533,673		2,694		(3		)	536,364
Asset-backed securities	453,088		125		(329		)	452,884
Mortgage backed securities issued by United States government-sponsored enterprises	274,366		4,589		(850		)	278,105
Money market funds	132,495		—		—			132,495
Foreign government bonds	84,800		121		(5		)	84,916
Total	$	4,412,977	$	11,046	$	(2,628	)	$	4,421,395
Classified as:
Cash equivalents								$	294,710
Marketable securities								4,126,685
Total								$	4,421,395



	January 26, 2014
	Amortized Cost		Unrealized Gain		Unrealized Loss			Estimated Fair Value
	(In thousands)
Corporate debt securities	$	1,762,833	$	1,837	$	(945	)	$	1,763,725
Debt securities of United States government agencies	1,012,740		848		(261		)	1,013,327
Debt securities issued by United States Treasury	495,889		621		(57		)	496,453
Money market funds	307,865		—		—			307,865
Asset-backed securities	258,017		15		(315		)	257,717
Mortgage backed securities issued by United States government-sponsored enterprises	185,594		3,837		(725		)	188,706
Foreign government bonds	64,955		20		(120		)	64,855
Total	$	4,087,893	$	7,178	$	(2,423	)	$	4,092,648
Classified as:
Cash equivalents								$	572,425
Marketable securities								3,520,223
Total								$	4,092,648

The following table provides the breakdown of the investments that were in a continuous unrealized loss position at January 25, 2015:



	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
	(In thousands)
Corporate debt securities	$	709,392	$	(1,199	)	$	10,085	$	(15	)	$	719,477	$	(1,214	)
Mortgage backed securities issued by United States government-sponsored enterprises	81,245		(639		)	21,314		(211		)	102,559		(850		)
Debt securities of United States Treasury	10,026		(3		)	—		—			10,026		(3		)
Debt securities issued by United States government agencies	246,480		(227		)	—		—			246,480		(227		)
Asset-backed securities	306,066		(323		)	4,476		(6		)	310,542		(329		)
Foreign government bonds	11,008		(5		)	—		—			11,008		(5		)
Total	$	1,364,217	$	(2,396	)	$	35,875	$	(232	)	$	1,400,092	$	(2,628	)

We performed an impairment review of our investment portfolio as of January 25, 2015. Factors considered included general market conditions, the duration and extent to which fair value is below cost, and our intent and ability to hold an investment for a sufficient period of time to allow for recovery in value. We also consider specific adverse conditions related to the financial health of and business outlook for an investee, including industry and sector performance, changes in technology, operational and financing cash flow factors, and changes in an investee’s credit rating. Investments that we identify as having an indicator of impairment are subject to further analysis to determine if the investment was other than temporarily impaired. Based on our quarterly impairment review and having considered the guidance in the relevant accounting literature, we concluded that our investments were appropriately valued and that no other than temporary impairment charges were necessary on our portfolio of available for sale investments as of January 25, 2015.

As of January 25, 2015, we had nine investments that were in an unrealized loss position with total unrealized losses amounting to $2.4 million and with a duration of less than one year. The gross unrealized losses related to fixed income securities were due to changes in interest rates. We have determined that the gross unrealized losses on investment securities at January 25, 2015 are temporary in nature. Currently, we have the intent and ability to hold our investments with impairment indicators until maturity.

Net realized gains were $0.1 million, $2.4 million and $0.5 million for fiscal years 2015, 2014, and 2013, respectively. As of January 25, 2015, we had a net unrealized gain of $8.4 million, which was comprised of gross unrealized gains of $11.0 million, offset by $2.6 million of gross unrealized losses. As of January 26, 2014, we had a net unrealized gain of $4.8 million, which was comprised of gross unrealized gains of $7.2 million, offset by $2.4 million of gross unrealized losses.

The amortized cost and estimated fair value of cash equivalents and marketable securities which are primarily debt instruments are classified as available-for-sale at January 25, 2015 and January 26, 2014 and are shown below by contractual maturity.



	January 25, 2015				January 26, 2014
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(In thousands)
Less than one year	$	1,570,233	$	1,570,622	$	1,883,132	$	1,883,753
Due in 1 - 5 years	2,719,852		2,725,945		2,114,289		2,117,387
Mortgage-backed securities issued by government-sponsored enterprises not due at a single maturity date	122,893		124,828		90,472		91,508
Total	$	4,412,978	$	4,421,395	$	4,087,893	$	4,092,648