Fair Value Measurements

12 Months Ended

Dec. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 5 — Fair Value Measurements

We value our financial assets and liabilities at fair value, defined as the price that would be received for assets when sold or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). We utilize market data or assumptions that we believe market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable.

We primarily apply the market approach for recurring fair value measurements and endeavor to utilize the best information reasonably available. Accordingly, we use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and consider the security issuers’ and the third-party issuers’ credit risk in our assessment of fair value.

We classify fair value based on the observability of those inputs using a hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement):

Level 1 — Observable inputs, such as quoted prices in active markets for identical assets or liabilities;

Level 2 — Inputs, other than the quoted prices in active markets, that are observable either directly or through corroboration with observable market data; and

Level 3 — Unobservable inputs, for which there is little or no market data for the assets or liabilities, such as internally-developed valuation models.

Fair Value of Financial Assets

The follow tables set forth the fair value of our financial assets, which consists of cash equivalents and investments classified as available-for-sale securities, that were measured on a recurring basis (in thousands):

	December 31, 2024
	Fair Value Hierarchy Level	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	Level 1	$	71,515	$	—	$	—		$	71,515
U.S. Treasury securities	Level 1		404,377		1,192		(74	)		405,495
U.S. Government agency securities	Level 2		134,547		339		(23	)		134,863
Commercial paper	Level 2		302,043		399		(128	)		302,314
Asset-backed securities	Level 2		13,924		42		—			13,966
Corporate obligations	Level 2		290,616		598		(182	)		291,032
		$	1,217,022	$	2,570	$	(407	)	$	1,219,185

	December 31, 2023
	Fair Value Hierarchy Level	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	Level 1	$	77,429	$	—	$	—		$	77,429
U.S. Treasury securities	Level 1		34,625		13		(15	)		34,623
U.S. Government agency securities	Level 2		175,301		87		(133	)		175,255
Commercial paper	Level 2		252,956		156		(59	)		253,053
Asset-backed securities	Level 2		37,947		13		(101	)		37,859
Corporate obligations	Level 2		54,437		90		(41	)		54,486
		$	632,695	$	359	$	(349	)	$	632,705

Investments in corporate debt securities, commercial paper, asset-backed securities and U.S. Government agency securities are classified as Level 2 as they are valued based upon quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs obtained from various third-party data providers, including but not limited to benchmark yields, interest rate curves, reported trades, broker/dealer quotes and reference data.

No credit losses on debt securities were recognized in the periods presented. In its evaluation to determine expected credit losses, management considered all available historical and current information, expectations of future economic conditions, the type of security, the credit rating of the security, and the size of the loss position, as well as other relevant information. The unrealized losses as of December 31, 2024 are attributed to market interest rate changes and are not attributed to credit. The Company does not intend to sell, and is unlikely to be required to sell, any of these available-for-sale investments before their effective maturity or market price recovery.