Fair Value Measurements

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

3. Fair Value Measurements

The carrying amounts of cash equivalents, prepaid and other assets, accounts payable and accrued liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. Based on the borrowing rates currently available to us for loans with similar terms, which is considered a Level 2 input, we believe that the fair value of our Term Loans approximate its carrying values. Investment securities are recorded at fair value.

The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1: Observable inputs such as quoted prices in active markets.

Level 2: Inputs, other than the quoted prices in active markets that are observable either directly or indirectly.

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Financial assets measured at fair value on a recurring basis consist of investment securities. Investment securities are recorded at fair value, defined as the exit price in the principal market in which we would transact, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Level 2 securities are valued using quoted market prices for similar instruments, non-binding market prices that are corroborated by observable market data, or discounted cash flow techniques and include our investments in asset-backed securities, commercial paper, and corporate debt securities. We have no financial liabilities measured at fair value on a recurring basis. None of our non-financial assets and liabilities is recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented.

Assets and liabilities measured at fair value on a recurring basis are as follows (in thousands):

			Fair Value Measurements Using
	Total		QuotedPricesin ActiveMarkets forIdentical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of December 31, 2018:
Assets:
Current:
Cash equivalents	$	16,019	$	16,019	$	—	$	—
Available-for-sale investments, short-term:
Asset-backed securities		7,773		—		7,773		—
Commercial paper		6,144		—		6,144		—
Corporate debt securities		12,666		—		12,666		—
Sub-total short-term investments		26,583		—		26,583		—
Total assets measured at fair value	$	42,602	$	16,019	$	26,583	$	—
As of December 31, 2017:
Assets:
Current:
Cash equivalents	$	9,070	$	9,070	$	—	$	—
Available-for-sale investments, short-term:
Asset-backed securities		6,497		—		6,497		—
Commercial paper		21,943		—		21,943		—
Corporate debt securities		18,260		—		18,260		—
United States Treasury securities		17,328		17,328		—		—
Sub-total short-term investments		64,028		17,328		46,700		—
Total assets measured at fair value	$	73,098	$	26,398	$	46,700	$	—

As of December 31, 2018 and 2017, available-for-sale investments are detailed as follows (in thousands):

	December 31, 2018
	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
Available-for-sale investments, short-term:
Asset-backed securities	$	7,777	$	—	$	(4	)	$	7,773
Commercial paper		6,144		—		—			6,144
Corporate debt securities		12,672		—		(6	)		12,666
	$	26,593	$	—	$	(10	)	$	26,583

	December 31, 2017
	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
Available-for-sale investments, short-term:
Asset-backed securities	$	6,501	$	—	$	(4	)	$	6,497
Commercial paper		21,943		—		—			21,943
Corporate debt securities		18,286		—		(26	)		18,260
United States Treasury securities		17,368		—		(40	)		17,328
	$	64,098	$	—	$	(70	)	$	64,028

As of December 31, 2018, all available-for-sale investments have contractual maturity dates less than one year. As of December 31, 2018, all available-for-sale investments are in a gross unrealized loss position, and they have been in such position for less than twelve months.

At each reporting date, we perform an evaluation of impairment to determine if the unrealized losses are other-than-temporary. Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition of the issuer, and our intent and ability to hold the investment until recovery of its amortized cost basis. We intend, and have the ability, to hold our investments in unrealized loss positions until their amortized cost basis has been recovered. Based on our evaluation, we determined that the unrealized losses were not other-than-temporary as of December 31, 2018.