Fair Value Measurements

6 Months Ended

Sep. 30, 2022

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis as of September 30, 2022 and March 31, 2022 based on the three-tier fair value hierarchy (in thousands):


	Fair Value Measurements as of September 30, 2022
	Level 1		Level 2		Level 3		Total
Cash and cash equivalents:
Money market funds	$	375,809	$	—	$	—	$	375,809



Short-term investments:
Certificates of deposit	—		51,646		—		51,646
Commercial paper	—		2,926		—		2,926
Corporate notes and bonds	—		82,735		—		82,735
U.S. treasury securities	224,957		—		—		224,957

Restricted cash:
Money market funds	5,779		—		—		5,779
Total	$	606,545	$	137,307	$	—	$	743,852
Included in cash and cash equivalents							$	375,809
Included in short-term investments							$	362,264
Included in restricted cash							$	5,779

	Fair Value Measurements as of March 31, 2022
	Level 1		Level 2		Level 3		Total
Cash and cash equivalents:
Money market funds	$	109,327	$	—	$	—	$	109,327



Short-term investments:
Certificates of deposit	—		126,885		—		126,885
Commercial paper	—		27,861		—		27,861
Corporate notes and bonds	—		85,065		—		85,065
U.S. treasury securities	320,173		—		—		320,173

Restricted cash:
Money market funds	5,775		—		—		5,775
Total	$	435,275	$	239,811	$	—	$	675,086
Included in cash and cash equivalents							$	109,327
Included in short-term investments							$	559,984
Included in restricted cash							$	5,775

There were no transfers between fair value measurement levels during the six months ended September 30, 2022 and 2021.

The Company invests in certificates of deposit, commercial paper, corporate debt securities, U.S. treasury securities, and U.S. agency securities, which are classified as available-for-sale securities.

The following table presents the Company’s available-for-sale securities as of September 30, 2022 (in thousands):


	Available-for-sale Investments as of September 30, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value



Short-term investments:
Certificates of deposit	$	52,000	$	—	$	(354)	$	51,646
Commercial paper	2,953		—		(27)		2,926
Corporate notes and bonds	86,193		—		(3,458)		82,735
U.S. treasury securities	231,243		—		(6,286)		224,957

Total available-for-sale investments	$	372,389	$	—	$	(10,125)	$	362,264

The following table presents the Company’s available-for-sale securities as of March 31, 2022 (in thousands):


	Available-for-sale Investments as of March 31, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value



Short-term investments:
Certificates of deposit	$	127,500	$	—	$	(615)	$	126,885
Commercial paper	27,946		—		(85)		27,861
Corporate notes and bonds	87,259		—		(2,194)		85,065
U.S. treasury securities	323,584		79		(3,490)		320,173

Total available-for-sale investments	$	566,289	$	79	$	(6,384)	$	559,984

As of September 30, 2022 and March 31, 2022, securities that were in an unrealized loss position for more than 12 months were $5.3 million and $1.3 million, respectively. The unrealized losses were caused by changes in market interest rates or the widening of market spreads subsequent to the initial purchase of these securities, and not related to the underlying credit of the issuers or the underlying collateral. The unrealized losses on these investments are not considered other-than-temporary impairment, because the decline in fair value is not attributable to credit quality and because the Company does not intend, and it is not likely that it will be required, to sell these securities before recovery of their amortized cost basis. As a result, the Company did not consider any available-for-sale securities to be impaired as of September 30, 2022 and March 31, 2022.

The following table classifies the Company’s available-for-sale short-term investments by contractual maturities as of September 30, 2022 and March 31, 2022 (in thousands):


	September 30, 2022		March 31, 2022
Due within one year	$	230,113	$	354,774
Due after one year and within three years	132,151		205,210
Total	$	362,264	$	559,984

For certain other financial instruments, including accounts receivable, accounts payable and other current liabilities, the carrying amounts approximate their fair value due to the relatively short maturity of these balances.

Convertible Senior Notes

As of September 30, 2022, the fair value of the Notes was $443.5 million. The fair value was determined based on the quoted price of the Notes in an inactive market on the last trading day of the reporting period and has been classified as Level 2 in the fair value hierarchy.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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