Fair Value Measurements

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

3.    Fair Value Measurements

Assets and liabilities recorded at fair value on a recurring basis in the accompanying condensed consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value. We use a fair value hierarchy to measure fair value, maximizing the use of observable inputs and minimizing the use of unobservable inputs. The three-tiers of the fair value hierarchy are as follows:

Level I - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level II - Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level III - Unobservable inputs that are supported by little or no market data for the related assets or liabilities and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

We measure and report our cash equivalents, restricted cash, and available-for-sale marketable securities at fair value on a recurring basis. The following tables summarize the unrealized gains and losses and fair value of these financial assets by significant investment category and their level within the fair value hierarchy (in thousands):

	September 30, 2018
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value		Level I		Level II		Level III
Financial Assets:
Cash Equivalents:
Money market funds	$	170,604	$	—	$	—		$	170,604	$	170,604	$	—	$	—
Marketable Securities:
Commercial paper	46,572		—		—			46,572		—		46,572		—
U.S. government notes	227,086		—		(513		)	226,573		226,573		—		—
Corporate bonds	581,093		19		(1,408		)	579,704		—		579,704		—
Agency securities	285,261		—		(998		)	284,263		—		284,263		—
	1,140,012		19		(2,919		)	1,137,112		226,573		910,539		—
Other Assets:
Money market funds - restricted	4,210		—		—			4,210		4,210		—		—
Total Financial Assets	$	1,314,826	$	19	$	(2,919	)	$	1,311,926	$	401,387	$	910,539	$	—

	December 31, 2017
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value		Level I		Level II		Level III
Financial Assets:
Cash Equivalents:
Money market funds	$	701,145	$	—	$	—		$	701,145	$	701,145	$	—	$	—
Agency securities	12,728		—		—			12,728		—		12,728		—
	713,873		—		—			713,873		701,145		12,728		—
Marketable Securities:
Commercial paper	11,924		—		—			11,924		—		11,924		—
U.S. government notes	137,025		—		(378		)	136,647		136,647		—		—
Corporate bonds	313,080		20		(616		)	312,484		—		312,484		—
Agency securities	215,923		2		(617		)	215,308		—		215,308		—
	677,952		22		(1,611		)	676,363		136,647		539,716		—
Other Assets:
Money market funds - restricted	5,505		—		—			5,505		5,505		—		—
Total Financial Assets	$	1,397,330	$	22	$	(1,611	)	$	1,395,741	$	843,297	$	552,444	$	—

We did not realize any other-than-temporary losses on our marketable securities for the three and nine months ended September 30, 2018 and 2017. We invest in marketable securities that have maximum maturities of up to two years and are generally deemed to be low risk based on their credit ratings from the major rating agencies. The longer the duration of these marketable securities, the more susceptible they are to changes in market interest rates and bond yields. As interest rates increase, those marketable securities purchased at a lower yield show a mark-to-market unrealized loss. The unrealized losses are due primarily to changes in credit spreads and interest rates. We expect to realize the full value of these investments upon maturity or sale and therefore, we do not consider any of our marketable securities to be other-than-temporarily impaired as of September 30, 2018.

As of September 30, 2018, the contractual maturities of our investments did not exceed 24 months. The fair values of available-for-sale marketable securities, by remaining contractual maturity, are as follows (in thousands):

	September 30, 2018
Due in 1 year or less	$	792,542
Due in 1 year through 2 years	344,570
Total marketable securities	$	1,137,112

The weighted-average remaining duration of our current marketable securities is approximately 0.7 years as of September 30, 2018. As we view these securities as available to support current operations, we classify securities with maturities beyond 12 months as current assets under the caption marketable securities in the accompanying unaudited condensed consolidated balance sheets.