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Financial Instruments (Tables)
9 Months Ended
Sep. 30, 2020
Fair Value Disclosures [Abstract]  
Available-for-sale debt securities
The following tables summarize our debt securities, for which we did not elect the fair value option, by significant investment categories as of December 31, 2019 and September 30, 2020 (in millions):
 As of December 31, 2019
 Adjusted
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
Cash and Cash
Equivalents
Marketable
Securities
Level 2:
Time deposits(1)
$2,294 $$$2,294 $2,294 $
Government bonds55,033 434 (30)55,437 4,518 50,919 
Corporate debt securities27,164 337 (3)27,498 44 27,454 
Mortgage-backed and asset-backed securities19,453 96 (41)19,508 19,508 
Total$103,944 $867 $(74)$104,737 $6,856 $97,881 

 As of September 30, 2020
 Adjusted
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
Cash and Cash
Equivalents
Marketable
Securities
(unaudited)
Level 2:
Time deposits(1)
$2,009 $$$2,009 $2,009 $
Government bonds59,073 1,023 (9)60,087 1,264 58,823 
Corporate debt securities28,632 678 (20)29,290 17 29,273 
Mortgage-backed and asset-backed securities17,149 381 (13)17,517 17,517 
Total$106,863 $2,082 $(42)$108,903 $3,290 $105,613 
(1)The majority of our time deposits are domestic deposits.
Investments by maturity date
The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities (in millions, unaudited):
As of
September 30, 2020
Due in 1 year or less$21,943 
Due in 1 year through 5 years67,496 
Due in 5 years through 10 years5,237 
Due after 10 years13,204 
Total$107,880 
Schedule of unrealized loss on debt securities
The following tables present fair values and gross unrealized losses recorded to AOCI as of December 31, 2019 and September 30, 2020, aggregated by investment category and the length of time that individual securities have been in a continuous loss position (in millions):
 As of December 31, 2019
 Less than 12 Months12 Months or GreaterTotal
 Fair ValueUnrealized
Loss
Fair ValueUnrealized
Loss
Fair ValueUnrealized
Loss
Government bonds$6,752 $(20)$4,590 $(10)$11,342 $(30)
Corporate debt securities1,665 (2)978 (1)2,643 (3)
Mortgage-backed and asset-backed securities4,536 (13)2,835 (28)7,371 (41)
Total$12,953 $(35)$8,403 $(39)$21,356 $(74)

 As of September 30, 2020
 Less than 12 Months12 Months or GreaterTotal
 Fair ValueUnrealized
Loss
Fair ValueUnrealized
Loss
Fair ValueUnrealized
Loss
(unaudited)
Government bonds$5,473 $(9)$$$5,473 $(9)
Corporate debt securities5,764 (10)5,764 (10)
Mortgage-backed and asset-backed securities1,990 (8)273 (5)2,263 (13)
Total$13,227 $(27)$273 $(5)$13,500 $(32)
Gains and losses on equity securities
Gains and losses recorded in other income (expense), net, for our marketable and non-marketable equity securities are summarized below (in millions, unaudited):
Three Months EndedNine Months Ended
September 30,September 30,
 2019202020192020
Net gain (loss) on equity securities sold during the period$(63)$(5)$381 $426 
Net unrealized gain (loss) on equity securities held as of the end of the period(1)
(1,465)1,904 1,873 2,114 
Total gain (loss) recognized in other income (expense), net$(1,528)$1,899 $2,254 $2,540 
(1)Includes net unrealized gain related to non-marketable equity securities of $166 million and $1.2 billion for the three months ended September 30, 2019 and 2020, respectively. Includes a net unrealized gain of $1.4 billion and $357 million for the nine months ended September 30, 2019 and 2020, respectively.
Cumulative net gains on equity securities sold
Equity Securities Sold
Three Months EndedNine Months Ended
September 30,September 30,
 2019202020192020
Total sale price$445 $1,389 $1,074 $2,888 
Total initial cost133 1,146 460 1,831 
Cumulative net gains$312 $243 $614 $1,057 
Summary of unrealized gains and losses for marketable and non-marketable equity securities The carrying values for our marketable and non-marketable equity securities are summarized below (in millions):
As of December 31, 2019
Marketable SecuritiesNon-Marketable SecuritiesTotal
Total initial cost$1,935 $8,297 $10,232 
Cumulative net gain(1)
1,361 3,056 4,417 
Carrying value$3,296 $11,353 $14,649 
(1)Non-marketable securities cumulative net gain is comprised of $3.5 billion unrealized gains and $445 million unrealized losses (including impairment).
As of September 30, 2020
Marketable Securities(2)
Non-Marketable SecuritiesTotal
(unaudited)
Total initial cost$2,438 $9,615 $12,053 
Cumulative net gain(1)
2,596 3,304 5,900 
Carrying value$5,034 $12,919 $17,953 
(1)Non-marketable securities cumulative net gain is comprised of $5.1 billion unrealized gains and $1.8 billion unrealized losses (including impairment).
(2)The long-term portion of marketable equity securities of $447 million is included within other non-current assets.
Marketable equity securities
The following table summarizes marketable equity securities measured at fair value by significant investment categories as of December 31, 2019 and September 30, 2020 (in millions):
 As of December 31, 2019As of September 30, 2020
 Cash and Cash EquivalentsMarketable
Securities
Cash and Cash EquivalentsMarketable
Securities
(unaudited)
Level 1:
Money market funds$4,604 $$10,102 $
Marketable equity securities(1)(2)3,046 4,626 
4,604 3,046 10,102 4,626 
Level 2:
Mutual funds250 408 
Total$4,604 $3,296 $10,102 $5,034 
(1)The balance as of December 31, 2019 and September 30, 2020 includes investments that were reclassified from non-marketable equity securities following the initial public offering of the issuers.
(2)The long-term portion of marketable equity securities of $447 million is included within other non-current assets.
Summary of unrealized gains and losses for non-marketable equity securities
The following is a summary of unrealized gains and losses recorded in other income (expense), net, and included as adjustments to the carrying value of non-marketable equity securities (in millions, unaudited):
Three Months EndedNine Months Ended
September 30,September 30,
2019202020192020
Unrealized gains$398 $1,225 $1,816 $1,770 
Unrealized losses (including impairment)(232)(27)(370)(1,413)
Total unrealized gain (loss) for non-marketable equity securities$166 $1,198 $1,446 $357 
Schedule of gross notional amounts of derivative instruments
The gross notional amounts of our outstanding derivative instruments were as follows (in millions):
As of December 31, 2019As of September 30, 2020
(unaudited)
Derivatives Designated as Hedging Instruments:
Foreign exchange contracts
    Cash flow hedges $13,207 $7,388 
    Fair value hedges$455 $476 
    Net investment hedges$9,318 $9,812 
Derivatives Not Designated as Hedging Instruments:
Foreign exchange contracts$43,497 $38,367 
Other contracts$117 $1,999 
Schedule of derivative instruments
The fair values of our outstanding derivative instruments were as follows (in millions):
  As of December 31, 2019
  
Balance Sheet LocationFair Value of Derivatives Designated as Hedging InstrumentsFair Value of
Derivatives Not
Designated as
Hedging Instruments
Total Fair Value
Derivative Assets:
Level 2:
Foreign exchange contractsOther current and non-current assets$91 $253 $344 
Other contractsOther current and non-current assets
Total$91 $254 $345 
Derivative Liabilities:
Level 2:
Foreign exchange contractsAccrued expenses and other liabilities, current and non-current$173 $196 $369 
Other contractsAccrued expenses and other liabilities, current and non-current13 13 
Total $173 $209 $382 
  As of September 30, 2020
  
Balance Sheet LocationFair Value of
Derivatives
Designated as
Hedging Instruments
Fair Value of
Derivatives Not
Designated as
Hedging Instruments
Total Fair Value
(unaudited)
Derivative Assets:
Level 2:
Foreign exchange contractsOther current and non-current assets$291 $189 $480 
Other contractsOther current and non-current assets$$13 $13 
Total$291 $202 $493 
Derivative Liabilities:
Level 2:
Foreign exchange contractsAccrued expenses and other liabilities, current and non-current$167 $175 $342 
Other contractsAccrued expenses and other liabilities, current and non-current$$453 $453 
Total $167 $628 $795 
Schedule of gain (loss) on derivative instruments
The gains (losses) on derivatives in cash flow hedging and net investment hedging relationships recognized in other comprehensive income ("OCI") are summarized below (in millions, unaudited):
 Gains (Losses) Recognized in OCI on Derivatives Before Tax Effect
Three Months EndedNine Months Ended
 September 30,September 30,
2019202020192020
Derivatives in Cash Flow Hedging Relationship:
Foreign exchange contracts
Amount included in the assessment of effectiveness$325 $(37)$277 $331 
Amount excluded from the assessment of effectiveness(23)(13)(20)
Derivatives in Net Investment Hedging Relationship:
Foreign exchange contracts
Amount included in the assessment of effectiveness328 (371)309 (412)
Total$659 $(431)$573 $(101)
 The effect of derivative instruments on income is summarized below (in millions, unaudited):
 Gains (Losses) Recognized in Income
Three Months Ended
 September 30,
20192020
RevenuesOther income (expense), netRevenuesOther income (expense), net
Total amounts presented in the Consolidated Statements of Income in which the effects of cash flow and fair value hedges are recorded$40,499 $(549)$46,173 $2,146 
Gains (Losses) on Derivatives in Cash Flow Hedging Relationship:
Foreign exchange contracts
Amount of gains (losses) reclassified from AOCI to income$93 $$(28)$
Amount excluded from the assessment of effectiveness recognized in earnings based on an amortization approach26 
Gains (Losses) on Derivatives in Fair Value Hedging Relationship:
Foreign exchange contracts
Hedged items(35)14 
Derivatives designated as hedging instruments35 (14)
Amount excluded from the assessment of effectiveness
Gains (Losses) on Derivatives in Net Investment Hedging Relationship:
Foreign exchange contracts
Amount excluded from the assessment of effectiveness62 20 
Gains (Losses) on Derivatives Not Designated as Hedging Instruments:
Foreign exchange contracts(233)382 
Other Contracts(181)
Total gains (losses)$119 $(167)$(22)$221 
Gains (Losses) Recognized in Income
Nine Months Ended
September 30,
20192020
RevenuesOther income (expense), netRevenuesOther income (expense), net
Total amounts presented in the Consolidated Statements of Income in which the effects of cash flow and fair value hedges are recorded$115,782 $3,956 $125,629 $3,820 
Gains (Losses) on Derivatives in Cash Flow Hedging Relationship:
Foreign exchange contracts
Amount of gains (losses) reclassified from AOCI to income$306 $$138 $
Amount excluded from the assessment of effectiveness recognized in earnings based on an amortization approach58 40 
Gains (Losses) on Derivatives in Fair Value Hedging Relationship:
Foreign exchange contracts
Hedged items(26)
Derivatives designated as hedging instruments26 (6)
Amount excluded from the assessment of effectiveness24 
Gains (Losses) on Derivatives in Net Investment Hedging Relationship:
Foreign exchange contracts
Amount excluded from the assessment of effectiveness173 131 
Gains (Losses) on Derivatives Not Designated as Hedging Instruments:
Foreign exchange contracts(387)542 
Other Contracts(420)
Total gains (losses)$364 $(190)$178 $255 
Offsetting assets
Offsetting of Assets
As of December 31, 2019
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts of Recognized AssetsGross Amounts Offset in the Consolidated Balance SheetsNet Presented in the Consolidated Balance SheetsFinancial Instruments Cash Collateral ReceivedNon-Cash Collateral ReceivedNet Assets Exposed
Derivatives$365 $(21)$344 $(88)
(1)
$(234)$$22 
As of September 30, 2020
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts of Recognized AssetsGross Amounts Offset in the Consolidated Balance SheetsNet Presented in the Consolidated Balance SheetsFinancial InstrumentsCash Collateral ReceivedNon-Cash Collateral ReceivedNet Assets Exposed
(unaudited)
Derivatives$511 $(18)$493 $(315)
(1)
$(121)$(1)$56 
(1)The balances as of December 31, 2019 and September 30, 2020 were related to derivative liabilities which are allowed to be net settled against derivative assets in accordance with our master netting agreements.
Offsetting liabilities
Offsetting of Liabilities
As of December 31, 2019
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the Consolidated Balance SheetsNet Presented in the Consolidated Balance SheetsFinancial Instruments Cash Collateral PledgedNon-Cash Collateral PledgedNet Liabilities
Derivatives$390 $(21)$369 $(88)
(2)
$$$281 
As of September 30, 2020
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the Consolidated Balance SheetsNet Presented in the Consolidated Balance SheetsFinancial Instruments Cash Collateral PledgedNon-Cash Collateral PledgedNet Liabilities
(unaudited)
Derivatives$813 $(18)$795 $(315)
(2)
$$(444)$36 
(2)    The balances as of December 31, 2019 and September 30, 2020 were related to derivative assets which are allowed to be net settled against derivative liabilities in accordance with our master netting agreements.