Note 6 — Cash Equivalents and Investments

The following tables summarize the Company’s cash equivalents and investments measured at fair value:


	Fair Value Measurements as of June 30, 2013
	Level 1			Level 2			Total
	(In thousands)
Cash equivalents:
Money-market funds	$	268,320	(a)	$	—		$	268,320
Government and agency securities		—			600	(b)		600
Commercial paper		—			4,924	(b)		4,924

Total cash equivalents	$	268,320		$	5,524		$	273,844

Available-for-sale debt securities:
Asset-backed and mortgage-backed securities:
Agency securities	$	—		$	144,220	(b)	$	144,220
Non-agency securities		—			845	(b)		845
Government and agency securities		23,441	(a)		61,200	(b)		84,641
Corporate debt securities		—			20,857	(b)		20,857
Commercial paper		—			13,345	(b)		13,345

Total short-term investments	$	23,441		$	240,467		$	263,908

Long-term investments in equity securities:
Marketable available-for-sale equity securities	$	1,990	(c)	$	—		$	1,990


	Fair Value Measurements as of December 31, 2012
	Level 1			Level 2			Total
	(In thousands)
Cash equivalents:
Money-market funds	$	364,596	(a)	$	—		$	364,596
Government and agency securities		—			6,479	(b)		6,479

Total cash equivalents	$	364,596		$	6,479		$	371,075

Available-for-sale debt securities:
Asset-backed and mortgage-backed securities:
Agency securities	$	—		$	129,463	(b)	$	129,463
Non-agency securities		—			1,393	(b)		1,393
Government and agency securities		17,042	(a)		49,658	(b)		66,700
Corporate debt securities		—			6,001	(b)		6,001
Commercial paper		—			900	(b)		900

Total short-term investments	$	17,042		$	187,415		$	204,457

Long-term investments in equity securities:
Marketable available-for-sale equity securities	$	1,689	(c)	$	—		$	1,689

(a)	The fair value of money-market funds is determined using unadjusted prices in active markets. Level 1 government and agency securities consist of U.S. government securities and their fair value is determined using quoted prices in active markets.

(b)

These investments are traded less frequently than Level 1 securities and are valued using inputs that include quoted prices for similar assets in active markets and inputs other than quoted prices that are observable for the asset, such as interest rates, yield curves, prepayment speeds, collateral performance, broker/dealer quotes and indices that are observable at commonly quoted intervals.

(c)	The fair value of marketable equity securities is determined using quoted prices in active markets. These amounts are included within other assets in the condensed consolidated balance sheets.

As of June 30, 2013 and December 31, 2012, the aggregate carrying value of the Company’s non-marketable securities was $42.8 million and $42.1 million, respectively.

Upon the acquisition of SandForce, Inc. (“SandForce”) in January 2012, the Company recognized a gain of $5.8 million as a result of re-measuring its pre-acquisition equity interest in SandForce to estimated fair value. There were no other non-marketable securities fair-valued during the three and six months ended June 30, 2013 or July 1, 2012.

The following tables summarize the Company’s available-for-sale securities:


	June 30, 2013
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
	(In thousands)
Short-term debt securities:
Asset-backed and mortgage-backed securities	$	142,541	$	4,862	$	(2,338	)	$	145,065
Government and agency securities		84,738		447		(544	)		84,641
Corporate debt securities		20,848		87		(78	)		20,857
Commercial paper		13,345		—		—			13,345

Total short-term debt securities	$	261,472	$	5,396	$	(2,960	)	$	263,908

Long-term marketable equity securities	$	669	$	1,321	$	—		$	1,990


	December 31, 2012
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
	(In thousands)
Short-term debt securities:
Asset-backed and mortgage-backed securities	$	125,563	$	6,390	$	(1,097	)	$	130,856
Government and agency securities		65,904		802		(6	)		66,700
Corporate debt securities		5,864		137		—			6,001
Commercial paper		900		—		—			900

Total short-term debt securities	$	198,231	$	7,329	$	(1,103	)	$	204,457

Long-term marketable equity securities	$	669	$	1,020	$	—		$	1,689

As of June 30, 2013, there were 217 investments in an unrealized loss position. The following tables summarize the gross unrealized losses and fair values of the Company’s short-term investments that have been in a continuous unrealized loss position for less than and greater than 12 months, aggregated by investment category:


	June 30, 2013
	Less than 12 Months					Greater than 12 Months
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands)
Asset-backed and mortgage-backed securities	$	67,133	$	(2,138	)	$	6,598	$	(200	)
Government and agency securities		51,960		(544	)		—		—
Corporate debt securities		9,611		(78	)		—		—

Total	$	128,704	$	(2,760	)	$	6,598	$	(200	)


	December 31, 2012
	Less than 12 Months					Greater than 12 Months
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands)
Asset-backed and mortgage-backed securities	$	38,280	$	(1,018	)	$	4,141	$	(79	)
Government and agency securities		18,301		(6	)		—		—

Total	$	56,581	$	(1,024	)	$	4,141	$	(79	)

Net realized losses and gains on sales of available-for-sale securities were not material for the three and six months ended June 30, 2013 or July 1, 2012.

Contractual maturities of available-for-sale debt securities as of June 30, 2013 were as follows (in thousands):


Due within one year	$	38,100
Due in 1-5 years		82,511
Due in 5-10 years		9,389
Due after 10 years		133,908

Total	$	263,908

The maturities of asset-backed and mortgage-backed securities were determined based on contractual principal maturities assuming no prepayments.