Fair Value Measurements

Fair value is the price that would be received upon the sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. The transaction would be in the principal or most advantageous market for the asset or liability, based on assumptions that a market participant would use in pricing the asset or liability. The fair value hierarchy consists of three levels:

Level 1–quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date;

Level 2–inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and

Level 3–unobservable inputs for the asset or liability.

Assets/Liabilities Measured and Recorded at Fair Value on a Recurring Basis

As of December 31, 2017 and December 25, 2016, we had assets related to our qualified pension plans measured at fair value. The required disclosures regarding such assets are presented in Note 9.

The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2017 and December 25, 2016:



(In thousands)	December 31, 2017								December 25, 2016 ⁽³⁾
(In thousands)	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Assets:
Short-term AFS securities⁽¹⁾
U.S Treasury securities	$	70,951	$	—	$	70,951	$	—	$	—	$	—	$	—	$	—
Corporate debt securities	150,107		—		150,107		—		—		—		—		—
U.S. governmental agency securities	45,640		—		45,640		—		—		—		—		—
Certificates of deposit	9,300		—		9,300		—		—		—		—		—
Commercial paper	32,591		—		32,591		—		—		—		—		—
Total short-term AFS securities	$	308,589	$	—	$	308,589	$	—	$	—	$	—	$	—	$	—
Long-term AFS securities⁽¹⁾
U.S. governmental agency securities	$	96,779	$	—	$	96,779	$	—	$	—	$	—	$	—	$	—
Corporate debt securities	92,004		—		92,004		—		—		—		—		—
U.S Treasury securities	52,628		—		52,628		—		—		—		—		—
Total long-term AFS securities	$	241,411	$	—	$	241,411	$	—	$	—	$	—	$	—	$	—
Liabilities:
Deferred compensation⁽²⁾	$	29,526	$	29,526	$	—	$	—	$	31,006	$	31,006	$	—	$	—

⁽¹⁾ Our marketable securities, which include U.S. Treasury securities, corporate debt securities, U.S. government agency securities, municipal securities, certificates of deposit and commercial paper, are recorded at fair value (see Note 3). We classified these investments as Level 2 since the fair value is based on market observable inputs for investments with similar terms and maturities.

⁽²⁾ The deferred compensation liability, included in “Other liabilities—Other” in our Consolidated Balance Sheets, consists of deferrals under The New York Times Company Deferred Executive Compensation Plan (the “DEC”), which enables certain eligible executives to elect to defer a portion of their compensation on a pre-tax basis. The deferred amounts are invested at the executives’ option in various mutual funds. The fair value of deferred compensation is based on the mutual fund investments elected by the executives and on quoted prices in active markets for identical assets. Participation in the DEC was frozen effective December 31, 2015. Refer to Note 11 for detail.

⁽³⁾ As noted in Note 2, in the third quarter of 2017, we reclassified our marketable securities from HTM to AFS. Prior to being classified as AFS, the securities were recorded at amortized cost and not adjusted to fair value in accordance with the HTM accounting treatment. As of December 25, 2016, the amortized cost approximated fair value because of the short-term maturity and highly liquid nature of these investments. We classified these investments as Level 2 since the fair value estimates are based on market observable inputs for investments with similar terms and maturities.

Financial Instruments Disclosed, But Not Reported, at Fair Value

The carrying value of our long-term debt was approximately $243 million as of December 31, 2017 and approximately $240 million as of December 25, 2016. The fair value of our long-term debt was approximately $279 million and $298 million as of December 31, 2017, and December 25, 2016, respectively. We estimate the fair value of our debt utilizing market quotations for debt that have quoted prices in active markets. Since our debt does not trade in an active market, the fair value estimates are based on market observable inputs based on borrowing rates currently available for debt with similar terms and average maturities (Level 2).

Assets Measured and Recorded at Fair Value on a Non-Recurring Basis

Certain non-financial assets, such as goodwill, intangible assets, property, plant and equipment and certain investments are only recorded at fair value if an impairment charge is recognized. Goodwill and intangible assets are initially recorded at fair value in purchase accounting. We classified all of these measurements as Level 3, as we used unobservable inputs within the valuation methodologies that were significant to the fair value measurements, and the valuations required management‘s judgment due to the absence of quoted market prices. There was no impairment recognized in 2017, 2016 and 2015.