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Financial Instruments
 3 Months Ended
Jun. 30, 2018
Investments, All Other Investments [Abstract]  
Financial Instruments
Financial Instruments

The following is a summary of cash equivalents and available-for-sale securities as of the end of the periods presented:

 
June 30, 2018
 
 
March 31, 2018
(In thousands)
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Estimated Fair Value
 
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Estimated Fair Value
Money market funds
$
458,706

 
$
—

 
$
—

 
$
458,706

 
 
$
1,291,891

 
$
—

 
$
—

 
$
1,291,891

Financial institution


 


 


 


 
 


 


 


 


securities
599,832

 
—

 
—

 
599,832

 
 
434,901

 
—

 
—

 
434,901

Non-financial institution


 


 


 


 
 


 


 


 


securities
615,958

 
1

 
(1,413
)
 
614,546

 
 
326,219

 
—

 
(1,376
)
 
324,843

U.S. government and

 

 

 

 
 

 

 

 

agency securities
421,679

 
9

 
(327
)
 
421,361

 
 
58,913

 
1

 
(272
)
 
58,642

Foreign government and

 

 

 

 
 

 

 

 

agency securities
174,405

 
—

 
—

 
174,405

 
 
179,957

 
—

 
—

 
179,957

Mortgage-backed securities
820,305

 
580

 
(23,932
)
 
796,953

 
 
866,048

 
660

 
(22,311
)
 
844,397

Asset-backed securities
90,426

 
12

 
(1,410
)
 
89,028

 
 
92,751

 
16

 
(1,378
)
 
91,389

Debt mutual funds
101,350

 
—

 
(15,717
)
 
85,633

 
 
101,350

 
—

 
(11,680
)
 
89,670

Commercial mortgage-


 


 


 


 
 


 


 


 


backed securities
146,984

 
—

 
(3,595
)
 
143,389

 
 
156,296

 
1

 
(3,427
)
 
152,870

Marketable equity securities
7,500

 
—

 
(1,433
)
 
6,067

 
 
7,500

 
726

 
—

 
8,226

 
$
3,437,145

 
$
602

 
$
(47,827
)
 
$
3,389,920

 
 
$
3,515,826

 
$
1,404

 
$
(40,444
)
 
$
3,476,786



Financial institution securities include securities issued or managed by financial institutions in various forms, such as commercial paper and time deposits. Substantially all time deposits were issued by institutions outside the U.S. as of June 30, 2018 and March 31, 2018.


The following tables show the fair values and gross unrealized losses of the Company’s investments, aggregated by investment category, for individual securities that have been in a continuous unrealized loss position for the length of time specified, as of June 30, 2018 and March 31, 2018:

 
June 30, 2018
 
Less Than 12 Months
 
12 Months or Greater
 
Total
(In thousands)
Fair Value
 
Gross Unrealized Losses
 
Fair Value
 
Gross Unrealized Losses
 
Fair Value
 
Gross Unrealized Losses
Non-financial institution securities
$
57,501

 
$
(1,193
)
 
$
7,910

 
$
(220
)
 
$
65,411

 
$
(1,413
)
U.S. government and

 

 

 

 


 


    agency securities
52,351

 
(224
)
 
4,586

 
(103
)
 
56,937

 
(327
)
Mortgage-backed securities
424,784

 
(10,639
)
 
340,733

 
(13,293
)
 
765,517

 
(23,932
)
Asset-backed securities
53,832

 
(944
)
 
33,333

 
(466
)
 
87,165

 
(1,410
)
Debt mutual funds
—

 
—

 
85,633

 
(15,717
)
 
85,633

 
(15,717
)
Commercial mortgage-

 

 

 

 
 
 
 
backed securities
84,596

 
(1,830
)
 
57,875

 
(1,765
)
 
142,471

 
(3,595
)
Marketable equity securities
6,067

 
(1,433
)
 
—

 
—

 
6,067

 
(1,433
)
 
$
679,131

 
$
(16,263
)
 
$
530,070

 
$
(31,564
)
 
$
1,209,201

 
$
(47,827
)

 
March 31, 2018
 
Less Than 12 Months
 
12 Months or Greater
 
Total
(In thousands)
Fair Value
 
Gross Unrealized Losses
 
Fair Value
 
Gross Unrealized Losses
 
Fair Value
 
Gross Unrealized Losses
Non-financial institution securities
$
69,780

 
$
(1,146
)
 
$
8,344

 
$
(230
)
 
$
78,124

 
$
(1,376
)
U.S. government and

 

 

 

 

 

    agency securities
13,471

 
(176
)
 
9,176

 
(96
)
 
22,647

 
(272
)
Mortgage-backed securities
510,988

 
(11,048
)
 
299,663

 
(11,263
)
 
810,651

 
(22,311
)
Asset-backed securities
57,128

 
(876
)
 
32,696

 
(502
)
 
89,824


(1,378
)
Debt mutual funds
—

 
—

 
89,670

 
(11,680
)
 
89,670

 
(11,680
)
Commercial mortgage-
 
 
 
 
 
 
 
 
 
 
 
    backed securities
95,435

 
(1,760
)
 
56,051

 
(1,667
)
 
151,486

 
(3,427
)
 
$
746,802

 
$
(15,006
)
 
$
495,600

 
$
(25,438
)
 
$
1,242,402

 
$
(40,444
)


As of June 30, 2018, the gross unrealized losses that had been outstanding for less than twelve months were primarily related to mortgage-backed securities due to the general rising of the interest-rate environment, although the percentage of such losses to the total estimated fair value of the mortgage-backed securities was relatively insignificant. The gross unrealized losses that had been outstanding for more than twelve months were primarily related to debt mutual funds and mortgage-backed securities, which were primarily due to the general rising of the interest-rate environment and foreign currency movement.

Starting April 1, 2018, the Company records the change in the fair value of its investment in debt mutual funds and marketable equity securities as part of its interest and other income (expense), net. This change in fair value was a net decrease of $6.2 million for the three months ended June 30, 2018 and resulted in an expense within interest and other income (expense) net for the period.
 
The Company reviewed the investment portfolio and determined that the gross unrealized losses on these investments as of June 30, 2018 and March 31, 2018 were temporary in nature as evidenced by the fluctuations in the gross unrealized losses within the investment categories. These investments are highly rated by the credit rating agencies, there have been no defaults on any of these securities and the company has received interest payments as they become due. Therefore, the Company believes that it will be able to collect both principal and interest amount due to the Company. Additionally, in the past several years a portion of the Company's investment in the mortgage-backed securities was redeemed or prepaid by the debtors at par. Furthermore, the aggregate of individual unrealized losses that had been outstanding for twelve months or more was not significant as of June 30, 2018 and March 31, 2018. The Company neither intends to sell these investments nor concludes that it is more-likely-than-not that it will have to sell them until recovery of their carrying values.

The amortized cost and estimated fair value of marketable debt securities (financial institution securities, non-financial institution securities, U.S. and foreign government and agency securities, asset-backed securities, mortgage-backed securities and commercial mortgage-backed securities), by contractual maturity, are shown in the table below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations without call or prepayment penalties.

 
June 30, 2018
(In thousands)
Amortized
Cost
 
Estimated
Fair Value
Due in one year or less
$
1,758,865

 
$
1,758,593

Due after one year through five years
176,391

 
172,941

Due after five years through ten years
148,349

 
143,894

Due after ten years
785,984

 
764,086


$
2,869,589

 
$
2,839,514



As of June 30, 2018, $1.08 billion of marketable debt securities with contractual maturities of greater than one year were classified as short-term investments. Additionally, the above table does not include investments in money market, debt mutual funds and marketable equity securities because these investments do not have specific contractual maturities.

Certain information related to available-for-sale securities is as follows:

 
Three Months Ended
(In thousands)
June 30, 2018
 
July 1, 2017
Proceeds from sale of available-for-sale securities
$
895

 
$
119,922

Gross realized gains on sale of available-for-sale securities
$
96

 
$
832

Gross realized losses on sale of available-for-sale securities
(47
)
 
(386
)
Net realized gains on sale of available-for-sale securities
$
49

 
$
446

Amortization of premiums on available-for-sale securities
$
2,491

 
$
6,823



The cost of securities matured or sold is based on the specific identification method.