Short-Term Investments

9 Months Ended

Sep. 30, 2011

Short-Term Investments [Abstract]

Short-Term Investments

2. Short-term Investments

Our short-term investments, consisting principally of debt securities, are classified as available-for-sale and are stated at fair value based upon observed market prices (Level 1 in the fair value hierarchy). Unrealized holding gains or losses on these securities are included in other comprehensive loss. The amortized cost of debt securities in this category is adjusted for amortization of premiums and accretion of discounts to maturity. For investments in mortgage-backed securities, amortization of premiums and accretion of discounts are recognized in interest income using the interest method, adjusted for anticipated prepayments as applicable. Estimates of expected cash flows are updated periodically and changes are recognized in the calculated effective yield prospectively as appropriate. Such amortization is included in interest income. Realized gains and losses are included in interest income and declines in value judged to be other-than-temporary on available-for-sale securities are included in impairment loss on investments, a component of other expense. In assessing potential impairment of our short-term investments, we evaluate the impact of interest rates, potential prepayments on mortgage-backed securities, changes in credit quality, the length of time and extent to which the market value has been less than cost, and our intent and ability not to sell the security in order to allow for an anticipated recovery in fair value. The cost of securities sold is based on the specific-identification method. The following is a summary of short-term investments as of September 30, 2011 and December 31, 2010 (in thousands):

	Available-for-Sale Securities
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
September 30, 2011
U.S. Treasury securities	$	62,131	$	3	$	(5	)	$	62,129
Obligations of U.S. Government-sponsored enterprises		73,984		342		(99	)		74,227
Corporate debt securities		199,814		739		(189	)		200,364
Asset backed securities		1,710		—		(1	)		1,709
Total	$	337,639	$	1,084	$	(294	)	$	338,429
December 31, 2010
U.S. Treasury securities	$	46,234	$	4	$	—		$	46,238
Obligations of U.S. Government-sponsored enterprises		37,826		191		(50	)		37,967
Corporate debt securities		191,680		743		(23	)		192,400
Asset backed securities		1,531		6		—			1,537
Total	$	277,271	$	944	$	(73	)	$	278,142

Contractual maturities of short-term investments at September 30, 2011 were as follows (in thousands):

	Fair Value
Due within 1 year	$	247,370
After 1 but within 5 years		74,468
After 5 but within 10 years		—
After 10 years		16,591
Total	$	338,429

For purposes of these maturity classifications, the final maturity date is used for securities not due at a single maturity date. Securities not due at a single maturity date include mortgage-backed securities, which are included in Obligations of U.S Government-sponsored enterprises in the table above, and asset-backed securities.

The following table shows the gross unrealized losses and fair value of our investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2011 (in thousands):

	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. Treasury securities	$	23,341	$	(5	)	$	—	$	—		$	23,341	$	(5	)
Obligations of U.S Government-sponsored enterprises		46,142		(62	)		5,223		(37	)		51,365		(99	)
Corporate debt securities		71,324		(189	)		—		—			71,324		(189	)
Asset backed securities		569		(1	)		—		—			569		(1	)
	$	141,376	$	(257	)	$	5,223	$	(37	)	$	146,599	$	(294	)

Our investments had gross unrealized losses of $0.3 million and $0.1 million for September 30, 2011 and December 31, 2010, respectively. The unrealized losses on our investments in marketable securities are due in most instances to the increased volatility in the markets impacting the classes of securities we invest in and not deterioration in credit ratings. Our investments have a short effective duration, and since we have the ability and intent not to sell these investments until a recovery of fair value, which may be maturity, we do not consider these investments to be other-than-temporarily impaired at September 30, 2011.