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FAIR VALUE MEASUREMENTS
3 Months Ended
Oct. 31, 2024
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
Assets and Liabilities that are Measured at Fair Value on a Recurring Basis
The following tables present the Company's financial assets and liability measured at fair value on a recurring basis as of October 31, 2024 and July 31, 2024, classified by fair value hierarchy:
Fair Value Measurements at Reporting Date Using
October 31, 2024Level 1Level 2Level 3
(In thousands)
Assets:
Money market funds$215,990 $215,990 $— $— 
Convertible loan note investment— — — — 
Investments in equity securities48,693 48,693 — — 

Fair Value Measurements at Reporting Date Using
July 31, 2024Level 1Level 2Level 3
(In thousands)
Assets:
Money market funds$235,221 $235,221 $— $— 
Convertible loan note investment— — — — 
Investments in equity securities41,376 41,376 — — 
Liabilities:
SPHG Note$12,903 $— $— $12,903 
There were no transfers between Levels 1, 2 or 3 during any of the periods presented.
ASC 820, Fair Value Measurement, provides that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820 requires the Company to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows:
Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets
Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs
Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants would price the assets or liabilities
When available, quoted prices are used to determine fair value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy. When quoted prices in active markets are not available, fair values are determined using pricing models, and the inputs to those pricing models are based on observable market inputs. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others.
Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis
The Company's assets and liabilities that are measured at fair value on a nonrecurring basis include long-lived assets and goodwill and other intangible assets. The Company reviews the carrying amounts of these assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. An impairment loss is recognized when the carrying amount of the asset group or reporting unit is not recoverable and exceeds its fair value. The Company estimates the fair values of assets subject to impairment based on the Company's own judgments about the assumptions that market participants would use in pricing the assets and on observable market data, when available.
Fair Value of Financial Instruments
The Company's financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, customer deposits, accounts payable, and restricted cash, and are reflected in the consolidated financial statements at carrying value. Carrying value approximates fair value for these items due to their short-term maturities or expected settlement dates of these instruments.
Following is a summary of changes in financial assets and liabilities measured using Level 3 inputs:
(In thousands)SPHG NoteConvertible Loan Note Investment
Balance as of July 31, 2024$12,903 $— 
Purchases— — 
Change in fair value(a)
— — 
Paydown of SPHG Note at maturity(12,903)— 
Balance as of October 31, 2024$— $— 
Balance as of July 31, 2023$12,461 $— 
Purchases— 1,227 
Change in fair value(a)
(134)— 
Balance as of October 31, 2023$12,327 $1,227 
(a) Unrealized gains and losses as a result of changes in fair value are recorded in Other (losses) gains, net within the condensed consolidated statements of operations.
Valuation Techniques
Included in cash and cash equivalents in the accompanying consolidated balance sheets are money market funds. These are valued at quoted market prices in active markets.
The Company uses quoted market prices to determine the fair value of investments in equity securities with readily determinable fair value.
In conjunction with the application of pushdown accounting, the Company began measuring the fair value of the SPHG Note on a recurring basis. Refer to Note 9 - "Debt" for further details. Prior to maturity, the Company estimated the fair value of the SPHG Note using a Binomial Lattice Model. The Company recognized $0.1 million in unrealized gains in Other gains, net within the condensed consolidated statements of operations for the three months ended October 31, 2023 as a result of the fair value measurement performed. As discussed previously, the SPHG Note matured on September 1, 2024, and the Company paid off the outstanding principal and accrued interest for the SPHG Note upon its maturity. As such, the balance of the SPHG Note as of October 31, 2024 is zero, and there were no unrealized gains or losses recorded to the condensed consolidated statement of operations for the three months ended October 31, 2024.
As discussed in Note 6 - "Investments", the Company elected the fair value option to account for their convertible loan note investment. In April 2024, the Company determined that the fair value of the investment is zero. As such, the Company recorded a loss of $1.2 million to the condensed consolidated statement of operations during the third quarter of fiscal year 2024. As of October 31, 2024, there was no new information available that would indicate that the fair value of the convertible loan note investment had changed. The Company believed the cost basis of the investment purchased in October 2023 approximated its fair value as of October 31, 2023. As such, there were no unrealized gains or losses recorded to the consolidated statement of operations for the three months ended October 31, 2023.