XML 27 R11.htm IDEA: XBRL DOCUMENT v3.22.4

Financial Instruments

12 Months Ended

Dec. 31, 2022

Fair Value Disclosures [Abstract]

Financial Instruments

FINANCIAL INSTRUMENTS

Cash, Cash Equivalents, and Investments

The following tables summarize the Company’s cash and available-for-sale debt securities’ amortized cost, gross unrealized gains, gross unrealized losses, allowance for credit loss, and fair value by significant investment category reported as cash and cash equivalents, short-term investments, or long-term investments as of December 31, 2022, and 2021 (in millions):

																																	Reported as:
			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Allowance for Credit Loss						Fair Value						Cash and Cash Equivalents						Short-term Investments						Long-term Investments
December 31, 2022
Cash			$	497.2					$	—					$	—					$	—					$	497.2					$	497.2					$	—					$	—
Level 1:
Money market funds			1,084.0						—						—						—						1,084.0						1,084.0						—						—
U.S. treasuries			2,715.2						—						(96.6)						—						2,618.6						—						1,542.4						1,076.2
Subtotal			3,799.2						—						(96.6)						—						3,702.6						1,084.0						1,542.4						1,076.2
Level 2:
Commercial paper			20.0						—						—						—						20.0						—						20.0						—
Corporate debt securities			2,022.0						—						(76.0)						(1.1)						1,944.9						—						651.8						1,293.1
U.S. government agencies			447.2						—						(19.9)						—						427.3						—						247.8						179.5
Municipal securities			155.5						—						(6.0)						—						149.5						—						74.7						74.8
Subtotal			2,644.7						—						(101.9)						(1.1)						2,541.7						—						994.3						1,547.4
Total assets measured at fair value			$	6,941.1					$	—					$	(198.5)					$	(1.1)					$	6,741.5					$	1,581.2					$	2,536.7					$	2,623.6

																																	Reported as:
			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Allowance for Credit Loss						Fair Value						Cash and Cash Equivalents						Short-term Investments						Long-term Investments
December 31, 2021
Cash			$	572.3					$	—					$	—					$	—					$	572.3					$	572.3					$	—					$	—
Level 1:
Money market funds			696.6						—						—						—						696.6						696.6						—						—
U.S. treasuries			3,429.1						6.3						(15.4)						—						3,420.0						17.0						1,100.3						2,302.7
Subtotal			4,125.7						6.3						(15.4)						—						4,116.6						713.6						1,100.3						2,302.7
Level 2:
Commercial paper			717.7						—						—						—						717.7						—						717.7						—
Corporate debt securities			2,485.6						2.7						(11.9)						—						2,476.4						5.0						886.7						1,584.7
U.S. government agencies			526.1						0.2						(2.9)						—						523.4						—						137.8						385.6
Municipal securities			213.4						0.7						(1.0)						—						213.1						—						70.6						142.5
Subtotal			3,942.8						3.6						(15.8)						—						3,930.6						5.0						1,812.8						2,112.8
Total assets measured at fair value			$	8,640.8					$	9.9					$	(31.2)					$	—					$	8,619.5					$	1,290.9					$	2,913.1					$	4,415.5

The following table summarizes the contractual maturities of the Company’s cash equivalents and available-for-sale debt securities (excluding money market funds) as of December 31, 2022 (in millions):

			Amortized Cost						Fair Value
Mature in less than one year			$	2,586.6					$	2,536.7
Mature in one to five years			2,773.3						2,623.6
Total			$	5,359.9					$	5,160.3

Actual maturities may differ from contractual maturities, because certain borrowers have the right to call or prepay certain obligations. Gross realized gains and losses recognized on the sale of investments were immaterial for the years ended December 31, 2022, and 2021.

As of December 31, 2022, and 2021, net unrealized losses on available-for-sale debt securities, net of tax, of $154.2 million and $16.0 million, respectively, were included in accumulated other comprehensive loss in the accompanying Consolidated Balance Sheets.

The following tables present the breakdown of the available-for-sale debt securities with unrealized losses as of December 31, 2022, and 2021 (in millions):

			Unrealized losses less than 12 months												Unrealized losses 12 months or greater												Total
December 31, 2022			Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
U.S. treasuries			$	731.7					$	(26.0)					$	1,886.9					$	(70.6)					$	2,618.6					$	(96.6)
Corporate debt securities			631.4						(17.6)						1,221.9						(58.4)						1,853.3						(76.0)
U.S. government agencies			102.7						(4.4)						324.6						(15.5)						427.3						(19.9)
Municipal securities			44.6						(1.1)						104.9						(4.9)						149.5						(6.0)
Total			$	1,510.4					$	(49.1)					$	3,538.3					$	(149.4)					$	5,048.7					$	(198.5)
December 31, 2021
U.S. treasuries			$	2,596.3					$	(15.4)					$	—					$	—					$	2,596.3					$	(15.4)
Commercial paper			4.0						—						—						—						4.0						—
Corporate debt securities			1,687.9						(11.9)						—						—						1,687.9						(11.9)
U.S. government agencies			412.5						(2.9)						—						—						412.5						(2.9)
Municipal securities			156.0						(1.0)						—						—						156.0						(1.0)
Total			$	4,856.7					$	(31.2)					$	—					$	—					$	4,856.7					$	(31.2)

The unrealized losses on the Company’s available-for-sale debt securities were caused by interest rate increases. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost basis of the investments. As of December 31, 2022, the Company does not intend to sell the investments, and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be at maturity. Additional factors considered in determining the treatment of unrealized losses include the financial condition and near-term prospects of the investee, the extent of the loss related to the credit of the issuer, and the expected cash flows from the security.

Equity Investments

The following table is a summary of the activity related to equity investments (in millions):

																											Reported as:
			December 31, 2021 Carrying Value						Changes in Fair Value (1)						Purchases / Sales / Other (2)						December 31, 2022 Carrying Value						Prepaids and other current assets						Intangible and other assets, net
Equity investments with readily determinable value (Level 1)			$	26.9					(21.2)						(1.4)						$	4.3					$	4.3					$	—
Equity investments without readily determinable value (Level 2)			$	15.6					0.2						43.3						$	59.1					$	—					$	59.1
(1) Recorded in interest and other income, net.
(2) Other includes foreign currency translation gains/(losses).

In September 2021, Broncus Holding Corporation (“Broncus”) completed an initial public offering (“IPO”) of common shares on the Stock Exchange of Hong Kong. Upon completion of its IPO, the Company’s preferred shares of Broncus were converted into common shares, which have a readily determinable value (Level 1). The Company was restricted from selling these shares for a period of six months. In 2022, the Company recognized a $21.2 million loss on this investment reflected in changes in fair value for Level 1 equity investments, which was reflected in Interest and other income, net.

The Company recognized a $0.2 million increase in fair value, which was reflected in interest and other income, net, due to changes in observable prices for certain equity investments that lack readily determinable market values (Level 2). There were no decreases in fair value reflected in net income due to impairments.

Foreign Currency Derivatives

The objective of the Company’s hedging program is to mitigate the impact of changes in currency exchange rates on net cash flow from foreign currency-denominated sales, expenses, intercompany balances, and other monetary assets or liabilities denominated in currencies other than the U.S. dollar (“USD”). The terms of the Company’s derivative contracts are generally twelve months or shorter. The derivative assets and liabilities are measured using Level 2 fair value inputs.

Cash Flow Hedges. The Company enters into currency forward contracts as cash flow hedges to hedge certain forecasted revenue transactions denominated in currencies other than the USD, primarily the Euro (“EUR”), the British Pound (“GBP”), the Japanese Yen (“JPY”), the Korean Won (“KRW”), and the New Taiwan Dollar (“TWD”). The Company also enters into currency forward contracts as cash flow hedges to hedge certain forecasted expense transactions denominated in EUR and the Swiss Franc (“CHF”).

For these derivatives, the Company reports the unrealized after-tax gain or loss from the hedge as a component of accumulated other comprehensive loss in stockholders’ equity and reclassifies the amount into earnings in the same period in which the hedged transaction affects earnings. The amounts reclassified to revenue and expenses related to the hedged transactions and the ineffective portions of cash flow hedges were not material for the periods presented.

Other Derivatives Not Designated as Hedging Instruments. Other derivatives not designated as hedging instruments consist primarily of forward contracts that the Company uses to hedge intercompany balances and other monetary assets or liabilities denominated in currencies other than the USD, primarily the EUR, GBP, JPY, KRW, CHF, TWD, Indian Rupee (“INR”), Mexican Peso (“MXN”), Chinese Yuan (“CNY”), and Canadian Dollar (“CAD”).

These derivative instruments are used to hedge against balance sheet foreign currency exposures. The related gains and losses were as follows (in millions):

			Years Ended December 31,
			2022						2021						2020
Recognized gains (losses) in interest and other income, net			$	26.9					$	15.5					$	(12.3)
Foreign exchange gains (losses) related to balance sheet re-measurement			$	(54.2)					$	(16.4)					$	10.9

The notional amounts for derivative instruments provide one measure of the transaction volume. Total gross notional amounts (in USD) for outstanding derivatives and the aggregate gross fair value at the end of each period were as follows (in millions):

			Derivatives Designated as Hedging Instruments												Derivatives Not Designated as Hedging Instruments
			December 31, 2022						December 31, 2021						December 31, 2022						December 31, 2021
Notional amounts:
Forward contracts			$	188.4					$	181.2					$	496.3					$	318.8
Gross fair value recorded in:
Prepaids and other current assets			$	1.8					$	5.7					$	4.3					$	6.9
Other accrued liabilities			$	5.3					$	0.5					$	4.2					$	0.8

X

- References

No definition available.

+ Details

Name:	us-gaap_FairValueDisclosuresAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures.

+ References

No definition available.

+ Details

Name:	us-gaap_FinancialInstrumentsDisclosureTextBlock
Namespace Prefix:	us-gaap_
Data Type:	dtr-types:textBlockItemType
Balance Type:	na
Period Type:	duration