FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The following table summarizes our investments as of March 31, 2015 and December 31, 2014 (in thousands):



	March 31, 2015
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Corporate debt securities	$	568,456	$	593	$	(243	)	$	568,806
Commercial paper	43,758		1		(9		)	43,750
Municipal bonds	49,825		21		(26		)	49,820
Certificates of deposit and term deposits ⁽¹⁾	13,080		—		—			13,080
U.S. government and agency securities	10,749		8		—			10,757
Total available-for-sale securities	$	685,868	$	623	$	(278	)	$	686,213



	December 31, 2014
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Corporate debt securities	$	589,526	$	365	$	(875	)	$	589,016
Commercial paper	51,156		3		(4		)	51,155
Municipal bonds	39,745		15		(39		)	39,721
Certificates of deposit and term deposits ⁽¹⁾	22,854		—		—			22,854
U.S. government and agency securities	5,749		1		(6		)	5,744
Total available-for-sale securities	$	709,030	$	384	$	(924	)	$	708,490

⁽¹⁾ The majority of our certificates of deposit and term deposits are foreign deposits.

The following table shows the gross unrealized losses and the related fair values of our investments that have been in a continuous unrealized loss position as of March 31, 2015 and December 31, 2014 (in thousands):



	March 31, 2015
	Less Than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Corporate debt securities	$	177,364	$	(214	)	$	13,142	$	(29	)	$	190,506	$	(243	)
Commercial paper	8,375		(9		)	—		—			8,375		(9		)
Municipal bonds	32,205		(26		)	—		—			32,205		(26		)
Total available-for-sale securities	$	217,944	$	(249	)	$	13,142	$	(29	)	$	231,086	$	(278	)



	December 31, 2014
	Less Than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Corporate debt securities	$	317,011	$	(858	)	$	6,011	$	(17	)	$	323,022	$	(875	)
Commercial paper	8,185		(4		)	—		—			8,185		(4		)
Municipal bonds	26,684		(39		)	—		—			26,684		(39		)
U.S. government and agency securities	4,745		(6		)	—		—			4,745		(6		)
Total available-for-sale securities	$	356,625	$	(907	)	$	6,011	$	(17	)	$	362,636	$	(924	)

The contractual maturities of our investments as of March 31, 2015 and December 31, 2014 were as follows (in thousands):



	March 31, 2015		December 31, 2014
Due within one year	$	417,605	$	436,766
Due within one to three years	268,608		271,724
Total	$	686,213	$	708,490

Available-for-sale securities are reported at fair value, with unrealized gains and losses, net of tax, included as a separate component of stockholders’ equity and in total comprehensive income. Realized gains and losses on available-for-sale securities are included in Other expense—net in our condensed consolidated statements of operations. Realized gains and losses from the sale of available-for-sale securities were not significant in any period presented.

The unrealized losses on our available-for-sale securities were caused by fluctuations in market value and interest rates as a result of the economic environment. As the decline in market value is attributable to changes in market conditions and not credit quality, and because we have concluded currently that we neither intend to sell nor is it more likely than not that we will be required to sell these investments prior to a recovery of par value, we do not consider these investments to be other-than temporarily impaired as of March 31, 2015.

Fair Value Accounting—We apply the following fair value hierarchy for disclosure of the inputs used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments.

Level 3—Unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation.

We measure the fair value of money market funds and certain U.S. government and agency securities using quoted prices in active markets for identical assets. The fair value of all other financial instruments was based on quoted prices for similar assets in active markets, or model driven valuations using significant inputs derived from or corroborated by observable market data.

We classify investments within Level 1 if quoted prices are available in active markets for identical securities.

We classify items within Level 2 if the investments are valued using model driven valuations using observable inputs such as quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Investments are held by custodians who obtain investment prices from a third-party pricing provider that incorporates standard inputs in various asset price models.

Fair Value of Financial Instruments

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the fair value of our financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2015 and December 31, 2014 (in thousands):



	March 31, 2015						December 31, 2014
	Aggregate Fair Value		Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs		Aggregate Fair Value		Quoted Prices in Active Markets For Identical Assets		Significant Other Observable Remaining Inputs
			(Level 1)		(Level 2)				(Level 1)		(Level 2)
Assets:
Corporate debt securities	$	568,806	$	—	$	568,806	$	589,016	$	—	$	589,016
Commercial paper	43,750		—		43,750		51,155		—		51,155
Municipal bonds	49,820		—		49,820		39,721		—		39,721
Certificates of deposit and term deposits	13,080		—		13,080		22,854		—		22,854
Money market funds	29,154		29,154		—		13,311		13,311		—
U.S. government and agency securities	10,757		2,001		8,756		5,744		1,998		3,746
Total	$	715,367	$	31,155	$	684,212	$	721,801	$	15,309	$	706,492

Reported as:
Cash equivalents	$	29,154					$	13,311
Short-term investments	417,605						436,766
Long-term investments	268,608						271,724
Total	$	715,367					$	721,801

There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the period ended March 31, 2015.