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Fair Value Measurements
 6 Months Ended
Jul. 31, 2021
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
We measure our cash equivalents, marketable securities, and foreign currency derivative contracts at fair value at each reporting period using a fair value hierarchy which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value:
Level 1 — Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 — Other inputs that are directly or indirectly observable in the marketplace.
Level 3 — Unobservable inputs that are supported by little or no market activity.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following table presents information about our assets and liabilities that are measured at fair value on a recurring basis and their assigned levels within the valuation hierarchy as of July 31, 2021 (in thousands):
Level 1Level 2Level 3Total
U.S. treasury securities$1,096,812 $— $— $1,096,812 
U.S. agency obligations— 189,254 — 189,254 
Corporate bonds— 372,479 — 372,479 
Commercial paper— 780,888 — 780,888 
Money market funds414,663 — — 414,663 
Marketable equity investments141,006 — — 141,006 
Foreign currency derivative assets— 10,973 — 10,973 
Total assets$1,652,481 $1,353,594 $— $3,006,075 
Foreign currency derivative liabilities$— $34,877 $— $34,877 
Total liabilities$— $34,877 $— $34,877 
The following table presents information about our assets and liabilities that are measured at fair value on a recurring basis and their assigned levels within the valuation hierarchy as of January 31, 2021 (in thousands):
Level 1Level 2Level 3Total
U.S. treasury securities$1,054,341 $— $— $1,054,341 
U.S. agency obligations— 504,445 — 504,445 
Corporate bonds— 347,802 — 347,802 
Commercial paper— 664,262 — 664,262 
Money market funds659,964 — — 659,964 
Marketable equity investments21,300 — — 21,300 
Foreign currency derivative assets— 3,221 — 3,221 
Total assets$1,735,605 $1,519,730 $— $3,255,335 
Foreign currency derivative liabilities$— $49,456 $— $49,456 
Total liabilities$— $49,456 $— $49,456 
Non-Marketable Equity Investments Measured at Fair Value on a Non-Recurring Basis
Non-marketable equity investments that have been remeasured during the period due to an observable event or impairment are classified within Level 3 in the fair value hierarchy because we estimate the value based on valuation methods which may include a combination of the observable transaction price at the transaction date and other unobservable inputs including volatility, rights, and obligations of the investments we hold. For further information, see Note 3, Investments.
Fair Value Measurements of Other Financial Instruments
In April 2020, we entered into a credit agreement (“Credit Agreement”) pursuant to which the lenders extended to Workday a senior unsecured term loan facility in an aggregate principal amount of $750 million (“Term Loan”) and an unsecured revolving credit facility in an aggregate principal amount of $750 million (“Revolving Credit Facility”). The carrying value of the Term Loan was $711 million and $729 million as of July 31, 2021, and January 31, 2021, respectively. The estimated fair value of the Term Loan, which we have classified as a Level 2 financial instrument, approximates its carrying value because it is a floating rate facility. There were no outstanding borrowings under the Revolving Credit Facility during the periods presented. For further information, see Note 11, Debt.
In September 2017, we completed an offering of $1.15 billion of 0.25% convertible senior notes due October 1, 2022. The carrying value of the 2022 Notes was $1.1 billion as of July 31, 2021, and January 31, 2021, and the estimated fair value of the 2022 Notes was $1.9 billion and $1.8 billion as of July 31, 2021, and January 31, 2021, respectively. The estimated fair value of the 2022 Notes, which we have classified as a Level 2 financial instrument, was determined based on the quoted bid price in an over-the-counter market on the last trading day of each reporting period. For further information, see Note 11, Debt.