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Strategic Investments | 6 Months Ended
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Jun. 30, 2024
Strategic Investments |
Strategic Investments | Note 7 - Strategic Investments Strategic investments include equity and debt investments in a number of non-public technology driven companies. We account for strategic equity investments under the ASC 321 measurement alternative for equity securities without readily determinable fair values, as there are no quoted market prices for the investments. The investments are measured at cost less impairment, adjusted for observable price changes and are assessed for impairment whenever events or changes in circumstances indicate that the fair value may be less than its carrying value. For the debt security strategic investment, we have elected to account for this investment and the associated embedded derivatives utilizing the fair value option. Unrealized changes in fair value for the entire hybrid instrument are recorded within other income (loss), net in the condensed consolidated statement of operations. The debt security is recorded as a strategic investment within the long-term assets section of the condensed consolidated balance sheet. In conjunction with certain of our strategic investments, we have the ability to commit additional capital over time through warrants and call options; for some investments, the exercisability and exercise prices are conditional on the achievement of certain performance metrics. The following tables provide a roll-forward of the balance of strategic investments (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended June 30, 2024 | ​ | Three Months Ended June 30, 2023
​ |  | Equity investments |  | Warrants |  | ​ | Call options | ​ | Debt investments | ​ | ​ | Total |  | Equity investments |  | Warrants |  | ​ | Call options | ​ | ​ | Total
Balance, beginning of period | ​ | $ | 280,108 | ​ | $ | 2,356 | ​ | $ | 13,033 | ​ | $ | — | ​ | ​ | $ | 295,497 | ​ | $ | 277,676 | ​ | $ | 1,654 | ​ | $ | 17,233 | ​ | $ | 296,563
Investments | ​ | ​ | 60,000 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 7,500 | ​ | ​ | ​ | 67,500 | ​ | ​ | 10,917 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 10,917
Fair value adjustments: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Realized gains | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 21 | ​ | ​ | — | ​ | ​ | ​ | 21 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Unrealized gains | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 137 | ​ | ​ | ​ | 137 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Unrealized losses and impairments | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | ​ | — | ​ | ​ | (72,648) | ​ | ​ | (1,195) | ​ | ​ | — | ​ | ​ | (73,843)
Exercises | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (21) | ​ | ​ | — | ​ | ​ | ​ | (21) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Balance, end of period | ​ | $ | 340,108 | ​ | $ | 2,356 | ​ | $ | 13,033 | ​ | $ | 7,637 | ​ | ​ | $ | 363,134 | ​ | $ | 215,945 | ​ | $ | 459 | ​ | $ | 17,233 | ​ | $ | 233,637
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Six Months Ended June 30, 2024 | ​ | Six Months Ended June 30, 2023
​ |  | Equity investments |  | Warrants |  | ​ | Call options | ​ | Debt investments | ​ | ​ | Total |  | Equity investments |  | Warrants |  | ​ | Call options | ​ | ​ | Total
Balance, beginning of period | ​ | $ | 212,996 | ​ | $ | 1,501 | ​ | $ | 17,233 | ​ | $ | — | ​ | ​ | $ | 231,730 | ​ | $ | 277,676 | ​ | $ | 1,654 | ​ | $ | 17,233 | ​ | $ | 296,563
Investments | ​ | ​ | 69,128 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 7,500 | ​ | ​ | ​ | 76,628 | ​ | ​ | 10,917 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 10,917
Fair value adjustments: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Realized gains | ​ | ​ | 45,162 | ​ | ​ | — | ​ | ​ | 21 | ​ | ​ | — | ​ | ​ | ​ | 45,183 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Realized losses | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (2,870) | ​ | ​ | — | ​ | ​ | ​ | (2,870) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Unrealized gains | ​ | ​ | 74,784 | ​ | ​ | 855 | ​ | ​ | — | ​ | ​ | 137 | ​ | ​ | ​ | 75,776 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Unrealized losses and impairments | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | ​ | — | ​ | ​ | (72,648) | ​ | ​ | (1,195) | ​ | ​ | — | ​ | ​ | (73,843)
Exercises | ​ | ​ | (61,962) | ​ | ​ | — | ​ | ​ | (1,351) | ​ | ​ | — | ​ | ​ | ​ | (63,313) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Balance, end of period | ​ | $ | 340,108 | ​ | $ | 2,356 | ​ | $ | 13,033 | ​ | $ | 7,637 | ​ | ​ | $ | 363,134 | ​ | $ | 215,945 | ​ | $ | 459 | ​ | $ | 17,233 | ​ | $ | 233,637
​ In January 2024, we acquired the remaining outstanding stock of a strategic investment. Our existing interest had a fair value at acquisition date of $63.3 million, which resulted in a net non-taxable gain of $42.3 million related to the existing strategic equity investment and call option. For additional information on the business combination, refer to Note 17. Additionally, as a result of an observable price change for a separate strategic investee, we recognized an unrealized gain of $75.6 million for the strategic investment and related warrants in other income (loss), net on our condensed consolidated statement of operations during the six months ended June 30, 2024. For the debt security strategic investment, we recognized an unrealized gain of $0.1 million for the entire hybrid instrument in other income (loss), net on our condensed consolidated statement of operations during the six months ended June 30, 2024. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Inception to date
​ |  | Equity investments |  | Warrants |  | ​ | Call options | ​ | Debt investments | ​ | ​ | Total
Investments | ​ | $ | 193,626 | ​ | $ | 4,222 | ​ | $ | 17,233 | ​ | $ | 7,500 | ​ | ​ | $ | 222,581
Fair value adjustments: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Realized gains | ​ | ​ | 57,474 | ​ | ​ | — | ​ | ​ | 21 | ​ | ​ | — | ​ | ​ | ​ | 57,495
Realized losses | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (2,870) | ​ | ​ | — | ​ | ​ | ​ | (2,870)
Unrealized gains | ​ | ​ | 149,601 | ​ | ​ | 29,928 | ​ | ​ | — | ​ | ​ | 137 | ​ | ​ | ​ | 179,666
Unrealized losses and impairments | ​ | ​ | (82,304) | ​ | ​ | (1,705) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | ​ | (84,009)
Exercises | ​ | ​ | 36,257 | ​ | ​ | (30,089) | ​ | ​ | (1,351) | ​ | ​ | — | ​ | ​ | ​ | 4,817
Sales | ​ | ​ | (14,546) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | ​ | (14,546)
Balance, end of period | ​ | $ | 340,108 | ​ | $ | 2,356 | ​ | $ | 13,033 | ​ | $ | 7,637 | ​ | ​ | $ | 363,134
​

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