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Financial Instruments and Fair Value

12 Months Ended

Dec. 31, 2023

Financial Instruments Disclosed at Fair Value

The following tables provide a summary of the significant financial instruments that are disclosed at fair value on a recurring basis as of December 31, 2023 and 2022:


	Fair Value Measurements at December 31, 2023
(in millions)	Level 1		Level 2		Level 3		Total
Term loan due May 2028(1)	$	490.2	$	—	$	—	$	490.2
0.375% Convertible Senior Notes(2)	—		765.6		—		765.6
Equipment financings(3)	—		—		59.3		59.3
5.15% Mortgage(3)	—		—		62.6		62.6
Total	$	490.2	$	765.6	$	121.9	$	1,377.7


	Fair Value Measurements at December 31, 2022
(in millions)	Level 1		Level 2		Level 3		Total
Term loan due May 2028(1)	$	485.1	$	—	$	—	$	485.1
0.375% Convertible Senior Notes(2)	—		1,038.7		—		1,038.7
Equipment financings(3)	—		—		66.4		66.4
5.15% Mortgage(3)	—		—		64.5		64.5
Total	$	485.1	$	1,038.7	$	130.9	$	1,654.7

(1) Fair value of the Term Loan was determined using quoted market prices.

(2) Fair value of the notes was determined using the Company’s quoted stock price and the contractual conversion rate.

(3) The fair values of the equipment financings and mortgage approximate their carrying values and were determined using their cost basis.

Assets Measured at Fair Value on a Recurring Basis

The following tables provide a summary of assets that are measured at fair value on a recurring basis as of December 31, 2023 and 2022:


	Fair Value Measurements at December 31, 2023
(in millions)	Level 1		Level 2		Level 3		Total
Cash(1)	$	103.7	$	—	$	—	$	103.7
Money market mutual funds(1)	547.0		—		—		547.0
Term deposits(2)	—		53.5		—		53.5
Interest rate swaps(3)	—		22.8		—		22.8
Debt securities(4)	—		—		4.7		4.7
Other investments(4)	—		—		3.8		3.8
Total assets	$	650.7	$	76.3	$	8.5	$	735.5


	Fair Value Measurements at December 31, 2022
(in millions)	Level 1		Level 2		Level 3		Total
Cash(1)	$	136.1	$	—	$	—	$	136.1
Money market mutual funds(1)	487.3		—		—		487.3
Term deposits(2)	—		50.8		—		50.8
Restricted cash(1)	0.5		—		—		0.5
Interest rate swaps(3)	—		36.9		—		36.9
Total assets	$	623.9	$	87.7	$	—	$	711.6

(1) Cash and cash equivalents are carried at face amounts, which approximate their fair values.

(2) Fair value is determined using Level 2 inputs.

(3) Fair value represents the estimated amounts the Company would receive or pay to terminate the contracts and is determined using industry standard valuation models and market-based observable inputs, including credit risk and interest rate yield curves. The fair value of the swaps is included in other assets on the consolidated balance sheets.

(4) Fair value is determined using industry standard valuation models and market-based unobservable inputs, including credit spread and risk free rate. The range used for the risk free rate is 3.8% - 5.6%.

The following is a reconciliation of changes in fair value of investments, which were acquired during the year ended December 31, 2023:


(in millions)	Debt Securities		Other Investments		Total
Balance at December 31, 2022	$	—	$	—	$	—
Purchases	5.0		2.0		7.0
Unrealized gain included in other income (expense), net	—		1.8		1.8
Unrealized loss on securities included in other comprehensive income	(0.3)		—		(0.3)
Balance at December 31, 2023	$	4.7	$	3.8	$	8.5

Assets Measured at Fair Value on a Non-Recurring Basis

Due to an observable price change in an orderly transaction during 2023, the Company adjusted the carrying value of certain investments in equity securities held as of December 31, 2023, which resulted in an unrealized gain of $0.8 million. The investments are classified as Level 2 in the fair value hierarchy.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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