Fair Value Measurements

3 Months Ended

Mar. 31, 2019

Fair Value Measurements

8. Fair Value Measurements

Assets and liabilities measured at fair value are classified into the following categories:

•

Level 1: Quoted market prices in active markets for identical assets or liabilities.

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Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.

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Level 3: Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets.

We classify our cash equivalents and marketable securities within Level 1 or Level 2 because we use quoted market prices or alternative pricing sources and models utilizing market observable inputs to determine their fair value. There were no transfers between levels during the periods presented.

The following tables set forth our financial assets as of March 31, 2019 and December 31, 2018 that are measured at fair value on a recurring basis during the period:

	March 31, 2019
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Total Estimated Fair Value
	(in thousands)
Cash	$	210,507	$	—	$	—		$	210,507
Level 1 securities:
U.S. government securities		728,749		208		(27	)		728,930
U.S. government agency securities		167,044		15		(31	)		167,028
Level 2 securities:
Corporate debt securities		28,931		31		—			28,962
Commercial paper		46,215		—		—			46,215
Certificates of deposit		27,090		—		—			27,090
Total	$	1,208,536	$	254	$	(58	)	$	1,208,732

	December 31, 2018
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Total Estimated Fair Value
	(in thousands)
Cash	$	279,950	$	—	$	—		$	279,950
Level 1 securities:
U.S. government securities		735,988		12		(175	)		735,825
U.S. government agency securities		181,032		4		(36	)		181,000
Level 2 securities:
Corporate debt securities		35,819		1		(18	)		35,802
Commercial paper		33,193		—		—			33,193
Certificates of deposit		13,293		—		—			13,293
Total	$	1,279,275	$	17	$	(229	)	$	1,279,063

Gross unrealized losses in a continuous loss position for 12 months or longer are not material as of March 31, 2019 and December 31, 2018, respectively. As of March 31, 2019, we considered the decreases in market value on our marketable securities to be temporary in nature and did not consider any of our investments to be other-than-temporarily impaired. All of our marketable securities have contractual maturities of less than one year.

- 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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