Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2018

Fair value of assets measured on recurring basis

Our financial instruments measured at fair value on a recurring basis at September 30, 2018, were as follows:



	Total		Quoted Market Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In millions)
Corporate debt securities	$	1,191	$	—	$	1,191	$	—
U.S. treasury notes	221		221		—		—
Government-sponsored enterprise securities (GSEs)	170		170		—		—
Municipal securities	119		—		119		—
Asset-backed securities	92		—		92		—
Certificate of deposit	15		—		15		—
Other	4		—		4		—
Subtotal - current investments	1,812		391		1,421		—
1.125% Call Option derivative asset	843		—		—		843
Total assets	$	2,655	$	391	$	1,421	$	843

1.125% Conversion Option derivative liability	$	843	$	—	$	—	$	843
Total liabilities	$	843	$	—	$	—	$	843

Our financial instruments measured at fair value on a recurring basis at December 31, 2017, were as follows:



	Total		Quoted Market Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In millions)
Corporate debt securities	$	1,588	$	—	$	1,588	$	—
U.S. treasury notes	388		388		—		—
GSEs	253		253		—		—
Municipal securities	141		—		141		—
Asset-backed securities	117		—		117		—
Certificates of deposit	37		—		37		—
Subtotal - current investments	2,524		641		1,883		—
Corporate debt securities	101		—		101		—
U.S. treasury notes	68		68		—		—
Subtotal - current restricted investments	169		68		101		—
1.125% Call Option derivative asset	522		—		—		522
Total assets	$	3,215	$	709	$	1,984	$	522

1.125% Conversion Option derivative liability	$	522	$	—	$	—	$	522
Total liabilities	$	522	$	—	$	—	$	522

Schedule of fair value, asset and liabilities measured on recurring basis - disclosure only

The carrying amounts and estimated fair values of our senior notes are classified as Level 2 financial instruments. Fair value for these securities is determined using a market approach based on quoted market prices for similar securities in active markets or quoted prices for identical securities in inactive markets.



	September 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(In millions)
5.375% Notes	$	693	$	711	$	692	$	730
1.125% Notes ⁽¹⁾	295		1,142		496		1,052
4.875% Notes	326		325		325		329
1.625% Notes ⁽²⁾	—		—		157		220
Credit Facility⁽²⁾	—		—		300		300
	$	1,314	$	2,178	$	1,970	$	2,631

______________________


(1)	The fair value of the 1.125% Conversion Option (the embedded cash conversion option), which is included in the fair value amounts presented above, amounted to $843 million and $522 million as of September 30, 2018, and December 31, 2017, respectively. See further discussion at Note 7, “Debt,” and Note 8, “Derivatives.”


(2)	For more information on debt repayments in the nine months ended September 30, 2018, refer to Note 7, “Debt.”