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FAIR VALUE MEASUREMENTS
 3 Months Ended
Mar. 31, 2025
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
The three levels of the fair value hierarchy established are as follows:
Level 1    Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2    Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3    Unobservable inputs that reflect the Company’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available.
The following table presents the Company’s fair value measurements as of March 31, 2025 along with the level within the fair value hierarchy in which the fair value measurements, in their entirety, fall.
(In thousands)Fair Value at March 31, 2025Quoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs (Level 3)
Cash, cash equivalents, and restricted cash
Cash and money market$341,013 $341,013 $— $— 
U.S. government agency securities6,114 — 6,114 — 
Marketable securities
Corporate bonds$212,791 $— $212,791 $— 
U.S. government agency securities153,947 — 153,947 — 
Asset backed securities68,844 — 68,844 — 
Equity securities3,466 3,466 — — 
Non-marketable securities (2)
$622 $— $— $622 
Liabilities
Contingent consideration$(290,499)$— $— $(290,499)
Total$496,298 $344,479 $441,696 $(289,877)
The following table presents the Company’s fair value measurements as of December 31, 2024 along with the level within the fair value hierarchy in which the fair value measurements, in their entirety, fall.
(In thousands)Fair Value at December 31, 2024Quoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs (Level 3)
Cash, cash equivalents and restricted cash
Cash and money market$595,548 $595,548 $— $— 
Restricted cash (1)
5,747 5,747 — — 
U.S. government agency securities5,341 — 5,341 — 
Marketable securities
Corporate bonds$206,874 $— $206,874 $— 
U.S. government agency securities140,952 — 140,952 — 
Asset backed securities83,339 — 83,339 — 
Equity securities5,972 5,972 — — 
Non-marketable securities (2)
$796 $— $— $796 
Liabilities
Contingent consideration$(282,212)$— $— $(282,212)
Total$762,357 $607,267 $436,506 $(281,416)
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(1)Restricted cash primarily represents cash held by a third-party financial institution as part of a cash collateral agreement related to the Company’s credit card program. The restrictions will lapse upon the termination of the agreements or the removal of the cash collateral requirement by the third-parties.
(2)The Company has elected the fair value option under the income approach to measure certain Level 3 non-marketable securities. Gains and losses recorded on non-marketable securities are included in investment income, net in the condensed consolidated statement of operations. The activity in the non-marketable securities held during the three months ended March 31, 2025 was not significant.
There have been no material changes in valuation techniques or transfers between fair value measurement levels during the three months ended March 31, 2025. The fair value of Level 2 instruments classified as cash equivalents and marketable debt securities are valued using a third-party pricing agency where the valuation is based on observable inputs including pricing for similar assets and other observable market factors.
Contingent Consideration Liabilities
The fair value of the contingent consideration liabilities was $290.5 million and $282.2 million as of March 31, 2025 and December 31, 2024, respectively. As of March 31, 2025, $20.0 million was included in other current liabilities and $270.5 million was included in other long-term liabilities in the condensed consolidated balance sheet. As of December 31, 2024, $19.7 million was included in other current liabilities and $262.5 million was included in other long-term liabilities in the condensed consolidated balance sheet.
The following table provides a reconciliation of the beginning and ending balances of contingent consideration:
Three Months Ended March 31,
(In thousands)20252024
Beginning balance
$282,212 $288,657 
Changes in fair value (1)8,287 5,603 
Ending balance
$290,499 $294,260 
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(1)The change in fair value of the contingent consideration liability is included in general and administrative expenses in the condensed consolidated statement of operations for the three months ended March 31, 2025 and 2024.
This fair value measurement of contingent consideration is categorized as a Level 3 liability, as the measurement amount is based primarily on significant inputs not observable in the market.
The fair value of the contingent consideration liabilities recorded from the Company’s acquisitions of Thrive Earlier Detection Corporation (“Thrive”) and Ashion Analytics, LLC (“Ashion”) related to regulatory and product development milestones was $290.5 million and $282.2 million as of March 31, 2025 and December 31, 2024, respectively. The Company estimates the fair value of the contingent consideration liabilities related to the regulatory and product development milestones using the probability-weighted scenario based discounted cash flow model, which is consistent with the initial measurement of the contingent consideration liabilities. Probabilities of success are applied to each potential scenario and the resulting values are discounted using a present-value factor. The passage of time in addition to changes in projected milestone achievement timing, present-value factor, the degree of achievement, if applicable, and probabilities of success may result in adjustments to the fair value measurement. The fair value of the contingent consideration liability recorded related to regulatory and product development milestones was determined using a weighted average probability of success of 90% as of March 31, 2025 and December 31, 2024, and a weighted average present-value factor of 6.0% and 6.2% as of March 31, 2025 and December 31, 2024, respectively. The projected fiscal year of payment range associated with the regulatory and development milestones related to the Company’s acquisition of Thrive is from 2030 to 2031. In April 2025, the Company made a payment of $20.0 million in settlement of the development milestone related to the Company’s acquisition of Ashion, which was accrued as of March 31, 2025. Unobservable inputs were weighted by the relative fair value of the contingent consideration liabilities.
The revenue milestone associated with the Ashion acquisition is not expected to be achieved and therefore no liability has been recorded for this milestone.
Non-Marketable Equity Securities
Non-marketable equity securities without readily determinable fair values, which are classified as a component of other long-term assets, net, had the following cumulative upward and downward adjustments and aggregate carrying amounts:
(In thousands)
March 31, 2025March 31, 2024
Cumulative upward adjustments (1)
$5,102 $5,100 
Cumulative downward adjustments and impairments (2)
(16,850)(15,100)
Aggregate carrying value (3)
50,448 45,968 
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(1)    There were no material upward adjustments recorded on non-marketable equity securities held for the three months ended March 31, 2025 and 2024.
(2)    There were no material downward adjustments or impairments recorded on non-marketable equity securities held for the three months ended March 31, 2025 and 2024, respectively.
(3)    The aggregate carrying value of non-marketable equity securities was $50.4 million as of December 31, 2024.
There were no material realized gains or losses recorded during the three months ended March 31, 2025 and 2024.
The Company has committed capital to venture capital investment funds of $18.0 million, of which $10.4 million remains callable through 2033 as of March 31, 2025. The aggregate carrying amount of these funds, which are classified as a component of other long-term assets, net in the Company’s condensed consolidated balance sheets, was $7.9 million and $7.5 million as of March 31, 2025 and December 31, 2024, respectively. Gains and losses recorded on these funds were not significant for the three months ended March 31, 2025 and 2024.
Derivative Financial Instruments
The Company enters into foreign currency forward contracts on the last day of each month to mitigate the impact of adverse movements in foreign exchange rates related to the remeasurement of monetary assets and liabilities and hedge the Company’s foreign currency exchange rate exposure. As of March 31, 2025 and December 31, 2024 the Company had open foreign currency forward contracts with notional amounts of $48.6 million and $44.2 million, respectively. The Company's foreign exchange derivative instruments are classified as Level 2 within the fair value hierarchy as they are valued using inputs that are observable in the market or can be derived principally from or corroborated by observable market data. The fair value of the open foreign currency forward contracts was zero at March 31, 2025 and December 31, 2024 and there were no gains or losses recorded to adjust the fair value of the open foreign currency contract held as of March 31, 2025. The contracts are closed subsequent to each month-end, and the gains and losses recorded from the contracts were not significant for the three months ended March 31, 2025 and 2024.