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Financial Instruments | 9 Months Ended
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Sep. 30, 2022
Investments, All Other Investments [Abstract] |
Financial Instruments | Financial Instruments Cash, Cash Equivalents and Marketable Securities The following tables summarize our cash and cash equivalents, and marketable securities on our Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021 (in thousands):
|  |  |  |  |  |  |  |  |  | Reported as:
September 30, 2022 |  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Cash and Cash Equivalents |  | Marketable securities, short-term |  | Marketable securities, long-term
Cash |  | $ | 709,497 |  |  | $ | — |  |  | $ | — |  |  | $ | 709,497 |  |  | $ | 709,497 |  |  | $ | — |  |  | $ | — |
Money market funds |  | 335,026 |  |  | — |  |  | — |  |  | 335,026 |  |  | 335,026 |  |  | — |  |  | — |
Corporate bonds |  | 70,560 |  |  | — |  |  | (3,405) |  |  | 67,155 |  |  | — |  |  | 29,454 |  |  | 37,701 |
U.S. government treasury bonds |  | 18,587 |  |  | — |  |  | (641) |  |  | 17,946 |  |  | — |  |  | 9,078 |  |  | 8,868 |
Asset-backed securities |  | 5,624 |  |  | — |  |  | (53) |  |  | 5,571 |  |  | — |  |  | 3,695 |  |  | 1,876 |
Municipal bonds |  | 4,780 |  |  | — |  |  | (93) |  |  | 4,687 |  |  | — |  |  | 4,015 |  |  | 672 |
U.S. government agency bonds |  | 1,204 |  |  | — |  |  | (65) |  |  | 1,139 |  |  | — |  |  | — |  |  | 1,139 |
Total |  | $ | 1,145,278 |  |  | $ | — |  |  | $ | (4,257) |  |  | $ | 1,141,021 |  |  | $ | 1,044,523 |  |  | $ | 46,242 |  |  | $ | 50,256 |
|  |  |  |  |  |  |  |  |  | Reported as:
December 31, 2021 |  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Cash and Cash Equivalents |  | Marketable securities, short-term |  | Marketable securities, long-term
Cash |  | $ | 754,802 |  |  | $ | — |  |  | $ | — |  |  | $ | 754,802 |  |  | $ | 754,802 |  |  | $ | — |  |  | $ | — |
Money market funds |  | 343,012 |  |  | — |  |  | (2) |  |  | 343,010 |  |  | 343,010 |  |  | — |  |  | — |
Corporate bonds |  | 115,507 |  |  | 9 |  |  | (398) |  |  | 115,118 |  |  | 1,042 |  |  | 35,065 |  |  | 79,011 |
U.S. government treasury bonds |  | 42,976 |  |  | — |  |  | (48) |  |  | 42,928 |  |  | — |  |  | 22,251 |  |  | 20,677 |
Asset-backed securities |  | 32,031 |  |  | — |  |  | (40) |  |  | 31,991 |  |  | — |  |  | 10,999 |  |  | 20,992 |
Municipal bonds |  | 7,628 |  |  | — |  |  | (15) |  |  | 7,613 |  |  | 516 |  |  | 3,657 |  |  | 3,440 |
U.S. government agency bonds |  | 1,201 |  |  | — |  |  | (1) |  |  | 1,200 |  |  | — |  |  | — |  |  | 1,200 |
Total |  | $ | 1,297,157 |  |  | $ | 9 |  |  | $ | (504) |  |  | $ | 1,296,662 |  |  | $ | 1,099,370 |  |  | $ | 71,972 |  |  | $ | 125,320 |
The following table summarizes the fair value of our available-for-sale marketable securities classified by contractual maturity as of September 30, 2022 and December 31, 2021 (in thousands):
|  | September 30, 2022 |  | December 31, 2021
Due in 1 year or less |  | $ | 35,157 |  |  | $ | 59,737 |
Due in 1 year through 5 years |  | 61,341 |  |  | 139,113 |
Total |  | $ | 96,498 |  |  | $ | 198,850 |
The securities that we invest in are generally deemed to be low risk based on their credit ratings from the major rating agencies. The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. As interest rates increase, those securities purchased at a lower yield show a mark-to-market unrealized loss. Our unrealized losses as of September 30, 2022 and December 31, 2021 are primarily due to changes in interest rates and credit spreads. Accounts Receivable Factoring During the third quarter of 2022, we entered into factoring transactions on a non-recourse basis with financial institutions to sell certain of our non-U.S. accounts receivable. We account for these transactions as sales of accounts receivables and include the cash proceeds as a part of our cash flows from operations in the Condensed Consolidated Statements of Cash Flows. Total accounts receivable sold under the factoring arrangements was $22.9 million during the three months ended September 30, 2022. Factoring fees on the sales of receivables were recorded in other income (expense), net in our Condensed Consolidated Statement of Operations and were not material. Fair Value Measurements Fair value is an exit price, representing the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We use the GAAP fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value: Level 1 — Quoted (unadjusted) prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. We obtain fair values for our Level 2 investments. Our custody bank and asset managers independently use professional pricing services to gather pricing data which may include quoted market prices for identical or comparable financial instruments, or inputs other than quoted prices that are observable either directly or indirectly, and we are ultimately responsible for these underlying estimates. Level 3 — Unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. The following tables summarize our financial assets measured at fair value as of September 30, 2022 and December 31, 2021 (in thousands):
Description |  | Balance as of September 30, 2022 |  | Level 1 |  | Level 2 |  | Level 3 |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 335,026 |  |  | $ | 335,026 |  |  | $ | — |  |  | $ | — |  |  |  |  |
Short-term investments: |  |  |  |  |  |  |  |  |  |  |  |
U.S. government treasury bonds |  | 9,078 |  |  | 9,078 |  |  | — |  |  | — |  |  |  |  |
Corporate bonds |  | 29,454 |  |  | — |  |  | 29,454 |  |  | — |  |  |  |  |
Municipal bonds |  | 4,015 |  |  | — |  |  | 4,015 |  |  | — |  |  |  |  |
Asset-backed securities |  | 3,695 |  |  | — |  |  | 3,695 |  |  | — |  |  |  |  |
Long-term investments: |  |  |  |  |  |  |  |  |  |  |  |
U.S. government treasury bonds |  | 8,868 |  |  | 8,868 |  |  | — |  |  | — |  |  |  |  |
Corporate bonds |  | 37,701 |  |  | — |  |  | 37,701 |  |  | — |  |  |  |  |
Municipal bonds |  | 672 |  |  | — |  |  | 672 |  |  | — |  |  |  |  |
U.S. government agency bonds |  | 1,139 |  |  | — |  |  | 1,139 |  |  | — |  |  |  |  |
Asset-backed securities |  | 1,876 |  |  | — |  |  | 1,876 |  |  | — |  |  |  |  |
Other assets: |  |  |  |  |  |  |  |  |  |  |  |
Investments in privately held companies |  | 12,180 |  |  | — |  |  | — |  |  | 12,180 |  |  |  |  |
|  | $ | 443,704 |  |  | $ | 352,972 |  |  | $ | 78,552 |  |  | $ | 12,180 |  |  |  |  |
Description |  | Balance as of December 31, 2021 |  | Level 1 |  | Level 2 |  | Level 3
Cash equivalents: |  |  |  |  |  |  |  |
Money market funds |  | $ | 343,010 |  |  | $ | 343,010 |  |  | $ | — |  |  | $ | — |
Corporate bonds |  | 1,042 |  |  | — |  |  | 1,042 |  |  | — |
Municipal bonds |  | 516 |  |  | — |  |  | 516 |  |  | — |
Short-term investments: |  |  |  |  |  |  |  |
U.S. government treasury bonds |  | 22,251 |  |  | 22,251 |  |  | — |  |  | — |
Corporate bonds |  | 35,065 |  |  | — |  |  | 35,065 |  |  | — |
Municipal bonds |  | 3,657 |  |  | — |  |  | 3,657 |  |  | — |
Asset-backed securities |  | 10,999 |  |  | — |  |  | 10,999 |  |  | — |
Long-term investments: |  |  |  |  |  |  |  |
U.S. government treasury bonds |  | 20,677 |  |  | 20,677 |  |  | — |  |  | — |
Corporate bonds |  | 79,011 |  |  | — |  |  | 79,011 |  |  | — |
Municipal bonds |  | 3,440 |  |  | — |  |  | 3,440 |  |  | — |
U.S. government agency bonds |  | 1,200 |  |  | — |  |  | 1,200 |  |  | — |
Asset-backed securities |  | 20,992 |  |  | — |  |  | 20,992 |  |  | — |
Prepaid expenses and other current assets: |  |  |  |  |  |  |  |
Israeli funds |  | 3,841 |  |  | — |  |  | 3,841 |  |  | — |
Other assets: |  |  |  |  |  |  |  |
Investments in privately held companies |  | 8,621 |  |  | — |  |  | — |  |  | 8,621 |
|  | $ | 554,322 |  |  | $ | 385,938 |  |  | $ | 159,763 |  |  | $ | 8,621 |
Derivatives Not Designated as Hedging Instruments We enter into foreign currency forward contracts to minimize the short-term impact of foreign currency exchange rate fluctuations on certain trade and intercompany receivables and payables. These forward contracts are classified within Level 2 of the fair value hierarchy. As a result of the settlement of foreign currency forward contracts, during the three months ended September 30, 2022 and 2021, we recognized net gains of $34.6 million and $14.7 million, respectively, and during the nine months ended September 30, 2022 and 2021, we recognized net gains of $43.8 million and $14.1 million, respectively. As of September 30, 2022 and December 31, 2021, the fair value of foreign exchange forward contracts outstanding was not material. The following tables present the gross notional value of all our foreign exchange forward contracts outstanding as of September 30, 2022 and December 31, 2021 (in thousands):
| September 30, 2022
| Local Currency Amount |  | Notional Contract Amount (USD)
Euro | €181,300 |  | $ | 177,102 |
Chinese Yuan | ¥569,000 |  | 79,875 |
Canadian Dollar | C$92,800 |  | 67,607 |
Polish Zloty | PLN315,800 |  | 63,306 |
British Pound | £44,200 |  | 48,974 |
Japanese Yen | ¥6,224,000 |  | 43,194 |
Brazilian Real | R$200,000 |  | 36,666 |
Swiss Franc | CHF24,800 |  | 25,391 |
Israeli Shekel | ILS78,390 |  | 22,021 |
Mexican Peso | M$283,900 |  | 14,088 |
Korean Won | ₩8,200,000 |  | 5,710 |
Australian Dollar | A$4,090 |  | 2,653 |
New Taiwan Dollar | NT$70,000 |  | 2,200 |
Czech Koruna | Kč40,000 |  | 1,585
New Zealand Dollar | NZ$2,500 |  | 1,419 |
|  |  | $ | 591,791 |
| December 31, 2021
| Local Currency Amount |  | Notional Contract Amount (USD)
Euro | €165,110 |  | $ | 186,358 |
Canadian Dollar | C$99,800 |  | 78,018 |
Chinese Yuan | ¥494,500 |  | 77,358 |
Polish Zloty | PLN219,800 |  | 54,014 |
Brazilian Real | R$286,500 |  | 50,894 |
Japanese Yen | ¥5,548,700 |  | 48,206 |
British Pound | £34,740 |  | 46,881 |
Israeli Shekel | ILS54,110 |  | 17,416 |
Mexican Peso | M$311,500 |  | 15,133 |
Swiss Franc | CHF9,950 |  | 10,883 |
Australian Dollar | A$6,900 |  | 5,009 |
|  |  | $ | 590,170 |

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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