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Fair Value of Financial Instruments | 9 Months Ended
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Sep. 30, 2017
Fair Value Disclosures [Abstract] |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For certain of the Company’s financial instruments, including certain cash equivalents, accounts receivable, accounts payable, and other current liabilities, the carrying amounts approximate their fair values due to the relatively short maturity of these balances. The Company measures and reports certain cash equivalents, investments and derivative foreign currency forward contracts at fair value in accordance with the provisions of the authoritative accounting guidance that addresses fair value measurements. This guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities. Level 2—Valuations based on other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Valuations based on inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The Company's financial instruments consist of assets and liabilities measured using Level 1 and 2 inputs. Level 1 assets include a highly liquid money market fund, which is valued using unadjusted quoted prices that are available in an active market for an identical asset. Level 2 assets include fixed-income U.S. government agency securities, commercial paper, corporate bonds, asset-backed securities and derivative financial instruments consisting of foreign currency forward contracts. The securities, bonds and commercial paper are valued using prices from independent pricing services based on quoted prices in active markets for similar instruments or on industry models using data inputs such as interest rates and prices that can be directly observed or corroborated in active markets. The foreign currency forward contracts are valued usi ng observable inputs, such as quotations on forward foreign exchange points and foreign interest rates. The Company's cash and cash equivalents, short-term investments, and long-term investments consist of the following:
| September 30, 2017
| Amortized Cost |  | Unrealized Gains |  | Unrealized Losses |  | Fair Value
| (in thousands)
Cash and cash equivalents: |  |  |  |  |  |  |
Cash | $ | 90,472 |  |  | $ | — |  |  | $ | — |  |  | $ | 90,472 |
Money market funds | 45 |  |  | — |  |  | — |  |  | 45 |
Total | 90,517 |  |  | — |  |  | — |  |  | 90,517 |
Short-term investments: |  |  |  |  |  |  |
Commercial paper | 20,930 |  |  | 4 |  |  | (1 | ) |  | 20,933 |
Corporate bonds | 31,786 |  |  | 3 |  |  | (22 | ) |  | 31,767 |
Asset-backed securities | 491 |  |  | — |  |  | — |  |  | 491 |
U.S. government agencies | 159,135 |  |  | 3 |  |  | (119 | ) |  | 159,019 |
Total | 212,342 |  |  | 10 |  |  | (142 | ) |  | 212,210 |
Long-term investments: |  |  |  |  |  |  |
Asset-backed securities | 2,855 |  |  | 1 |  |  | — |  |  | 2,856 |
Corporate bonds | 37,490 |  |  | 32 |  |  | (20 | ) |  | 37,502 |
Total | 40,345 |  |  | 33 |  |  | (20 | ) |  | 40,358 |
Total | $ | 343,204 |  |  | $ | 43 |  |  | $ | (162 | ) |  | $ | 343,085 |
| December 31, 2016
| Amortized Cost |  | Unrealized Gains |  | Unrealized Losses |  | Fair Value
| (in thousands)
Cash and cash equivalents: |  |  |  |  |  |  |
Cash | $ | 72,673 |  |  | $ | — |  |  | $ | — |  |  | $ | 72,673 |
Money market funds | 473 |  |  | — |  |  | — |  |  | 473 |
Commercial paper | 13,591 |  |  | — |  |  | — |  |  | 13,591 |
Total | 86,737 |  |  | — |  |  | — |  |  | 86,737 |
Short-term investments: |  |  |  |  |  |  |
Commercial paper | 14,782 |  |  | 5 |  |  | — |  |  | 14,787 |
Corporate bonds | 13,490 |  |  | — |  |  | (11 | ) |  | 13,479 |
Asset-backed securities | 1,235 |  |  |  |  |  |  | 1,235 |
U.S. government agencies | 127,660 |  |  |  |  | (42 | ) |  | 127,618 |
Total | 157,167 |  |  | 5 |  |  | (53 | ) |  | 157,119 |
Long-term investments: |  |  |  |  |  |  |
Asset-backed securities | 5,091 |  |  | 2 |  |  | — |  |  | 5,093 |
U.S. government agencies | 29,501 |  |  | — |  |  | (71 | ) |  | 29,430 |
Corporate bonds | 11,243 |  |  | — |  |  | (41 | ) |  | 11,202 |
Total | 45,835 |  |  | 2 |  |  | (112 | ) |  | 45,725 |
Total | $ | 289,739 |  |  | $ | 7 |  |  | $ | (165 | ) |  | $ | 289,581 |
The following table shows the changes to accumulated other comprehensive income (loss) for the nine months ended September 30, 2017 (in thousands):
| Unrealized Gain (Loss), net on Investments
Balance at December 31, 2016 | $ | (156 | )
Change in net realized gain (loss) on investments | 32 |
Amounts reclassified for net realized gain (loss) included in net income | 4 |
Other comprehensive income (loss), net | 36 |
Balance at September 30, 2017 | $ | (120 | )
The following table sets forth by level within the fair value hierarchy the fair value of the Company's available-for-sale securities measured on a recurring basis, excluding cash and money market funds:
| September 30, 2017
| Level 1 |  | Level 2 |  | Level 3 |  | Fair Value
| (in thousands)
Commercial paper | $ | — |  |  | $ | 20,933 |  |  | $ | — |  |  | $ | 20,933 |
U.S. government agencies | — |  |  | 159,019 |  |  | — |  |  | 159,019 |
Corporate bonds | — |  |  | 69,269 |  |  | — |  |  | 69,269 |
Asset-backed securities | — |  |  | 3,347 |  |  | — |  |  | 3,347 |
Total | $ | — |  |  | $ | 252,568 |  |  | $ | — |  |  | $ | 252,568 |
| December 31, 2016
| Level 1 |  | Level 2 |  | Level 3 |  | Fair Value
| (in thousands)
Commercial paper | $ | — |  |  | $ | 28,378 |  |  | $ | — |  |  | $ | 28,378 |
U.S. government agencies | — |  |  | 157,048 |  |  | — |  |  | 157,048 |
Corporate bonds | — |  |  | 24,681 |  |  | — |  |  | 24,681 |
Asset-backed securities | — |  |  | 6,328 |  |  | — |  |  | 6,328 |
Total | $ | — |  |  | $ | 216,435 |  |  | $ | — |  |  | $ | 216,435 |
There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy, as determined at the end of each reporting period. The following summarizes the fair value of securities classified as available-for-sale by contractual, or effective, maturity:
| September 30, 2017
| Mature within One Year |  | After One Year through Two Years |  | Over Two Years |  | Fair Value
| (in thousands)
Commercial paper | $ | 20,933 |  |  | $ | — |  |  | $ | — |  |  | $ | 20,933 |
U.S. government agencies | 159,019 |  |  | — |  |  | — |  |  | 159,019 |
Corporate bonds | 32,783 |  |  | 27,037 |  |  | 9,449 |  |  | 69,269 |
Asset-backed securities | 1,781 |  |  | 1,000 |  |  | 566 |  |  | 3,347 |
Total | $ | 214,516 |  |  | $ | 28,037 |  |  | $ | 10,015 |  |  | $ | 252,568 |
Derivative Financial Instruments Derivative financial instruments are utilized by the Company to reduce foreign currency exchange risks. The Company uses foreign currency forward contracts to mitigate the impact of foreign currency fluctuations of certain non-U.S. dollar denominated asset positions, primarily cash and accounts receivable. These contracts are recorded within prepaid expenses and other current assets or accrued liabilities in the condensed consolidated balance sheets. Gains and losses resulting from currency exchange rate movements on these forward contracts are recognized in other income (expense) in the accompanying condensed consolidated statements of operations in the period in which the exchange rates change and offset the foreign currency gains and losses on the underlying exposure being hedged. The Company does not enter into derivative financial instruments for trading or speculative purposes. At September 30, 2017, the Company had two outstanding forward contrac ts with notional amounts of 6.7 million Euros and 4.8 million British Pounds, which expire on October 31, 2017. At December 31, 2016, the Company had two outstanding forward contracts with notional amounts of 7.6 million Euros and 4.6 million British Pounds, which expired on February 2, 2017. These forward contracts were entered into at the end of each month, and thus the fair value of these contracts was $0 at September 30, 2017 and December 31, 2016. These derivatives did not meet the criteria to be designated as hedges. These instruments were valued using Level 2 inputs. The following summarizes the gains (losses) recognized in Other expense, net on the condensed consolidated statement of operations, from forward contracts and other foreign currency transactions:
| Three Months Ended |  | Nine Months Ended
| September 30, |  | September 30,
| 2017 |  | 2016 |  | 2017 |  | 2016
| (in thousands)
Net loss from forward contracts | $ | (463 | ) |  | $ | (82 | ) |  | $ | (1,585 | ) |  | $ | (9 | )
Other foreign currency transactions gain | 431 |  |  | (2 | ) |  | 1,424 |  |  | (276 | )
Total foreign exchange gain (loss), net | $ | (32 | ) |  | $ | (84 | ) |  | $ | (161 | ) |  | $ | (285 | )

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- 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. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 28 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14064-108612 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13537-108611 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 16 -URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13504-108611 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13433-108611 + Details
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