XML 26 R15.htm IDEA: XBRL DOCUMENT
v3.24.3

FAIR VALUE MEASUREMENTS | 9 Months Ended
--- | ---
Sep. 30, 2024
Fair Value Disclosures [Abstract] |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The accounting guidance defines fair value as the price 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. When determining the fair value measurements for assets and liabilities recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An asset’s or liability’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value: •Level 1 - Valuations based on quoted prices in active markets for identical assets or liabilities that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of such assets or liabilities do not entail a significant degree of judgment. •Level 2 - Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. •Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The following table presents assets and liabilities measured at fair value on a recurring basis using the above input categories:
| September 30, 2024 |  | December 31, 2023
| (In thousands)
| Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Assets: |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents: |  |  |  |  |  |  |  |  |  |  |
Money market funds | $ | 94,245 |  |  | $ | — |  |  | $ | — |  |  | $ | 132,037 |  |  | $ | — |  |  | $ | — |
Certificates of deposit | — |  |  |  |  | — |  |  | — |  |  | 750 |  |  | — |
Commercial paper | — |  |  | 23,914 |  |  | — |  |  | — |  |  | 1,694 |  |  | — |
Corporate notes and bonds |  |  | — |  |  | — |  |  | — |  |  | 462 |  |  | — |
Marketable securities: |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit | — |  |  | 26,375 |  |  | — |  |  | — |  |  | 55,162 |  |  | — |
Commercial paper | — |  |  | 53,325 |  |  | — |  |  | — |  |  | 69,743 |  |  | — |
Corporate notes and bonds | — |  |  | 459,647 |  |  | — |  |  | — |  |  | 405,634 |  |  | — |
U.S. Treasuries | — |  |  | 222,585 |  |  | — |  |  | — |  |  | 327,891 |  |  | — |
U.S. Government agency securities | — |  |  | 748,367 |  |  | — |  |  | — |  |  | 547,856 |  |  | — |
Other assets: |  |  |  |  |  |  |  |  |  |  |
Investments in debt securities | — |  |  | — |  |  | 61,137 |  |  | — |  |  | — |  |  | 79,855 |
Total assets measured at fair value | $ | 94,245 |  |  | $ | 1,534,213 |  |  | $ | 61,137 |  |  | $ | 132,037 |  |  | $ | 1,409,192 |  |  | $ | 79,855 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |
Warranty obligations: |  |  |  |  |  |  |  |  |  |  |
Current | $ | — |  |  | $ | — |  |  | $ | 26,087 |  |  | $ | — |  |  | $ | — |  |  | $ | 28,667 |
Non-current | — |  |  | — |  |  | 130,633 |  |  | — |  |  | — |  |  | 133,126 |
Total warranty obligations measured at fair value | — |  |  | — |  |  | 156,720 |  |  | — |  |  | — |  |  | 161,793 |
Total liabilities measured at fair value | $ | — |  |  | $ | — |  |  | $ | 156,720 |  |  | $ | — |  |  | $ | — |  |  | $ | 161,793 |
Notes due 2028, Notes due 2026 and Notes due 2025 The Company carries the Notes due 2028 (as defined in Note 9, “Debt”) and Notes due 2026 (as defined in Note 9, “Debt”) at face value less unamortized debt issuance costs on its condensed consolidated balance sheets. The Company carries the Notes due 2025 (as defined in Note 9, “Debt”) at face value less unamortized debt discount and issuance costs on its condensed consolidated balance sheets. As of September 30, 2024, the fair value of the Notes due 2028, Notes due 2026 and Notes due 2025 was $491.9 million, $588.5 million and $147.1 million, respectively. The fair value as of September 30, 2024 was determined based on the closing trading price per $100 principal amount as of the last day of trading for the period. The Company considers the fair value of the Notes due 2028, Notes due 2026 and Notes due 2025 to be a Level 2 measurement as they are not actively traded. Equity investments without readily determinable fair value The Company had previously invested $6.0 million in a privately-held company without readily determinable fair value, which is included in “Other assets” in the condensed consolidated balance sheet as of December 31, 2023. During the nine months ended September 30, 2024, the Company determined that the carrying value of the investment was not recoverable. Accordingly, the Company recorded an impairment charge of $6.0 million within “Other income, net” on the condensed consolidated statement of operations for the nine months September 30, 2024. Investments in debt securities The Company had previously taken a non-voting participating interest of approximately $15.0 million in a loan held by a privately-held company, which is included in “Other assets” in the condensed consolidated balance sheet as of December 31, 2023. As of September 30, 2024, the Company accreted interest of approximately $2.0 million in “Other income (expense), net” in the condensed consolidated statement of operations. The Company determined that the carrying value of the investment was not recoverable as the privately-held company filed for Chapter 11 bankruptcy during the three months ended September 30, 2024. Accordingly, the Company recorded an impairment charge of $17.0 million within “Other income, net” on the condensed consolidated statement of operations for the three and nine months ended September 30, 2024. Investment in debt securities is recorded in “Other assets” on the accompanying condensed consolidated balance sheets as of September 30, 2024 and December 31, 2023. The changes in the balance in investments in debt securities during the period were as follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30, |  |
| 2024 |  | 2023 |  | 2024 |  | 2023 |  |
| (In thousands)
Balance at beginning of period | $ | 78,866 |  |  | $ | 60,275 |  |  | $ | 79,855 |  |  | $ | 56,777 |  |  |
Investment | — |  |  | 15,000 |  |  | — |  |  | 15,000 |  |  |
Fair value adjustments included in other income, net | (741) |  |  | 1,910 |  |  | (1,730) |  |  | 5,408 |  |  |
Impairment | (16,988) |  |  | — |  |  | (16,988) |  |  | — |  |  |
Balance at end of period | $ | 61,137 |  |  | $ | 77,185 |  |  | $ | 61,137 |  |  | $ | 77,185 |  |  |
Warranty obligations Fair Value Option for Warranty Obligations Related to Products Sold Since January 1, 2014 The Company estimates the fair value of warranty obligations by calculating the warranty obligations in the same manner as for sales prior to January 1, 2014 and applying an expected present value technique to that result. The expected present value technique, an income approach, converts future amounts into a single current discounted amount. In addition to the key estimates of return rates and replacement costs, the Company used certain Level 3 inputs, which are unobservable and significant to the overall fair value measurement. Such additional assumptions are based on the Company’s credit-adjusted risk-free rate (“discount rate”) and compensation comprised of a profit element and risk premium required of a market participant to assume the obligation. The following table provides information regarding changes in nonfinancial liabilities related to the Company’s warranty obligations measured at fair value on a recurring basis using significant unobservable inputs designated as Level 3 for the periods indicated:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2024 |  | 2023 |  | 2024 |  | 2023 |  |
| (In thousands)
Balance at beginning of period | $ | 150,193 |  |  | $ | 150,540 |  |  | $ | 161,793 |  |  | $ | 106,489 |  |  |
Accruals for warranties issued during period | 7,752 |  |  | 12,485 |  |  | 20,251 |  |  | 44,854 |  |  |
Changes in estimates | 2,161 |  |  | (2,561) |  |  | (12,307) |  |  | (14,241) |  |  |
Settlements | (4,707) |  |  | (5,514) |  |  | (17,043) |  |  | (19,527) |  |  |
Increase due to accretion expense | 2,649 |  |  | 3,157 |  |  | 8,244 |  |  | 10,609 |  |  |
Change in discount rate | — |  |  | 2,811 |  |  | 759 |  |  | 34,608 |  |  |
Other | (1,328) |  |  | (2,028) |  |  | (4,977) |  |  | (3,902) |  |  |
Balance at end of period | $ | 156,720 |  |  | $ | 158,890 |  |  | $ | 156,720 |  |  | $ | 158,890 |  |  |
Quantitative and Qualitative Information about Level 3 Fair Value Measurements As of September 30, 2024 and December 31, 2023, the significant unobservable inputs used in the fair value measurement of the Company’s liabilities designated as Level 3 were as follows, of which the monetary impact for change in discount rate is captured in “Change in discount rate” in the table above:
|  |  |  |  |  | Percent Used (Weighted Average)
Item Measured at Fair Value |  | Valuation Technique |  | Description of Significant Unobservable Input |  | September 30, 2024 |  | December 31, 2023
Warranty obligations for products sold since January 1, 2014 |  | Discounted cash flows |  | Profit element and risk premium |  | 17% |  | 17%
|  | Credit-adjusted risk-free rate |  | 7% |  | 7%
Sensitivity of Level 3 Inputs - Warranty Obligations Each of the significant unobservable inputs is independent of the other. The profit element and risk premium are estimated based on the requirements of a third-party participant willing to assume the Company’s warranty obligations. The discount rate is determined by reference to the Company’s own credit standing at the fair value measurement date, which improved in the three and nine months ended September 30, 2023, contributing to the $2.8 million and $34.6 million change in warranty expense, respectively, captured in “Change in discount rate” in the table above. Under the expected present value technique, increasing the profit element and risk premium input by 100 basis points would result in a $1.1 million increase to the liability. Decreasing the profit element and risk premium by 100 basis points would result in a $1.1 million reduction of the liability. Increasing the discount rate by 100 basis points would result in a $10.8 million decrease to the liability. Decreasing the discount rate by 100 basis points would result in a $12.2 million increase to the liability.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration