XML 20 R10.htm IDEA: XBRL DOCUMENT
v3.20.2

Fair Value of Financial Instruments | 9 Months Ended
--- | ---
Oct. 03, 2020
Fair Value of Financial Instruments |
Fair Value of Financial Instruments | 3. Fair Value of Financial Instruments ​ The fair values of the Company’s financial instruments are recorded using a hierarchical disclosure framework based upon the level of subjectivity of the inputs used in measuring assets and liabilities. The three levels are described below: ​ Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. ​ Level 2 – Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. ​ Level 3 – Inputs are unobservable for the asset or liability and are developed based on the best information available in the circumstances, which might include the Company’s own data. ​ The following summarizes the valuation of the Company’s financial instruments (in thousands). The tables do not include either cash on hand or assets and liabilities that are measured at historical cost or any basis other than fair value. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Fair Value Measurements | ​ | ​ | ​
​ | ​ | at October 3, 2020 Using | ​ | ​ | ​
​ | ​ | Quoted Prices in | ​ | Significant Other | ​ | Significant | ​ | ​ | ​
​ | ​ | Active Markets for | ​ | Observable | ​ | Unobservable | ​ | ​ | ​
​ | ​ | Identical Assets | ​ | Inputs | ​ | Inputs | ​ | ​ | ​
Description |  | (Level 1) |  | (Level 2) |  | (Level 3) |  | Total
Assets: | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |
Cash equivalents: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Money market funds | ​ | $ | 115,033 | ​ | $ | — | ​ | $ | — | ​ | $ | 115,033
Corporate debt securities | ​ | ​ | — | ​ | ​ | 2,350 | ​ | ​ | — | ​ | ​ | 2,350
Government debt securities | ​ | ​ | 4,335 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 4,335
Total cash equivalents | ​ | $ | 119,368 | ​ | $ | 2,350 | ​ | $ | — | ​ | $ | 121,718
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Short-term investments: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Government debt securities | ​ | $ | 47,252 | ​ | $ | 90,733 | ​ | $ | — | ​ | $ | 137,985
Corporate debt securities | ​ | ​ | — | ​ | ​ | 353,443 | ​ | ​ | — | ​ | ​ | 353,443
Total short-term investments | ​ | $ | 47,252 | ​ | $ | 444,176 | ​ | $ | — | ​ | $ | 491,428
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other assets, net: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Auction rate securities | ​ | $ | — | ​ | $ | — | ​ | $ | 5,400 | ​ | $ | 5,400
Total | ​ | $ | — | ​ | $ | — | ​ | $ | 5,400 | ​ | $ | 5,400
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total | ​ | $ | 166,620 | ​ | $ | 446,526 | ​ | $ | 5,400 | ​ | $ | 618,546
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Fair Value Measurements | ​ | ​ | ​
​ | ​ | at December 28, 2019 Using | ​ | ​ | ​
​ | ​ | Quoted Prices in | ​ | Significant Other | ​ | Significant | ​ | ​ | ​
​ | ​ | Active Markets for | ​ | Observable | ​ | Unobservable | ​ | ​ | ​
​ | ​ | Identical Assets | ​ | Inputs | ​ | Inputs | ​ | ​ | ​
Description |  | (Level 1) |  | (Level 2) |  | (Level 3) |  | Total
Assets: | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |
Cash equivalents: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Money market funds | ​ | $ | 92,379 | ​ | $ | — | ​ | $ | — | ​ | $ | 92,379
Corporate debt securities | ​ | ​ | — | ​ |  | 1,325 | ​ |  | — | ​ |  | 1,325
Total cash equivalents | ​ | $ | 92,379 | ​ | $ | 1,325 | ​ | $ | — | ​ | $ | 93,704
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Short-term investments: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Government debt securities | ​ | $ | 85,189 | ​ | $ | 86,682 | ​ | $ | — | ​ | $ | 171,871
Corporate debt securities | ​ | ​ | — | ​ | ​ | 326,954 | ​ | ​ | — | ​ | ​ | 326,954
Total short-term investments | ​ | $ | 85,189 | ​ | $ | 413,636 | ​ | $ | — | ​ | $ | 498,825
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other assets, net: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Auction rate securities | ​ | $ | — | ​ | $ | — | ​ | $ | 5,647 | ​ | $ | 5,647
Total | ​ | $ | — | ​ | $ | — | ​ | $ | 5,647 | ​ | $ | 5,647
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total | ​ | $ | 177,568 | ​ | $ | 414,961 | ​ | $ | 5,647 | ​ | $ | 598,176
​ Valuation methodology ​ The Company’s cash equivalents and short-term investments that are classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. Investments classified as Level 3 are valued using a discounted cash flow model. The assumptions used in preparing the discounted cash flow model include estimates for interest rates, amount of cash flows, expected holding periods of the securities and a discount to reflect the Company’s inability to liquidate the securities. The Company’s derivative instruments are valued using discounted cash flow models. The assumptions used in preparing the valuation models include quoted interest swap rates, foreign exchange rates, forward and spot prices for currencies, and market observable data of similar instruments. ​ Available-for-sale investments ​ The Company’s investments are reported at fair value, with unrealized gains and losses, net of tax, recorded as a component of accumulated other comprehensive income in the Consolidated Balance Sheet. The following summarizes the contractual underlying maturities of the Company’s available-for-sale investments at October 3, 2020 (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ |  | Fair
​ | ​ | Cost | ​ | Value
Due in one year or less | ​ | $ | 349,278 | ​ | $ | 350,447
Due after one year through ten years | ​ |  | 228,563 | ​ | ​ | 230,349
Due after ten years | ​ |  | 38,350 | ​ |  | 37,750
​ | ​ | $ | 616,191 | ​ | $ | 618,546
​ The available-for-sale investments that were in a continuous unrealized loss position, aggregated by length of time that individual securities have been in a continuous loss position, were as follows (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Less Than 12 Months | ​ | 12 Months or Greater | ​ | Total
​ | ​ | ​ | ​ | ​ | Gross | ​ | ​ | ​ | ​ | Gross | ​ | ​ | ​ | ​ | Gross
​ | ​ | Fair | ​ | Unrealized | ​ | Fair | ​ | Unrealized | ​ | Fair | ​ | Unrealized
As of October 3, 2020 |  | Value |  | Losses |  | Value |  | Losses |  | Value |  | Losses
Government debt securities | ​ | $ | 18,940 | ​ | $ | (9) | ​ | $ | — | ​ | $ | — | ​ | $ | 18,940 | ​ | $ | (9)
Corporate debt securities | ​ |  | 61,215 | ​ |  | (59) | ​ |  | — | ​ |  | — | ​ |  | 61,215 | ​ |  | (59)
Auction rate securities | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 5,400 | ​ | ​ | (600) | ​ | ​ | 5,400 | ​ | ​ | (600)
​ | ​ | $ | 80,155 | ​ | $ | (68) | ​ | $ | 5,400 | ​ | $ | (600) | ​ | $ | 85,555 | ​ | $ | (668)
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Less Than 12 Months | ​ | 12 Months or Greater | ​ | Total
​ | ​ | ​ | ​ | ​ | Gross | ​ | ​ | ​ | ​ | Gross | ​ | ​ | ​ | ​ | Gross
​ | ​ | Fair | ​ | Unrealized | ​ | Fair | ​ | Unrealized | ​ | Fair | ​ | Unrealized
As of December 28, 2019 |  | Value |  | Losses |  | Value |  | Losses |  | Value |  | Losses
Government debt securities | ​ | $ | 11,947 | ​ | $ | (19) | ​ | $ | 7,183 | ​ | $ | (7) | ​ | $ | 19,130 | ​ | $ | (26)
Corporate debt securities | ​ |  | 68,116 | ​ | ​ | (81) | ​ | ​ | 20 | ​ | ​ | — | ​ | ​ | 68,136 | ​ | ​ | (81)
Auction rate securities | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 5,647 | ​ | ​ | (353) | ​ | ​ | 5,647 | ​ | ​ | (353)
​ | ​ | $ | 80,063 | ​ | $ | (100) | ​ | $ | 12,850 | ​ | $ | (360) | ​ | $ | 92,913 | ​ | $ | (460)
​ The gross unrealized losses as of October 3, 2020 and December 28, 2019 were due primarily to changes in market interest rates and the illiquidity of the Company’s auction-rate securities. The Company’s auction-rate securities have been illiquid since 2008 when auctions for the securities failed because sell orders exceeded buy orders. These securities have a contractual maturity date of 2046. The Company is unable to predict if these funds will become available before their maturity date. ​ The Company records an allowance for credit loss when a decline in investment market value is due to credit-related factors. When evaluating an investment for impairment, the Company reviews factors such as the severity of the impairment, changes in underlying credit ratings, forecasted recovery, the Company’s intent to sell or the likelihood that it would be required to sell the investment before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made. As of October 3, 2020, there were no material declines in the market value of available-for-sale investments due to credit-related factors. ​ At October 3, 2020 and December 28, 2019, there were no material unrealized gains associated with the Company’s available-for-sale investments. ​ Level 3 fair value measurements ​ The following summarizes quantitative information about Level 3 fair value measurements. ​ Auction rate securities ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Fair Value at | ​ | ​ | ​ | ​ | ​ | ​ |
October 3, 2020 | ​ | ​ | ​ | ​ | ​ | Weighted |
(000s) |  | Valuation Technique |  | Unobservable Input |  | Average |
$ | 5,400 |  | Discounted cash flow |  | Estimated yield |  | 1.95 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ |  | Expected holding period | ​ | 10 years | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ |  | Estimated discount rate |  | 2.00 | %
​ Significant changes in any of the unobservable inputs used in the fair value measurement of auction rate securities in isolation could result in a significantly lower or higher fair value measurement. An increase in expected yield would result in a higher fair value measurement, whereas an increase in expected holding period or estimated discount rate would result in a lower fair value measurement. Generally, a change in the assumptions used for expected holding period is accompanied by a directionally similar change in the assumptions used for estimated yield and discount rate. ​ The following summarizes the activity in Level 3 financial instruments for the three and nine months ended October 3, 2020 (in thousands): ​ Assets ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months |  | Nine Months | ​
Auction Rate Securities |  | Ended |  | Ended | ​
Beginning balance | ​ | $ | 5,400 | ​ | $ | 5,647 | ​
Loss included in other comprehensive income (loss) | ​ |  | — | ​ |  | (247) | ​
Balance at October 3, 2020 | ​ | $ | 5,400 | ​ | $ | 5,400 | ​
​ Fair values of other financial instruments ​ The Company’s debt is recorded at cost, but is measured at fair value for disclosure purposes. The fair value of the Company’s convertible senior notes is determined using observable market prices. The notes are traded in less active markets and are therefore classified as a Level 2 fair value measurement. As of October 3, 2020 and December 28, 2019, the fair value of the 1.375% convertible senior notes was $174.5 million and $524.0 million, respectively. The fair value of the 0.625% convertible senior notes as of October 3, 2020 was $575.8 million. ​ The Company’s other financial instruments, including cash, accounts receivable and accounts payable, are recorded at amounts that approximate their fair values due to their short maturities.

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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration