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Investments and Fair Value Measurements
 6 Months Ended
Jun. 30, 2023
Fair Value Disclosures [Abstract]  
Investments and Fair Value Measurements Investments and Fair Value MeasurementsMarketable Investments
The Company’s marketable investments have been classified and accounted for as available-for-sale. The Company’s marketable investments as of June 30, 2023 and December 31, 2022 were as follows (in thousands):
June 30, 2023
Short-Term Marketable InvestmentsCostGross Unrealized GainsGross Unrealized LossesFair Value
Certificates of deposit$2,205 $— $(2)$2,203 
U.S. treasury securities169,199 17 (343)168,873 
U.S. agency securities246,153 4 (811)245,346 
Commercial paper35,624 1 (23)35,602 
Municipal bonds10,861 — (29)10,832 
Corporate bonds1,389 — (1)1,388 
Total$465,431 $22 $(1,209)$464,244 
June 30, 2023
Long-term Marketable InvestmentsCostGross Unrealized GainsGross Unrealized LossesFair Value
U.S. treasury securities$57,122 $— $(836)$56,286 
U.S. agency securities21,569 — (179)21,390 
Corporate bonds7,524 — (90)7,434 
Total$86,215 $— $(1,105)$85,110 
December 31, 2022
Short-Term Marketable InvestmentsCostGross Unrealized GainsGross Unrealized LossesFair Value
Certificates of deposit$747 $— $(13)$734 
U.S. treasury securities186,776 8 (1,382)185,402 
U.S. agency and government-sponsored securities197,597 29 (1,660)195,966 
Commercial paper25,386 — — 25,386 
Municipal bonds22,764 — (145)22,619 
Corporate bonds3,658 — (22)3,636 
Total$436,928 $37 $(3,222)$433,743 
December 31, 2022
Long-term Marketable InvestmentsCostGross Unrealized GainsGross Unrealized LossesFair Value
U.S. agency securities$885 $— $— $885 
Total$885 $— $— $885 
The following table presents the gross unrealized losses and the fair value for those marketable investments that were in an unrealized loss position for less than 12 months as of June 30, 2023 and December 31, 2022 (in thousands):
June 30, 2023December 31, 2022
Gross Unrealized LossesFair ValueGross Unrealized LossesFair Value
Certificates of deposit$(2)$496 $(13)$734 
U.S. treasury securities(1,179)153,087 (1,382)126,534 
U.S. agency securities(990)255,208 (1,660)172,458 
Commercial paper(23)30,682 — — 
Municipal bonds(29)8,362 (145)12,623 
Corporate bonds(91)8,822 (22)3,636 
Total$(2,314)$456,657 $(3,222)$315,985 
Although the Company had certain available-for-sale debt securities in an unrealized loss position as of June 30, 2023, no impairment loss was recorded since it did not intend to sell them, did not anticipate a need to sell them, and the decline in fair value was not due to any credit-related factors.

Fair Value Measurements
The Company carries cash equivalents and marketable investments at fair value. Fair value is based on 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. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 — Observable inputs, which include unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2 — Observable inputs other than Level 1 inputs, such as quoted prices 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 assets or liabilities.
Level 3 — Unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined by using pricing models, discounted cash flow methodologies or similar techniques.
The Company determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments.
Marketable investments classified within Level 2 of the fair value hierarchy are valued based on other observable inputs, including broker or dealer quotations or alternative pricing sources. When quoted prices in active markets for identical assets or liabilities are not available, the Company relies on non-binding quotes from its investment managers, which are based on proprietary valuation models of independent pricing services. These models generally use inputs such as observable market data, quoted market prices for similar instruments, historical pricing trends of a security as relative to its peers. To validate the fair value determination provided by its investment managers, the Company reviews the pricing movement in the context of overall market trends and trading information from its investment managers. The Company performs routine procedures such as comparing prices obtained from independent source to ensure that appropriate fair values are recorded.
The following tables set forth the Company’s assets measured at fair value by level within the fair value hierarchy (in thousands):
June 30, 2023
Level 1Level 2Level 3Total
Assets
Cash equivalents
Money market funds$90,698 $— $— $90,698 
U.S. treasury securities11,926 — — 11,926 
U.S. agency securities and government sponsored securities— 14,988 — 14,988 
Total cash equivalents$102,624 $14,988 $— $117,612 
Marketable investments (short and long term)
Certificates of deposit$— $2,203 $— $2,203 
U.S. treasury securities225,159 — — 225,159 
U.S. agency securities and government sponsored securities— 266,736 — 266,736 
Commercial paper— 35,602 — 35,602 
Municipal bonds— 10,832 — 10,832 
Corporate bonds— 8,822 — 8,822 
Total marketable investments$225,159 $324,195 $— $549,354 
December 31, 2022
Level 1Level 2Level 3Total
Assets
Cash equivalents
Money market funds$37,560 $— $— $37,560 
U.S. treasury securities19,700 — — 19,700 
Total cash equivalents$57,260 $— $— $57,260 
Marketable investments (short and long-term)
Certificates of deposit$— $734 $— $734 
U.S. treasury securities185,402 — — 185,402 
U.S. agency and government-sponsored securities— 196,851 — 196,851 
Commercial paper— 25,386 — 25,386 
Municipal bonds— 22,619 — 22,619 
Corporate bonds— 3,636 — 3,636 
Total marketable investments$185,402 $249,226 $— $434,628 
As of December 31, 2022, the estimated fair value of the Company’s outstanding 2023 convertible senior notes was $0.3 million. The 2023 convertible senior notes matured on May 1, 2023. As of June 30, 2023 and December 31, 2022, the estimated fair value of the Company's outstanding 2025 convertible senior notes was $723.0 million and $687.1 million, respectively. The fair values were determined based on the quoted price of the convertible senior notes in an inactive market on the last trading day of the reporting period and have been classified as Level 2 in the fair value hierarchy. See Note 6 for further information on the Company’s convertible senior notes.
In February 2022, the Company made a $2.0 million equity investment in a privately-held company that it does not have the ability to exercise significant influence over. The Company elected the measurement alternative for an equity security without a readily determinable fair value. Accordingly, this investment is accounted for at its cost minus impairment, if any, and is classified within Level 3. If the Company identifies observable price changes
in orderly transactions for such investment or a similar investment, it will measure the investment at fair value as of the date that the observable transactions or events occurred.
Except for the $2.0 million equity investment described above, there were no assets or liabilities measured at fair value on a non-recurring basis as of June 30, 2023 and December 31, 2022.
The fair value of the Company’s other financial instruments, including accounts receivable, accounts payable and other current liabilities, approximate their carrying value due to the relatively short maturity of those instruments. The carrying amounts of the Company’s operating and finance leases approximate their fair value, which is the present value of expected future cash payments based on assumptions about current interest rates and the creditworthiness of the Company.