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Fair Value Measurements | 12 Months Ended
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Dec. 31, 2019
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Note 4—Fair Value Measurements The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as quoted prices in active markets; Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The Company classifies its cash equivalents and available-for-sale investments within Level 1 or Level 2. The fair value of the Company’s investment grade corporate debt securities and commercial paper is determined using proprietary valuation models and analytical tools, which utilize market pricing or prices for similar instruments that are both objective and publicly available, such as matrix pricing or reported trades, benchmark yields, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, and offers. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table presents the hierarchy for assets measured at fair value on a recurring basis as of December 31, 2019 and December 31, 2018 (in thousands):
|  | Fair Value Measurements at End of Period Using: |
|  |  |  |  |  | Quoted Market |  |  | Significant |  |  | Significant |
|  |  |  |  |  | Prices for |  |  | Other Observable |  |  | Unobservable |
|  | Total |  |  | Identical Assets |  |  | Inputs |  |  | Inputs |
|  | Fair Value |  |  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |
As of December 31, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 82,125 |  |  | $ | 82,125 |  |  | $ | — |  |  | $ | — |
U.S. Treasury and agency securities |  |  | 91,717 |  |  |  | 91,717 |  |  |  | — |  |  |  | — |
Commercial paper |  |  | 37,411 |  |  |  | — |  |  |  | 37,411 |  |  |  | — |
Corporate debt securities |  |  | 156,277 |  |  |  | — |  |  |  | 156,277 |  |  |  | — |
As of December 31, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 17,295 |  |  | $ | 17,295 |  |  | $ | — |  |  | $ | — |
U.S. Treasury securities |  |  | 123,439 |  |  |  | 123,439 |  |  |  | — |  |  |  | — |
Fair Value of Other Financial Instruments As of December 31, 2019 and December 31, 2018, the carrying amounts of the Company’s financial instruments, which include cash, interest and securities receivable, accounts payable and accrued expenses, approximate fair values because of their short maturities. Interest receivable as of December 31, 2019 and December 31, 2018 was $1.5 million and $0.5 million, respectively, and is recorded as a component of prepaid expenses and other current assets on the condensed consolidated balance sheets. Securities receivable reflect the timing differences of maturities or settlements of investments and the ultimate reinvestment of such amounts. The Company believes that its Credit Facility bears interest at a rate that approximates prevailing market rates for instruments with similar characteristics and, accordingly, the carrying value of the Credit Facility approximates fair value. The Company estimates the fair value of long-term debt utilizing an income approach. The Company uses a present value calculation to discount principal and interest payments and the final maturity payment on these liabilities using a discounted cash flow model based on observable inputs. The debt instrument is then discounted based on what the current market rates would be as of the reporting date. Based on the assumptions used to value these liabilities at fair value, the debt instrument is categorized as Level 2 in the fair value hierarchy. Available for Sale Investments The Company invests its excess cash in U.S. Treasury and agency securities and debt instruments of corporations and commercial obligations, which are classified as available-for-sale investments. These investments are carried at fair value and are included in the tables above. The Company evaluates securities with unrealized losses to determine whether such losses, if any, are other than temporary. Realized gains and losses are calculated using the specific identification method and recorded as interest income or expense. The Company does not generally intend to sell the investments and it is not more likely than not that it will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity. The aggregate market value, cost basis, and gross unrealized gains and losses of available-for-sale investments by security type, classified in marketable securities and long-term investments as of December 31, 2019 are as follows (in thousands):
|  |  |  |  |  | Gross |  |  | Gross |  |  |  |  |
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Total |
|  | Cost |  |  | Gains |  |  | Losses |  |  | Fair Value |
Marketable securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury and agency securities |  | $ | 77,993 |  |  | $ | 57 |  |  | $ | — |  |  | $ | 78,050 |
Commercial paper |  |  | 32,413 |  |  |  | — |  |  |  | — |  |  |  | 32,413 |
Corporate debt securities |  |  | 156,059 |  |  |  | 238 |  |  |  | (20 | ) |  |  | 156,277 |
Total marketable securities |  | $ | 266,465 |  |  | $ | 295 |  |  | $ | (20 | ) |  | $ | 266,740 |
As of December 31, 2019, the Company classified $18.7 million of assets with original maturities of 90 days or less as cash equivalents. None of the investments have been in a gross unrealized loss for a period greater than 12 months. At each reporting date, the Company performs an evaluation of impairment to determine if any unrealized losses are other-than-temporary. Factors considered in determining whether a loss is other-than-temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition of the issuer, and our intent and ability to hold the investment until recovery of the amortized cost basis. The Company intends and has the ability to hold its investments in unrealized loss positions until their amortized cost basis has been recovered. Further, based on its evaluation, the Company determined that unrealized losses were not other-than-temporary as of December 31, 2019. Contractual maturities of available-for-sale debt securities, as of December 31, 2019, were as follows (in thousands):
|  |  |  |  |  |  |  | Estimated |
|  |  |  |  |  |  |  | Fair Value |
Due within one year |  |  |  |  |  |  |  | $ | 237,449 |
One to two years |  |  |  |  |  |  |  |  | 29,291 |
Total |  |  |  |  |  |  |  | $ | 266,740 |
The Company has the ability, if necessary, to liquidate any of its cash equivalents and marketable securities to meet its liquidity needs in the next 12 months. Accordingly, those investments with contractual maturities greater than one year from the date of purchase are classified as current assets on the accompanying consolidated balance sheets.

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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/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
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