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Fair Value Measurements
 9 Months Ended
Sep. 30, 2024
Fair Value Disclosures [Abstract]  
Fair Value Measurements

3. Fair Value Measurements

Fair Value Measurements-Recurring Basis

Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is as follows:

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Inputs, other than the quoted prices included in Level 1, that are either directly or indirectly observable.

Level 3: Unobservable inputs in which there is little or no market activity, which require the reporting entity to develop its own assumptions.

The following tables present information about the fair value measurements of the Company’s financial assets and liabilities which are measured at fair value on a recurring basis, and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands):

 

 

 

September 30, 2024

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

Money market fund

 

$

24,276

 

 

$

—

 

 

$

—

 

 

$

24,276

 

Total cash equivalents

 

 

24,276

 

 

 

—

 

 

 

—

 

 

 

24,276

 

Marketable securities

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

 

20,762

 

 

 

—

 

 

 

—

 

 

 

20,762

 

U.S. government agency securities

 

 

—

 

 

 

34,674

 

 

 

—

 

 

 

34,674

 

Corporate debt securities

 

 

—

 

 

 

18,820

 

 

 

—

 

 

 

18,820

 

Commercial paper

 

 

—

 

 

 

132,436

 

 

 

—

 

 

 

132,436

 

Asset backed securities

 

 

—

 

 

 

6,368

 

 

 

—

 

 

 

6,368

 

Total marketable securities

 

 

20,762

 

 

 

192,298

 

 

 

—

 

 

 

213,060

 

Total assets

 

$

45,038

 

 

$

192,298

 

 

$

—

 

 

$

237,336

 

 

 

 

December 31, 2023

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

Money market fund

 

$

40,241

 

 

$

—

 

 

$

—

 

 

$

40,241

 

Commercial paper

 

 

—

 

 

 

7,468

 

 

 

—

 

 

 

7,468

 

Total cash equivalents

 

 

40,241

 

 

 

7,468

 

 

 

—

 

 

 

47,709

 

Marketable securities

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency securities

 

 

—

 

 

 

67,208

 

 

 

—

 

 

 

67,208

 

Commercial paper

 

 

—

 

 

 

118,465

 

 

 

—

 

 

 

118,465

 

Asset backed securities

 

 

—

 

 

 

14,968

 

 

 

—

 

 

 

14,968

 

Total marketable securities

 

 

—

 

 

 

200,641

 

 

 

—

 

 

 

200,641

 

Total assets

 

$

40,241

 

 

$

208,109

 

 

$

—

 

 

$

248,350

 

 

In determining the fair value of its Level 2 investments, the Company relied on the most recent observable inputs for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or are directly or indirectly observable. These quoted prices were obtained by the Company with the assistance of a third-party pricing service based on available trade, bid and other observable market data for identical or similar securities. During the nine months ended September 30, 2024 and 2023, there were no transfers between Level 1, Level 2 and Level 3.

As of September 30, 2024 and December 31, 2023, the fair value of the Company’s available-for-sale marketable securities by type of security was as follows (in thousands):

 

 

 

September 30, 2024

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Fair

 

 

 

Cost

 

 

Gain

 

 

Loss

 

 

Value

 

Marketable securities:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

20,570

 

 

$

192

 

 

$

—

 

 

$

20,762

 

U.S. government agency securities

 

 

34,446

 

 

 

228

 

 

 

—

 

 

 

34,674

 

Corporate debt securities

 

 

18,750

 

 

 

73

 

 

 

(3

)

 

 

18,820

 

Commercial paper

 

 

132,169

 

 

 

270

 

 

 

(3

)

 

 

132,436

 

Asset backed securities

 

 

6,354

 

 

 

14

 

 

 

—

 

 

 

6,368

 

Total marketable securities

 

$

212,289

 

 

$

777

 

 

$

(6

)

 

$

213,060

 

 

 

 

December 31, 2023

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Fair

 

 

 

Cost

 

 

Gain

 

 

Loss

 

 

Value

 

Marketable securities:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency securities

 

$

67,310

 

 

$

—

 

 

$

(102

)

 

$

67,208

 

Commercial paper

 

 

118,323

 

 

 

143

 

 

 

(1

)

 

 

118,465

 

Asset backed securities

 

 

14,979

 

 

 

2

 

 

 

(13

)

 

 

14,968

 

Total marketable securities

 

$

200,612

 

 

$

145

 

 

$

(116

)

 

$

200,641

 

All of the Company’s marketable securities as of September 30, 2024 have maturity dates of less than one year.

As of September 30, 2024, two available-for-sale marketable securities were in an unrealized loss position. Of the two available-for-sale marketable securities in an unrealized loss position, both had been in an unrealized loss position for less than 12 months. As of December 31, 2023, ten available-for-sale marketable securities were in an unrealized loss position. Of the ten available-for-sale marketable securities in an unrealized loss position, eight had been in an unrealized loss position for less than 12 months and two had been in an unrealized loss position for greater than 12 months.

The following table presents available-for-sale marketable securities that were in an unrealized loss position as of September 30, 2024, aggregated by major security type and length of time in a continuous loss position (in thousands):

 

 

 

Less than 12 Months

 

 

12 Months or Longer

 

 

Total

 

 

 

Fair Value

 

 

Unrealized Loss

 

 

Fair Value

 

 

Unrealized Loss

 

 

Fair Value

 

 

Unrealized Loss

 

Corporate debt securities

 

$

3,908

 

 

$

(3

)

 

$

—

 

 

$

—

 

 

$

3,908

 

 

$

(3

)

Commercial paper

 

$

3,873

 

 

$

(3

)

 

$

—

 

 

$

—

 

 

$

3,873

 

 

$

(3

)

 

The following table presents available-for-sale marketable securities that were in an unrealized loss position as of December 31, 2023, aggregated by major security type and length of time in a continuous loss position (in thousands):

 

 

 

Less than 12 Months

 

 

12 Months or Longer

 

 

Total

 

 

 

Fair Value

 

 

Unrealized Loss

 

 

Fair Value

 

 

Unrealized Loss

 

 

Fair Value

 

 

Unrealized Loss

 

U.S. government agency securities

 

$

47,242

 

 

$

(79

)

 

$

19,966

 

 

$

(23

)

 

$

67,208

 

 

$

(102

)

Commercial paper

 

$

9,965

 

 

$

(1

)

 

$

—

 

 

$

—

 

 

$

9,965

 

 

$

(1

)

Asset backed securities

 

$

9,854

 

 

$

(13

)

 

$

—

 

 

$

—

 

 

$

9,854

 

 

$

(13

)

The Company reviews its marketable securities at each reporting date to determine if any security is impaired, which would require the Company to record an allowance for credit losses in that respective period. The Company evaluated the securities individually for impairment and considered 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 the Company would be required to sell the security before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made. Based on the Company’s review of these marketable securities, the Company believes none of the unrealized losses are the result of a credit loss as of September 30, 2024. These marketable securities are of high credit quality, and the Company does not intend to sell these securities prior to maturity and it is not more-likely-than-not that the Company will be required to sell these securities before the recovery of their amortized cost basis. As such, the Company did not record an allowance for credit losses as of September 30, 2024. During the nine months ended September 30, 2024, the immaterial unrealized losses were due to market fluctuations and were only sustained for a short period of time. During the year ended December 31, 2023, the decline in market value in the Company’s marketable securities was primarily attributable to an increase in interest rates.

Accrued interest receivable on available-for-sale marketable securities, included in prepaid expenses and other assets on the Company’s condensed consolidated balance sheets, was $0.4 million and $0.8 million at September 30, 2024 and December 31, 2023, respectively. The Company does not measure an allowance for credit losses for accrued interest receivables. For the purposes of identifying and measuring an impairment, accrued interest is excluded from both the fair value and amortized cost basis of the available-for-sale marketable security. Uncollectible accrued interest receivables associated with an impaired available-for-sale marketable security are reversed against interest income upon identification of the impairment. No accrued interest receivables were written off during the nine months ended September 30, 2024 or 2023.