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Fair Value Measurements | 9 Months Ended
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Dec. 31, 2021
Financial Instruments, Owned, at Fair Value [Abstract] |
Fair Value Measurements | Fair Value Measurements Fair Value Measurements The Company considers fair value as the exchange price that would be received for 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. The Company utilizes the following three-level fair value hierarchy to establish the priorities of the inputs used to measure fair value: •Level 1 — Quoted prices in active markets for identical assets or liabilities. •Level 2 — Observable inputs other than quoted market prices included in Level 1, such as: quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. •Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis, excluding assets related to the Company’s defined benefit pension plans, classified by the level within the fair value hierarchy (in thousands):
|  | December 31, 2021 |  | March 31, 2021
|  | Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 475,187 |  |  | $ | — |  |  | $ | — |  |  | $ | 669,759 |  |  | $ | — |  |  | $ | — |
Trading investments for deferred compensation plan included in other assets: |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 349 |  |  | $ | — |  |  | $ | — |  |  | $ | 31 |  |  | $ | — |  |  | $ | — |
Common stock |  | 2,240 |  |  | — |  |  | — |  |  | 1,569 |  |  | — |  |  | — |
Money market funds |  | 7,117 |  |  | — |  |  | — |  |  | 6,734 |  |  | — |  |  | — |
Mutual funds |  | 20,005 |  |  | — |  |  | — |  |  | 16,475 |  |  | — |  |  | — |
Total of trading investments for deferred compensation plan |  | $ | 29,711 |  |  | $ | — |  |  | $ | — |  |  | $ | 24,809 |  |  | $ | — |  |  | $ | — |
Currency exchange derivative assets included in other current assets |  | $ | — |  |  | $ | 198 |  |  | $ | — |  |  | $ | — |  |  | $ | 5,452 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Contingent consideration for business acquisition included in accrued and other current liabilities |  | $ | — |  |  | $ | — |  |  | $ | 8,042 |  |  | $ | — |  |  | $ | — |  |  | $ | 6,430 |
Contingent consideration for business acquisition included in other non-current liabilities |  | $ | — |  |  | $ | — |  |  | $ | 3,971 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Currency exchange derivative liabilities included in accrued and other current liabilities |  | $ | — |  |  | $ | 808 |  |  | $ | — |  |  | $ | — |  |  | $ | 100 |  |  | $ | — |
The following table summarizes the change in the fair value of the Company's contingent consideration balance during the nine months ended December 31, 2021 and 2020 (in thousands):
| Nine Months Ended December 31,
| 2021 |  | 2020
Beginning of the period | $ | 6,967 |  |  | $ | 23,284 |
Fair value of contingent consideration upon acquisition (1) | 9,973 |  |  | — |
Change in fair value of contingent consideration | (3,509) |  |  | 5,716 |
Settlement of contingent consideration | (880) |  |  | (28,463) |
End of the period (2) | $ | 12,551 |  |  | $ | 537 |
(1) Fair value of contingent consideration includes the earn-out of the immaterial technology acquisition. See Contingent Consideration for Business Acquisitions section below for more information. (2) As of June 30, 2020, the earn-out period was completed in connection with our acquisition of General Workings, Inc. ("Streamlabs") (discussed below). The earn-out payment of $29.0 million was based on the actual net sales of Streamlabs services during the earn-out period and was no longer subject to fair value measurement and was accordingly transferred out of Level 3. During the third quarter of fiscal year 2021, $28.5 million of the contingent consideration was transferred from other current liabilities to equity upon settlement of the contingent consideration through the issuance of shares out of treasury stock. The remaining $0.5 million is held back in escrow for claims made against the escrow and for the payment of taxes. Investment Securities The marketable securities for the Company's deferred compensation plan were recorded at a fair value of $29.7 million and $24.8 million, as of December 31, 2021 and March 31, 2021, respectively, based on quoted market prices. Quoted market prices are observable inputs that are classified as Level 1 within the fair value hierarchy. Unrealized gains (losses) related to trading securities for the three and nine months ended December 31, 2021 and 2020 were not material and are included in other income, net in the Company's condensed consolidated statements of operations. Contingent Consideration for Business Acquisitions On May 19, 2021, the Company made an immaterial technology acquisition. The contingent consideration for business acquisition arising from the immaterial technology acquisition represents the future potential earn-out payments of up to $10.0 million payable in cash only upon the achievement of three technical development milestones required to be completed as of December 31, 2021, June 30, 2022, and June 30, 2023. The fair value of the contingent amount was determined using a probability-weighted expected payment model and discounted at the estimated cost of debt. During the third quarter of fiscal 2022, $0.9 million of the contingent consideration was released from other current liabilities upon cash settlement of the contingent consideration for the first technical development milestone. On February 17, 2021 (the "Mevo Acquisition Date"), the Company acquired all of the equity interests of Mevo Inc. ("Mevo"). In connection with the acquisition of Mevo, the Company agreed to pay a total earn out payment of up to $17.0 million payable in cash only upon the achievement of certain net sales for the period beginning on December 26, 2020 and ending on December 31, 2021. The fair value of the earn-out as of the Mevo Acquisition Date was $3.4 million which was determined by using a Black-Scholes-Merton valuation model to calculate the probability of the earn-out threshold being met, times the value of the earn-out payment, and discounted at the risk-free rate. The valuation included significant assumptions and unobservable inputs such as the projected sales of Mevo over the earn-out period, risk-free rate, and the net sales volatility. Projected sales were based on the Company's internal projections, including analysis of the target market and historical sales of Mevo products. As of December 31, 2021, the fair value of the contingent consideration was released from other current liabilities as the net sales milestone was not achieved upon completion of the earn-out period. As of March 31, 2021 the fair value of the contingent consideration was $3.4 million. On January 4, 2021, the Company made an immaterial technology acquisition. The contingent consideration for business acq uisition arising from the immaterial technology acquisition represents the future potential earn-out payments of up to $3.0 million payable in cash upon the achievement of two technical development milestones required to be completed as of December 31, 2021 and March 31, 2022. The fair value of the contingent amount was determined using a probability-weighted expected payment model and discounted at the estimated cost of debt. The contingent consideration related to the first milestone is expected to be paid in the fourth quarter of fiscal year 2022. On October 31, 2019, the Company acquired all of the equity interests of General Workings, Inc. (Streamlabs). In connection with the acquisition of Streamlabs, the Company agreed to pay a total earn-out payment of up to $29.0 million, payable in stock, only upon the achievement of certain net revenues for the period beginning on January 1, 2020 and ending on June 30, 2020. The fair value was increased by $5.7 million to $29.0 million as of June 30, 2020, based on actual sales. As of June 30, 2020, the earn-out period was completed, and was no longer subject to fair value measurement. During the third quarter of fiscal 2021, $28.5 million of the contingent consideration was transferred from other current liabilities to equity upon settlement of the contingent consideration through the issuance of shares out of treasury stock. The remaining amount of $0.5 million is held back in escrow for claims made against the escrow and for the payment of taxes. Although these estimates are based on management’s best knowledge of current events, the estimates could change significantly from period to period. Actual results that differ from the assumptions used and any changes to the significant assumptions and unobservable inputs used could have a material impact on future results of operations. Equity Method Investments The Company has certain non-marketable investments included in other assets that are accounted for under the equity method of accounting, with a carrying value of $40.8 million and $40.7 million as of December 31, 2021 and March 31, 2021, respectively. Unrealized gains (losses) related to equity investments for the three and nine months ended December 31, 2021 and 2020 were not material and are included in other income, net in the Company's condensed consolidated statements of operations. There was no impairment of these assets during the three and nine months ended December 31, 2021 or 2020. Other Assets Measured at Fair Value on a Nonrecurring Basis Financial Assets. The Company has certain investments without readily determinable fair values due to the absence of quoted market prices, the inherent lack of liquidity, and the fact that inputs used to measure fair value are unobservable and require management's judgment. When certain events or circumstances indicate that impairment may exist, the Company revalues the investments using various assumptions, including the financial metrics and ratios of comparable public companies. The carrying value is also adjusted for observable price changes with a same or similar security from the same issuer. The amount of these investments included in other assets was immaterial as of December 31, 2021 and March 31, 2021. There was no impairment of these assets during the three and nine months ended December 31, 2021 or 2020. Non-Financial Assets. Goodwill, intangible assets, and property, plant and equipment, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur (or tested at least annually for goodwill) such that a non-financial instrument is required to be evaluated for impairment and an impairment is recorded to reduce the non-financial instrument's carrying value to the fair value as a result of such triggering events, the non-financial assets and liabilities are measured at fair value for the period such triggering events occur. As further discussed in Note 8, during the three and nine months ended December 31, 2021, the Company recorded impairment charges of $7.0 million for the Jaybird intangible assets. There was no impairment of non-financial assets during the three and nine months ended December 31, 2020.

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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