CASH, CASH EQUIVALENTS AND INVESTMENTS

9 Months Ended

Oct. 31, 2024

CASH, CASH EQUIVALENTS AND INVESTMENTS

CASH, CASH EQUIVALENTS AND INVESTMENTS

NOTE 3 – CASH, CASH EQUIVALENTS AND INVESTMENTS

Cash Equivalents

At October 31, 2024 and January 31, 2024, certain amounts of cash equivalents were invested in a money market fund with net assets invested in high-quality money market instruments, including U.S. Treasury obligations; obligations of U.S. government agencies, authorities, instrumentalities or sponsored enterprises; and repurchase agreements secured by such obligations. Dividend income related to money market investments is recorded when earned. The balances of accrued dividends at October 31, 2024 and January 31, 2024 were $0.4 million and $0.7 million, respectively.

Investments

The Company’s investments consisted of the following as of October 31, 2024 and January 31, 2024:

	October 31,		January 31,
	2024		2024
Short-term investments	$	124,490	$	109,489
Available-for-sale securities		206,443		105,884
Total investments	$	330,933	$	215,373

Short-Term Investments

Short-term investments as of October 31, 2024 and January 31, 2024 consisted solely of certificates of deposit (“CDs”) with initial maturities of one year or less purchased from Bank of America, N.A. (the “Bank”). The Company has the intent and ability to hold the CDs until they mature, and they are carried at cost plus accrued interest. The balances of accrued interest on the CDs at October 31, 2024 and January 31, 2024 were $2.0 million and $4.5 million, respectively. Interest income is recorded when earned and is included in other income, net, in the condensed consolidated statements of earnings. At October 31, 2024 and January 31, 2024, the weighted average annual interest rates of the outstanding CDs were 4.8% and 5.4%, respectively.

Available-For-Sale Securities

The Company’s available-for-sale (“AFS”) securities consisted of the following amounts of amortized cost, allowance for credit losses, gross unrealized gains and losses and estimated fair value by contractual maturity as of October 31, 2024 and January 31, 2024:

	October 31, 2024
			Allowance for		Gross		Gross		Estimated
	Amortized		Credit		Unrealized		Unrealized		Fair
	Cost		Losses		Gains		Losses		Value
U.S. Treasury notes:
Due within one year	$	50,323	$	—	$	161	$	32	$	50,452
Due in one to three years		72,751		—		488		96		73,143
Due in three to five years		73,274		—		425		784		72,915
U.S. corporate debt security:
Due in one to three years		10,046		—		—		113		9,933
Totals	$	206,394	$	—	$	1,074	$	1,025	$	206,443

	January 31, 2024
			Allowance for		Gross		Gross		Estimated
	Amortized		Credit		Unrealized		Unrealized		Fair
	Cost		Losses		Gains		Losses		Value
U.S. Treasury notes:
Due in one to three years	$	96,217	$	—	$	568	$	230	$	96,555
U.S. corporate debt security:
Due in one to three years		9,406		—		—		77		9,329
Totals	$	105,623	$	—	$	568	$	307	$	105,884

As of October 31, 2024 and January 31, 2024, interest receivable in the amounts of $1.3 million were included in the balances of AFS securities. For the three and nine months ended October 31, 2024 and 2023, there were no sales of the Company’s AFS securities and, therefore, there were no amounts of gains or losses reclassified out of other comprehensive income into net income.

The Company does not believe the unrealized losses represent credit losses based on the evaluation of evidence as of October 31, 2024 and January 31, 2024, which includes an assessment of whether it is more likely than not the Company will be required to sell or intends to sell the investments before recovery of their corresponding amortized cost bases.

Earnings on Investments

Earnings on investments for the three and nine months ended October 31, 2024 were $4.8 million and $14.0 million, respectively, and they were $4.0 million and $9.7 million for the three and nine months ended October 31, 2023, respectively. Earnings on investments are included in other income, net, in the condensed consolidated statements of earnings.

Concentration Risk

The Company has a substantial portion of its cash on deposit in the U.S. with the Bank or invested in CDs purchased from the Bank. In addition, the Company has cash invested in a money market fund at a separate institution. The Company also maintains certain Euro-based bank accounts in Ireland and certain pound sterling-based bank accounts in the U.K. in support of the operations of APC. As of October 31, 2024 and January 31, 2024, approximately 2% and 12%, respectively, of the Company’s cash and cash equivalents were held by financial institutions in Ireland and the U.K. Management does not believe that the combined amount of the CDs and the cash deposited with the Bank, cash invested in the money market fund, and cash balances maintained at financial institutions in Ireland and the U.K., in excess of government-insured levels, represent material risks.