Cash, Cash Equivalents and Investments

9 Months Ended

Sep. 30, 2021

Cash, Cash Equivalents and Investments

Cash, Cash Equivalents and Investments

Note 3 - Cash, Cash Equivalents and Investments

The following tables summarize our cash, cash equivalents, marketable securities, and held-to-maturity investments at September 30, 2021 and December 31, 2020 (in thousands):

	As of September 30, 2021
			Gross		Gross				Cash and
	Amortized		Unrealized		Unrealized				Cash			Marketable	Short-Term		Long-Term
	Cost		Gains		Losses		Fair Value		Equivalents			Securities	Investments		Investments
Cash	$	162,478	$	—	$	—	$	162,478	$	162,478	$	—	$	—	$	—
Level 1:
Money market funds		119,225		—		—		119,225		119,225		—		—		—
Agency bonds		48,000		49		—		48,049				—		40,000		8,000
Marketable securities		90,000				(6,660)		83,340				83,340		—		—
Subtotal		257,225		49		(6,660)		250,614		119,225		83,340		40,000		8,000
Level 2:
State and municipal obligations		77,764		4		(22)		77,746						72,383		5,381
Certificates of deposit		500		—		—		500		—		—		500		—
Corporate bonds		119,817		76		(95)		119,798		—		—		83,751		36,066
Commercial paper		19,994		—		—		19,994		—		—		19,994		—
Subtotal		218,075		80		(117)		218,038		—				176,628		41,447
Total	$	637,778	$	129	$	(6,777)	$	631,130		281,703		83,340		216,628		49,447
Expected credit loss reserve										(12)		—		(71)		(16)
Total, net of reserve for expected credit losses									$	281,691	$	83,340	$	216,557	$	49,431

During the quarter ended September 30, 2021, we acquired 9,000,000 shares of common stock of Cellebrite DI Ltd (“CLBT”) with a fair value of $90.0 million. The CLBT common stock is recorded as marketable securities in the accompanying condensed consolidated balance sheets and its fair value is adjusted every reporting period. Changes in fair value are recorded in the consolidated statement of operations as unrealized gain or (loss) on marketable securities, which is included in interest and other income (expense), net. During the three and nine months ended September 30, 2021, we recorded a $6.7 million unrealized loss on marketable securities relating to CLBT.

Because we do not have any history of losses for our held-to-maturity investments, our expected credit loss allowance methodology for held-to-maturity investments is developed using published or estimated credit default rates for similar investments and current and future economic and market conditions. At September 30, 2021 and December 31, 2020, our credit loss reserve for held-to-maturity investments was approximately $0.1 million and $0.2 million, respectively.

	As of December 31, 2020
			Gross		Gross				Cash and
	Amortized		Unrealized		Unrealized				Cash		Short-Term		Long-Term
	Cost		Gains		Losses		Fair Value		Equivalents		Investments		Investments
Cash	$	116,107	$	—	$	—	$	116,107	$	116,107	$	—	$	—
Level 1:
Money market funds		23,611		—		—		23,611		23,611		—		—
Agency bonds		63,794		122		—		63,916		—		23,794		40,000
Treasury Bills		96,384		6		—		96,390				96,384
Subtotal		183,789		128		—		183,917		23,611		120,178		40,000
Level 2:
State and municipal obligations		77,130		25		(28)		77,127		—		66,519		10,611
Certificates of deposit		500		—		—		500		—		500		—
Corporate bonds		212,825		232		(100)		212,957		2,525		170,205		40,095
U.S. Treasury repurchase agreements		13,200		—		—		13,200		13,200		—		—
Treasury inflation-protected securities		3,291		16		—		3,307		—		3,291
Commercial paper		45,974		—		—		45,974				45,974		—
Subtotal		352,920		273		(128)		353,065		15,725		286,489		50,706
Total	$	652,816	$	401	$	(128)	$	653,089		155,443		406,667		90,706
Expected credit loss reserve										(3)		(142)		(25)
Total, net of reserve for expected credit losses									$	155,440	$	406,525	$	90,681