INVESTMENTS

Short-term and Long-term Investments in Available-for-sale Securities

The following table summarizes, by major security type, the Company's investments as of March 31, 2017 (in thousands):



	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Short-term investments:
International government securities	$	517,398	$	1,254	$	(187	)	$	518,465
U.S. government securities	580,630		17		(427		)	580,220
Corporate debt securities	1,831,179		1,482		(1,166		)	1,831,495
Commercial paper	5,978		—		—			5,978
Total short-term investments	$	2,935,185	$	2,753	$	(1,780	)	$	2,936,158

Long-term investments:
International government securities	$	450,445	$	1,894	$	(788	)	$	451,551
U.S. government securities	828,777		286		(6,744		)	822,319
Corporate debt securities	6,387,523		10,334		(37,658		)	6,360,199
U.S. government agency securities	4,971		—		(25		)	4,946
Ctrip convertible debt securities	1,275,000		171,425		(8,050		)	1,438,375
Ctrip equity securities	655,311		407,929		—			1,063,240
Total long-term investments	$	9,602,027	$	591,868	$	(53,265	)	$	10,140,630

The Company's investment policy seeks to preserve capital and maintain sufficient liquidity to meet operational and other needs of the business. As of March 31, 2017, the weighted-average life of the Company’s fixed income investment portfolio, excluding the Company's investment in Ctrip convertible debt securities, was approximately 2.0 years with an average credit quality of A+/A1/A+.

The Company invests in international government securities with high credit quality. As of March 31, 2017, investments in international government securities principally included debt securities issued by the governments of the Netherlands, Belgium, France, Germany and Austria.

On May 26, 2015 and August 7, 2014, the Company invested $250 million and $500 million, respectively, in five-year senior convertible notes issued at par by Ctrip. On December 11, 2015, the Company invested $500 million in a Ctrip ten-year senior convertible note issued at par value, which included a put option allowing the Company to require a prepayment in cash from Ctrip at the end of the sixth year of the note. On September 12, 2016, the Company invested $25 million in a Ctrip six-year senior convertible note issued at par value, which included a put option allowing the Company to require prepayment in cash from Ctrip at the end of the third year of the note. The conversion feature associated with this September 2016 Ctrip convertible note met the definition of an embedded derivative (see Note 5). As of March 31, 2017, the Company had also invested $655.3 million of its international cash in Ctrip American Depositary Shares ("ADSs"). The convertible debt and equity securities of Ctrip have been marked-to-market in accordance with the accounting guidance for available-for-sale securities.

In connection with the Company's investments in Ctrip's convertible notes, Ctrip granted the Company the right to appoint an observer to its board of directors and permission to acquire its shares (through the acquisition of Ctrip ADSs in the open market) so that combined with ADSs issuable upon conversion of the August 2014, May 2015 and September 2016 convertible notes, the Company could hold up to an aggregate of approximately 15% of Ctrip's outstanding equity. As of March 31, 2017, the Company did not have significant influence over Ctrip.

The following table summarizes, by major security type, the Company's investments as of December 31, 2016 (in thousands):



	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Short-term investments:
International government securities	$	249,552	$	221	$	(89	)	$	249,684
U.S. government securities	456,971		57		(140		)	456,888
Corporate debt securities	1,510,119		1,119		(928		)	1,510,310
Commercial paper	1,998		—		—			1,998
Total short-term investments	$	2,218,640	$	1,397	$	(1,157	)	$	2,218,880

Long-term investments:
International government securities	$	655,857	$	4,110	$	(623	)	$	659,344
U.S. government securities	773,718		337		(7,463		)	766,592
Corporate debt securities	6,042,271		9,973		(50,455		)	6,001,789
U.S. government agency securities	4,979		—		(27		)	4,952
Ctrip convertible debt securities	1,275,000		65,800		(47,712		)	1,293,088
Ctrip equity securities	655,311		213,233		(3,242		)	865,302
Total long-term investments	$	9,407,136	$	293,453	$	(109,522	)	$	9,591,067

The Company has classified its investments as available-for-sale securities. These securities are carried at estimated fair value with the aggregate unrealized gains and losses related to these investments, net of taxes, reflected as a part of "Accumulated other comprehensive income (loss)" in the Unaudited Consolidated Balance Sheets. Classification as short-term or long-term investment is based upon the maturity of the debt securities.

The Company recognized net realized gains of $0.2 million for the three months ended March 31, 2017 compared to net realized losses of $2.9 million for the three months ended March 31, 2016, related to investments. As of March 31, 2017, the Company does not consider any of its investments to be other-than-temporarily impaired.

Cost-method Investments

The Company held investments in equity securities of private companies, companies typically at an early stage of development, of approximately $7.6 million at both March 31, 2017 and December 31, 2016. The investments are accounted for under the cost method and included in "Other assets" in the Company's Unaudited Consolidated Balance Sheets. There have been no identified events or changes in circumstances to indicate a potential impairment with the Company's cost-method investments as of March 31, 2017.

In March 2016, the Company recognized an impairment of approximately $50 million, which was not tax deductible, related to its investment in Hotel Urbano.