Financial Instruments

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Financial Instruments

Note 3. Financial Instruments

Fair value is defined 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 on the measurement date. The Company’s valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company follows a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value. These levels of inputs are the following:

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

• Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• 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.

The Company’s financial instruments are valued using quoted prices in active markets or based upon other observable inputs. Money market funds are classified as Level 1 financial assets. Certificates of deposit, commercial paper, municipal bonds, corporate debt securities, and U.S. Government agency securities are classified as Level 2 financial assets. The fair value of the Level 2 assets is estimated using pricing models using current observable market information for similar securities. The Company’s Level 2 investments include U.S. government-backed securities and corporate securities that are valued based upon observable inputs that may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications. The fair value of commercial paper is based upon the time to maturity and discounted using the three-month treasury bill rate. The average remaining maturity of the Company’s Level 2 investments as of March 31, 2021 is less than twelve months and these investments are rated by S&P and Moody’s at AAA or AA- for securities and A1, A2, P1 or P2 for commercial paper.

The following is a summary of available-for-sale securities as of March 31, 2021 and December 31, 2020 (in thousands):

	March 31, 2021
	Amortized Cost		Unrealized Gain		Unrealized Loss			Estimated Fair Value
Money market funds	$	1,152	$	—	$	—		$	1,152
Certificates of deposit		150		—		—			150
Commercial paper		86,094		—		(10	)		86,084
Municipal bonds		4,259		—		(3	)		4,256
Corporate debt		1,317		—		(1	)		1,316
	$	92,972	$	—	$	(14	)	$	92,958
Reported as:
Cash and cash equivalents	$	53,272	$	—	$	(2	)	$	53,270
Short-term investments		39,550		—		(12	)		39,538
Long-term restricted investments		150		—		—			150
	$	92,972	$	—	$	(14	)	$	92,958

	December 31, 2020
	Amortized Cost		Unrealized Gain		Unrealized Loss			Estimated Fair Value
Money market funds	$	522	$	—	$	—		$	522
Certificates of deposit		150		—		—			150
Commercial paper		32,213		2		(2	)		32,213
Municipal bonds		6,310		—		(5	)		6,305
U.S. Government agencies		1,000		—		—			1,000
	$	40,195	$	2	$	(7	)	$	40,190
Reported as:
Cash and cash equivalents	$	19,619	$	1	$	(1	)	$	19,619
Short-term investments		19,426		1		(6	)		19,421
Long-term investments	$	1,000	$	—	$	—			1,000
Long-term restricted investments		150		—		—			150
	$	40,195	$	2	$	(7	)	$	40,190

The following is a summary of the cost and estimated fair value of available-for-sale securities at March 31, 2021, by contractual maturity (in thousands):

	March 31, 2021
	Amortized Cost		Estimated Fair Value
Mature in one year or less		91,670		91,656
Mature after one year through five years		150		150
	$	91,820	$	91,806

There were no securities that have had an unrealized loss for more than 12 months as of March 31, 2021.

As of March 31, 2021, unrealized losses on available-for-sale investments are not attributed to credit risk and are considered to be temporary. The Company believes that it is more-likely-than-not that investments in an unrealized loss position will be held until maturity or the recovery of the cost basis of the investment. To date, the Company has not recorded any impairment charges on marketable securities related to other-than-temporary declines in market value.