Investments

12 Months Ended

Jan. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Marketable Securities

At January 31, 2020, marketable securities consisted of the following (in millions):


Investments classified as Marketable Securities	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Corporate notes and obligations	$	2,199	$	9	$	(1)	$	2,207
U.S. treasury securities	182		1		0		183
Mortgage backed obligations	225		1		0		226
Asset backed securities	779		2		0		781
Municipal securities	157		1		0		158
Foreign government obligations	69		0		0		69
U.S. agency obligations	12		0		0		12

Time deposits	1		0		0		1
Covered bonds	165		0		0		165
Total marketable securities	$	3,789	$	14	$	(1)	$	3,802

At January 31, 2019, marketable securities consisted of the following (in millions):


Investments classified as Marketable Securities	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Corporate notes and obligations	$	1,027	$	0	$	(8)	$	1,019
U.S. treasury securities	89		0		(1)		88
Mortgage backed obligations	79		0		(1)		78
Asset backed securities	245		0		(1)		244
Municipal securities	104		0		0		104
Foreign government obligations	58		0		(1)		57
U.S. agency obligations	4		0		0		4
Time deposits	4		0		0		4
Covered bonds	75		0		0		75
Total marketable securities	$	1,685	$	0	$	(12)	$	1,673

The contractual maturities of the investments classified as marketable securities are as follows (in millions):


	As of
	January 31, 2020		January 31, 2019
Due within 1 year	$	1,332	$	482
Due in 1 year through 5 years	2,466		1,189
Due in 5 years through 10 years	4		2
	$	3,802	$	1,673

As of January 31, 2020, the following marketable securities were in an unrealized loss position (in millions):


	Less than 12 Months						12 Months or Greater						Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Corporate notes and obligations	$	285	$	(1)	$	0	$	0	$	285	$	(1)

The unrealized losses for each of the fixed rate marketable securities were less than $1 million. The Company does not believe any of the unrealized losses represent an other-than-temporary impairment based on its evaluation of available evidence as of January 31, 2020, such as the Company's intent to hold the investment and whether it is more likely than not that the Company will be required to sell the investment before recovery of the investment's amortized basis. The Company expects to receive the full principal and interest on all of these marketable securities.

Investment Income

Investment income consists of interest income, realized gains and realized losses on the Company’s cash, cash equivalents and marketable securities. The components of investment income are presented below (in millions):


	Fiscal Year Ended January 31,
	2020		2019		2018
Interest income	$	117	$	61	$	37
Realized gains	2		1		1
Realized losses	(1)		(5)		(2)
Investment income	$	118	$	57	$	36

Strategic Investments

Strategic investments by form and measurement category as of January 31, 2020 were as follows (in millions):


	Measurement Category
	Fair Value		Measurement Alternative		Other		Total
Equity securities	$	370	$	1,502	$	40	$	1,912
Debt securities	0		0		51		51
Balance as of January 31, 2020	$	370	$	1,502	$	91	$	1,963

Strategic investments by form and measurement category as of January 31, 2019 were as follows (in millions):


	Measurement Category
	Fair Value		Measurement Alternative		Other		Total
Equity securities	$	436	$	785	$	50	$	1,271
Debt securities	0		0		31		31
Balance as of January 31, 2019	$	436	$	785	$	81	$	1,302

Measurement Alternative Adjustments

The components of privately held equity securities accounted for under the measurement alternative included in the table above are presented below (in millions):


	Fiscal Year Ended January 31,
	2020		2019
Carrying amount, beginning of period	$	785	$	548
Adjustments related to privately held equity securities:
Net additions (1)	507		95
Upward adjustments	280		174
Impairments and downward adjustments	(70)		(32)
Carrying amount, end of period	$	1,502	$	785

(1) Net additions include additions from purchases and reductions due to exits of securities and reclassifications due to changes to capital structure.

In April 2019 the Company made a strategic investment of $100 million in cash for common shares of a technology company in a private placement concurrent with the investee company's initial public offering. In September 2019, the Company made a strategic investment of $300 million in cash for preferred shares of a technology company in a preferred stock financing. Additionally, in November 2019, the Company made a strategic investment of $150 million in cash for preferred shares of a technology company in a preferred stock financing. These investments were made as part of the Company's overall strategy of investing in complementary companies to facilitate potential alignment and integration into the Company’s offerings or product features. These investments are accounted for using the measurement alternative.

Since the adoption of ASU 2016-01 on February 1, 2018, cumulative impairments and downward adjustments were $102 million and cumulative upward adjustments were $454 million through January 31, 2020.

Gains (losses) on strategic investments, net

The components of gains and losses on strategic investments are presented below (in millions):


4	Fiscal Year Ended January 31,
	2020		2019		2018
Unrealized gains recognized on publicly traded equity securities, net	$	138	$	345	$	0
Unrealized gains recognized on privately held equity securities, net	208		133		19
Realized gains on sales of equity securities, net	95		74		0
Losses on debt securities, net	(14)		(10)		0
Gains on strategic investments, net	$	427	$	542	19

Realized gains on sales of equity securities, net reflects the difference between the sale proceeds and the carrying value of the equity security at the beginning of the period or the purchase date, if later. The cumulative net realized gain, measured as the sale price less the initial purchase price, for equity securities exited during fiscal 2020 is $353 million.

Net unrealized gains recognized in fiscal 2020 for strategic investments still held as of January 31, 2020 were $290 million.