FAIR VALUE

We define fair value as the estimated price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value measurements for assets and liabilities which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk. We apply the following fair value hierarchy, which ranks the quality and reliability of the information used to determine fair values:


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


Level 2-	Inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices of identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets), 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 to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

Our cash equivalents and short-term investment instruments are generally classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. The types of instruments valued based on quoted market prices in active markets include most money market and marketable securities. Such instruments are generally classified within Level 1 of the fair value hierarchy. The types of instruments valued based on other observable inputs include investment-grade corporate bonds and commercial paper. Such instruments are generally classified within Level 2 of the fair value hierarchy.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are shown in the tables below by their corresponding balance sheet captions and consisted of the following types of instruments at July 1, 2017 and July 2, 2016:



		Fair Value Measurement at July 1, 2017 Using
		Quoted Prices		Significant
		in Active		Other		Significant
		Markets for		Observable		Unobservable
		Identical Assets		Inputs		Inputs
		(Level 1)		(Level 2)		(Level 3)		Total
Assets:		(Thousands)
Cash and cash equivalents: ⁽¹⁾
	Money market funds	$	99,037	$	—	$	—	$	99,037
	Commercial paper	—		22,981		—		22,981
	Corporate bonds	—		2,012		—		2,012
	U.S. agency securities	—		15,981		—		15,981
Restricted cash:
	Money market funds	712		—		—		712
Short-term investments:
	Commercial paper	—		23,459		—		23,459
	Corporate bonds	—		10,094		—		10,094
	U.S. Treasury securities	—		4,006		—		4,006
Total assets measured at fair value		$	99,749	$	78,533	$	—	$	178,282


(1)	Excludes $79.3 million in cash held in our bank accounts at July 1, 2017.



		Fair Value Measurement at July 2, 2016 Using
		Quoted Prices		Significant
		in Active		Other		Significant
		Markets for		Observable		Unobservable
		Identical Assets		Inputs		Inputs
		(Level 1)		(Level 2)		(Level 3)		Total
Assets:		(Thousands)
Cash and cash equivalents: ⁽¹⁾
	Money market funds	$	25,004	$	—	$	—	$	25,004
Restricted cash:
	Money market funds	712		—		—		712
Total assets measured at fair value		$	25,716	$	—	$	—	$	25,716


(1)	Excludes $70.9 million in cash held in our bank accounts at July 2, 2016.