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Investments & Fair Value Measurements
 9 Months Ended
Jun. 26, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract]  
Investments & Fair Value Measurements . Investments & Fair Value Measurements
We use cash holdings to purchase investment grade securities diversified among security types, industries, and issuers. All of our investment securities are measured at fair value, and are recorded within cash equivalents and both short-term and long-term investments in our consolidated balance sheets. With the exception of our mutual fund investments held in our SERP and classified as trading securities, all of our investments are classified as AFS securities. Derivative contracts are used to hedge currency risk, these are carried at fair value and classified as other assets and other liabilities.
Our investment securities primarily consist of government bonds, certificates of deposit, municipal debt securities, corporate bonds, U.S. agency securities, and commercial paper. In addition, our cash and cash equivalents also consist of highly-liquid money market funds. Consistent with our investment policy, none of our municipal debt investments are supported by letters of credit or standby purchase agreements. Our cash and investment portfolio consisted of the following (in thousands):
June 26, 2020
CostUnrealizedEstimated Fair Value
GainsLossesTotalLevel 1Level 2Level 3
Cash and cash equivalents:
Cash$791,914  $—  $—  $791,914  $791,914  $—  $—  
Cash equivalents:
Certificate of deposit200  —  —  200  —  200  —  
Corporate bonds976  —  —  976  —  976  —  
Money market funds8,019  —  —  8,019  8,019  —  —  
Government bonds53,994  1  (1) 53,994  53,994  —  —  
Cash and cash equivalents855,103  1  (1) 855,103  853,927  1,176  —  
Short-term investments:
Certificate of deposit575  —  —  575  —  575  —  
U.S. agency securities5,798  23  —  5,821  —  5,821  —  
Government bonds114,175  95  (2) 114,268  111,677  2,591  —  
Commercial paper17,753  23  (2) 17,774  —  17,774  —  
Corporate bonds34,073  200  —  34,273  —  34,273  —  
Municipal debt securities16,597  75  —  16,672  —  16,672  —  
Short-term investments188,971  416  (4) 189,383  111,677  77,706  —  
Long-term investments:
U.S. agency securities4,214  134  —  4,348  —  4,348  —  
Government bonds26,039  755  —  26,794  22,492  4,302  —  
Corporate bonds19,599  457  (2) 20,054  —  20,054  —  
Municipal debt securities19,662  236  (5) 19,893  —  19,893  —  
Other long-term investments (1)3,679  —  —  3,679  —  —  —  
Long-term investments73,193  1,582  (7) 74,768  22,492  48,597  —  
Total cash, cash equivalents, and investments$1,117,267  $1,999  $(12) $1,119,254  $988,096  $127,479  $—  
Investments held in supplemental retirement plan:
Assets3,860  —  —  3,860  3,860  —  —  
Included in prepaid expenses and other current assets & other non-current assets
Liabilities3,860  —  —  3,860  3,860  —  —  
Included in accrued liabilities & other non-current liabilities
Currency derivatives as hedge instruments:
Assets: Included in other current assets—  1,621  —  1,621  —  1,621  —  
Assets: included in other non-current assets—  1,000  —  1,000  —  1,000  —  
Liabilities: Included in other accrued expenses—  —  (502) (502) —  (502) —  
Liabilities: Included in other non-current liabilities—  —  (34) (34) —  (34) —  
(1)Other long-term investments as of June 26, 2020 include investments that are not carried at fair value including an equity method investment of $3.7 million.
September 27, 2019
CostUnrealizedEstimated Fair Value
GainsLossesTotalLevel 1Level 2Level 3
Cash and cash equivalents:
Cash$680,287  $—  $—  $680,287  $680,287  $—  $—  
Cash equivalents:
Corporate bonds1,000  —  —  1,000  —  1,000  —  
Money market funds115,270  —  —  115,270  115,270  —  —  
Government bonds653  —  —  653  653  —  —  
Cash and cash equivalents797,210  —  —  797,210  796,210  1,000  —  
Short-term investments:
Certificate of deposit1,265  1  —  1,266  —  1,266  —  
U.S. agency securities10,973  8  (9) 10,972  —  10,972  —  
Government bonds8,381  11  (1) 8,391  5,784  2,607  —  
Commercial paper6,347  9  —  6,356  —  6,356  —  
Corporate bonds76,802  172  (34) 76,940  —  76,940  —  
Municipal debt securities15,210  18  (7) 15,221  —  15,221  —  
Short-term investments118,978  219  (51) 119,146  5,784  113,362  —  
Long-term investments:
Asset backed securities400  2  —  402  —  402  —  
U.S. agency securities7,102  146  —  7,248  —  7,248  —  
Government bonds23,563  187  —  23,750  19,670  4,080  —  
Corporate bonds134,360  1,700  —  136,060  —  136,060  —  
Municipal debt securities10,315  87  (6) 10,396  —  10,396  —  
Other long-term investments (1)1,731  —  —  1,731  —  —  —  
Long-term investments177,471  2,122  (6) 179,587  19,670  158,186  —  
Total cash, cash equivalents, and investments$1,093,659  $2,341  $(57) $1,095,943  $821,664  $272,548  $—  
Investments held in supplemental retirement plan:
Assets3,564  —  —  3,564  3,564  —  —  
Included in prepaid expenses and other current assets & other non-current assets
Liabilities3,564  —  —  3,564  3,564  —  —  
Included in accrued liabilities & other non-current liabilities
Currency derivatives as hedge instruments:
Liabilities: Included in other accrued expenses—  —  (242) (242) —  (242) —  

(1)Other long-term investments as of September 27, 2019 include an investment that is not carried at fair value including an equity method investment of $1.7 million.
Fair Value Hierarchy.    Fair value is the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. We minimize the use of unobservable inputs and use observable market data, if available, when determining fair value. We classify our inputs to measure fair value using the following three-level hierarchy:
Level 1: Quoted prices in active markets at the measurement date for identical assets and liabilities. We base the fair value of our Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments.
Level 2: Prices may be based upon quoted prices in active markets or inputs not quoted on active markets but are corroborated by market data. We obtain the fair value of our Level 2 investments from a professional pricing service, which may use quoted market prices for identical or comparable instruments, or model driven valuations using observable market data or inputs corroborated by observable market data. To validate the fair value determination provided by our primary pricing service, we perform quality controls over values received which include comparing our pricing service provider’s assessment of the fair values of our investment securities against the fair values of our investment securities obtained from another independent source, reviewing the pricing movement in the
context of overall market trends, and reviewing trading information from our investment managers. In addition, we assess the inputs and methods used in determining the fair value in order to determine the classification of securities in the fair value hierarchy. The fair value of the currency derivatives are calculated from market spot rates, forward rates, interest rates, and credit ratings at the end of the period.
Level 3: Unobservable inputs are used when little or no market data is available and reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.
Securities In Gross Unrealized Loss Position.    We periodically evaluate our investments for other-than- temporary declines in fair value. The unrealized losses on our AFS securities were primarily the result of unfavorable changes in interest rates subsequent to the initial purchase of these securities. The following table presents the gross unrealized losses and fair value for those AFS securities that were in an unrealized loss position for less than twelve months and for twelve months or greater as of June 26, 2020 and September 27, 2019 (in thousands):
June 26, 2020September 27, 2019
Less Than 12 Months12 Months Or GreaterLess Than 12 Months12 Months Or Greater
Investment TypeFair ValueGross Unrealized LossesFair ValueGross Unrealized LossesFair ValueGross Unrealized LossesFair ValueGross Unrealized Losses
Certificate of deposit$275  $—  $—  $—  $300  $—  $—  $—  
U.S. agency securities—  —  —  —  —  —  4,787  (9) 
Government bonds94,113  (2) —  —  1,426  —  —  —  
Commercial paper1,669  (2) —  —  —  —  —  —  
Corporate bonds2,135  (2) —  —  7,647  (3) 27,078  (32) 
Municipal debt securities2,508  (6) —  —  9,552  (13) 900  —  
Total$100,700  $(12) $—  $—  $18,925  $(16) $32,765  $(41) 
Although we had certain securities that were in an unrealized loss position as of June 26, 2020, we expect to recover the full carrying value of these securities. As a result, we do not consider any portion of the unrealized losses at either June 26, 2020 or September 27, 2019 to represent an other–than–temporary impairment, nor do we consider any of the unrealized losses to be credit losses.
Investment Maturities.    The following table summarizes the amortized cost and estimated fair value of the AFS securities within our investment portfolio based on stated maturities as of June 26, 2020 and September 27, 2019, which are recorded within cash equivalents and both short and long-term investments in our consolidated balance sheets (in thousands):
June 26, 2020September 27, 2019
Range of maturityAmortized CostFair ValueAmortized CostFair Value
Due within 1 year$252,160  $252,573  $238,186  $238,354  
Due in 1 to 2 years35,334  35,985  93,948  94,899  
Due in 2 to 3 years34,180  35,103  81,793  82,957  
Total$321,674  $323,661  $413,927  $416,210