NOTE 5 — Fair Value Measurements

Financial assets measured at fair value on a recurring basis as of December 31, 2016 are classified using the fair value hierarchy in the table below:



	Total		Level 1		Level 2
	(In thousands)
Assets
Cash equivalents:
Money market funds	$	113,955	$	113,955	$	—
Time deposits	299,585		—		299,585
Investments:
Time deposits	24,576		—		24,576
Corporate debt securities	64,227		—		64,227
Total assets	$	502,343	$	113,955	$	388,388

Liabilities
Derivatives:
Foreign currency forward contracts	$	4,402	$	—	$	4,402

Financial assets measured at fair value on a recurring basis as of December 31, 2015 are classified using the fair value hierarchy in the table below:



	Total		Level 1		Level 2
	(In thousands)
Assets
Cash equivalents:
Money market funds	$	218,340	$	218,340	$	—
Time deposits	29,126		—		29,126
Derivatives:
Foreign currency forward contracts	8,045		—		8,045
Investments:
Corporate debt securities	98,403		—		98,403
Total assets	$	353,914	$	218,340	$	135,574

We classify our cash equivalents and investments within Level 1 and Level 2 as we value our cash equivalents and investments using quoted market prices or alternative pricing sources and models utilizing market observable inputs. Valuation of the foreign currency forward contracts is based on foreign currency exchange rates in active markets, a Level 2 input.

As of December 31, 2016 and 2015, our cash and cash equivalents consisted primarily of prime institutional money market funds with maturities of three months or less, time deposits as well as bank account balances.

We invest in investment grade corporate debt securities, all of which are classified as available for sale. As of December 31, 2016, we had $48 million of short-term and $16 million of long-term available for sale investments and the amortized cost basis of the investments approximated their fair value with both gross unrealized gains and gross unrealized losses of less than $1 million. As of December 31, 2015, we had $34 million of short-term and $65 million of long-term available for sale investments and the amortized cost basis of the investments approximated their fair value with both gross unrealized gains and gross unrealized losses of less than $1 million.

We also hold time deposit investments with financial institutions. Time deposits with original maturities of less than three months are classified as cash equivalents and those with remaining maturities of less than one year are classified within short-term investments.

We use foreign currency forward contracts to economically hedge certain merchant revenue exposures, foreign denominated liabilities related to certain of our loyalty programs and our other foreign currency-denominated operating liabilities. As of December 31, 2016, we were party to outstanding forward contracts hedging our liability exposures with a total net notional value of $1.9 billion. We had a net forward liability of $4 million recorded in accrued expenses and other current liabilities as of December 31, 2016 and a net forward asset of $8 million recorded in prepaid expenses and other current assets as of December 31, 2015. We recorded $(66) million, $46 million and $10 million in net gains (losses) from foreign currency forward contracts in 2016, 2015 and 2014.