Investments and Fair Value Measurements

3 Months Ended

Apr. 30, 2020

Investments, Debt and Equity Securities and Fair Value Disclosures [Abstract]

Investments and Fair Value Measurements

Investments and Fair Value Measurements

The carrying amounts of certain of our financial instruments including cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short-term maturities.

Assets and liabilities recorded at fair value in the financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels that are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities are as follows:

Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs other than Level 1 prices 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.

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability.

The following table sets forth the fair value of our financial assets that were measured on a recurring basis:

	April 30, 2020								January 31, 2020
(In thousands)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	329,321	$	—	$	—	$	329,321	$	138,999	$	—	$	—	$	138,999
U.S. treasury securities	—		730,619		—		730,619		—		875,180		—		875,180
Corporate bonds	—		103,448		—		103,448		—		124,972		—		124,972
Commercial paper	—		—		—		—		—		4,994		—		4,994
Other	—		—		2,000		2,000		—		—		2,000		2,000
Reported as:
Assets:
Cash and cash equivalents							$	329,321							$	147,034
Investments, current							834,067								976,508
Investments, non-current							2,000								22,603
Total							$	1,165,388							$	1,146,145

Our investments in money market funds are measured at fair value on a recurring basis. These money market funds are actively traded and reported daily through a variety of sources. The fair value of the money market fund investments is classified as Level 1.

We invest in U.S. treasury securities, corporate bonds and commercial paper, which we have classified as available-for-sale investments. The following table presents our available-for-sale investments as of April 30, 2020:

(In thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Investments, current:
U.S. treasury securities	$	726,104	$	4,515	$	—	$	730,619
Corporate bonds	102,772		677		(1)		103,448
Total available-for-sale investments	$	828,876	$	5,192	$	(1)	$	834,067

The following table presents our available-for-sale investments as of January 31, 2020:

(In thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Cash and cash equivalents:
U.S. treasury securities	$	8,035	$	—	$	—	$	8,035
Investments, current:
U.S. treasury securities	866,578		590		(23)		867,145
Corporate bonds	103,848		521		—		104,369
Commercial paper	4,991		3		—		4,994
Investments, non-current:
Corporate bonds	20,444		159		—		20,603
Total available-for-sale investments	$	1,003,896	$	1,273	$	(23)	$	1,005,146

The following table presents the fair values and unrealized losses of our available-for-sale investments classified by length of time that the securities have been in a continuous unrealized loss position:

	Less than 12 Months				12 Months or Greater				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
April 30, 2020
Corporate bonds	$	—	$	—	$	3,500	$	(1)	$	3,500	$	(1)
Total	$	—	$	—	$	3,500	$	(1)	$	3,500	$	(1)
January 31, 2020
U.S. treasury securities	$	129,149	$	(23)	$	—	$	—	$	129,149	$	(23)
Corporate bonds	7,504		—		—		—		7,504		—
Total	$	136,653	$	(23)	$	—	$	—	$	136,653	$	(23)

As of April 30, 2020 and January 31, 2020, we did not consider any of our investments to be impaired.

The contractual maturities of our investments are as follows:

(In thousands)	April 30, 2020
Due within one year	$	834,067
Total	$	834,067

Investments with maturities of less than 12 months from the balance sheet date are classified as current assets, which are available for use to fund current operations. Investments with maturities greater than 12 months from the balance sheet date are classified as long-term assets.

Convertible Senior Notes

Refer to Note 7 “Convertible Senior Notes” for details regarding the fair value of our convertible senior notes.

Equity Investments

Our equity investments are included in “Investments, non-current” on our condensed consolidated balance sheets. The following table provides a summary of our equity investments:

(In thousands)	April 30, 2020		January 31, 2020
Equity investments without readily determinable fair values	$	12,744	$	10,744
Equity investments under the equity method of accounting	2,398		2,023
Total	$	15,142	$	12,767