Fair Value Measurement

6 Months Ended

Jun. 30, 2022

Note 3. Fair Value Measurement

The Company measures and reports certain financial instruments as assets and liabilities at fair value on a recurring basis. The following tables set forth the fair value of the Company’s financial assets, which consist of cash equivalents and marketable securities measured and recognized at fair value (in thousands):


		June 30, 2022
	Fair Value Hierarchy Level	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Included within cash and cash equivalents:
Money market funds	Level 1	$	108,227	$	—	$	—		$	108,227
U.S. treasury securities	Level 1		9,491		1		—			9,492
Commercial paper	Level 2		62,710		1		(15	)		62,696
U.S. government agency securities	Level 2		32,647		—		(4	)		32,643
Included within marketable securities:
U.S. treasury securities	Level 1		129,554		8		(277	)		129,285
Corporate bonds	Level 2		13,038		—		(60	)		12,978
Commercial paper	Level 2		146,802		—		(113	)		146,689
U.S. government agency securities	Level 2		2,982		5		(8	)		2,979
Total		$	505,451	$	15	$	(477	)	$	504,989


		December 31, 2021
	Fair Value Hierarchy Level	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Included within cash and cash equivalents:
Money market funds	Level 1	$	99,326	$	—	$	—		$	99,326
Commercial paper	Level 2		25,996		—		(1	)		25,995
Corporate bonds	Level 2		1,802		—		(1	)		1,801
Included within marketable securities:
U.S. treasury securities	Level 1		2,499		—		—			2,499
U.S. government agency securities	Level 2		24,260		—		(24	)		24,236
Commercial paper	Level 2		51,376		—		(11	)		51,365
Corporate bonds	Level 2		18,137		—		(29	)		18,108
Total		$	223,396	$	—	$	(66	)	$	223,330

The Company evaluates transfers between levels at the end of each reporting period. There were no transfers between Levels 1, 2 and 3 during the three and six months ended June 30, 2022 and 2021. As of June 30, 2022 and December 31, 2021, there were no financial instruments classified as Level 3.

As of June 30, 2022 and December 31, 2021, all debt securities with an unrealized loss position have been in a loss position for less than one year. The aggregate fair value of debt securities in an unrealized loss position as of June 30, 2022 and December 31, 2021 were $312.5 million and $113.0 million, respectively, with no individual securities in a significant unrealized loss position. The Company evaluated its securities for other-than-temporary impairment and considered the decline in market value to be primarily attributable to current economic and market conditions and would not be required to sell the securities before recovery of the amortized cost basis. Based on this analysis, these marketable securities were not considered to be other-than-temporarily impaired as of June 30, 2022 and December 31, 2021.

The following table presents the contractual maturities of the Company’s marketable securities as of June 30, 2022 and December 31, 2021 (in thousands):


	June 30,		December 31,
	2022		2021
Due in less than one year	$	494,543	$	223,330
Due in more than one year		10,446		—
Total	$	504,989	$	223,330

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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