Fair Value Measurements

3 Months Ended

Apr. 30, 2020

The following table presents information about our financial instruments that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value:


	April 30, 2020
	Fair Value		Level 1		Level 2		Level 3

	(in thousands)
Financial Assets:
Money market funds	$	220,739	$	220,739	$	—	$	—



Cash equivalents	220,739		220,739		—		—
Commercial paper	11,892		—		11,892		—
Agency bonds	157,722		—		157,722		—
Corporate and other debt securities	394,011		—		394,011		—
U.S. government agency securities	50,089		—		50,089		—
Treasury bills	3,000		—		3,000		—
Marketable securities	616,714		—		616,714		—
Certificate of deposit included in prepaid expenses and other current assets	100		—		100		—

Certificates of deposit included in other assets, noncurrent	2,296		—		2,296		—

Convertible Note included in other assets, noncurrent	5,000		—		—		5,000
Total financial assets	$	844,849	$	220,739	$	619,110	$	5,000


	January 31, 2020
	Fair Value		Level 1		Level 2		Level 3

	(in thousands)
Financial Assets:
Money market funds	$	96,486	$	96,486	$	—	$	—
Commercial paper	4,994		—		4,994		—
Agency bonds	9,999		—		9,999		—
Cash equivalents	111,479		96,486		14,993		—
Commercial paper	37,894		—		37,894		—
Agency bonds	141,163		—		141,163		—
Corporate and other debt securities	321,166		—		321,166		—
U.S. government agency securities	71,837		—		71,837		—

Marketable securities	572,060		—		572,060		—
Certificate of deposit included in prepaid expenses and other current assets	100		—		100		—

Certificates of deposit included in other assets, noncurrent	2,301		—		2,301		—

Total financial assets	$	685,940	$	96,486	$	589,454	$	—

We classify our highly liquid money market funds within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. We classify our commercial paper, agency bonds, corporate bonds, corporate and other debt securities, U.S. government agency securities, treasury bills, and certificates of deposit within Level 2 because they are valued using inputs other than quoted prices that are directly or indirectly observable in the market, including readily available pricing sources for the identical underlying security which may not be actively traded. We classify the Convertible Note as Level 3 due to the lack of relevant observable market data over fair value inputs, such as the probability weighting of the various scenarios that can impact settlement of the arrangement.

As of April 30, 2020 and January 31, 2020, the carrying amount of the equity investment was $13.5 million and $3.0 million, respectively. We classify the equity investment as Level 3 within the fair value hierarchy only if an impairment or

observable adjustment is recognized during the period, as it is based on an observable transaction price at the transaction date and other unobservable inputs, such as volatility.

- 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.

+ References + Details