Financial Instruments

9 Months Ended

Sep. 30, 2023

Financial Instruments

Financial Instruments

5. Financial Instruments

The Company elected to invest a portion of its cash assets in conservative, income earning, and liquid investments. Cash, cash equivalents, restricted cash and investments, which are classified as available-for-sale securities, consisted of the following:

	September 30, 2023						December 31, 2022
	Amortized Cost		Gross Unrealized Loss		Estimated Fair Value		Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Estimated Fair Value
	(in thousands)
Cash, cash equivalents and restricted cash (2)	$	668,710	$	—	$	668,710	$	466,091	$	—	$	—	$	466,091
U.S. Treasury securities (1)		227,276		(2,833)		224,443		358,385		—		(12,328)		346,057
Corporate bonds and notes (1)		4,000		(24)		3,976		24,045		—		(516)		23,529
Municipal securities (1)		41,701		(2,273)		39,428		65,973		1		(3,259)		62,715
Total	$	941,687	$	(5,130)	$	936,557	$	914,494	$	1	$	(16,103)	$	898,392
Classified as:
Cash, cash equivalents and restricted cash (2)						668,710								466,091
Short-term investments						267,847								432,301
Total					$	936,557							$	898,392

(1) Per the Company’s investment policy, all debt securities are classified as short-term investments irrespective of holding period.  

(2) Cash equivalents includes money market deposits and liquid demand deposits.

The Company invests in U.S. Treasuries, U.S. agency and high-quality municipal bonds which mature at par value and are all paying their coupons on schedule. The Company has therefore concluded an allowance for expected credit losses of its investments was not necessary and will continue to recognize unrealized gains and losses in other comprehensive income (loss). During the nine months ended September 30, 2023, the Company did not sell any investments. The Company uses the specific investment identification method to calculate realized gains and losses and amounts reclassified out of other comprehensive income (loss) to net loss. As of September 30, 2023, the Company had 38 investments in an unrealized loss position in its portfolio. An allowance for credit losses was not necessary as the decrease in the fair market value for a majority of these available-for-sale securities was as a result of a significant average yield rate increase for similar securities as of September 30, 2023. The Company has assessed the unrealized loss position for available-for-sale debt securities for which an allowance for credit losses has not been recorded and concluded any such losses are temporary and not indicative of an impairment as these investments will be held until maturity or price recovery.

The following table presents debt securities available-for-sale that were in an unrealized loss position as of September 30, 2023, aggregated by major security type in a continuous loss position. There were no debt securities available-for-sale in an unrealized loss position for less than 12 months as of September 30, 2023.

	Total
	Fair Value		Unrealized Loss
	(in thousands)
U.S. Treasury securities	$	224,443	$	(2,833)
Corporate bonds and notes		3,976		(24)
Municipal securities		39,428		(2,273)
Total	$	267,847	$	(5,130)

The following table summarizes the Company’s portfolio of available-for-sale securities by contractual maturity as of September 30, 2023:

	September 30, 2023
	Amortized Cost		Fair Value
	(in thousands)
Less than or equal to one year	$	242,845	$	239,773
Greater than one year but less than five years		30,132		28,074
Total	$	272,977	$	267,847