Cash, Cash Equivalents, and Available for Sale Marketable Investments

9 Months Ended

Sep. 30, 2016

Cash and Cash Equivalents [Abstract]

Cash, Cash Equivalents, and Available for Sale Marketable Investments

4. Cash, Cash Equivalents, and Available for Sale Marketable Securities

Cash equivalents include all highly liquid investments maturing within 90 days from the date of purchase. Investments consist of securities with original maturities greater than 90 days when purchased. The Company classifies these investments as available-for-sale and records them at fair value in the accompanying condensed consolidated balance sheets. Unrealized gains or losses are included in accumulated other comprehensive income (loss). Premiums or discounts from par value are amortized to investment income over the life of the underlying investment.

The Company classifies marketable debt securities with a remaining maturity when purchased of greater than three months as available‑for‑sale. Marketable debt securities with a remaining maturity date greater than one year and marketable equity securities are classified as non‑current where the Company has the intent and ability to hold these securities for at least the next 12 months. Available‑for‑sale debt securities are maintained by an investment manager and consist of U.S. Treasury securities and U.S. Government agency securities. During the third quarter in 2016, the Company invested in a supplier and received common stock and warrants to purchase common stock in that entity. The common stock is included in non-current marketable securities and the warrants are included in non-current assets.

All available‑for‑sale securities are carried at fair value with the unrealized gains and losses included in other comprehensive income (loss) as a component of stockholders’ equity until realized. Any premium or discount arising at purchase is amortized and/or accreted to interest income and/or expense. Realized gains and losses are determined using the specific identification method and are included in other income (expense). If any adjustment to fair value reflects a decline in value of the investment, the Company considers all available evidence to evaluate the extent to which the decline is “other‑than‑temporary” and, if so, recognizes the unrealized loss through a charge to the Company’s statement of operations and comprehensive loss. No other temporary losses have been recognized.

Cash, cash equivalents, and marketable securities included the following at September 30, 2016 and December 31, 2015:

	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(in thousands)
As of September 30, 2016
Money market funds included in cash and cash equivalents	$	63,008	$	—	$	—	$	63,008
Total money market funds included in cash and cash equivalents	$	63,008	$	—	$	—	$	63,008
Marketable securities:
U.S. Treasury notes		112,489		—		3		112,486
U.S. Government agency bonds		15,153		7		—		15,160
Total debt securities	$	127,642	$	7	$	3	$	127,646
Equity securities		1,220		1,196		—		2,416
Total marketable securities	$	128,862	$	1,203	$	3	$	130,062
Total money market funds and marketable securities	$	191,870	$	1,203	$	3	$	193,070
As of December 31, 2015
Money market funds included in cash and cash equivalents	$	29,601	$	—	$	—	$	29,601
Total money market funds included in cash and cash equivalents	$	29,601	$	—	$	—	$	29,601
Marketable securities:
U.S. Treasury notes		158,166		—		185		157,981
U.S. Government agency bonds		35,121		—		66		35,055
Total marketable securities	$	193,287	$	—	$	251	$	193,036
Total money market funds and marketable securities	$	222,888	$	—	$	251	$	222,637

The estimated fair value of the Company’s debt securities balance at September 30, 2016, by contractual maturity, is as follows:

Due in one year or less $ 127,646