FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2024

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

(3) FAIR VALUE OF FINANCIAL INSTRUMENTS

The following tables summarize the Company’s financial assets measured at fair value on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):

			Fair Value Measurements Using
			Quoted Prices in
			Active Markets		Significant Other		Significant
			for Identical		Observable		Unobservable
	June 30,		Assets		Inputs		Inputs
	2024		(Level 1)		(Level 2)		(level 3)
Assets:
Cash equivalents
Money market funds	$	18,343	$	18,343	$	—	$	—
Commercial paper		2,988		—		2,988		—
Total cash equivalents		21,331		18,343		2,988		—
Short-term investments
Agency bonds		37,367		—		37,367		—
Commercial paper		19,503		—		19,503		—
U.S. Treasury bills		9,420		9,420		—		—
Corporate debt securities		6,843		—		6,843		—
Total short-term investments		73,133		9,420		63,713		—
Total fair value of assets	$	94,464	$	27,763	$	66,701	$	—

			Fair Value Measurements Using
			Quoted Prices in
			Active Markets		Significant Other		Significant
			for Identical		Observable		Unobservable
	December 31,		Assets		Inputs		Inputs
	2023		(Level 1)		(Level 2)		(level 3)
Assets:
Cash equivalents
Money market funds	$	19,787	$	19,787	$	—	$	—
Total cash equivalents		19,787		19,787		—		—
Short-term investments
Agency bonds		42,255				42,255
Commercial paper		38,386		—		38,386		—
U.S. Treasury bills		10,362		10,362		—		—
Corporate debt securities		7,945		—		7,945		—
Total short-term investments		98,948		10,362		88,586		—
Total fair value of assets	$	118,735	$	30,149	$	88,586	$	—

Cash Equivalents and Short-Term Investments

Financial assets measured at fair value on a recurring basis consist of the Company’s cash equivalents and short-term investments. Cash equivalents consisted of money market funds and commercial paper, and short-term investments consisted of U.S. Treasury bills, agency bonds, corporate debt securities, and commercial paper. The Company obtains pricing information from its investment manager and generally determines the fair value of investment securities using standard observable inputs, including reported trades, broker/dealer quotes, and bids and/or offers.

The following tables summarize the Company’s short-term investments (in thousands):

		As of June 30, 2024
				Gross		Gross
		Amortized		unrealized		unrealized		Estimated fair
	Maturity	cost		gains		losses		value
Agency bonds	2 years or less		37,409		9		(51)		37,367
Commercial paper	2 years or less		19,508		3		(8)		19,503
U.S. Treasury bills	2 years or less		9,439		—		(19)		9,420
Corporate debt securities	2 years or less		6,860		—		(17)		6,843
		$	73,216	$	12	$	(95)	$	73,133

		As of December 31, 2023
				Gross		Gross
		Amortized		unrealized		unrealized		Estimated fair
	Maturity	cost		gains		losses		value
Agency bonds	2 years or less	$	42,090		179		(14)	$	42,255
Commercial paper	2 years or less		38,362		29		(5)		38,386
U.S. Treasury bills	2 years or less		10,334		31		(3)		10,362
Corporate debt securities	2 years or less		7,925		21		(1)		7,945
		$	98,711	$	260	$	(23)	$	98,948

The following tables summarize the Company’s short-term investments with unrealized losses for less than 12 months and 12 months or greater (in thousands):

		As of June 30, 2024
		Less than 12 months			12 months or Greater
			Unrealized				Unrealized		Total		Total Unrealized
		Fair Value	Losses		Fair Value		Losses		Fair Value		Losses
Agency bonds	$	17,234	$	(35)	$	12,498	$	(15)	$	29,732	$	(50)
Commercial paper		8,866		(8)		—		—		8,866		(8)
U.S. Treasury bills		7,380		(17)		1,975		(3)		9,355		(20)
Corporate debt securities		6,843		(17)		—		—		6,843		(17)
	$	40,323	$	(77)	$	14,473	$	(18)	$	54,796	$	(95)

		As of December 31, 2023
		Less than 12 months			12 months or Greater
			Unrealized				Unrealized		Total		Total Unrealized
		Fair Value	Losses		Fair Value		Losses		Fair Value		Losses
Commercial paper	$	6,042	$	(5)	$	—	$	—	$	6,042	$	(5)
Agency bonds		3,760		(6)		6,579		(8)		10,339		(14)
U.S. Treasury bills		488		(2)		1,007		(1)		1,495		(3)
Corporate debt securities		3,110		(1)		—		—		3,110		(1)
	$	13,400	$	(14)	$	7,586	$	(9)	$	20,986	$	(23)

The Company considers whether unrealized losses have resulted from a credit loss or other factors. The unrealized losses on the Company’s short-term investments as of June 30, 2024 and December 31, 2023 were caused by fluctuations in market value and interest rates as a result of the economic environment and not credit risk. As of June 30, 2024 and December 31, 2023, no allowance for credit losses was recorded. During the six months ended June 30, 2024, the Company did not recognize any impairment losses related to its short-term investments. It is neither management’s intention to sell nor is it more likely than not that the Company will be required to sell these investments prior to recovery of their cost basis or recovery of fair value. Unrealized gains and losses are included in accumulated other comprehensive gain (loss).

Accrued interest receivable is written off through net realized investment gains (losses) at the time the issuer of the bond defaults or is expected to default on payment. Accrued interest receivable related to short-term investments was $0.5 million as of June 30, 2024 and $0.6 million as of December 31, 2023.