Investments and Fair Value Measurements

12 Months Ended

Dec. 31, 2021

Investments

Available-for-sale Investments

The Company's short-term available-for-sale debt investments are measured to fair value on a recurring basis. Unrealized gains and losses related to the Company’s short-term investments are recorded in Other comprehensive loss and are generally due to interest rate fluctuations. The securities that are in an unrealized loss position are reviewed on an individual basis in order to evaluate if all or a portion of the unrealized loss is a result of a credit loss. For impairment indicators due to credit loss factors, the Company establishes an allowance for credit losses with a charge to current period net income. See Note 4 for additional information regarding the credit losses for available-for-sale investments. As of December 31, 2021 and 2020, unrealized gains and losses from the Company’s available-for-sale investments were not material and the amortized cost approximated their fair value. For the year ended December 31, 2021 and 2020, the Company had no realized gains or losses on available-for-sale investments.

The average remaining maturities of the Company’s short-term and long-term available-for-sale investments at December 31, 2021 were approximately five months and two years, respectively.

Equity Securities Accounted for at Net Asset Value The Company held equity interests in certain private equity funds of $21.5 million and $11.3 million as of December 31, 2021 and 2020, respectively, which are accounted for under the net asset value practical expedient. These investments are included in Other assets in the accompanying consolidated balance sheets. The net asset value of these investments is determined using quarterly capital statements from the funds, which are based on the Company’s contributions to the funds, allocation of profit and loss and changes in fair value of the underlying fund investments. These private equity funds focus on making venture capital investments, principally by investing in equity securities of early and late stage privately held corporations. The funds’ general partner shall determine the amount, timing and form (whether cash or in kind) of all distributions made by the funds. The Company may only transfer its investments in private equity fund interests subject to the general partner’s written consent and cannot trade its fund interests in established securities markets, secondary markets or equivalents thereof. The Company had no unfunded commitments as of December 31, 2021.

Equity Securities without Readily Determinable Fair Values

The Company held direct investments in privately-held companies of approximately $24.4 million and $22.5 million as of December 31, 2021, and 2020, respectively, which are accounted for at cost, less impairment plus or minus adjustments

resulting from observable price changes in orderly transactions for an identical or a similar investment of the same issuer. These investments are included in Other assets in the accompanying consolidated balance sheets. The Company periodically reviews these investments for impairment and observable price changes on a quarterly basis, and adjusts the carrying value accordingly.

Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Recurring Basis


	As of December 31, 2021		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Assets:
Cash and cash equivalents:
Cash	$	425,650	$	425,650	$	—	$	—
Money market funds	70,893		70,893		—		—

Corporate securities	17,450		—		17,450		—

Available-for-sale securities:

Corporate securities	27,940		—		27,440		500


Prepaid expenses and other current assets:
Foreign currency derivatives	741		—		741		—
Total assets	$	542,674	$	496,543	$	45,631	$	500
Accrued expenses and other current liabilities:
Foreign currency derivatives	1,531		—		1,531		—
Total liabilities	$	1,531	$	—	$	1,531	$	—


	As of December 31, 2020		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Assets:
Cash and cash equivalents:
Cash	$	375,874	$	375,874	$	—	$	—
Money market funds	23,089		23,089		—		—

Corporate securities	166,436		—		166,436		—
Government securities	187,496		—		187,496		—
Available-for-sale securities:
Agency securities	3,300		—		3,300		—
Corporate securities	70,684		—		70,184		500

Government securities	64,494		—		64,494		—
Prepaid expenses and other current assets:
Foreign currency derivatives	4,012		—		4,012		—
Total assets	$	895,385	$	398,963	$	495,922	$	500
Accrued expenses and other current liabilities:
Foreign currency derivatives	1,447		—		1,447		—
Total liabilities	$	1,447	$	—	$	1,447	$	—

The Company’s investment policy is designed to limit exposure to any one issuer depending on credit quality. The Company’s fixed income available-for-sale security portfolio generally consists of investment grade securities from diverse issuers with a minimum credit rating of A-/A3 and a weighted-average credit rating of AA-/Aa3. The Company values these securities based on pricing from the Service, whose sources may use quoted prices in active markets for identical assets (Level

1 inputs) or inputs other than quoted prices that are observable either directly or indirectly (Level 2 inputs) in determining fair value, and accordingly, the Company classifies the majority of its fixed income available-for-sale securities as Level 2.

The Company measures its cash flow hedges, which are classified as Prepaid expenses and other current assets and Accrued expenses and other current liabilities, at fair value based on indicative prices in active markets (Level 2 inputs). See Note 14 for further information regarding the Company's derivatives.

Additional Disclosures Regarding Fair Value Measurements

The carrying value of accounts receivable, accounts payable and accrued expenses approximate their fair value due to the short maturity of these items.

As of December 31, 2021, the fair value of the $750.0 million unsecured senior notes due March 1, 2030 (the “2030 Notes”), $750.0 million of unsecured senior notes due December 1, 2027 (the “2027 Notes”) and $750.0 million of unsecured senior notes due March 1, 2026 (the “2026 Notes”) were determined based on inputs that are observable in the market (Level 2). Based on the closing trading price per $100 as of the last day of trading for the year ended December 31, 2021, the fair value of these instruments was as follows (in thousands):


	Fair Value		Carrying Value
2030 Notes	$	763,418	$	740,287
2027 Notes	$	814,148	$	744,707
2026 Notes	$	730,110	$	742,872

The Company also has variable debt instruments indexed to 1-Month LIBOR that resets monthly and the fair values of these instruments approximate the carrying value as of December 31, 2021. See Note 13 for more information on the Company's debt instruments.