Fair Value Measurements

3 Months Ended

Mar. 31, 2024

Assets Measured at Fair Value on a Recurring Basis

The following tables set forth the Company’s cash equivalents and marketable securities that were measured at fair value on a recurring basis by level within the fair value hierarchy (in millions):


	December 31, 2023
	Level 1		Level 2		Level 3		Total

Cash equivalents
Money market funds	$	1,349	$	—	$	—	$	1,349
U.S. Treasury securities	—		35		—		35
Short-term marketable securities
Certificates of deposit	—		38		—		38
Commercial paper	—		216		—		216
Corporate bonds	—		289		—		289
U.S. government agency securities	—		162		—		162
U.S. Treasury securities	—		717		—		717
Long-term marketable securities
Corporate bonds	—		383		—		383
U.S. government agency securities	—		55		—		55
U.S. Treasury securities	—		145		—		145
Total	$	1,349	$	2,040	$	—	$	3,389


	March 31, 2024
	Level 1		Level 2		Level 3		Total

Cash equivalents
Money market funds	$	1,914	$	—	$	—	$	1,914
Commercial paper	—		6		—		6
Corporate bonds	—		3		—		3
U.S. Treasury securities	—		30		—		30

Short-term marketable securities
Certificates of deposit	—		46		—		46
Commercial paper	—		235		—		235
Corporate bonds	—		271		—		271
U.S. government agency securities	—		63		—		63
U.S. Treasury securities	—		751		—		751

Long-term marketable securities
Corporate bonds	—		450		—		450
U.S. government agency securities	—		56		—		56
U.S. Treasury securities	—		140		—		140

Total	$	1,914	$	2,051	$	—	$	3,965

The fair value of the Company’s Level 1 financial instruments is based on quoted market prices for identical instruments in active markets. The fair value of the Company’s Level 2 fixed income securities is obtained from independent pricing services, which may use quoted market prices for identical or comparable instruments in less active markets or model driven valuations using observable market data or inputs corroborated by observable market data.

Assets Measured at Fair Value on a Non-Recurring Basis

The Company’s non-marketable equity securities accounted for using the measurement alternative are recorded at fair value on a non-recurring basis. When indicators of impairment exist or observable price changes in a same or similar security from the same issuer occur, the respective non-marketable equity security would be classified within Level 3 of the fair value hierarchy because the valuation methods include a combination of the observable transaction price at the transaction date and other unobservable inputs.

In the three months ended March 31, 2023 and 2024, the Company did not record any upward or downward adjustments or impairments on its non-marketable equity securities.

Estimating the fair value of the Company’s investments in non-marketable equity securities requires the use of estimates and judgments. Changes in estimates and judgments could result in different estimates of fair value and future adjustments.

The following table summarizes the carrying value of the Company's non-marketable equity securities as of December 31, 2023 and March 31, 2024, including impairments and cumulative upward and downward adjustments made to the initial cost basis of the securities, which were recorded in other expense, net in the condensed consolidated statements of operations during the period in which they were incurred (in millions):


	December 31, 2023		March 31, 2024
Initial cost basis	$	450	$	450
Upward adjustments	9		9
Downward adjustments (including impairment)	(413)		(413)
Total carrying value at the end of reporting period	$	46	$	46

- 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.

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