Quarterly report pursuant to Section 13 or 15(d)

Investments in Marketable Debt Securities, Available-for-Sale

v3.22.2.2
Investments in Marketable Debt Securities, Available-for-Sale
 9 Months Ended
Sep. 30, 2022
Investments, Debt and Equity Securities [Abstract]  
Investments in Marketable Debt Securities, Available-for-Sale Investments in Marketable Debt Securities, Available for Sale
Amortized cost, allowance for credit losses, gross unrealized gains (losses) in accumulated other comprehensive (loss) income and fair value of marketable debt securities, available-for-sale, by type of security consisted of the following (in thousands):
September 30, 2022
Amortized
Cost		 Allowance
for Credit
Losses		 Gross
Unrealized
Gains		 Gross
Unrealized
Losses 		Fair
Value
Short-term investments:
U.S. treasuries $ 122,550  $ —  $ —  $ (1,140) $ 121,410 
Corporate debt 89,638  —  1  (132) 89,507 
Asset-backed securities (“ABS”) and other 854  —  —  (12) 842 
$ 213,042  $ —  $ 1  $ (1,284) $ 211,759 
Long-term investments:
U.S. treasuries $ 44,315  $ —  $ —  $ (1,434) $ 42,881 
U.S. government sponsored entities 619  —  —  (76) 543 
Corporate debt 42,885  —  3  (3,326) 39,562 
ABS and other 6,908  —  —  (565) 6,343 
$ 94,727  $ —  $ 3  $ (5,401) $ 89,329 
December 31, 2021
Amortized
Cost		 Allowance
for Credit
Losses		 Gross
Unrealized
Gains		 Gross
Unrealized
Losses		 Fair
Value
Short-term investments:
U.S. treasuries $ 35,767  $ —  $ —  $ (34) $ 35,733 
Corporate debt 148,148  —  22  (35) 148,135 
$ 183,915  $ —  $ 22  $ (69) $ 183,868 
Long-term investments:        
U.S. treasuries $ 70,902  $ —  $ 128  $ (263) $ 70,767 
U.S. government sponsored entities 726  —  22  (3) 745 
Corporate debt 33,197  —  962  (146) 34,013 
ABS and other 7,033  —  82  (30) 7,085 
$ 111,858  $ —  $ 1,194  $ (442) $ 112,610 
The Company’s investments in marketable debt securities, available-for-sale, that have been in a continuous unrealized loss position, for which an allowance for credit losses has not been recorded, by type of security consisted of the following (in thousands):
September 30, 2022
Less than 12 months 12 months or greater Total
Fair
Value		 Gross
Unrealized
Losses 		Fair
Value		 Gross
Unrealized
Losses 		Fair
Value		 Gross
Unrealized
Losses
U.S. treasuries $ 143,148  $ (2,042) $ 20,766  $ (532) $ 163,914  $ (2,574)
U.S. government sponsored entities 453  (55) 88  (21) 541  (76)
Corporate debt 110,806  (2,793) 4,454  (665) 115,260  (3,458)
ABS and other 6,950  (534) 212  (43) 7,162  (577)
$ 261,357  $ (5,424) $ 25,520  $ (1,261) $ 286,877  $ (6,685)

December 31, 2021
Less than 12 months 12 months or greater Total
Fair
Value		 Gross
Unrealized
Losses 		Fair
Value		 Gross
Unrealized
Losses 		Fair
Value		 Gross
Unrealized
Losses
U.S. treasuries $ 103,019  $ (297) $ —  $ —  $ 103,019  $ (297)
U.S. government sponsored entities 115  (3) —  —  115  (3)
Corporate debt 115,908  (173) 146  (8) 116,054  (181)
ABS and other 2,915  (30) —  —  2,915  (30)
$ 221,957  $ (503) $ 146  $ (8) $ 222,103  $ (511)
Gross realized gains and losses from the sales of the Company’s marketable debt securities, available-for-sale, consisted of the following (in thousands):
Three Months Ended
September 30,		 Nine Months Ended
September 30,
2022 2021 2022 2021
Gross realized gains (1)
$ —  $ 68  $ 114  $ 78 
Gross realized losses (1)
$ (10) $ —  $ (27) $ — 
(1) Recorded in other income, net in the condensed consolidated statements of net income. The cost basis of securities sold were determined based on the specific identification method.
The Company invests its excess cash in a diversified portfolio of fixed and variable rate debt securities to meet current and future cash flow needs. All investments are made in accordance with the Company’s approved investment policy. As of September 30, 2022, the portfolio had an average credit rating of AA and a weighted term to contractual maturity of 1.3 years, with 223 securities in the portfolio representing an unrealized aggregate loss of $6.7 million or 2% of amortized cost, and a weighted average credit rating of AA+.
As of September 30, 2022, the Company performed an impairment analysis and determined an allowance for credit losses was not required. The Company determined that it did not have an intent to sell and it was not more likely than not that the Company would be required to sell any security based on its current liquidity position, or to maintain compliance with its investment policy, specifically as it relates to minimum credit ratings. The Company evaluated the securities with an unrealized loss considering severity of loss, credit ratings, specific credit events during the period since acquisition, overall likelihood of default, market sector, potential impact from the current economic environment, including interest rates, geopolitical unrest and a review of an issuer’s and securities’ liquidity and financial strength, as needed. The Company concluded that it would receive all scheduled interest and principal payments. The Company, therefore,
determined qualitatively that the unrealized loss was related to changes in interest rates and other market factors and therefore no allowance for credit losses was required.
Amortized cost and fair value of marketable debt securities, available-for-sale, by contractual maturity consisted of the following (in thousands, except weighted average data):
September 30, 2022 December 31, 2021
Amortized
 Cost		 Fair Value Amortized
 Cost		 Fair Value
Due in one year or less $ 213,042  $ 211,759  $ 183,915  $ 183,868 
Due after one year through five years 78,268  74,918  96,035  96,257 
Due after five years through ten years 13,554  11,808  11,129  11,601 
Due after ten years 2,905  2,603  4,694  4,752 
$ 307,769  $ 301,088  $ 295,773  $ 296,478 
Weighted average contractual maturity 1.3 years 1.5 years
Actual maturities may differ from contractual maturities because certain issuers have the right to prepay certain obligations with or without prepayment penalties.