10-Q 1 rcus-20220331.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____________to _______________

Commission File Number: 001-38419

 

Arcus Biosciences, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

47-3898435

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

3928 Point Eden Way

Hayward, California 94545

 

(Address of principal executive offices)

 

Registrant’s telephone number, including area code: (510) 694-6200

 

Securities registered pursuant to Section 12(b) of the Act:

 

Titles of Each Class

 

Trading Symbol(s)

 

Name of Each Exchange on which Registered

Common Stock, Par Value $0.0001 Per Share

 

RCUS

 

The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

 

Smaller reporting company

 

 

 

 

 

 

 

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No ☒

 

As of April 29, 2022, the registrant had 71,718,564 shares of common stock, $0.0001 par value per share, outstanding.

 

 


 

Table of Contents

 

 

 

Page

PART I.

FINANCIAL INFORMATION

 

Item 1.

Financial Statements

1

 

Condensed Consolidated Balance Sheets (unaudited)

1

 

Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited)

2

 

Condensed Consolidated Statements of Stockholders’ Equity (unaudited)

3

 

Condensed Consolidated Statements of Cash Flows (unaudited)

4

 

Notes to Condensed Consolidated Financial Statements (unaudited)

5

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

19

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

25

Item 4.

Controls and Procedures

25

PART II.

OTHER INFORMATION

 

Item 1.

Legal Proceedings

27

Item 1A.

Risk Factors

27

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

58

Item 3.

Defaults Upon Senior Securities

58

Item 4.

Mine Safety Disclosures

58

Item 5.

Other Information

58

Item 6.

Exhibits

59

SIGNATURES

60

 

 

 

 

 

i


 

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

ARCUS BIOSCIENCES, INC.

Condensed Consolidated Balance Sheets

(unaudited)

(In thousands, except share and per share amounts)

 

 

 

March 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

548,783

 

 

$

147,914

 

Short-term investments

 

 

664,751

 

 

 

351,394

 

Receivable from collaboration partners ($29,262 and $744,535 from a related party)

 

 

29,419

 

 

 

744,595

 

Accrued interest receivable

 

 

2,746

 

 

 

2,227

 

Prepaid expenses and other current assets

 

 

18,527

 

 

 

15,620

 

Total current assets

 

 

1,264,226

 

 

 

1,261,750

 

Long-term investments

 

 

128,836

 

 

 

181,990

 

Property and equipment, net

 

 

33,481

 

 

 

32,455

 

Right-of-use assets

 

 

102,992

 

 

 

104,968

 

Restricted cash

 

 

3,005

 

 

 

3,005

 

Other long-term assets ($1,135 and $0 from a related party)

 

 

10,887

 

 

 

7,730

 

Total assets

 

$

1,543,427

 

 

$

1,591,898

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

18,094

 

 

$

10,261

 

Accrued research and development

 

 

37,654

 

 

 

29,587

 

Other accrued liabilities

 

 

16,196

 

 

 

24,181

 

Deferred revenue, current ($86,038 and $96,981 to a related party)

 

 

89,310

 

 

 

102,003

 

Other current liabilities

 

 

-

 

 

 

52

 

Total current liabilities

 

 

161,254

 

 

 

166,084

 

Deferred revenue, noncurrent ($456,905 and $462,217 to a related party)

 

 

456,905

 

 

 

462,217

 

Operating lease liabilities, noncurrent

 

 

114,815

 

 

 

116,887

 

Other long-term liabilities

 

 

13,874

 

 

 

5,260

 

Total liabilities

 

 

746,848

 

 

 

750,448

 

Commitments (Note 10)

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred stock, $0.0001 par value, 10,000,000 shares authorized as of March 31, 2022 and December 31, 2021; no shares issued and outstanding as of March 31, 2022 and December 31, 2021

 

 

-

 

 

 

-

 

Common stock, $0.0001 par value, 400,000,000 shares authorized as of March 31, 2022 and December 31, 2021; 71,622,313 and 70,781,736 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively. Shares outstanding includes zero and 9,946 shares issued but subject to vesting as of March 31, 2022 and December 31, 2021, respectively.

 

 

7

 

 

 

7

 

Additional paid-in capital

 

 

1,144,579

 

 

 

1,118,058

 

Accumulated deficit

 

 

(343,347

)

 

 

(275,354

)

Accumulated other comprehensive loss

 

 

(4,660

)

 

 

(1,261

)

Total stockholders’ equity

 

 

796,579

 

 

 

841,450

 

Total liabilities and stockholders’ equity

 

$

1,543,427

 

 

$

1,591,898

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

1


 

ARCUS BIOSCIENCES, INC.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(unaudited)

(In thousands, except share and per share amounts)

 

 

Three Months Ended

 

 

March 31,

 

 

2022

 

 

2021

 

Revenues:

 

 

 

 

 

Other collaboration revenue ($8,316 and $7,711 from a related party)

$

10,066

 

 

$

9,461

 

License and development service revenue ($7,939 from a related party)

 

7,939

 

 

 

-

 

Total revenues

 

18,005

 

 

 

9,461

 

Operating expenses:

 

 

 

 

 

Research and development (($30,299) and ($4,924) from a related party)

 

61,211

 

 

 

66,387

 

General and administrative (($98) and $0 from a related party)

 

23,974

 

 

 

15,821

 

Total operating expenses

 

85,185

 

 

 

82,208

 

Loss from operations

 

(67,180

)

 

 

(72,747

)

Non-operating income (expense):

 

 

 

 

 

Interest and other income, net

 

582

 

 

 

154

 

Effective interest on liability for sale of future royalties

 

(391

)

 

 

-

 

Total non-operating income, net

 

191

 

 

 

154

 

Net loss before income taxes

 

(66,989

)

 

 

(72,593

)

Income tax expense

 

(1,004

)

 

 

-

 

Net loss

 

(67,993

)

 

 

(72,593

)

Other comprehensive loss

 

(3,399

)

 

 

(46

)

Comprehensive loss

$

(71,392

)

 

$

(72,639

)

Net loss per share, basic and diluted

$

(0.96

)

 

$

(1.08

)

Weighted-average number of shares used to
   compute basic and diluted net loss per share

 

71,194,778

 

 

 

67,082,161

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

2


 

ARCUS BIOSCIENCES, INC.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(In thousands, except share amounts)

 

 

 

 

 

 

 

Common stock

 

 

Additional
Paid-In

 

 

Accumulated

 

 

Accumulated
Other
Comprehensive

 

 

Total
Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Income (Loss)

 

 

Equity

 

Balance at December 31, 2020

 

 

63,691,901

 

 

$

6

 

 

$

830,438

 

 

$

(328,184

)

 

$

44

 

 

$

502,304

 

Issuance of common stock and rights to purchase additional shares
in accordance with Amended and Restated Gilead Purchase
Agreement, net of $
55 offering costs

 

 

5,650,000

 

 

 

1

 

 

 

220,295

 

 

 

-

 

 

 

-

 

 

 

220,296

 

Issuance of common stock upon exercise of stock options
and vesting of restricted stock

 

 

200,828

 

 

 

-

 

 

 

1,885

 

 

 

-

 

 

 

-

 

 

 

1,885

 

Vesting of early exercised stock options

 

 

54,039

 

 

 

-

 

 

 

183

 

 

 

-

 

 

 

-

 

 

 

183

 

Stock-based compensation

 

 

-

 

 

 

-

 

 

 

12,761

 

 

 

-

 

 

 

-

 

 

 

12,761

 

Other comprehensive loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(46

)

 

 

(46

)

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(72,593

)

 

 

-

 

 

 

(72,593

)

Balance at March 31, 2021

 

 

69,596,768

 

 

$

7

 

 

$

1,065,562

 

 

$

(400,777

)

 

$

(2

)

 

$

664,790

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2021

 

 

70,771,790

 

 

$

7

 

 

$

1,118,058

 

 

$

(275,354

)

 

$

(1,261

)

 

$

841,450

 

Issuance of common stock upon exercise of stock options
and vesting of restricted stock

 

 

840,577

 

 

 

-

 

 

 

9,928

 

 

 

-

 

 

 

-

 

 

 

9,928

 

Vesting of early exercised stock options

 

 

9,946

 

 

 

-

 

 

 

52

 

 

 

-

 

 

 

-

 

 

 

52

 

Stock-based compensation

 

 

-

 

 

 

-

 

 

 

16,541

 

 

 

-

 

 

 

-

 

 

 

16,541

 

Other comprehensive loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,399

)

 

 

(3,399

)

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(67,993

)

 

 

-

 

 

 

(67,993

)

Balance at March 31, 2022

 

 

71,622,313

 

 

$

7

 

 

$

1,144,579

 

 

$

(343,347

)

 

$

(4,660

)

 

$

796,579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

3


 

ARCUS BIOSCIENCES, INC.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(In thousands)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2022

 

 

2021

 

Cash flow from operating activities

 

 

 

 

 

 

Net loss

 

$

(67,993

)

 

$

(72,593

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Stock-based compensation expense

 

 

16,541

 

 

 

12,761

 

Depreciation and amortization

 

 

1,457

 

 

 

800

 

Noncash lease expense

 

 

1,976

 

 

 

538

 

Amortization of premiums on investments

 

 

1,670

 

 

 

506

 

Acquired in-process research and development

 

 

2,500

 

 

 

-

 

Effective interest on liability for sale of future royalties

 

 

391

 

 

 

-

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Receivable from collaboration partners ($715,273 and ($3,981) from a related party)

 

 

715,176

 

 

 

(4,186

)

Prepaid expenses and other current assets

 

 

(5,590

)

 

 

(4,568

)

Other long-term assets (($1,135) and $0 to a related party)

 

 

(1,727

)

 

 

63

 

Accounts payable

 

 

8,138

 

 

 

7,722

 

Accrued research and development

 

 

5,567

 

 

 

4,716

 

Other accrued liabilities

 

 

(8,462

)

 

 

(2,007

)

Deferred revenue (($16,255) and ($7,711) to a related party)

 

 

(18,005

)

 

 

(9,461

)

Operating lease liabilities

 

 

92

 

 

 

(605

)

Other long-term liabilities

 

 

2,270

 

 

 

(2

)

Net cash provided by (used in) operating activities

 

 

654,001

 

 

 

(66,316

)

Cash flow from investing activities

 

 

 

 

 

 

Purchases of short-term and long-term investments

 

 

(377,573

)

 

 

(192,398

)

Proceeds from maturities of short-term and long-term investments

 

 

93,817

 

 

 

251,365

 

Sales of short-term and long-term investments

 

 

18,484

 

 

 

7,500

 

Purchases of property and equipment

 

 

(2,788

)

 

 

(3,641

)

Net cash provided by (used in) investing activities

 

 

(268,060

)

 

 

62,826

 

Cash flow from financing activities

 

 

 

 

 

 

Proceeds from issuance of common stock ($0 and $220,235 from a related party)

 

 

-

 

 

 

220,235

 

Proceeds from sale of future royalties

 

 

5,000

 

 

 

-

 

Proceeds from issuance of common stock pursuant to equity award plans

 

 

9,928

 

 

 

1,885

 

Net cash provided by financing activities

 

 

14,928

 

 

 

222,120

 

Net increase in cash and cash equivalents

 

 

400,869

 

 

 

218,630

 

Cash, cash equivalents and restricted cash at beginning of period

 

 

150,919

 

 

 

173,618

 

Cash, cash equivalents and restricted cash at end of period

 

$

551,788

 

 

$

392,248

 

 

 

 

 

 

 

 

Non-cash investing and financing activities:

 

 

 

 

 

 

Unpaid acquisition of in-process research and development

 

$

2,500

 

 

$

-

 

Unpaid portion of property and equipment purchases included in accounts payable and accrued liabilities

 

$

691

 

 

$

2,784

 

Vesting of early exercised stock options and restricted stock

 

$

52

 

 

$

183

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

4


 

ARCUS BIOSCIENCES, INC.

Notes to Condensed Consolidated Financial Statements

Note 1. Organization

Description of Business

Arcus Biosciences, Inc. (the Company) is a clinical-stage biopharmaceutical company focused on creating best-in-class cancer therapies. Using its robust and highly efficient drug discovery capability, the Company has now advanced six investigational products into clinical development, with its most advanced molecule, an anti-TIGIT antibody, now in two Phase 3 registrational studies. The Company’s deep portfolio of novel small molecules and enabling antibodies allows it to create highly differentiated combination therapies, which the Company is developing to treat multiple large tumor types including lung, colorectal, prostate and pancreatic cancers. The Company expects its clinical-stage portfolio to continue to expand and to include molecules targeting both immuno-oncology and cancer cell-intrinsic pathways. The Company’s vision is to create, develop and commercialize highly differentiated combination cancer therapies that have a meaningful impact on patients. The Company currently has six investigational products in clinical development: domvanalimab (previously referred to as AB154), etrumadenant (previously referred to as AB928), quemliclustat (previously referred to as AB680), zimberelimab (previously referred to as AB122), AB308 and AB521.

In 2020, the Company entered into an Option, License and Collaboration Agreement (Gilead Collaboration Agreement) with Gilead Sciences, Inc. (Gilead), whereby Gilead obtained an exclusive license to zimberelimab and time-limited exclusive options to all of the Company's then-current and future programs during the 10-year collaboration term. In December 2021, Gilead obtained rights to an additional four of the Company's investigational products: domvanalimab, etrumadenant, quemliclustat and AB308. For each program to which Gilead exercised or exercises its option, the parties will co-develop globally and co-commercialize the program in the U.S., subject to certain exceptions, and Gilead will have the right to commercialize the program outside of the United States, subject to the rights of our existing partners in certain territories.

Liquidity and Capital Resources

As of March 31, 2022, the Company had cash and investments of $1,342.4 million, which are cash, cash equivalents, and investments in marketable securities, which the Company believes will be sufficient to fund its planned operations for a period of at least twelve months following the date of filing of this report.

Note 2. Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and pursuant to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the Company’s opinion, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of the results of operations and cash flows for the periods presented have been included.

Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or for any future period. The balance sheet as of December 31, 2021 has been derived from audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements.

The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 23, 2022. There have been no significant changes to the Company’s significant accounting policies described in Note 2, Summary of Significant Accounting Policies, in Notes to Consolidated Financial Statements in Item 8 of Part II of the Form 10-K.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Arcus Biosciences, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

5


 

Use of Estimates

The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosures of contingent assets and liabilities. Estimates were used to determine the standalone selling price of performance obligations and the timing of revenue recognition, the value of stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, and uncertain tax positions. Actual results could differ materially from the Company’s estimates.

Cash Equivalents and Investments

Cash equivalents include marketable securities having an original maturity of three months or less at the time of purchase. Short-term investments have maturities of greater than three months and up to twelve months at the time of purchase. Long-term investments have maturities greater than 12 months at the time of purchase. Collectively, cash equivalents, short-term and long-term investments are considered available-for-sale and are recorded at fair value. Unrealized gains and losses are recorded in accumulated other comprehensive income (loss). Realized gains and losses are included in interest and other income, net in the condensed consolidated statements of operations and comprehensive income or loss. The basis on which the cost of a security that is sold or an amount that is reclassified out of accumulated other comprehensive income or loss into earnings is determined using the specific identification method.

Reconciliation of Cash, Cash Equivalents, and Restricted Cash as Reported in Condensed Consolidated Statements of Cash Flows

Restricted cash at March 31, 2022 and 2021 represents cash balances held as security in connection with the Company’s facility lease agreements. The following table provides a reconciliation of cash, cash equivalents, and restricted cash within the condensed consolidated balance sheets to the total shown in the condensed consolidated statements of cash flows (in thousands):

 

 

March 31,

 

 

 

2022

 

 

2021

 

Cash and cash equivalents

 

$

548,783

 

 

$

390,260

 

Restricted cash

 

 

3,005

 

 

 

1,988

 

Cash, cash equivalents and restricted cash

 

$

551,788

 

 

$

392,248

 

Concentration of Credit Risk

Cash equivalents, short-term and long-term investments are financial instruments that potentially subject the Company to concentrations of credit risk. The Company invests in money market funds, treasury bills and notes, government bonds, commercial paper, corporate notes, and certificates of deposit. The Company limits its credit risk associated with cash equivalents, short-term and long-term investments by placing them with banks and institutions it believes are credit worthy and in highly rated investments.

Leases and Rent Expense

The Company recognizes a lease asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation. The Company determines whether an arrangement is or contains a lease at contract inception. Operating leases and related tenant improvement allowances receivable are included in operating lease right-of-use assets, prepaid expenses and other current assets, and operating lease liabilities, noncurrent in our condensed consolidated balance sheets at March 31, 2022 and December 31, 2021. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the net present value of lease payments, the Company uses its incremental borrowing rate based on information available at the lease commencement date. The incremental borrowing rate represents the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. The Company considers a lease term to be the noncancelable period that it has the right to use the underlying asset, including any periods where it is reasonably assured the Company will exercise the option to extend the contract. Periods covered by an option to extend are included in the lease term if the lessor controls the exercise of that option.

The Company elected to not apply the recognition requirements of the new leasing standard to short-term leases with terms of 12 months or less which do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. For short-term leases, lease payments are recognized as operating expenses on a straight-line basis over the lease term.

The following table summarizes supplemental cashflow disclosures related to the Company's operating leases (in thousands):

 

 

Year Ended March 31,

 

 

 

2022

 

 

2021

 

Cash paid for amounts included in measurement of lease liabilities

 

$

1,470

 

 

$

927

 

 

6


 

Note 3. Fair Value Measurements

Financial assets and liabilities are recorded at fair value. The accounting guidance for fair value provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value.

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability.

During the periods presented, the Company has not changed the manner in which it values assets and liabilities that are measured at fair value. The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the hierarchy as of March 31, 2022 or December 31, 2021. The following tables set forth the Company’s financial instruments (excluding restricted cash) that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands):

 

 

 

March 31, 2022

 

 

 

Total

 

 

Level 1
(Quoted Prices in
Active Markets For
Identical Assets)

 

 

Level 2
(Significant Other
Observable
Remaining Inputs)

 

 

Level 3
(Significant Other
Unobservable
Remaining Inputs)

 

Money market funds

 

$

475,934

 

 

$

475,934

 

 

$

-

 

 

$

-

 

U.S. treasury securities

 

 

321,642

 

 

 

-

 

 

 

321,642

 

 

 

-

 

Corporate securities and commercial paper

 

 

524,051

 

 

 

-

 

 

 

524,051

 

 

 

-

 

Certificates of deposit

 

 

20,743

 

 

 

 

 

 

20,743

 

 

 

 

Total assets measured at fair value

 

$

1,342,370

 

 

$

475,934

 

 

$

866,436

 

 

$

-

 

 

 

 

December 31, 2021

 

 

 

Total

 

 

Level 1
(Quoted Prices in
Active Markets For
Identical Assets)

 

 

Level 2
(Significant Other
Observable
Remaining Inputs)

 

 

Level 3
(Significant Other
Unobservable
Remaining Inputs)

 

Money market funds

 

$

147,914

 

 

$

147,914

 

 

$

-

 

 

$

-

 

U.S. treasury securities

 

 

112,170

 

 

 

-

 

 

 

112,170

 

 

 

-

 

Corporate securities and commercial paper

 

 

421,214

 

 

 

-

 

 

 

421,214

 

 

 

-

 

Total assets measured at fair value

 

$

681,298

 

 

$

147,914

 

 

$

533,384

 

 

$

-

 

Classified as (with contractual maturities):

 

 

March 31, 2022

 

 

December 31, 2021

 

Cash and cash equivalents

 

$

548,783

 

 

$

147,914

 

Short-term investments (due within one year)

 

 

664,751

 

 

 

351,394

 

Long-term investments (due between one and three years)

 

 

128,836

 

 

 

181,990

 

Total cash, cash equivalents and investments in marketable securities

 

$

1,342,370

 

 

$

681,298

 

 

7


 

All the Company's investments in marketable securities are classified as available-for-sale. At March 31, 2022 and December 31, 2021, the balance in the Company’s accumulated other comprehensive income (loss) related to the Company’s available-for-sale marketable securities. There were no realized gains or losses recognized on the sale or maturity of available-for-sale marketable securities as of March 31, 2022 and December 31, 2021, and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive income for the periods then ended. The Company has not recognized any allowances for credit losses given the nature of its receivables and investment portfolio and the immaterial amount of unrealized losses on available for sale securities. No credit related losses have been recognized for any of the periods presented. The fair value and amortized cost of investments in marketable securities by major security type as of March 31, 2022 and December 31, 2021 are presented in the tables that follow (in thousands):

 

 

 

Amortized
Cost

 

 

Unrealized
Gain

 

 

Unrealized
Loss

 

 

Fair
Value

 

As of March 31, 2022:

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

475,934

 

 

$

-

 

 

$

-

 

 

$

475,934

 

U.S. treasury securities

 

 

323,034

 

 

 

7

 

 

 

(1,399

)

 

 

321,642

 

Corporate securities and commercial paper

 

 

527,328

 

 

 

24

 

 

 

(3,301

)

 

 

524,051

 

Certificates of deposit

 

 

20,734