CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
Cash equivalents consist of instruments with remaining maturities of three months or less at the date of purchase. We classify all of our cash equivalents and short-term investments as “available-for-sale.” In general, these investments are free of trading restrictions. We carry these investments at fair value, based on quoted market prices or other readily available market information. Unrealized gains and losses, net of taxes, are included in accumulated other comprehensive income, which is reflected as a separate component of stockholders’ equity in our Consolidated Balance Sheets. Gains and losses are recognized when realized in our Consolidated Statements of Income. When we have determined that an other-than-temporary decline in fair value has occurred, the amount of the decline that is related to a credit loss is recognized in income. Gains and losses are determined using the specific identification method.
Cash, cash equivalents and short-term investments consisted of the following as of November 29, 2013 (in thousands): |
| | | | | | | | | | | | | | | |
| Amortized Cost | | Unrealized Gains | | Unrealized Losses | | Estimated Fair Value |
Current assets: | | | | | | | |
Cash | $ | 286,221 |
| | $ | — |
| | $ | — |
| | $ | 286,221 |
|
Cash equivalents: | | | | | | | |
Money market mutual funds | 429,373 |
| | — |
| | — |
| | 429,373 |
|
Time deposits | 104,711 |
| | — |
| | — |
| | 104,711 |
|
U.S. Treasury securities | 14,251 |
| | — |
| | — |
| | 14,251 |
|
Total cash equivalents | 548,335 |
| | — |
| | — |
| | 548,335 |
|
Total cash and cash equivalents | 834,556 |
| | — |
| | — |
| | 834,556 |
|
Short-term fixed income securities: | | | | | | | |
Corporate bonds and commercial paper | 1,261,375 |
| | 7,116 |
| | (631 | ) | | 1,267,860 |
|
Foreign government securities | 11,213 |
| | 56 |
| | — |
| | 11,269 |
|
Municipal securities | 186,320 |
| | 328 |
| | (24 | ) | | 186,624 |
|
U.S. agency securities | 446,615 |
| | 1,516 |
| | (186 | ) | | 447,945 |
|
U.S. Treasury securities | 424,076 |
| | 799 |
| | (97 | ) | | 424,778 |
|
Subtotal | 2,329,599 |
| | 9,815 |
| | (938 | ) | | 2,338,476 |
|
Marketable equity securities | 177 |
| | 543 |
| | — |
| | 720 |
|
Total short-term investments | 2,329,776 |
| | 10,358 |
| | (938 | ) | | 2,339,196 |
|
Total cash, cash equivalents and short-term investments | $ | 3,164,332 |
| | $ | 10,358 |
| | $ | (938 | ) | | $ | 3,173,752 |
|
Cash, cash equivalents and short-term investments consisted of the following as of November 30, 2012 (in thousands):
|
| | | | | | | | | | | | | | | |
| Amortized Cost | | Unrealized Gains | | Unrealized Losses | | Estimated Fair Value |
Current assets: | | | | | | | |
Cash | $ | 200,771 |
| | $ | — |
| | $ | — |
| | $ | 200,771 |
|
Cash equivalents: | |
| | | | | | |
|
Corporate bonds and commercial paper | 3,998 |
| | — |
| | — |
| | 3,998 |
|
Money market mutual funds and repurchase agreements | 1,171,270 |
| | — |
| | — |
| | 1,171,270 |
|
Municipal securities | 3,895 |
| | — |
| | — |
| | 3,895 |
|
Time deposits | 45,118 |
| | — |
| | — |
| | 45,118 |
|
Total cash equivalents | 1,224,281 |
| | — |
| | — |
| | 1,224,281 |
|
Total cash and cash equivalents | 1,425,052 |
| | — |
| | — |
| | 1,425,052 |
|
Short-term fixed income securities: | | | | | | | |
|
Corporate bonds and commercial paper | 1,059,158 |
| | 11,415 |
| | (133 | ) | | 1,070,440 |
|
Foreign government securities | 6,919 |
| | 45 |
| | (12 | ) | | 6,952 |
|
Municipal securities | 180,488 |
| | 97 |
| | (60 | ) | | 180,525 |
|
Time deposits | 20,113 |
| | — |
| | — |
| | 20,113 |
|
U.S. agency securities | 501,863 |
| | 2,346 |
| | (18 | ) | | 504,191 |
|
U.S. Treasury securities | 330,072 |
| | 801 |
| | (37 | ) | | 330,836 |
|
Subtotal | 2,098,613 |
| | 14,704 |
| | (260 | ) | | 2,113,057 |
|
Marketable equity securities | 237 |
| | 7 |
| | — |
| | 244 |
|
Total short-term investments | 2,098,850 |
| | 14,711 |
| | (260 | ) | | 2,113,301 |
|
Total cash, cash equivalents and short-term investments | $ | 3,523,902 |
| | $ | 14,711 |
| | $ | (260 | ) | | $ | 3,538,353 |
|
See Note 4 for further information regarding the fair value of our financial instruments.
The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category, that have been in a continuous unrealized loss position for less than twelve months, as of November 29, 2013 and November 30, 2012 (in thousands):
|
| | | | | | | | | | | | | | | |
| 2013 | | 2012 |
| Fair Value | | Gross Unrealized Losses | | Fair Value | | Gross Unrealized Losses |
Corporate bonds and commercial paper | $ | 225,759 |
| | $ | (631 | ) | | $ | 95,489 |
| | $ | (132 | ) |
Foreign government securities | — |
| | — |
| | 2,105 |
| | (12 | ) |
Municipal securities | 13,522 |
| | (24 | ) | | 40,524 |
| | (60 | ) |
U.S. Treasury and agency securities | 105,278 |
| | (283 | ) | | 48,203 |
| | (55 | ) |
Total | $ | 344,559 |
| | $ | (938 | ) | | $ | 186,321 |
| | $ | (259 | ) |
There were 177 securities and 65 securities in an unrealized loss position for less than twelve months at November 29, 2013 and at November 30, 2012, respectively.
As of November 29, 2013, there were no securities in an unrealized loss position for more than twelve months. As of November 30, 2012 there was one security in an unrealized loss position for more than twelve months. The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category, that were in a continuous unrealized loss position for more than twelve months, as of November 30, 2012 (in thousands):
|
| | | | | | | | | | | |
| 2012 |
| Fair Value | | Gross Unrealized Losses |
Corporate bonds and commercial paper | $ | 2,999 |
| | $ | (1 | ) |
Total | $ | 2,999 |
| | $ | (1 | ) |
The following table summarizes the cost and estimated fair value of short-term fixed income securities classified as short-term investments based on stated effective maturities as of November 29, 2013 (in thousands):
|
| | | | | | | |
| Amortized Cost | | Estimated Fair Value |
Due within one year | $ | 508,359 |
| | $ | 509,438 |
|
Due between one and two years | 904,704 |
| | 908,767 |
|
Due between two and three years | 698,679 |
| | 702,035 |
|
Due after three years | 217,857 |
| | 218,236 |
|
Total | $ | 2,329,599 |
| | $ | 2,338,476 |
|
We review our debt and marketable equity securities classified as short-term investments on a regular basis to evaluate whether or not any security has experienced an other-than-temporary decline in fair value. We consider factors such as the length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issuer and our intent to sell, or whether it is more likely than not we will be required to sell the investment before recovery of the investment's amortized cost basis. If we believe that an other-than-temporary decline exists in one of these securities, we write down these investments to fair value. For debt securities, the portion of the write-down related to credit loss would be recorded to interest and other income, net in our Consolidated Statements of Income. Any portion not related to credit loss would be recorded to accumulated other comprehensive income, which is reflected as a separate component of stockholders’ equity in our Consolidated Balance Sheets. For equity securities, the write-down would be recorded to investment gains (losses), net in our Consolidated Statements of Income. During fiscal 2013, we did not consider any of our investments to be other-than-temporarily impaired. During fiscal 2012 and 2011, we recorded immaterial other-than-temporary impairment losses associated with our marketable equity securities and did not consider any of our debt securities to be other-than-temporarily impaired.
