Alector, Inc. Fair Value Disclosure
The following tables summarize the Company’s financial assets measured at fair value on a recurring basis by level within the fair value hierarchy:
|
|
December 31, 2025 |
|
|||||||||||||||
|
|
Fair Value |
|
Amortized |
|
|
Unrealized |
|
|
Unrealized |
|
|
Fair Market |
|
||||
|
|
(In thousands) |
|
|||||||||||||||
Money market funds |
|
Level 1 |
|
$ |
36,834 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
36,834 |
|
U.S. government treasury securities |
|
Level 1 |
|
|
13,915 |
|
|
|
13 |
|
|
|
— |
|
|
|
13,928 |
|
Certificates of deposit |
|
Level 2 |
|
|
9,468 |
|
|
|
7 |
|
|
|
— |
|
|
|
9,475 |
|
Commercial paper |
|
Level 2 |
|
|
92,887 |
|
|
|
9 |
|
|
|
(7 |
) |
|
|
92,889 |
|
Corporate bonds |
|
Level 2 |
|
|
102,135 |
|
|
|
151 |
|
|
|
(7 |
) |
|
|
102,279 |
|
Total cash equivalents and marketable securities |
|
|
|
$ |
255,239 |
|
|
$ |
180 |
|
|
$ |
(14 |
) |
|
$ |
255,405 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
December 31, 2024 |
|
|||||||||||||||
|
|
Fair Value |
|
Amortized |
|
|
Unrealized |
|
|
Unrealized |
|
|
Fair Market |
|
||||
|
|
(In thousands) |
|
|||||||||||||||
Money market funds |
|
Level 1 |
|
$ |
31,310 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
31,310 |
|
U.S. government treasury securities |
|
Level 1 |
|
|
72,360 |
|
|
|
38 |
|
|
|
(38 |
) |
|
$ |
72,360 |
|
Certificates of deposit |
|
Level 2 |
|
|
15,955 |
|
|
|
4 |
|
|
|
(1 |
) |
|
$ |
15,958 |
|
Commercial paper |
|
Level 2 |
|
|
81,744 |
|
|
|
51 |
|
|
|
(15 |
) |
|
|
81,780 |
|
Corporate bonds |
|
Level 2 |
|
|
210,056 |
|
|
|
301 |
|
|
|
(79 |
) |
|
|
210,278 |
|
Total cash equivalents and marketable securities |
|
|
|
$ |
411,425 |
|
|
$ |
394 |
|
|
$ |
(133 |
) |
|
$ |
411,686 |
|
The Company’s Level 2 securities are valued using third-party pricing sources. The pricing services utilize industry standard valuation models for which all significant inputs are observable. The Company classifies marketable securities available to fund current operations as current assets. As of December 31, 2025, the remaining contractual maturities of $214.4 million of investments were less than one year and $41.0 million of investments were after one year through two years. The Company does not intend to sell the investments that are currently in an unrealized loss position, and it is highly unlikely that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be at maturity. For the years ended December 31, 2025 and 2024, the Company sold marketable securities for the total proceeds of $3.0 million and $2.6 million for immaterial realized losses or gains based on the specific identification method.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 26, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Mar 24, 2020 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.