Fair Value Measurements
The following tables present information about the Company’s financial assets that have been measured at fair value as of December 31, 2025 and 2024 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Description | | Level 1 | | Level 2 | | Level 3 | | December 31, 2025 |
| Assets: | | | | | | | | |
| U.S. Treasury Bills | | $ | — | | | $ | 318,116 | | | $ | — | | | $ | 318,116 | |
| Money market funds included within cash and cash equivalents | | 93,595 | | | — | | | — | | | 93,595 | |
| Total | | $ | 93,595 | | | $ | 318,116 | | | $ | — | | | $ | 411,711 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Description | | Level 1 | | Level 2 | | Level 3 | | December 31, 2024 |
| Assets: | | | | | | | | |
| Money market funds included within cash and cash equivalents | | $ | 485,168 | | | $ | — | | | $ | — | | | $ | 485,168 | |
| Total | | $ | 485,168 | | | $ | — | | | $ | — | | | $ | 485,168 | |
As of December 31, 2025, the Company’s cash equivalents consisted of money market funds. During the years ended December 31, 2025 and 2024, there were no transfers between Level 1, Level 2 and Level 3.
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.