Cabaletta Bio, Inc. Fair Value Disclosure
3. Fair Value Measurements
As of December 31, 2025 and 2024, the Company’s financial instruments included cash and cash equivalents, available-for-sale debt securities, accounts payable and accrued expenses. The carrying amounts for cash and cash equivalents, accounts payable and accrued expenses reported in the Company’s consolidated financial statements for these instruments approximate their respective fair values because of the short-term nature of these instruments.
The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values:
|
|
December 31, 2025 |
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|
|
Total |
|
|
Quoted |
|
|
Significant |
|
|
Significant |
|
||||
Financial assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
|
$ |
81,470 |
|
|
$ |
81,470 |
|
|
$ |
— |
|
|
$ |
— |
|
Short-term investments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasury securities |
|
|
50,617 |
|
|
|
— |
|
|
|
50,617 |
|
|
|
— |
|
Total |
|
$ |
132,087 |
|
|
$ |
81,470 |
|
|
$ |
50,617 |
|
|
$ |
— |
|
|
|
December 31, 2024 |
|
|||||||||||||
|
|
Total |
|
|
Quoted |
|
|
Significant |
|
|
Significant |
|
||||
Financial assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
|
$ |
162,634 |
|
|
$ |
162,634 |
|
|
$ |
— |
|
|
$ |
— |
|
Total |
|
$ |
162,634 |
|
|
$ |
162,634 |
|
|
$ |
— |
|
|
$ |
— |
|
Money market funds are measured at fair value on a recurring basis using quoted prices and are classified as Level 1 inputs. Investments are measured at fair value based on inputs other than quoted prices that are derived from observable market data and are classified as Level 2 inputs.
For debt securities classified as available-for-sale investments, the Company records unrealized gains or losses resulting from changes in fair value between measurement dates as a component of other comprehensive income. The Company did not hold any available-for-sale securities as of December 31, 2024.
|
|
December 31, 2025 |
|
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|
|
Amortized Cost |
|
|
Gross Unrealized Gains |
|
|
Fair value |
|
|||
Financial assets |
|
|
|
|
|
|
|
|
|
|||
Cash |
|
$ |
1,512 |
|
|
$ |
— |
|
|
$ |
1,512 |
|
Money market funds |
|
|
81,470 |
|
|
|
— |
|
|
|
81,470 |
|
Included in cash and cash equivalents |
|
|
82,982 |
|
|
|
— |
|
|
|
82,982 |
|
U.S. Treasury securities - due in one year or less |
|
|
|
|
|
|
|
|
|
|||
Included in short-term investments |
|
|
50,592 |
|
|
|
25 |
|
|
|
50,617 |
|
Total |
|
$ |
133,574 |
|
|
$ |
25 |
|
|
$ |
133,599 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 23, 2026 | Showing above |
| 2024 | Mar 31, 2025 | |
| 2023 | Mar 21, 2024 | |
| 2022 | Mar 16, 2023 | |
| 2021 | Mar 17, 2022 | |
| 2020 | Mar 16, 2021 | |
| 2019 | Mar 30, 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.