Fair Value Measurement
Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are reported in one of three levels reflecting the significant inputs used to determine fair value.
The following summarizes our financial assets and financial liabilities that are measured at fair value on a recurring basis:
(in millions)
ClassificationMeasurement LevelDecember 31, 2025December 31, 2024
Financial assets
Money market trustCash and cash equivalentsLevel 1$2,262 $1,755 
Money market fundCash and cash equivalentsLevel 1$548 $828 
Money market trustRestricted cashLevel 1$90 $83 
Our long-term debt is recorded at amortized cost. The fair value is estimated using Level 2 inputs based on our current interest rates for similar types of borrowing arrangements. The carrying amount of long-term debt approximates its fair value as of December 31, 2025 and December 31, 2024 due primarily to the interest rates approximating market interest rates.

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 25, 2025
2023Feb 28, 2024
2022Mar 1, 2023
2021Mar 3, 2022

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.