QuantumScape Corp Fair Value Disclosure
Note 4. Fair Value Measurement
The Company’s financial assets subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows (amounts in thousands):
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|
Fair Value Measured as of December 31, 2025 |
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|
|
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||||||
|
|
Level 1 |
|
|
Level 2 |
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|
Total |
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|||
Assets included in: |
|
|
|
|
|
|
|
|
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|||
Money market funds(1) |
|
$ |
117,773 |
|
|
$ |
— |
|
|
$ |
117,773 |
|
Commercial paper(2) |
|
|
— |
|
|
|
141,108 |
|
|
|
141,108 |
|
U.S. government and agency securities(2) |
|
|
— |
|
|
|
590,808 |
|
|
|
590,808 |
|
Corporate notes and bonds(2) |
|
|
— |
|
|
|
99,608 |
|
|
|
99,608 |
|
Total fair value |
|
$ |
117,773 |
|
|
$ |
831,524 |
|
|
$ |
949,297 |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Fair Value Measured as of December 31, 2024 |
|
|
|
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||||||
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Level 1 |
|
|
Level 2 |
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Total |
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|||
Assets included in: |
|
|
|
|
|
|
|
|
|
|||
Money market funds(1) |
|
$ |
78,736 |
|
|
$ |
— |
|
|
$ |
78,736 |
|
Commercial paper(2) |
|
|
— |
|
|
|
61,926 |
|
|
|
61,926 |
|
U.S. government and agency securities(2) |
|
|
— |
|
|
|
695,504 |
|
|
|
695,504 |
|
Corporate notes and bonds(2) |
|
|
— |
|
|
|
54,615 |
|
|
|
54,615 |
|
Total fair value |
|
$ |
78,736 |
|
|
$ |
812,045 |
|
|
$ |
890,781 |
|
Level 1 assets: Money market funds are classified as Level 1 within the fair value hierarchy, as fair value is based on unadjusted quoted prices in active markets for identical assets.
Level 2 assets: Investments in commercial paper, U.S. government and agency securities, and corporate notes and bonds are classified as Level 2 as they were valued based upon quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets.
The Company had no financial liabilities subject to fair value measurements on a recurring basis as of December 31, 2025 and 2024.
There have been no changes to the valuation methods utilized during the year ended December 31, 2025. As of December 31, 2025 and 2024, the carrying values of cash and cash equivalents, accounts payable and accrued liabilities approximate their respective fair values due to their short-term nature.
Marketable Securities
The following table summarizes, by major security type, the Company’s assets that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. Amortized cost net of unrealized gain (loss) is equal to fair value as of December 31, 2025 and 2024. The fair value as of December 31, 2025 and 2024 are as follows (amounts in thousands):
|
|
December 31, 2025 |
|
|||||||||||||
|
|
Amortized Cost |
|
|
Gross |
|
|
Gross |
|
|
Fair Value |
|
||||
Level 1 securities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
|
$ |
117,773 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
117,773 |
|
Level 2 securities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Commercial paper |
|
|
141,108 |
|
|
|
— |
|
|
|
— |
|
|
|
141,108 |
|
U.S. government and agency securities |
|
|
590,215 |
|
|
|
593 |
|
|
|
— |
|
|
|
590,808 |
|
Corporate notes and bonds |
|
|
99,557 |
|
|
|
68 |
|
|
|
(17 |
) |
|
|
99,608 |
|
Total |
|
$ |
948,653 |
|
|
$ |
661 |
|
|
$ |
(17 |
) |
|
$ |
949,297 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
December 31, 2024 |
|
|||||||||||||
|
|
Amortized Cost |
|
|
Gross |
|
|
Gross |
|
|
Fair Value |
|
||||
Level 1 securities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
|
$ |
78,736 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
78,736 |
|
Level 2 securities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Commercial paper |
|
|
61,926 |
|
|
|
— |
|
|
|
— |
|
|
|
61,926 |
|
U.S. government and agency securities |
|
|
695,082 |
|
|
|
436 |
|
|
|
(14 |
) |
|
|
695,504 |
|
Corporate notes and bonds |
|
|
54,609 |
|
|
|
28 |
|
|
|
(22 |
) |
|
|
54,615 |
|
Total |
|
$ |
890,353 |
|
|
$ |
464 |
|
|
$ |
(36 |
) |
|
$ |
890,781 |
|
Realized gains and losses and interest income from the investment are included in interest income.
The Company regularly reviews its available-for-sale marketable securities in an unrealized loss position and evaluates the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. The following tables display additional information regarding gross unrealized losses and fair value by major security type for the 3 and 17 marketable securities in unrealized loss positions held by the Company as of December 31, 2025 and 2024, respectively (amounts in thousands):
|
|
December 31, 2025 |
|
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|
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Less than 12 Consecutive Months |
|
|
12 Consecutive Months or Longer |
|
|
Total |
|
|||||||||||||||
|
|
Gross |
|
|
Fair Value |
|
|
Gross |
|
|
Fair Value |
|
|
Gross |
|
|
Fair Value |
|
||||||
U.S. government and agency securities |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Corporate notes and bonds |
|
|
(17 |
) |
|
|
17,253 |
|
|
|
— |
|
|
|
— |
|
|
|
(17 |
) |
|
|
17,253 |
|
Total |
|
$ |
(17 |
) |
|
$ |
17,253 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(17 |
) |
|
$ |
17,253 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
December 31, 2024 |
|
|||||||||||||||||||||
|
|
Less than 12 Consecutive Months |
|
|
12 Consecutive Months or Longer |
|
|
Total |
|
|||||||||||||||
|
|
Gross |
|
|
Fair Value |
|
|
Gross |
|
|
Fair Value |
|
|
Gross |
|
|
Fair Value |
|
||||||
U.S. government and agency securities |
|
$ |
(14 |
) |
|
$ |
96,988 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(14 |
) |
|
$ |
96,988 |
|
Corporate notes and bonds |
|
|
(19 |
) |
|
|
33,111 |
|
|
|
(3 |
) |
|
|
1,063 |
|
|
|
(22 |
) |
|
|
34,174 |
|
Total |
|
$ |
(33 |
) |
|
$ |
130,099 |
|
|
$ |
(3 |
) |
|
$ |
1,063 |
|
|
$ |
(36 |
) |
|
$ |
131,162 |
|
The unrealized losses were attributable to changes in interest rates that impacted the value of the investments, and not increased credit risk. There were no sales of available-for-sale marketable securities during the year ended December 31, 2025. During the years ended December 31, 2024 and 2023, the Company received proceeds of $1.2 million and $1.5 million, including interest, from the sale of available-for-sale marketable securities, respectively. The Company realized immaterial gains as a result of such sales. The Company does not intend to sell the investments that are in an unrealized loss position, nor is it more likely than not that the Company will be required to sell the investments before the recovery of the amortized cost basis, which may be its maturity. Accordingly, the Company did not record an allowance for credit losses associated with these investments.
The estimated amortized cost and fair value of available-for-sale securities by contractual maturity as of December 31, 2025 are as follows (amounts in thousands):
|
|
December 31, 2025 |
|
|||||
|
|
Amortized Cost |
|
|
Fair Value |
|
||
Due within one year |
|
$ |
943,707 |
|
|
$ |
944,352 |
|
Due after one year and through five years |
|
|
4,946 |
|
|
|
4,945 |
|
Total |
|
$ |
948,653 |
|
|
$ |
949,297 |
|
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 28, 2022 | |
| 2020 | Feb 23, 2021 | |
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.