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Interest rate fluctuation may arise from changes in the market’s view of the quality of the security issuer, the overall economic outlook and the time to maturity of our portfolio.
−Removed: We mitigate this risk by investing only in high quality, highly liquid instruments.
+Added: We mitigate this risk by investing only in highly rated, liquid instruments.
Securities with original maturities of one year or less must be rated by two of the three industry standard rating agencies as follows:
8 unchanged sentences
Our policy requires that at least 10% of the portfolio be in securities with a maturity of 90 days or less.
−Removed: We may make investments in U.S.
−Removed: Treasuries, U.S.
−Removed: Agencies and corporate bonds with maturities up to 36 months.
−Removed: However, the bias of our investment portfolio is shorter maturities.
−Removed: All investments must be U.S.
+Added: We may make investments in time deposits, U.S.
+Added: government-sponsored obligations and corporate bonds, commercial paper and notes with maturities up to 36 months.
+Added: We bias our investment portfolio to shorter maturities.
+Added: All of our investments are U.S.
dollar denominated.
−Removed: Additionally, we have no significant exposure to European sovereign debt.
−Removed: We invest our cash equivalents and marketable securities in a variety of U.S.
−Removed: dollar financial instruments such as U.S.
−Removed: Treasuries, U.S.
−Removed: Government Agencies, commercial paper and corporate notes.
−Removed: Our policy specifically prohibits trading securities for the sole purposes of realizing trading profits.
−Removed: However, we may liquidate a portion of our portfolio if we experience unforeseen liquidity requirements.
−Removed: In such a case, if the environment has been one of rising interest rates, we may experience a realized loss, similarly, if the environment has been one of declining interest rates, we may experience a realized gain.
+Added: Our policy specifically prohibits trading securities for the sole purpose of realizing trading profits, however, we may liquidate a portion of our portfolio if we experience unforeseen liquidity requirements.
+Added: In such a case, if the environment has been one of rising interest rates, we may experience a realized loss.
+Added: Similarly, if the environment has been one of declining interest rates, we may experience a realized gain.
As of December 31, 2023, we had an investment portfolio of fixed income marketable securities of $337.4 million, including cash equivalents.
1 unchanged sentence
Actual results may differ materially from this sensitivity analysis.
−Removed: The fair value of our outstanding convertible notes is subject to interest rate risk, market risk and other factors due to the convertible feature.
−Removed: The fair value of the convertible notes will generally increase as interest rates fall and decrease as interest rates rise.
−Removed: In addition, the fair value of the convertible notes will generally increase as our common stock price increases and will generally decrease as our common stock price declines in value.
−Removed: The interest and market value changes affect the fair value of our convertible notes but do not impact our financial position, cash flows or results of operations due to the fixed nature of the debt obligation.
−Removed: All outstanding convertible notes were retired as of February 1, 2023.
We invoice the majority of our customers in U.S.
−Removed: Although the fluctuation of currency exchange rates may impact our customers, and thus indirectly impact us, we do not attempt to hedge this indirect and speculative risk.
−Removed: Our overseas operations consist primarily of international business operations in France, the Netherlands and the United Kingdom, design centers in Canada, India, Bulgaria and Finland and small business development offices in Australia, China, Japan, South Korea and Taiwan.
−Removed: We monitor our foreign currency exposure;
−Removed: however, we believe our foreign currency exposure is not material as of December 31, 2022.
+Added: Although the fluctuation of currency exchange rates may impact our customers, and thus indirectly impact us, we do not attempt to hedge this indirect and speculative risk, other than as noted in the paragraph below.
+Added: Our overseas operations consist primarily of international business operations in France, the Netherlands and the United Kingdom, design centers in Bulgaria, Canada, India, and Finland and small business development offices in China, South Korea and Taiwan.
+Added: We monitor our foreign currency exposure and, as disclosed below, we have entered into foreign currency forward contracts to partially mitigate the exposure in currencies where we believe this is appropriate.
+Added: We have on occasion, entered into foreign currency forward contracts (the “Contracts”) to manage our exposure related to certain foreign currency denominated monetary assets (the “Hedging Program”) and to minimize the related impact of foreign currency fluctuations on our earnings.
+Added: The hedged monetary assets primarily consisted of certain euro-denominated cash and accounts receivable balances.
+Added: Contracts are typically entered into at the end of a month, with an approximately one month duration at inception.
+Added: As of December 31, 2023, no Contracts were outstanding.
Financial Statements and Supplementary Data
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.