Financial Instruments

3 Months Ended

Mar. 31, 2025

5. FINANCIAL INSTRUMENTS

Investments consist of the following as of March 31, 2025 and December 31, 2024 (dollars in thousands):


	March 31, 2025
			Gross Unrealized
	Cost		Gain		(Loss)			Fair Value
Short-term investments (available-for-sale):
Non-governmental debt securities	$	242,291	$	588	$	(70	)	$	242,809
Treasury and federal agencies		215,396		382		(60	)		215,718
Total short-term investments (available-for-sale)	$	457,687	$	970	$	(130	)	$	458,527


	December 31, 2024
			Gross Unrealized
	Cost		Gain		(Loss)			Fair Value
Short-term investments (available-for-sale):
Non-governmental debt securities		246,070		466		(278	)		246,258
Treasury and federal agencies		213,394		258		(115	)		213,537
Total short-term investments (available-for-sale)	$	459,464	$	724	$	(393	)	$	459,795

In the table above, unrealized holding gains (losses) relate to short-term investments that have been in a continuous unrealized gain (loss) position for less than one year, which are recorded within accumulated other comprehensive income on our condensed consolidated balance sheets.

Our non-governmental debt securities primarily consist of corporate bonds, certificates of deposit and commercial paper. Our treasury and federal agencies primarily consist of U.S. Treasury bills and federal home loan debt securities.

There were no realized gains or losses from the sale of investments for the quarters ended March 31, 2025 and March 31, 2024.

Fair Value Measurements

FASB ASC Topic 820 – Fair Value Measurement establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions.

As of March 31, 2025, we held investments that are required to be measured at fair value on a recurring basis. These investments (available-for-sale) consist of non-governmental debt securities and treasury and federal agencies securities. Available-for-sale securities included in Level 2 are estimated based on observable inputs other than quoted prices in active markets for identical assets and liabilities, such as quoted prices for identical or similar assets or liabilities in inactive markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Financial instruments measured at fair value on a recurring basis subject to the disclosure requirements of FASB ASC Topic 820 - Fair Value Measurements at March 31, 2025 and December 31, 2024 were as follows (dollars in thousands):


	As of March 31, 2025
	Level 1		Level 2		Total
Cash and cash equivalents - money market funds	$	30,745	$	-	$	30,745
Short-term investments - non-governmental debt securities		-		242,809		242,809
Short-term investments - treasury and federal agencies		-		215,718		215,718
Totals	$	30,745	$	458,527	$	489,272

	As of December 31, 2024
	Level 1		Level 2		Total
Cash and cash equivalents - money market funds	$	30,189	$	-	$	30,189
Cash and cash equivalents - federal agency debt securities		-		13,078		13,078
Short-term investments - non-governmental debt securities		-		246,258		246,258
Short-term investments - treasury and federal agencies		-		213,537		213,537
Totals	$	30,189	$	472,873	$	503,062

Equity Method Investment

We make periodic operating maintenance payments to an equity affiliate. The total fees recorded during the quarters ended March 31, 2025 and 2024 were as follows (dollars in thousands):


	Maintenance Fee Payments
For the quarter ended March 31, 2025	$	428
For the quarter ended March 31, 2024	$	444

PERDOCEO EDUCATION Corp 10-Q