Sirius XM Holdings Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Cash, Cash Equivalents and Investments

Cash, Cash Equivalents and Investments

9 Months Ended

Sep. 30, 2015

Cash and Cash Equivalents [Abstract]

Cash, cash equivalents and investments consisted of the following:



	As of December 31, 2014		As of September 30, 2015
	(in thousands)
Cash and cash equivalents
Cash	$	72,487	$	79,423
Money market funds	89,113		161,808
Commercial paper	9,349		1,750
Corporate debt securities	5,008		—
Total cash and cash equivalents	$	175,957	$	242,981
Short-term investments
Commercial paper	$	45,443	$	33,484
Corporate debt securities	128,691		84,629
U.S. government and government agency debt securities	4,497		2,501
Total short-term investments	$	178,631	$	120,614
Long-term investments
Corporate debt securities	$	100,998	$	78,982
U.S. government and government agency debt securities	3,245		—
Total long-term investments	$	104,243	$	78,982
Cash, cash equivalents and investments	$	458,831	$	442,577

Our short-term investments have maturities of twelve months or less and are classified as available-for-sale. Our long-term investments have maturities of greater than twelve months and are classified as available-for-sale.

The following tables summarize our available-for-sale securities’ adjusted cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category as of December 31, 2014 and September 30, 2015.



	As of December 31, 2014
	Adjusted Cost		Unrealized Gains		Unrealized Losses			Fair Value
	(in thousands)
Money market funds	$	89,113	$	—	$	—		$	89,113
Commercial paper	54,792		—		—			54,792
Corporate debt securities	235,135		6		(444		)	234,697
U.S. government and government agency debt securities	7,751		—		(9		)	7,742
Total cash equivalents and marketable securities	$	386,791	$	6	$	(453	)	$	386,344



	As of September 30, 2015
	Adjusted Cost		Unrealized Gains		Unrealized Losses			Fair Value
	(in thousands)
Money market funds	$	161,808	$	—	$	—		$	161,808
Commercial paper	35,234		—		—			35,234
Corporate debt securities	163,735		100		(224		)	163,611
U.S. government and government agency debt securities	2,500		1		—			2,501
Total cash equivalents and marketable securities	$	363,277	$	101	$	(224	)	$	363,154

The following table presents available-for-sale investments by contractual maturity date as of December 31, 2014 and September 30, 2015.



	As of December 31, 2014
	Adjusted Cost		Fair Value
	(in thousands)
Due in one year or less	$	282,206	$	282,101
Due after one year through three years	104,585		104,243
Total	$	386,791	$	386,344



	As of September 30, 2015
	Adjusted Cost		Fair Value
	(in thousands)
Due in one year or less	$	284,126	$	284,172
Due after one year through three years	79,151		78,982
Total	$	363,277	$	363,154

The following tables summarize our available-for-sale securities’ fair value and gross unrealized losses aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position as of December 31, 2014 and September 30, 2015.



	As of December 31, 2014
	Twelve Months or Less					More than Twelve Months					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
	(in thousands)
Money market funds	$	—	$	—		$	—	$	—		$	—	$	—
Commercial paper	—		—			—		—			—		—
Corporate debt securities	192,699		(422		)	12,148		(22		)	204,847		(444		)
U.S. government and government agency debt securities	5,240		(9		)	—		—			5,240		(9		)
Total	$	197,939	$	(431	)	$	12,148	$	(22	)	$	210,087	$	(453	)



	As of September 30, 2015
	Twelve Months or Less					More than Twelve Months					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
	(in thousands)
Money market funds	$	—	$	—		$	—	$	—		$	—	$	—
Commercial paper	—		—			—		—			—		—
Corporate debt securities	82,366		(209		)	14,569		(15		)	96,935		(224		)
U.S. government and government agency debt securities	—		—			—		—			—		—
Total	$	82,366	$	(209	)	$	14,569	$	(15	)	$	96,935	$	(224	)

Our investment policy requires investments to be investment grade, primarily rated “A1” by Standard & Poor’s or “P1” by Moody’s or better for short-term investments and rated “A” by Standard & Poor’s or “A2” by Moody’s or better for long-term investments, with the objective of minimizing the potential risk of principal loss. In addition, the investment policy limits the amount of credit exposure to any one issuer.

The unrealized losses on our available-for-sale securities as of September 30, 2015 were primarily a result of unfavorable changes in interest rates subsequent to the initial purchase of these securities. As of September 30, 2015, we owned 77 securities that were in an unrealized loss position. Based on our cash flow needs, we may be required to sell a portion of these securities prior to maturity. However, we expect to recover the full carrying value of these securities. As a result, no portion of the unrealized losses at September 30, 2015 is deemed to be other-than-temporary and the unrealized losses are not deemed to be credit losses. When evaluating the investments for other-than-temporary impairment, we review factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and our intent to sell, or whether it is more likely than not we will be required to sell, the investment before recovery of the investment’s amortized cost basis. During the three and nine months ended September 30, 2015, we did not recognize any impairment charges. During the three and nine months ended September 30, 2015, proceeds from the sale of available-for-sale securities were $37.7 million and $41.3 million. We did not recognize a realized gain or loss in connection with these sales.