v3.26.1
Financial Instruments and Fair Value Measurements
 9 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
Financial Instruments and Fair Value Measurements
Note 3. Financial Instruments and Fair Value Measurements

We classify our financial instruments, except for our investment in an auction rate security and other investments in privately held companies, within Level 1 or Level 2 in the fair value hierarchy because we use quoted prices in active markets or alternative pricing sources and models using market observable inputs to determine their fair value.
Financial Instruments Measured at Fair Value on a Recurring Basis

Cash and cash equivalents, certificates of deposit, investment in an auction rate security, and marketable securities, included in prepaid expenses and other current assets and other assets in the condensed consolidated balance sheets, are carried at fair value.

The following table sets forth our financial instruments as of March 31, 2026 and June 30, 2025, which are measured at fair value on a recurring basis by level within the fair value hierarchy. These are classified based on the lowest level of input that is significant to the fair value measurement (in thousands):

As of March 31, 2026
As of June 30, 2025
Level 1Level 2Level 3Asset at Fair ValueLevel 1Level 2Level 3Asset at Fair Value
Assets
Money market funds (1)
$19 $— $— $19 $44 $— $— $44 
Certificates of deposit— 47,494 — 47,494 — 519 — 519 
Marketable equity security14,709 — — 14,709 6,239 — — 6,239 
Available-for-Sale Investment:
Auction rate security (2)
— — — — — — 1,750 1,750 
Total assets$14,728 $47,494 $— $62,222 $6,283 $519 $1,750 $8,552 

(1) All of the money market funds are included in cash and cash equivalents in the condensed consolidated balance sheets as of March 31, 2026 and June 30, 2025, respectively.
(2) The fair value of our auction rate security was immaterial as of March 31, 2026.

The investment in marketable equity security is carried at fair value using values available on a public exchange, is based on a Level 1 input, and is recorded in prepaid expenses and other current assets in the condensed consolidated balance sheets. The unrealized gains and losses of the investment are included in other income (expense), net in our condensed consolidated statements of operations. For the three and nine months ended March 31, 2026, an unrealized loss of $0.5 million and an unrealized gain of $8.5 million, respectively, were recorded in other income (expense), net in the condensed consolidated statements of operations. For the three and nine months ended March 31, 2025, an unrealized loss of $1.3 million and an unrealized loss of $0.2 million, respectively, were recorded in other income (expense), net in the condensed consolidated statements of operations.

On a quarterly basis, we also evaluate the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, current economic conditions, and reasonable economic forecasts that affect collectability. For the three and nine months ended March 31, 2026 and 2025, the credit losses related to our investments were not material.

There were no transfers between Level 1, Level 2, or Level 3 financial instruments during the three and nine months ended March 31, 2026 and 2025.

Financial Instruments Not Recorded at Fair Value

Accounts receivable, accounts payable, and accrued liabilities are carried at cost, which approximates fair value due to the short maturity of these instruments. We estimate the fair value of outstanding debt, including our 3.50% Convertible Senior Notes due 2029 (“2029 Convertible Notes”), 2.25% Convertible Senior Notes due 2028 (“2028 Convertible Notes”), and 0.00% Convertible Senior Notes due 2030 (“2030 Convertible Notes”), for disclosure purposes on a recurring basis. Non-current accounts receivable, included in other assets in the condensed consolidated balance sheets, are carried at amortized cost, and bear interest at rates that approximate current market rates for similar credit. We believe the carrying amounts approximate fair value because there have been no significant changes in market rates or credit risk.
As of March 31, 2026 and June 30, 2025, our total lines of credit and term loans of $4,113.7 million and $112.5 million, respectively, are reported at amortized cost. The carrying value of our outstanding lines of credit and term loans approximates fair value because the borrowings primarily bear interest at variable rates based on current market rates or have short-term maturities. These fair value measurements are classified within Level 2 of the fair value hierarchy based on observable market inputs.

The estimated fair values as of March 31, 2026 of the 2029 Convertible Notes, the 2028 Convertible Notes, and the 2030 Convertible Notes were $1,381.7 million, $601.9 million, and $1,684.3 million, respectively. The estimated fair values as of June 30, 2025 of the 2029 Convertible Notes, the 2028 Convertible Notes, and the 2030 Convertible Notes were $1,801.9 million, $818.5 million, and $2,576.6 million. The estimated fair values of the 2029 Convertible Notes, the 2028 Convertible Notes, and the 2030 Convertible Notes was determined based on level 2 inputs of quoted market prices.