v3.26.1
Fair Value Measurements
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements
6. Fair Value Measurements
The Company measures and reports certain assets and liabilities at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The Company measures certain non-marketable equity securities and warrant investments at fair value on a nonrecurring basis in accordance with ASC 321, Investment - Equity Securities. Instruments are remeasured to fair value when observable price changes in orderly transactions for an identical or a similar investment of the same issuer occur.
The three levels of inputs that may be used to measure fair value are as follows:
Level 1 – Observable inputs, such as quoted prices in active markets for identical assets or liabilities.
Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 – Valuations based on unobservable inputs to the valuation methodology and including data about assumptions market participants would use in pricing the asset or liability based on the best information available under the circumstances.
The recorded carrying amounts of certain financial instruments, including cash and cash equivalents, prepaid expenses, accounts payable, and accounts receivable as of March 31, 2026 and December 31, 2025, approximate fair value due to their short-term maturities.
Recurring Fair Value Measurements
The Company measures and reports certain assets and liabilities at fair value on a recurring basis. The fair value of these assets and liabilities as of March 31, 2026 and December 31, 2025 are classified as follows (in thousands):
As of March 31, 2026
Level 1Level 2Level 3Total
Assets:
Money market funds$239,367 $— $— $239,367 
Short-term investments
— 106,104 — 106,104 
Convertible Note Investment
— — 20,876 20,876 
Total assets$239,367 $106,104 $20,876 $366,347 
As of December 31, 2025
Level 1Level 2Level 3Total
Assets:
Money market funds$332,808 $— $— $332,808 
Convertible Note Investment— — 24,726 24,726 
Total assets$332,808 $— $24,726 $357,534 

The change in fair value of the Level 3 instruments are as follows (in thousands):
As of March 31, 2026
Convertible Note Investment
Fair value, beginning of the year
$24,726 
Changes in fair value(3,850)
Fair value, end of period
$20,876 
Convertible Note Investment
In May 2025, the Company entered into a series of transactions with Aura Consolidated Group, Inc. (“Aura”) including (i) a 3-year advertising partnership and revenue sharing agreement intended to expand the Company's advertising revenue and other revenue channels and subscription membership offerings, and (ii) a $25.0 million convertible note investment by the Company into Aura (“Convertible Note Investment”). The note bears zero interest and matures on May 12, 2030. The principal is due at maturity and includes both optional and mandatory conversion features, which may result in conversion into the issuer’s equity upon the occurrence of specific events, including financing events, change in control, or at maturity. The Company elected to apply the fair value option in accordance with ASC 825, Financial Instruments, to account for the hybrid instrument as a single financial instrument. As a result, the entire instrument is measured at fair value, with changes in fair value recognized in the condensed consolidated statements of operations and comprehensive income within other income (expense). The Convertible Note Investment is included within prepaid expenses and other assets, noncurrent on the condensed consolidated balance sheet.
The Company classifies the Convertible Note Investment as Level 3 due to the absence of relevant observable inputs. The fair value of the Convertible Note Investment was estimated using a scenario-based, probability-weighted option pricing model. Significant assumptions include the discount rate as well as the timing and probability weighting of each settlement scenario.
Nonrecurring Fair Value Measurements
The Company measures certain non-marketable equity securities and warrant investments at fair value on a nonrecurring basis in accordance with ASC 321, Investment - Equity Securities, which are included within prepaid expenses and other assets, noncurrent on the condensed consolidated balance sheet. Additionally, the Company measures and reports certain assets at fair value each reporting period. For additional information, refer to Note 8, "Balance Sheet Components". Instruments that are remeasured to fair value when observable price changes in orderly transactions for an identical or a similar investment of the same issuer occur are considered Level 2 investments.
Related Party Investment
The Related Party Investment is classified within Level 2 of the fair value hierarchy as the valuation is based on an observable price for identical shares that are not readily determinable. The Related Party Investment balance as of March 31, 2026, was $5.9 million and is included within prepaid expenses and other assets, noncurrent on the condensed consolidated balance sheet.