Quarterly report pursuant to Section 13 or 15(d)

Investments in Non-Marketable Securities

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Investments in Non-Marketable Securities
3 Months Ended
Mar. 31, 2021
Investments, Debt and Equity Securities [Abstract]  
Investments in Non-Marketable Securities Investments in Non-Marketable Securities
Non-Marketable Debt Securities
We classify non-marketable debt securities, which are accounted for as available-for-sale, within Level 3 in the fair value hierarchy because we estimate the fair value based on a qualitative analysis using the most recent observable transaction price and other significant unobservable inputs including volatility, rights, and obligations of the securities we hold.
We determine gains or losses on the sale or extinguishment of non-marketable debt securities using a specific identification method. Unrealized gains and losses from bifurcated embedded derivatives, which represent share-settled redemption features, are recorded as other expense, net, in the unaudited condensed consolidated statements of operations. Unrealized gains and losses on non-marketable debt securities are recorded as a component of other comprehensive loss until realized. Realized gains or losses are recorded as a component of other expenses, net.
In the three months ended March 31, 2021, we recognized $0.1 million in interest income from amortization of debt discount and interest earned on our investment in non-marketable debt security, and $68 thousand in other expenses, net, on the change in the fair value of an embedded bifurcated derivative. We recognized no unrealized or realized gains or losses during the three months ended March 31, 2021. We recognized no interest income, other expenses, and unrealized or realized gains or losses during the three months ended March 31, 2020.
The following table presents balances of the adjusted cost and carrying value and fair value of non-marketable debt security by contractual maturity (in thousands):
  March 31, 2021
Adjusted Cost and Carrying Value Fair Value
Non-marketable debt security due in 1 year or less $ 1,067  $ 1,067 

  December 31, 2020
Adjusted Cost and Carrying Value Fair value
Non-marketable debt security due in 1 year or less $ 1,000  $ 1,000 

Non-Marketable Equity Securities
Non-marketable equity securities are investments in privately held companies without readily determinable market values. We measure investments in non-marketable equity securities without a readily determinable fair value using a measurement alternative that measures these securities at the cost method minus impairment, if any, plus or minus changes resulting from observable price changes on a non-recurring basis. The fair value of non-marketable equity securities that have been remeasured due to impairment are classified within Level 3. We adjust the carrying value of non-marketable equity securities which have been remeasured during the period and recognize resulting gains or losses as a component of other expenses, net. We recognized no unrealized or realized gain or losses during the three months ended March 31, 2021 and 2020.
The following table presents balances of the carrying value of non-marketable equity securities (in thousands):

  March 31, 2021 December 31, 2020
Non-marketable equity securities $ 2,350  $ 1,450