Yahoo 2013 Annual Report Download - page 93

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The following tables show all investments in an unrealized loss position for which an other-than-temporary
impairment has not been recognized and the related gross unrealized losses and fair value, aggregated by
investment category and length of time that individual securities have been in a continuous unrealized loss
position (in thousands):
December 31, 2012
Less than 12 Months 12 Months or Greater Total
Fair
Value
Unrealized
Loss
Fair
Value
Unrealized
Loss
Fair
Value
Unrealized
Loss
Government and agency securities ........ $165,025 $ (45) $ — $ — $165,025 $ (45)
Corporate debt securities, commercial paper,
and bank certificates of deposit ......... 729,046 (622) — — 729,046 (622)
Corporate equity securities .............. 197 (33) — — 197 (33)
Total investments in available-for-sale
securities ...................... $894,268 $ (700) $ — $ — $894,268 $ (700)
December 31, 2013
Less than 12 Months 12 Months or Greater Total
Fair
Value
Unrealized
Loss
Fair
Value
Unrealized
Loss
Fair
Value
Unrealized
Loss
Government and agency securities ........ $263,514 $ (101) $ — $ — $263,514 $ (101)
Corporate debt securities, commercial paper,
and bank certificates of deposit ......... 696,950 (1,214) 3,833 (2) 700,783 (1,216)
Total investments in available-for-sale
securities ...................... $960,464 $(1,315) $3,833 $ (2) $964,297 $(1,317)
The Company’s investment portfolio consists of liquid high-quality fixed income government, agency, and
corporate debt securities, money market funds, time deposits with financial institutions, and preference shares.
Investments in both fixed rate and floating rate interest earning instruments carry a degree of interest rate risk.
Fixed rate securities may have their fair market value adversely impacted due to a rise in interest rates, while
floating rate securities may produce less income than expected if interest rates fall. Fixed income securities may
have their fair market value adversely impacted due to a deterioration of the credit quality of the issuer. The
longer the term of the securities, the more susceptible they are to changes in market rates. Investments are
reviewed periodically to identify possible other-than-temporary impairment. The Company has no current
requirement or intent to sell these securities. The Company expects to recover up to (or beyond) the initial cost of
investment for securities held.
The Company’s investment in the Alibaba Group Preference Shares was presented as an asset carried at fair
value on the Company’s consolidated balance sheets as of December 31, 2012. As of December 31, 2012, the
total carrying and fair value of the Alibaba Group Preference Shares was $822 million, which included $6
million of accrued dividend income recorded within prepaid expenses and other current assets and $16 million of
accrued dividend income recorded as part of the carrying value of the Alibaba Group Preference Shares. For the
years ended December 31, 2012 and 2013, the Company recorded approximately $23 million and $36 million,
respectively, in dividend income related to the Alibaba Group Preference Shares within other income, net on the
consolidated statements of income. On May 16, 2013, Alibaba Group Holding Limited (“Alibaba Group”)
exercised its right to redeem the Alibaba Group Preference Shares for $846 million in cash. The cash received
represented the redemption value, which included the stated value of $800 million plus accrued dividends of $46
million.
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