v3.23.2
Financial Instruments (Tables)
 6 Months Ended
Jun. 30, 2023
Fair Value Disclosures [Abstract]  
Marketable equity securities
The following tables summarize our cash, cash equivalents, and marketable securities measured at fair value on a recurring basis (in millions):
As of December 31, 2022
Fair Value HierarchyAdjusted CostGross Unrealized GainsGross Unrealized LossesFair ValueCash and Cash EquivalentsMarketable Securities
Fair value changes recorded in other comprehensive income
Time depositsLevel 2$5,297 $0 $0 $5,297 $5,293 $4 
Government bondsLevel 241,03664 (2,045)39,055 283 38,772 
Corporate debt securitiesLevel 228,5788 (1,569)27,017 1 27,016 
Mortgage-backed and asset-backed securitiesLevel 216,1765 (1,242)14,939 0 14,939 
Total investments with fair value change reflected in other comprehensive income(1)
$91,087 $77 $(4,856)$86,308 $5,577 $80,731 
Fair value adjustments recorded in net income
Money market fundsLevel 1$7,234 $7,234 $0 
Current marketable equity securities(2)
Level 14,013 0 4,013 
Mutual fundsLevel 2339 0 339 
Government bondsLevel 21,877 440 1,437 
Corporate debt securitiesLevel 23,744 65 3,679 
Mortgage-backed and asset-backed securitiesLevel 21,686 2 1,684 
Total investments with fair value change recorded in net income$18,893 $7,741 $11,152 
Cash0 8,561 0 
Total$91,087 $77 $(4,856)$105,201 $21,879 $91,883 
(1)Represents gross unrealized gains and losses for debt securities recorded to accumulated other comprehensive income (AOCI).
(2)The long-term portion of marketable equity securities (subject to long-term lock-up restrictions) of $803 million as of December 31, 2022 is included within other non-current assets.
As of June 30, 2023
Fair Value HierarchyAdjusted CostGross Unrealized GainsGross Unrealized LossesFair ValueCash and Cash EquivalentsMarketable Securities
Fair value changes recorded in other comprehensive income
Time depositsLevel 2$2,913 $0 $0 $2,913 $2,913 $0 
Government bondsLevel 245,339 49 (1,588)43,800 2,481 41,319 
Corporate debt securitiesLevel 223,480 8 (1,162)22,326 0 22,326 
Mortgage-backed and asset-backed securitiesLevel 218,047 4 (1,092)16,959 0 16,959 
Total investments with fair value change reflected in other comprehensive income(1)
$89,779 $61 $(3,842)$85,998 $5,394 $80,604 
Fair value adjustments recorded in net income
Money market fundsLevel 1$9,472 $9,472 $0 
Current marketable equity securities(2)
Level 14,088 0 4,088 
Mutual fundsLevel 23150 315
Government bondsLevel 22,158546 1,612
Corporate debt securitiesLevel 23,8312 3,829
Mortgage-backed and asset-backed securitiesLevel 21,9550 1,955
Total investments with fair value change recorded in net income$21,819 $10,020 $11,799 
Cash0 10,515 0 
Total$89,779 $61 $(3,842)$107,817 $25,929 $92,403 
(1)Represents gross unrealized gains and losses for debt securities recorded to AOCI.
(2)The long-term portion of marketable equity securities (subject to long-term lock-up restrictions) of $892 million as of June 30, 2023 is included within other non-current assets
Investments by maturity date
The following table summarizes the estimated fair value of investments in available-for-sale marketable debt securities by effective contractual maturity dates (in millions):
As of
June 30, 2023
Due in 1 year or less$15,403 
Due in 1 year through 5 years43,749 
Due in 5 years through 10 years15,162 
Due after 10 years13,686 
Total$88,000 
Fair value of gross unrealized losses recorded to AOCI
The following tables present fair values and gross unrealized losses recorded to AOCI, aggregated by investment category and the length of time that individual securities have been in a continuous loss position (in millions):
 As of December 31, 2022
 Less than 12 Months12 Months or GreaterTotal
 Fair ValueUnrealized
Loss		Fair ValueUnrealized
Loss		Fair ValueUnrealized
Loss
Government bonds$21,039 $(1,004)$13,438 $(1,041)$34,477 $(2,045)
Corporate debt securities11,228 (440)15,125 (1,052)26,353 (1,492)
Mortgage-backed and asset-backed securities7,725 (585)6,964 (657)14,689 (1,242)
Total$39,992 $(2,029)$35,527 $(2,750)$75,519 $(4,779)
 As of June 30, 2023
 Less than 12 Months12 Months or GreaterTotal
 Fair ValueUnrealized
Loss		Fair ValueUnrealized
Loss		Fair ValueUnrealized
Loss
Government bonds$19,195 $(580)$13,976 $(1,008)$33,171 $(1,588)
Corporate debt securities3,915 (69)17,573 (1,008)21,488 (1,077)
Mortgage-backed and asset-backed securities6,352 (153)10,095 (939)16,447 (1,092)
Total$29,462 $(802)$41,644 $(2,955)$71,106 $(3,757)
Available-for-sale debt securities The following table summarizes gains and losses for debt securities, reflected as a component of other income (expense), net (in millions):    
Three Months EndedSix Months Ended
June 30,June 30,
 2022202320222023
Unrealized gain (loss) on fair value option debt securities$(367)$(24)$(569)$121 
Gross realized gain on debt securities29 28 69 85 
Gross realized loss on debt securities(368)(303)(639)(795)
(Increase) decrease in allowance for credit losses(84)(5)(18)(8)
Total gain (loss) on debt securities recognized in other income (expense), net$(790)$(304)$(1,157)$(597)
Summary of unrealized gains and losses for marketable and non-marketable equity securities
The carrying values for marketable and non-marketable equity securities are summarized below (in millions):
As of December 31, 2022As of June 30, 2023
Marketable Equity SecuritiesNon-Marketable Equity SecuritiesTotalMarketable Equity SecuritiesNon-Marketable Equity SecuritiesTotal
Total initial cost$5,764 $16,157 $21,921 $5,647 $17,261 $22,908 
Cumulative net gain (loss)(1)
(608)12,372 11,764 (352)11,868 11,516 
Carrying value$5,156 $28,529 $33,685 $5,295 $29,129 $34,424 
(1)Non-marketable equity securities cumulative net gain (loss) is comprised of $16.8 billion gains and $4.5 billion losses (including impairments) as of December 31, 2022 and $17.8 billion gains and $5.9 billion losses (including impairments) as of June 30, 2023.
Gains and losses on equity securities
Gains and losses (including impairments), net, for marketable and non-marketable equity securities included in other income (expense), net are summarized below (in millions):
Three Months EndedSix Months Ended
June 30,June 30,
2022202320222023
Realized net gain (loss) on equity securities sold during the period$26 $87 $(230)$292 
Unrealized net gain (loss) on marketable equity securities(1,188)397 (2,462)349 
Unrealized net gain (loss) on non-marketable equity securities(1)
911 (689)1,371 (469)
Total gain (loss) on equity securities in other income (expense), net$(251)$(205)$(1,321)$172 
(1)Unrealized gain (loss) on non-marketable equity securities accounted for under the measurement alternative is comprised of $2.2 billion and $75 million of upward adjustments and $1.3 billion and $789 million of downward adjustments (including impairments) for three months ended June 30, 2022 and 2023, respectively, and $3.0 billion and $989 million of upward adjustments and $1.6 billion and $1.5 billion of downward adjustments (including impairments) for the six months ended June 30, 2022 and 2023, respectively.
In the table above, realized net gain (loss) on equity securities sold during the period reflects the difference between the sale proceeds and the carrying value of the equity securities at the beginning of the period or the purchase date, if later.
Cumulative net gains on equity securities sold
Cumulative net gains (losses) on equity securities sold during the period, which is summarized in the following table (in millions), represents the total net gains (losses) recognized after the initial purchase date of the equity security sold during the period. While these net gains (losses) may have been reflected in periods prior to the period of sale, we believe they are important supplemental information as they reflect the economic net gains (losses) on the securities sold during the period. Cumulative net gains (losses) are calculated as the difference between the sale price and the initial purchase price for the equity security sold during the period.
Equity Securities Sold
Three Months EndedSix Months Ended
June 30,June 30,
 2022202320222023
Total sale price$645 $427 $1,335 $739 
Total initial cost168 156 428 367 
Cumulative net gain (loss)$477 $271 $907 $372 
Schedule of gross notional amounts of derivative instruments The gross notional amounts of outstanding derivative instruments were as follows (in millions):
As of December 31, 2022As of June 30, 2023
Derivatives designated as hedging instruments:
Foreign exchange contracts
Cash flow hedges $15,972 $15,823 
Fair value hedges$2,117 $1,472 
Net investment hedges$8,751 $9,371 
Derivatives not designated as hedging instruments:
Foreign exchange contracts$34,979 $34,185 
Other contracts$7,932 $9,133 
Schedule of derivative instruments
The fair values of outstanding derivative instruments were as follows (in millions):
 As of December 31, 2022As of June 30, 2023
  
Assets(1)
Liabilities(2)
Assets(1)
Liabilities(2)
Derivatives designated as hedging instruments:
Foreign exchange contracts$271 $556 $228 $201 
Derivatives not designated as hedging instruments:
Foreign exchange contracts365207130136
Other contracts40473967
Total derivatives not designated as hedging instruments405 254 169 203 
Total$676 $810 $397 $404 
(1)    Derivative assets are recorded as other current and non-current assets in the Consolidated Balance Sheets.
(2)    Derivative liabilities are recorded as accrued expenses and other liabilities, current and non-current in the Consolidated Balance Sheets.
Schedule of gain (loss) on derivative instruments The gains (losses) on derivatives in cash flow hedging and net investment hedging relationships recognized in other comprehensive income (OCI) are summarized below (in millions):
 Gains (Losses) Recognized in OCI on Derivatives Before Tax Effect
Three Months EndedSix Months Ended
 June 30,June 30,
2022202320222023
Derivatives in cash flow hedging relationship:
Foreign exchange contracts
Amount included in the assessment of effectiveness$1,131 $77 $1,266 $(61)
Amount excluded from the assessment of effectiveness(39)80 (54)127 
Derivatives in net investment hedging relationship:
Foreign exchange contracts
Amount included in the assessment of effectiveness509 (59)658 (274)
Total$1,601 $98 $1,870 $(208)
 The table below presents the gains (losses) of our derivatives on the Consolidated Statements of Income: (in millions):
 Gains (Losses) Recognized in Income
Three Months Ended
 June 30,
20222023
RevenuesOther income (expense), netRevenuesOther income (expense), net
Total amounts in the Consolidated Statements of Income$69,685 $(439)$74,604 $65 
Effect of cash flow hedges:
Foreign exchange contracts
Amount reclassified from AOCI to income$400 $0 $(2)$0 
Amount excluded from the assessment of effectiveness (amortized)(24)0 6 0 
Effect of fair value hedges:
Foreign exchange contracts
Hedged items0 (136)0 22 
Derivatives designated as hedging instruments0 136 0 (22)
Amount excluded from the assessment of effectiveness0 2 0 5 
Effect of net investment hedges:
Foreign exchange contracts
Amount excluded from the assessment of effectiveness0 28 0 72 
Effect of non designated hedges:
Foreign exchange contracts0 (149)0 124 
Other contracts0 86 0 (4)
Total gains (losses)$376 $(33)$4 $197 
 Gains (Losses) Recognized in Income
Six Months Ended
 June 30,
20222023
RevenuesOther income (expense), netRevenuesOther income (expense), net
Total amounts in the Consolidated Statements of Income$137,696 $(1,599)$144,391 $855 
Effect of cash flow hedges:
Foreign exchange contracts
Amount of gains (losses) reclassified from AOCI to income$697 $0 $86 $0 
Amount excluded from the assessment of effectiveness (amortized)(43)0 2 0 
Effect of fair value hedges:
Foreign exchange contracts
Hedged items0 (123)0 54 
Derivatives designated as hedging instruments0 124 0 (54)
Amount excluded from the assessment of effectiveness0 3 0 10 
Effect of net investment hedges:
Foreign exchange contracts
Amount excluded from the assessment of effectiveness0 40 0 123 
Effect of non designated hedges:
Foreign exchange contracts0 (396)0 154 
Other Contracts0 124 0 (1)
Total gains (losses)$654 $(228)$88 $286 
Offsetting assets
The gross amounts of derivative instruments subject to master netting arrangements with various counterparties, and cash and non-cash collateral received and pledged under such agreements were as follows (in millions):
As of December 31, 2022
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts RecognizedGross Amounts Offset in the Consolidated Balance SheetsNet Amounts Presented in the Consolidated Balance Sheets
Financial Instruments(1)
Cash and Non-Cash Collateral Received or PledgedNet Amounts
Derivatives assets$760 $(84)$676 $(463)$(132)$81 
Derivatives liabilities$894 $(84)$810 $(463)$(28)$319 
As of June 30, 2023
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts RecognizedGross Amounts Offset in the Consolidated Balance SheetsNet Amounts Presented in the Consolidated Balance Sheets
Financial Instruments(1)
Cash and Non-Cash Collateral Received or PledgedNet Amounts
Derivatives assets$444 $(47)$397 $(138)$(226)$33 
Derivatives liabilities$451 $(47)$404 $(138)$(34)$232 
(1)The balances as of December 31, 2022 and June 30, 2023 were related to derivatives allowed to be net settled in accordance with our master netting agreements.
Offsetting liabilities
The gross amounts of derivative instruments subject to master netting arrangements with various counterparties, and cash and non-cash collateral received and pledged under such agreements were as follows (in millions):
As of December 31, 2022
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts RecognizedGross Amounts Offset in the Consolidated Balance SheetsNet Amounts Presented in the Consolidated Balance Sheets
Financial Instruments(1)
Cash and Non-Cash Collateral Received or PledgedNet Amounts
Derivatives assets$760 $(84)$676 $(463)$(132)$81 
Derivatives liabilities$894 $(84)$810 $(463)$(28)$319 
As of June 30, 2023
Gross Amounts Not Offset in the Consolidated Balance Sheets, but Have Legal Rights to Offset
Gross Amounts RecognizedGross Amounts Offset in the Consolidated Balance SheetsNet Amounts Presented in the Consolidated Balance Sheets
Financial Instruments(1)
Cash and Non-Cash Collateral Received or PledgedNet Amounts
Derivatives assets$444 $(47)$397 $(138)$(226)$33 
Derivatives liabilities$451 $(47)$404 $(138)$(34)$232 
(1)The balances as of December 31, 2022 and June 30, 2023 were related to derivatives allowed to be net settled in accordance with our master netting agreements.