Pegasystems (PEGA) 10-K 26 Feb 18 2017 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($) $ in Billions	12 Months Ended
	Dec. 31, 2017	Feb. 14, 2018	Jun. 30, 2017
Document Information [Line Items]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	FY
Trading Symbol	PEGA
Entity Registrant Name	PEGASYSTEMS INC
Entity Central Index Key	1,013,857
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		78,099,419
Entity Public Float			$ 2.2

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 162,279	$ 70,594
Marketable securities	61,469	63,167
Total cash, cash equivalents, and marketable securities	223,748	133,761
Trade accounts receivable, net of allowance of $7,655 and $4,126	248,331	265,028
Income taxes receivable	25,662	14,155
Other current assets	14,559	12,188
Total current assets	512,300	425,132
Property and equipment, net	40,359	38,281
Deferred income taxes	57,127	69,898
Other long-term assets	6,969	3,990
Intangible assets, net	31,899	44,191
Goodwill	72,952	73,164
Total assets	721,606	654,656
Current liabilities:
Accounts payable	17,370	14,414
Accrued expenses	45,508	36,751
Accrued compensation and related expenses	66,040	60,660
Deferred revenue	195,073	175,647
Total current liabilities	323,991	287,472
Income taxes payable	4,717	4,263
Long-term deferred revenue	6,591	10,989
Other long-term liabilities	15,229	16,043
Total liabilities	350,528	318,767
Commitments and contingencies (Note 12)
Stockholders' equity:
Preferred stock, $0.01 par value, 1,000 shares authorized; no shares issued and outstanding
Common stock, $0.01 par value, 200,000 shares authorized; 78,081 and 76,591 shares issued and outstanding at December 31, 2017 and 2016, respectively	781	766
Additional paid-in capital	152,097	143,903
Retained earnings	221,926	198,315
Accumulated other comprehensive loss:
Net unrealized loss on available-for-sale marketable securities, net of tax	(232)	(169)
Foreign currency translation adjustments	(3,494)	(6,926)
Total stockholders' equity	371,078	335,889
Total liabilities and stockholders' equity	$ 721,606	$ 654,656

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Allowance for sales credit memos	$ 7,655	$ 4,126
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	78,081,000	76,591,000
Common stock, shares outstanding	78,081,000	76,591,000

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenue:
Software license	$ 288,334	$ 279,995	$ 275,588
Maintenance	244,347	220,336	202,802
Services	307,901	249,935	204,305
Total revenue	840,582	750,266	682,695
Cost of revenue:
Software license	5,085	4,943	4,125
Maintenance	27,905	25,505	21,903
Services	246,683	208,808	187,418
Total cost of revenue	279,673	239,256	213,446
Gross profit	560,909	511,010	469,249
Operating expenses:
Selling and marketing	307,210	278,849	241,387
Research and development	162,886	145,548	126,374
General and administrative	52,153	45,951	36,738
Acquisition-related		2,903	89
Total operating expenses	522,249	473,251	404,588
Income from operations	38,660	37,759	64,661
Foreign currency transaction (loss)/gain	(900)	2,247	(4,168)
Interest income, net	731	776	1,056
Other expense, net	(1,391)	(5,580)	(1,044)
Income before provision for income taxes	37,100	35,202	60,505
Provision for income taxes	4,166	8,216	24,183
Net income	$ 32,934	$ 26,986	$ 36,322
Earnings per share:
Basic	$ 0.43	$ 0.35	$ 0.47
Diluted	$ 0.40	$ 0.34	$ 0.46
Weighted-average number of common shares outstanding:
Basic	77,431	76,343	76,507
Diluted	82,832	79,732	79,043

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net income	$ 32,934	$ 26,986	$ 36,322
Other comprehensive income/(loss), net of tax
Unrealized loss on available-for-sale marketable securities, net of tax	(63)	(19)	(85)
Foreign currency translation adjustments	3,432	(3,569)	(2,810)
Total other comprehensive income/(loss), net of tax	3,369	(3,588)	(2,895)
Comprehensive income	$ 36,303	$ 23,398	$ 33,427

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive (Loss) Income
Balance (in shares) at Dec. 31, 2014		76,357
Balance at Dec. 31, 2014	$ 294,705	$ 764	$ 141,495	$ 153,058	$ (612)
Repurchase of common stock (in shares)		(952)
Repurchase of common stock	(22,750)	$ (10)	(22,740)
Issuance of common stock for share-based compensation plans (in shares)		1,059
Issuance of common stock for share-based compensation plans	(9,190)	$ 11	(9,201)
Issuance of common stock under Employee Stock Purchase Plan (in shares)		24
Issuance of common stock under Employee Stock Purchase Plan	550		550
Stock-based compensation expense	30,078		30,078
Tax benefit from exercise or vesting of equity awards, net of deferred tax asset deficiencies	5,236		5,236
Cash dividends declared	(9,197)			(9,197)
Other comprehensive income (loss)	(2,895)				(2,895)
Net income	36,322			36,322
Balance (in shares) at Dec. 31, 2015		76,488
Balance at Dec. 31, 2015	322,859	$ 765	145,418	180,183	(3,507)
Repurchase of common stock (in shares)		(1,078)
Repurchase of common stock	(27,028)	$ (11)	(27,017)
Issuance of common stock for share-based compensation plans (in shares)		1,161
Issuance of common stock for share-based compensation plans	(15,856)	$ 12	(15,868)
Issuance of common stock under Employee Stock Purchase Plan (in shares)		20
Issuance of common stock under Employee Stock Purchase Plan	562		562
Stock-based compensation expense	40,808		40,808
Cash dividends declared	(9,175)			(9,175)
Other comprehensive income (loss)	(3,588)				(3,588)
Net income	$ 26,986			26,986
Balance (in shares) at Dec. 31, 2016	76,591	76,591
Balance at Dec. 31, 2016	$ 335,889	$ 766	143,903	198,315	(7,095)
Cumulative-effect adjustment from adoption of ASU 2016-09	321			321
Repurchase of common stock (in shares)		(99)
Repurchase of common stock	(4,493)		(4,493)
Issuance of common stock for share-based compensation plans (in shares)		1,568
Issuance of common stock for share-based compensation plans	(41,627)	$ 15	(41,642)
Issuance of common stock under Employee Stock Purchase Plan (in shares)		21
Issuance of common stock under Employee Stock Purchase Plan	1,009		1,009
Stock-based compensation expense	53,320		53,320
Cash dividends declared	(9,323)			(9,323)
Other comprehensive income (loss)	3,369				3,369
Net income	$ 32,934			32,934
Balance (in shares) at Dec. 31, 2017	78,081	78,081
Balance at Dec. 31, 2017	$ 371,078	$ 781	$ 152,097	$ 221,926	$ (3,726)

CONSOLIDATED STATEMENTS OF STO7

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) $ in Thousands	12 Months Ended
	Dec. 31, 2015USD ($)$ / shares
Tax benefit from exercise or vesting of equity awards, deferred tax asset deficiencies | $	$ 105
Cash dividends declared, per share | $ / shares	$ 0.12

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands	12 Months Ended
	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)
Operating activities:
Net income	$ 32,934	$ 26,986	$ 36,322
Adjustment to reconcile net income to cash provided by operating activities:
Deferred income taxes	13,795	(5,810)	(2,099)
Depreciation and amortization	24,713	24,137	23,093
Stock-based compensation expense	53,313	40,821	30,054
Foreign currency transaction loss (gain)	900	(2,247)	4,168
Amortization of investments	1,381	1,862	2,238
Other non-cash	(1,383)	(1,382)	822
Change in operating assets and liabilities:
Trade accounts receivable	23,814	(56,730)	(62,235)
Income taxes receivable and other current assets	(13,393)	(10,818)	3,223
Accounts payable and accrued expenses	14,473	1,531	16,572
Deferred revenue	8,363	21,271	17,668
Other long-term assets and liabilities	(675)	253	(2,023)
Cash provided by operating activities	158,235	39,874	67,803
Investing activities:
Purchases of investments	(27,718)	(23,969)	(75,702)
Proceeds from maturities and called investments	26,997	22,788	42,026
Sales of investments		62,210	1,915
Payments for acquisitions, net of cash acquired	(297)	(49,113)	(1,671)
Investment in property and equipment	(13,741)	(19,088)	(11,020)
Cash used in investing activities	(14,759)	(7,172)	(44,452)
Financing activities:
Dividend payments to shareholders	(9,277)	(9,174)	(9,194)
Common stock repurchases for tax withholdings for net settlement of equity awards	(40,617)	(15,294)	(8,640)
Common stock repurchases under share repurchase program	(4,335)	(27,248)	(22,825)
Cash used in financing activities	(54,229)	(51,716)	(40,659)
Effect of exchange rates on cash and cash equivalents	2,438	(3,418)	(4,251)
Net increase/(decrease) in cash and cash equivalents	91,685	(22,432)	(21,559)
Cash and cash equivalents, beginning of period	70,594	93,026	114,585
Cash and cash equivalents, end of period	162,279	70,594	93,026
Supplemental disclosures:
Income taxes (refunded)/paid	(2,322)	28,844	30,215
Non-cash investing and financing activity:
Dividends payable	$ 2,344	$ 2,298	$ 2,297

BASIS OF PRESENTATION

BASIS OF PRESENTATION	12 Months Ended
	Dec. 31, 2017
BASIS OF PRESENTATION	1. BASIS OF PRESENTATION Business The Company develops, markets, licenses, and supports software applications for marketing, sales automation, customer service, and operations, in addition to the Pega Platform for clients that wish to build and extend their own applications. The Company provides implementation, consulting, training, technical support, and hosting services to facilitate the use of its software. Management estimates and reporting The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S.”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could differ from those estimates. Accounts with reported amounts based on significant estimates and judgments include, but are not limited to, revenue, deferred revenue, deferred income taxes, income taxes payable, intangible assets, and goodwill. Principles of consolidation The Company’s consolidated financial statements reflect Pegasystems Inc. and subsidiaries in which the Company holds a controlling financial interest.

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2017
SIGNIFICANT ACCOUNTING POLICIES	2. SIGNIFICANT ACCOUNTING POLICIES Revenue recognition The Company’s revenue is derived primarily from software licenses, cloud arrangements, maintenance fees related to the Company’s software licenses, and consulting services. The Company’s license arrangements, whether involving a perpetual license or a term license, generally also contain multiple elements, including consulting services, training, and software maintenance services. Software revenue recognition requires judgment, including whether a software arrangement includes multiple elements, and if so, whether vendor-specific objective evidence (“VSOE”) of fair value exists for those elements. The amount of arrangement consideration allocated to undelivered elements is based on the VSOE of fair value for those elements and recognized as those elements are delivered. Any remaining portion of the total arrangement fee is allocated to the software license—the first delivered element. Revenue is recognized for each element when all of the revenue recognition criteria have been met. Revenue is recognized net of any taxes collected from clients and subsequently remitted to governmental authorities. Changes in the mix of the elements in a software arrangement, the ability to identify VSOE for those elements, the fair value of the respective elements, and changes to a product’s estimated life cycle could materially impact the amount of earned and unearned revenue. Before the Company can recognize revenue, the following four basic criteria must be met: • Persuasive evidence of an arrangement— • Delivery of product and services— • Fee is fixed or determinable— • Collection of fee is probable— Software license revenues Perpetual software license fees are recognized as revenue when the software is delivered, any acceptance required by the contract that is not perfunctory is obtained, no significant obligations or contingencies exist related to the software, all other undelivered elements in a multiple element arrangement possess VSOE, and all other revenue recognition criteria are met. Term software license fees are usually payable on a monthly, quarterly, or annual basis under license agreements that typically have a three to five-year term and may be renewed for additional terms at the client’s option. The Company recognizes term license revenue over the term of the agreement as payments become due or earlier if prepaid, provided all other criteria for revenue recognition have been met. Maintenance revenues First-year maintenance typically is sold with the related software license and renewed on an annual basis thereafter. Maintenance revenue is deferred and recognized ratably over the term of the support period, which is generally one year and subject to annual renewals. Perpetual software maintenance obligations are based on separately stated renewal rates in the arrangement that are substantive and therefore represent VSOE of fair value. Term license arrangements include separately stated maintenance fees and the Company uses stand-alone sales to determine VSOE of fair value. Services revenues The Company’s services revenue is comprised of fees for consulting services including software implementation, training, reimbursable expenses, and for sales of its Pega Cloud as-a-platform Revenue from training services and consulting services under time and materials contracts is recognized as services are performed. The Company has VSOE of fair value for its training services and consulting services under time and materials contracts in the Americas, Europe, and certain regions of Asia. Consulting services may sometimes be provided on a fixed-price basis. The Company does not have VSOE of fair value for fixed-price services or time and materials services in certain geographical regions. When these services are part of a multiple element arrangement, and the services are not essential to the functionality of the software, and when services, including maintenance, are the only undelivered element, the Company recognizes the revenue from the total arrangement ratably over the longer of the software maintenance period or the service period. Revenue from fixed-price services that are not bundled with a software license is generally recognized ratably over the service period, which is typically less than four months. Revenue from stand-alone sales of the Pega Cloud Dev/Test environment is recognized as services are performed because the Company has VSOE of fair value. Revenue from stand-alone sales of the Pega Cloud Production environment is recognized ratably over the term of the service. When implementation services are sold together with the Company’s Pega Cloud offering and these services have stand-alone value to the client, the Company accounts for these services separately from this offering. Stand-alone value is established through the client’s ability to buy these services from many trained partner system integrators and from transactions sold independently from the sale of Pega Cloud. Since these multiple-element arrangements are not software license sales, the Company applies a selling price hierarchy to determine the fair value of each element in the arrangement. Under the selling price hierarchy, each element’s fair value is determined based on its VSOE, if available. If VSOE does not exist, third-party evidence of fair value (“TPE”) will be considered, and estimated selling price (“ESP”) will be used if neither VSOE nor TPE is available. The Company generally does not have VSOE of its Pega Cloud offering and is not able to determine TPE as its sales strategy is customized to the needs of its clients and the Company’s products and services are dissimilar to comparable products or services in the marketplace. In determining ESP, the Company applies significant judgment as it weighs a variety of factors, based on the facts and circumstances of the arrangement. The Company typically arrives at an ESP for a service without VSOE or TPE by considering company-specific factors such as geographies, competitive landscape, and pricing practices used to establish bundled pricing and discounting. Deferred revenue Deferred software license revenue typically results from client billings for which all of the criteria to recognize revenue have not been met. Deferred maintenance revenue represents software license updates and product support contracts that are typically billed in advance and are recognized ratably over the support periods. Deferred services revenue represents advanced billings for consulting, hosting, and training services that are recognized as the services are performed. Fair value of financial instruments The principal financial instruments held by the Company consist of cash equivalents, marketable securities, derivative instruments, accounts receivable, and accounts payable. See Note 3 “Marketable Securities”, Note 4 “Derivative Instruments”, and Note 5 “Fair Value Measurements” for further discussion of financial instruments that are carried at fair value on a recurring basis. Derivative instruments The Company has in the past used, but does not currently use, foreign currency forward contracts (“forward contracts”) to manage its exposures to changes in foreign currency exchange rates associated with its foreign currency denominated accounts receivable, intercompany receivable and payables, and cash. See Note 4 “Derivative Instruments” for further discussion. Property and equipment Property and equipment are recorded at cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets, which are three years for computer equipment and five years for furniture and fixtures. Leasehold improvements are amortized over the lesser of the term of the lease or the useful life of the asset. Repairs and maintenance costs are expensed as incurred. Internal-use The Company capitalizes and amortizes certain direct costs associated with computer software developed or purchased for internal use incurred during the application development stage. Costs related to preliminary project activities and post implementation activities are expensed as incurred. The Company amortizes capitalized software costs generally over three to five years commencing on the date the software is placed into service. During 2016, the Company placed into service computer software developed for internal use of $11.3 million, of which $1.1 million was capitalized in 2015 and $10.2 million was capitalized in 2016. Goodwill Goodwill represents the residual purchase price paid in a business combination after the fair value of all identified assets and liabilities have been recorded. Goodwill is not amortized. The Company operates as a single reporting unit. The Company performed its qualitative assessment as of November 30, 2017, 2016, and 2015, and concluded it was not more likely than not that the fair value of its reporting unit was less than its carrying value. Intangible and long-lived assets All of the Company’s intangible assets are amortized using the straight-line method over their estimated useful life. The Company evaluates its long-lived tangible and intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Impairment is assessed by comparing the undiscounted cash flows expected to be generated by the intangible asset to its carrying value. If impairment exists, the Company calculates the impairment by comparing the carrying value of the intangible asset to its fair value as determined by discounted expected cash flows. The Company did not record any impairments in 2017, 2016, or 2015. Business combinations The Company uses its best estimates and assumptions to accurately assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. The Company’s estimates are inherently uncertain and subject to refinement. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. In addition, uncertain tax positions and tax-related Research and development and software development costs Research and development costs are expensed as incurred. Capitalization of computer software developed for resale begins upon the establishment of technological feasibility, generally demonstrated by a working model or an operative version of the computer software product. Such costs have not been material to date as technological feasibility is established within a short time frame from the software’s general availability and, as a result, no costs were capitalized in 2017, 2016, or 2015. Stock-based compensation The Company recognizes stock-based compensation expense associated with equity awards based on the fair value of these awards at the grant date. Stock-based compensation is recognized over the requisite service period, which is generally the vesting period of the equity award, and is adjusted each period for anticipated forfeitures. See Note 14 “Stock-based Compensation” for discussion of the Company’s key assumptions included in determining the fair value of its equity awards at the grant date. Foreign currency translation The translation of assets and liabilities for the Company’s subsidiaries with functional currencies other than the U.S. Dollar are made at period-end Accounting for income taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company regularly assesses the need for a valuation allowance against its deferred tax assets. Future realization of the Company’s deferred tax assets ultimately depends on the existence of sufficient taxable income within the available carryback or carryforward periods. Sources of taxable income include taxable income in prior carryback years, future reversals of existing taxable temporary differences, tax planning strategies, and future taxable income. The Company records a valuation allowance to reduce its deferred tax assets to an amount it believes is more-likely-than-not with-and-without The Company assesses its income tax positions and records tax benefits based upon management’s evaluation of the facts, circumstances, and information available at the reporting date. For those tax positions where it is more-likely-than-not more-likely-than-not non-current As a global company, the Company uses significant judgment to calculate and provide for income taxes in each of the tax jurisdictions in which it operates. In the ordinary course of the Company’s business, there are transactions and calculations undertaken whose ultimate tax outcome cannot be certain. Some of these uncertainties arise as a consequence of transfer pricing for transactions with the Company’s subsidiaries and nexus and tax credit estimates. In addition, the calculation of acquired tax attributes and the associated limitations are complex. See Note 15 “Income Taxes” for further information. Advertising expense Advertising costs are expensed as incurred. Advertising costs were $6.1 million, $8.9 million, and $9.8 million during 2017, 2016, and 2015, respectively. New accounting pronouncements Stock-Based Compensation In May 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-09 Financial Instruments In June 2016, the FASB issued ASU No. 2016-13, available-for-sale Leases In February 2016, the FASB issued ASU No. 2016-02, right-of-use right-of-use Revenue In May 2014, the FASB issued ASU No. 2014-09, The Company has elected the full retrospective adoption model, effective January 1, 2018. The Company’s quarterly results beginning with the quarter ending March 31, 2018 and comparative prior periods will be compliant with ASC 606. The Company’s Annual Report on Form 10-K The Company has substantially completed the implementation of ASC 606 and has identified the necessary changes to its policies, processes, systems, and controls. However, due to the complex nature of the Company’s arrangements and recent updates to interpretive guidance, which were made as recently as the fall of 2017, the Company has not yet completed all of its internal control procedures. Based upon the work performed to date, the Company expects to record a cumulative-effect adjustment as of December 31, 2015 to increase retained earnings by approximately $205 million which includes a $30 million increase in retained earnings due to deferred commission expense and a $97 million decrease in retained earnings due to the resulting tax impact. We expect to fully disclose the impacts of the new standard in connection with our 10Q filing for the first quarter of 2018. The Company expects the following impacts upon adoption of the standard: • Currently, the Company recognizes revenue from term licenses and perpetual licenses with extended payment terms over the term of the agreement as payments become due or earlier if prepaid, provided all other criteria for revenue recognition have been met, and any corresponding maintenance over the term of the agreement. The adoption of ASC 606 will result in revenue for performance obligations being recognized as they are satisfied, which will typically occur upon delivery. Therefore, revenue from the term and perpetual license performance obligations with extended payment terms is recognized when control is transferred to the client. Any unrecognized license revenue from these arrangements, included in deferred revenue at December 31, 2015, will not be recognized in revenue in future periods but as a cumulative adjustment to retained earnings. Further, term license revenue from new arrangements executed in 2016 and 2017 will be recognized in full in the year that control of the license is transferred to the client instead of over the term of the agreement. Revenue from the maintenance performance obligations is expected to be recognized on a straight-line basis over the contractual term, consistent with the previous treatment. Due to the revenue from term and perpetual licenses with extended payment terms being recognized prior to amounts being billed to the client, the Company expects to recognize a material unbilled receivable on the balance sheet. • Currently, the Company allocates revenue to licenses under the residual method when it has Vendor Specific Objective Evidence (“VSOE”) for the remaining undelivered elements, which allocates any future credits or significant discounts entirely to the license. The adoption of ASC 606 will result in future credits, significant discounts, and material rights under ASC 606, generally allocated to all performance obligations based upon their relative selling price. Under ASC 606, additional license revenue from the reallocation of such arrangement considerations will be recognized when control is transferred to the client, which is generally upon delivery of the license. • Currently, the Company does not have VSOE, in software bundled arrangements, for fixed price services, time and materials services in certain geographical areas, and unspecified future products, which results in revenue being deferred in such instances until such time as VSOE exists for all undelivered elements or recognized ratably over the longest performance period. The adoption of ASC 606 eliminates the requirement for VSOE and replaces it with the concept of a stand-alone selling price. Once the transaction price is allocated to each of the performance obligations based on their relative stand-alone selling prices, the Company can recognize revenue as the performance obligations are delivered, either at a point in time or over time. Under ASC 606, license revenue will be recognized when control is transferred to the client, consulting revenue will be recognized over time based on input measures that reflect the Company’s performance on the contract. This will result in the acceleration of consulting revenue when compared to the current practice of ratable recognition for consulting when there is a lack of VSOE. • Sales commissions and other third party acquisition costs resulting directly from securing contracts with clients are currently expensed when incurred. ASC 340-40 “Accounting for Other Assets and Deferred Costs” will require these costs to be recognized as an asset when incurred and to be expensed over the associated contract term or estimated client life depending on the nature of the underlying contract. The Company expects this change to impact its commissions related to multi-year cloud offerings and term and perpetual licenses with additional rights of use that extend beyond one year which will require the allocation of a portion of the commission paid for term and perpetual licenses to future maintenance obligations when the commission rates within each arrangement are not commensurate. This change will impact retained earnings as of December 31, 2015 but will not have a significant impact in future periods. • ASC 606 provides additional accounting guidance for contract modifications whereby changes must be accounted for either as a retrospective change (creating either a catch up or deferral of past revenues), prospectively with a reallocation of revenues amongst identified performance obligations, or prospectively as separate contracts which will not require any reallocation. This may result in a difference in the timing of the recognition of revenue as compared to how contract modifications are recognized currently. • There will be a corresponding effect on tax liabilities in relation to all of the above impacts.

MARKETABLE SECURITIES

MARKETABLE SECURITIES	12 Months Ended
	Dec. 31, 2017
MARKETABLE SECURITIES	3. MARKETABLE SECURITIES (in thousands) December 31, 2017 Amortized Unrealized Unrealized Fair Municipal bonds $ 32,996 $ — $ (148 ) $ 32,848 Corporate bonds 28,757 1 (137 ) 28,621 $ 61,753 $ 1 $ (285 ) $ 61,469 (in thousands) December 31, 2016 Amortized Unrealized Unrealized Fair Municipal bonds $ 36,746 $ — $ (139 ) $ 36,607 Corporate bonds 26,610 1 (51 ) 26,560 $ 63,356 $ 1 $ (190 ) $ 63,167 The Company considers debt securities with maturities of three months or less from the purchase date to be cash equivalents. Interest is recorded when earned. All of the Company’s investments are classified as available-for-sale As of December 31, 2017, the Company did not hold any investments with unrealized losses considered to be other than temporary. As of December 31, 2017, remaining maturities of marketable debt securities ranged from January 2018 to October 2020, with a weighted-average remaining maturity of approximately 12 months.

DERIVATIVE INSTRUMENTS

DERIVATIVE INSTRUMENTS	12 Months Ended
	Dec. 31, 2017
DERIVATIVE INSTRUMENTS	4. DERIVATIVE INSTRUMENTS The Company historically used, but does not currently use, foreign currency forward contracts (“forward contracts”) to reduce its exposure to fluctuations in foreign currency exchange rates associated with its foreign currency denominated cash, accounts receivable, and intercompany receivables and payables held primarily by the U.S. parent company and its United Kingdom (“U.K.”) subsidiary. The cash flows related to these forward contracts are classified as operating activities in the accompanying consolidated statements of cash flows. The Company does not enter into any forward contracts for trading or speculative purposes. At December 31, 2016, the total notional value of the Company’s outstanding forward contracts was $128.4 million. The fair value of the Company’s outstanding forward contracts was as follows: (in thousands) December 31, 2016 Recorded In: Fair Value Asset Derivatives Foreign currency forward contracts Other current assets $ 628 Liability Derivatives Foreign currency forward contracts Accrued expenses $ 883 The Company had forward contracts outstanding with total notional values as of December 31, 2016 as follows: (in thousands) Euro € 29,820 British pound £ 6,440 Australian dollar A$ 22,010 United States dollar $ 73,125 The income statement impact of the Company’s outstanding forward contracts and foreign currency transactions was as follows: 2017 2016 2015 Gain (loss) from the change in the fair value of forward contracts included in other expense, net $ 286 $ (5,643 ) $ (1,047 ) Foreign currency transaction (losses) gains from the remeasurement of foreign currency assets and liabilities (900 ) 2,247 (4,168 )

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	12 Months Ended
	Dec. 31, 2017
FAIR VALUE MEASUREMENTS	5. FAIR VALUE MEASUREMENTS Assets and Liabilities Measured at Fair Value on a Recurring Basis The Company records its marketable securities, forward contracts and investments in privately-held companies at fair value on a recurring basis. Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants based on assumptions that market participants would use in pricing an asset or liability. As a basis for classifying the fair value measurements, a three-tier fair value hierarchy, which classifies the fair value measurements based on the inputs used in measuring fair value, was established as follows: (Level 1) observable inputs such as quoted prices in active markets for identical assets or liabilities; (Level 2) significant other inputs that are observable either directly or indirectly; and (Level 3) significant unobservable inputs on which there is little or no market data, which require the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The Company’s cash equivalents are composed of money market funds and time deposits which are classified as Level 1 and Level 2, respectively, in the fair value hierarchy. The Company’s marketable securities are classified within Level 2 of the fair value hierarchy are valued based on a market approach using quoted prices, when available, or matrix pricing compiled by third party pricing vendors, using observable market inputs such as interest rates, yield curves, and credit risk. The Company’s foreign currency forward contracts, which are all classified within Level 2 of the fair value hierarchy, are valued based on the notional amounts and rates under the contracts and observable market inputs such as currency exchange rates and credit risk. The Company’s investments in privately-held companies are classified within Level 3 of the fair value hierarchy and are valued using model-based techniques, including option pricing models and discounted cash flow models. If applicable, the Company will recognize transfers into and out of levels within the fair value hierarchy at the end of the reporting period in which the actual event or change in circumstance occurs. There were no transfers of investments between Level 1 and Level 2 during 2017 and 2016. The Company’s assets and liabilities measured at fair value on a recurring basis consisted of the following: (in thousands) Fair Value Measurements at Reporting Date Using Total Level 1 Level 2 Level 3 December 31, 2017 Fair Value Assets: Cash equivalents (1) $ 2,720 $ 40,051 $ — $ 42,771 Marketable securities: Municipal bonds $ — $ 32,848 $ — $ 32,848 Corporate bonds — 28,621 — 28,621 Total marketable securities $ — $ 61,469 $ — $ 61,469 Investments in privately-held companies (2) $ — $ — $ 1,030 $ 1,030 December 31, 2016 Fair Value Assets: Money market funds (1) $ 458 $ — $ — $ 458 Marketable securities: Municipal bonds $ — $ 36,607 $ — $ 36,607 Corporate bonds — 26,560 — 26,560 Total marketable securities $ — $ 63,167 $ — $ 63,167 Foreign currency forward contracts $ — $ 628 $ — $ 628 Fair Value Liabilities: Foreign currency forward contracts $ — $ 883 $ — $ 883 (1) Included in cash and cash equivalents in the consolidated balance sheets. (2) Included in other long-term assets in the consolidated balance sheets. For certain other financial instruments, including accounts receivable and accounts payable, the carrying value approximates their fair value due to the relatively short maturity of these items. Assets Measured at Fair Value on a Nonrecurring Basis Assets recorded at fair value on a nonrecurring basis, such as property and equipment, and intangible assets are recognized at fair value when they are impaired. During 2017, 2016, and 2015, the Company did not recognize any impairments on its assets measured at fair value on a nonrecurring basis.

TRADE ACCOUNTS RECEIVABLE, NET

TRADE ACCOUNTS RECEIVABLE, NET OF ALLOWANCE	12 Months Ended
	Dec. 31, 2017
TRADE ACCOUNTS RECEIVABLE, NET OF ALLOWANCE	6. TRADE ACCOUNTS RECEIVABLE, NET OF ALLOWANCE Unbilled trade accounts receivable primarily relate to services earned under time and materials arrangements and to license, maintenance, and cloud arrangements that have commenced or been delivered in excess of scheduled invoicing. (in thousands) December 31, 2017 2016 Trade accounts receivable $ 225,923 $ 234,473 Unbilled accounts receivable 30,063 34,681 Total accounts receivable 255,986 269,154 Allowance for sales credit memos (7,655 ) (4,126 ) $ 248,331 $ 265,028 The Company records an allowance for estimates of potential sales credit memos when the related revenue is recorded and reviews this allowance periodically. The following reflects the activity of the allowance for sales credit memos: (in thousands) 2017 2016 2015 Balance at beginning of year $ 4,126 $ 4,631 $ 1,540 Provision for credit memos 7,052 3,290 8,005 Credit memos issued (3,523 ) (3,795 ) (4,914 ) $ 7,655 $ 4,126 $ 4,631

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT	12 Months Ended
	Dec. 31, 2017
PROPERTY AND EQUIPMENT	7. PROPERTY AND EQUIPMENT (in thousands) December 31, 2017 2016 Leasehold improvements $ 38,650 $ 32,852 Computer equipment 23,783 21,522 Furniture and fixtures 8,517 6,127 Computer software purchased 6,690 6,083 Computer software developed for internal use 12,596 12,069 Fixed assets in progress 2,167 772 92,403 79,425 Less: accumulated depreciation and amortization (52,044 ) (41,144 ) Property and equipment, net $ 40,359 $ 38,281 Depreciation expense was approximately $12.4 million, $11.2 million, and $10.6 million for 2017, 2016, and 2015, respectively.

ACQUISITIONS

ACQUISITIONS	12 Months Ended
	Dec. 31, 2017
ACQUISITIONS	8. ACQUISITIONS On April 11, 2016, the Company acquired OpenSpan, Inc. (“OpenSpan”), a privately held software provider of robotic process automation and workforce analytics software for $48.8 million in cash, net of $1.8 million in cash acquired.

GOODWILL AND OTHER INTANGIBLE A

GOODWILL AND OTHER INTANGIBLE ASSETS	12 Months Ended
	Dec. 31, 2017
GOODWILL AND OTHER INTANGIBLE ASSETS	9. GOODWILL AND OTHER INTANGIBLE ASSETS As discussed in Note 17 “Geographic Information and Major Clients”, the Company operates in one reportable segment and has one reporting unit. The following table presents the changes in the carrying amount of goodwill: (in thousands) 2017 2016 Balance as of January 1, $ 73,164 $ 46,776 Acquisitions — 26,689 Purchase price adjustments to goodwill (354 ) — Translation adjustments 142 (301 ) Balance as of December 31, $ 72,952 $ 73,164 Intangible assets are recorded at cost and are amortized using the straight-line method over their estimated useful lives. (in thousands) Range of Cost Accumulated Net book December 31, 2017 Client related intangibles 9-10 years $ 63,164 $ (44,835 ) $ 18,329 Technology 7-10 58,942 (45,372 ) 13,570 Other intangibles — 5,361 (5,361 ) — Total $ 127,467 $ (95,568 ) $ 31,899 December 31, 2016 Client related intangibles 4-10 $ 63,091 $ (37,573 ) $ 25,518 Technology 3-10 58,942 (40,269 ) 18,673 Other intangibles — 5,361 (5,361 ) — Total $ 127,394 $ (83,203 ) $ 44,191 Amortization expense of acquired intangibles was reflected in the Company’s consolidated statements of operations as follows: (in thousands) 2017 2016 2015 Cost of revenue $ 5,103 $ 5,986 $ 5,392 Selling and marketing 7,235 7,145 6,127 General and administrative — 277 683 $ 12,338 $ 13,408 $ 12,202 Future estimated amortization expense related to intangible assets as of December 31, 2017 was as follows: (in thousands) Future estimated 2018 $ 11,345 2019 5,553 2020 2,657 2021 2,633 2022 and thereafter 9,711 $ 31,899

ACCRUED EXPENSES

ACCRUED EXPENSES	12 Months Ended
	Dec. 31, 2017
ACCRUED EXPENSES	10. ACCRUED EXPENSES (in thousands) December 31, 2017 2016 Outside professional services $ 14,468 $ 10,204 Income and other taxes 7,420 10,422 Marketing and sales program expenses 6,444 3,707 Dividends payable 2,344 2,298 Employee related expenses 4,065 3,806 Other 10,767 6,314 $ 45,508 $ 36,751

DEFERRED REVENUE

DEFERRED REVENUE	12 Months Ended
	Dec. 31, 2017
DEFERRED REVENUE	11. DEFERRED REVENUE (in thousands) December 31, December 31, Term license $ 16,853 $ 15,843 Perpetual license 19,277 23,189 Maintenance 126,083 112,397 Cloud 23,276 13,604 Consulting and Training 9,584 10,614 Current deferred revenue 195,073 175,647 Perpetual license 2,568 7,909 Maintenance 2,745 1,802 Cloud 1,278 1,278 Long-term deferred revenue 6,591 10,989 $ 201,664 $ 186,636

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	12 Months Ended
	Dec. 31, 2017
COMMITMENTS AND CONTINGENCIES	12. COMMITMENTS AND CONTINGENCIES Commitments The Company leases space for its offices under noncancellable operating leases that expire at various dates through 2023. As of December 31, 2017, the Company’s future minimum rental payments required under operating leases with noncancellable terms in excess of one year were as follows: (in thousands) Operating Leases (1) 2018 $ 15,395 2019 13,881 2020 12,737 2021 11,066 2022 and thereafter 18,896 $ 71,975 (1) Operating leases include future minimum rent payments, net of estimated sublease income for facilities that the Company has vacated pursuant to its restructuring activities. Rent expense under operating leases is recognized on a straight-line basis to account for scheduled rent increases and landlord tenant allowances. In connection with the Company’s amended lease for its office headquarters dated November 11, 2014, the Company has a landlord tenant allowance totaling approximately $9.4 million, all of which was used and reimbursed to the Company as of December 31, 2016 and will be amortized as a reduction to rent expense on a straight-line basis over the term of the lease. Total rent expense under operating leases was approximately $14.7 million, $13.4 million, and $12.3 million for 2017, 2016 and 2015, respectively. Contingencies The Company is a party in various contractual disputes, litigation and potential claims arising in the ordinary course of business. The Company does not believe that the resolution of these matters will have a material adverse effect on its financial position or results of operations.

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	12 Months Ended
	Dec. 31, 2017
STOCKHOLDERS' EQUITY	13. STOCKHOLDERS’ EQUITY Preferred stock The Company has authorized 1 million shares of preferred stock. The Board of Directors has the authority to issue the shares of preferred stock in one or more series, to establish the number of shares to be included in each series, and to fix the designation, powers, preferences and rights of the shares of each series and the qualifications, limitations or restrictions thereof, without any further vote or action by the stockholders. The issuance of preferred stock could decrease the amount of earnings and assets available for distribution to holders of common stock, and may have the effect of delaying, deferring or defeating a change in control of the Company. The Company had not issued any shares of preferred stock through December 31, 2017. Common stock The Company has 200 million authorized shares of common stock, $0.01 par value per share, of which 78.1 million shares were issued and outstanding at December 31, 2017. Since 2004, the Company’s Board of Directors has approved stock repurchase programs that have authorized the Company to repurchase in the aggregate up to $195 million of its common stock. On May 30, 2017, we announced that our Board of Directors extended the expiration date of the current stock repurchase program to June 30, 2018. Purchases under these programs have been made on the open market. (in thousands) 2017 2016 2015 Shares Amount Shares Amount Shares Amount Authorization remaining, beginning of period $ 39,385 $ 40,534 $ 13,284 Authorizations — 25,879 50,000 Repurchases paid 96 (4,335 ) 1,078 (27,028 ) 944 (22,530 ) Repurchases unsettled 3 (158 ) — — 8 (220 ) Authorization remaining, end of period $ 34,892 $ 39,385 $ 40,534 Dividends For 2017, 2016, and 2015, the Company paid cash dividends of $9.3 million, $9.2 million, and $9.2 million, respectively. (per share) 2017 2016 2015 Dividends Declared $ 0.12 $ 0.12 $ 0.12 It is the Company’s current intention to pay a quarterly cash dividend of $0.03 per share, however, the Board of Directors may terminate or modify this dividend program at any time without notice.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	12 Months Ended
	Dec. 31, 2017
STOCK-BASED COMPENSATION	14. STOCK-BASED COMPENSATION The following table presents the stock-based compensation expense included in the Company’s consolidated statements of operations: (in thousands) 2017 2016 2015 Cost of revenues $ 14,573 $ 11,459 $ 8,772 Selling and marketing 15,720 12,464 8,911 Research and development 13,618 10,043 8,116 General and administrative 9,402 6,513 4,255 Acquisition-related — 342 — Total stock-based compensation before tax $ 53,313 $ 40,821 $ 30,054 Income tax benefit $ (12,113 ) $ (12,198 ) $ (8,098 ) The majority of the Company’s stock-based compensation arrangements generally vest over five years with 20% vesting after one year and the remaining 80% vesting in equal quarterly installments over the remaining four years. The Company’s stock options have a ten-year The Company periodically grants stock options and restricted stock units (“RSUs”) for a fixed number of shares upon vesting to employees and non-employee Employees may elect to receive 50% of their target incentive compensation under the Company’s Corporate Incentive Compensation Plan (the “CICP”) in the form of RSUs instead of cash. If elected by an employee, the equity amount is equal in value on the date of grant to 50% of his or her target incentive opportunity, based on the employee’s base salary. The number of RSUs granted is determined by dividing 50% of the employee’s target incentive opportunity by 85% of the closing price of its common stock on the grant date, less the present value of expected dividends during the vesting period. If elected, the award vests 100% on the CICP payout date of the following year for all participants. Vesting is conditioned upon the performance conditions of the CICP and on continued employment; if threshold funding does not occur, the RSU will not vest. The Company considers vesting to be probable on the grant date and recognizes the associated stock-based compensation expense over the requisite service period beginning on the grant date and ending on the vesting date. The Company grants awards that allow for the settlement of vested stock options RSUs on a net share basis (“net settled awards”). With net settled awards, the employee does not surrender any cash or shares upon exercise. Rather, the Company withholds the number of shares to cover the option exercise price (in the case of stock options) and the minimum statutory tax withholding obligations (in the case of stock options and RSUs) from the shares that would otherwise be issued upon exercise or settlement. The exercise of stock options and settlement of RSUs on a net share basis results in fewer shares issued by the Company. Share-Based Compensation Plans: 2004 Long-Term Incentive Plan (as amended and restated) In 2004, the Company adopted the 2004 Long-Term Incentive Plan (as amended and restated, the “2004 Plan”) to provide employees, non-employee non-qualified non-employee As of December 31, 2017, approximately 10 million shares were subject to outstanding options and stock-based awards under the 2004 Plan. 2006 Employee Stock Purchase Plan In 2006, the Company adopted the 2006 Employee Stock Purchase Plan (the “2006 ESPP”) pursuant to which the Company’s employees are entitled to purchase up to an aggregate of 1 million shares, of common stock at a price equal to at least 85% of the fair market value of the Company’s common stock on either the commencement date or completion date for offerings under the plan, whichever is less, or such higher price as the Company’s Board of Directors may establish from time to time. Until the Company’s Board of Directors determines otherwise, the Board has set the purchase price at 95% of the fair market value on the completion date of the offering period. As a result, the 2006 ESPP is non-compensatory As of December 31, 2017, approximately 0.4 million shares had been issued thereunder. Shares Available for Issuance As of December 31, 2017, there were approximately 9.2 million shares available for issuance for future equity grants under the Company’s stock plans, consisting of approximately 8.6 million shares under the 2004 Plan and approximately 0.6 million shares under the 2006 ESPP. Equity grants, assumptions and activity During 2017, the Company issued approximately 1.6 million shares to its employees and directors under the Company’s share-based compensation plans. Stock Options The Company estimates the fair value of stock options using a Black-Scholes option valuation model. Key inputs used to estimate the fair value of stock options include the exercise price of the award, expected term of the option, expected volatility of the Company’s common stock over the option’s expected term, risk-free interest rate over the option’s expected term, and the Company’s expected annual dividend yield. The amount of stock-based compensation recognized during a period is based on the value of the awards that are ultimately expected to vest. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Ultimately, the Company recognizes the actual expense over the vesting period only for the shares that vest. The weighted-average grant-date fair value for stock options granted in 2017, 2016, and 2015, was $13.79, $8.31 and $7.62 per share, respectively. The weighted-average assumptions used in the Black-Scholes option valuation model are as follows: 2017 2016 2015 Expected annual volatility (1) 35 % 40 % 45 % Expected term in years (2) 4.5 4.4 4.5 Risk-free interest rate (3) 1.85 % 1.21 % 1.34 % Expected annual dividend yield (4) 0.53 % 0.63 % 0.68 % • The expected annual volatility for each grant is determined based on the average of historical daily price changes of the Company’s common stock over a period of time which approximates the expected option term. • The expected option term for each grant is determined based on the historical exercise behavior of employees and post-vesting employment termination behavior. • The risk-free interest rate is based on the yield of U.S. Treasury securities with a maturity that is commensurate with the expected option term at the time of grant. • The expected annual dividend yield is based on the weighted-average of the dividend yield assumptions used for options granted during the applicable period. The following table summarizes the combined stock option activity under the Company’s stock option plans for 2017: Shares (in thousands) Weighted-average Weighted-average Aggregate intrinsic Options outstanding as of January 1, 2017 7,463 $ 19.45 Granted 1,639 45.78 Exercised (1,741 ) 16.25 Forfeited (231 ) 25.30 Options outstanding as of December 31, 2017 7,130 $ 26.10 Vested and expected to vest as December 31, 2017 5,926 $ 25.20 7.2 $ 131,599 Exercisable as of December 31, 2017 2,800 $ 16.98 5.8 $ 84,479 The aggregate intrinsic value of stock options exercised (i.e., the difference between the market price at exercise and the price paid by the employee at exercise) in 2017, 2016, and 2015 was $62.6 million, $19.9 million and $18.6 million, respectively. The aggregate intrinsic value of stock options outstanding and exercisable as of December 31, 2017 is based on the difference between the closing price of the Company’s stock of $47.15 and the exercise price of the applicable stock options. As of December 31, 2017, the Company had unrecognized stock-based compensation expense related to the unvested portion of stock options of approximately $16.8 million that is expected to be recognized as expense over a weighted-average period of approximately 2.2 years. RSUs The weighted-average grant-date fair value for RSUs granted in 2017, 2016, and 2015 was $46.07, $25.54, and $20.49, respectively. The following table summarizes the combined RSU activity for periodic grants and the CICP under the 2004 Plan for 2017: Shares Weighted- Grant-Date Aggregate Nonvested as of January 1, 2017 3,161 $ 23.39 Granted 1,148 46.07 Vested (1,188 ) 23.66 Forfeited (220 ) 27.06 Nonvested as of December 31, 2017 2,901 $ 31.97 $ 136,771 Expected to vest as of December 31, 2017 2,113 $ 32.74 $ 99,628 The fair value of RSUs vested in 2017, 2016, and 2015 was $59.0 million, $29.2 million, and $14.9 million, respectively. The aggregate intrinsic value of RSUs outstanding and expected to vest as of December 31, 2017 is based on the closing price of the Company’s stock of $47.15 on December 31, 2017. As of December 31, 2017, the Company had approximately $32.4 million of unrecognized stock-based compensation expense related to all unvested RSUs that is expected to be recognized as expense over a weighted-average period of approximately 2.1 years.

INCOME TAXES

INCOME TAXES	12 Months Ended
	Dec. 31, 2017
INCOME TAXES	15. INCOME TAXES Effective income tax rate The components of income before provision for income taxes are as follows: (in thousands) 2017 2016 2015 Domestic $ 18,605 $ 37,329 $ 63,124 Foreign 18,495 (2,127 ) (2,619 ) Income before provision for income taxes $ 37,100 $ 35,202 $ 60,505 The components of the provision for income taxes are as follows: (in thousands) 2017 2016 2015 Current: Federal $ (18,205 ) $ 6,741 $ 17,864 State 97 2,963 4,565 Foreign 8,479 4,322 3,853 Total current (benefits)/provision (9,629 ) 14,026 26,282 Deferred: Federal 19,683 (1,120 ) 2,075 State (2,158 ) (480 ) (466 ) Foreign (3,730 ) (4,210 ) (3,708 ) Total deferred provision/(benefit) 13,795 (5,810 ) (2,099 ) Provision for income taxes $ 4,166 $ 8,216 $ 24,183 The effective income tax rate differed from the statutory federal income tax rate due to the following: 2017 2016 2015 Statutory federal income tax rate 35.0 % 35.0 % 35.0 % Valuation allowance 1.2 0.3 0.7 Transaction costs — 1.1 — State income taxes, net of federal benefit and tax credits (4.5 ) 3.7 4.6 Permanent differences 2.7 2.2 1.1 Domestic production activities — (3.2 ) (3.1 ) Federal research and experimentation credits (9.1 ) (2.3 ) (1.2 ) Tax effects of foreign activities (1.1 ) 5.2 2.0 Tax-exempt (0.3 ) (0.3 ) (0.1 ) Provision to return adjustments (5.2 ) 0.3 0.3 Non-deductible 5.0 6.2 3.3 Provision for uncertain tax positions 0.7 (2.3 ) (2.6 ) Excess tax benefits related to share-based compensation (66.0 ) (20.1 ) — Net deferred tax assets re-measurement (1) 51.8 — — Other 1.0 (2.5 ) — Effective income tax rate 11.2 % 23.3 % 40.0 % (1) Due to the impact of the Tax Reform Act. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (the “Tax Reform Act”). The Tax Reform Act makes significant changes in the U.S. tax code including the following: • reduction of the corporate federal income tax rate from 35% to 21%; • repeal of the domestic manufacturing deduction; • repeal of the corporate alternative minimum tax; • a one-time • a move to a territorial tax system; and • acceleration of business asset expensing. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for income tax effects of the Tax Reform Act. The Company has recognized the provisional tax impacts in 2017, including $20.4 million in additional income tax expense in the fourth quarter of 2017 to re-measure The Tax Reform Act provided for a one-time While the Tax Reform Act provides for a territorial tax system, beginning in 2018, it includes the following new anti-abuse provisions: • The global intangible low-taxed • The base-erosion and anti-abuse tax (“BEAT”) provisions in the Tax Reform Act impose an alternative minimum tax on taxpayers with substantial base-erosion payments. Our preliminary assessment is that the company will not be subject to the BEAT; however, our analysis is incomplete and we will continue to analyze the impact of the BEAT provisions to determine if these would be material to the company’s effective tax rate. Deferred income taxes Significant components of net deferred tax assets and liabilities are as follows: December 31, (in thousands) 2017 2016 Deferred tax assets: Net operating loss carryforwards $ 52,311 $ 69,307 Accruals and reserves 22,984 34,021 Software revenue 2,686 6,559 Depreciation 2,558 3,593 Tax credit carryforwards 13,056 8,094 Other 52 19 Total deferred tax assets 93,647 121,593 Less valuation allowances (27,993 ) (34,054 ) Total net deferred tax assets 65,654 87,539 Deferred tax liabilities: Intangibles (8,527 ) (17,641 ) Total deferred tax liabilities (8,527 ) (17,641 ) Deferred income taxes $ 57,127 $ 69,898 Due to the Tax Reform Act U.S. deferred tax assets and liabilities were re-measured The Company regularly assesses the need for a valuation allowance against its deferred tax assets. In making that assessment, the Company considers both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more-likely-than-not re-measurement At December 31, 2017, the Company had $99.2 million and $3.3 million in federal and state net operating losses, respectively, and $3.4 million and $1.8 million in federal and state credit carryforwards, respectively. These amounts include $99.2 million and $1 million in federal and state net operating losses carryforwards, respectively, from acquisitions and $0.6 million and $0.3 million in federal and state credit carryforwards, respectively, from acquisitions. The carryforward losses and credits expire between 2018 and 2037, except for $0.6 million in state credits that have unlimited carryforward periods. The federal and state net operating losses exclude $60.2 million and $0.8 million, respectively, in net operating losses that the Company expects will expire unutilized, and the federal and state tax credits exclude $0.1 million and $6.7 million, respectively, in tax credits that the Company expects will expire unutilized. As of December 31, 2017, the Company had available $33.5 million of foreign NOLS which have an unlimited carryover period. The Company’s India subsidiary is a development center in an area designated as a Special Economic Zone (“SEZ”) and is entitled to a tax holiday in India. The tax holiday reduces or eliminates income tax in that country and is scheduled to expire in 2022. For 2017, 2016 and 2015, the effect of the income tax holiday was to reduce the Company’s provision for income taxes by approximately $1.3 million, $1 million, and $0.9 million, respectively. The benefit of the tax holiday on net income per share (diluted) was $0.02 for 2017 and $0.01 for 2016 and 2015. The Company adopted ASU 2016-09 Uncertain tax benefits and other considerations A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows: (in thousands) 2017 2016 2015 Balance as of January 1, $ 22,671 $ 23,972 $ 43,396 Additions based on tax positions related to the current year 452 80 817 Additions for tax positions of prior years 238 110 183 Additions for acquired uncertain tax benefits — 387 — Reductions for change in US federal tax rate (2,424 ) — — Reductions for tax positions of prior years (1,500 ) (1,541 ) (19,855 ) Reductions for a lapse of the applicable statute of limitations (287 ) (337 ) (569 ) Balance as of December 31, $ 19,150 $ 22,671 $ 23,972 As of December 31, 2017, the Company had approximately $19.2 million of total unrecognized tax benefits, which would decrease the Company’s effective tax rate if recognized. The $2.4 million reduction for change in U.S. federal tax rate relates to a decrease in the uncertain tax benefits recorded against deferred tax items (e.g., net operating losses) corresponding with the re-measurement The Company recognizes interest accrued and penalties related to unrecognized tax benefits in the income tax provision. For 2017 the Company did not recognize any significant change in net interest expense. For the 2016 and 2015, the Company recognized a decrease of approximately $0.6 million and an increase of $0.3 million, respectively, of interest expense. As of December 31, 2017, 2016 and 2015, the company did not recognize any significant penalties. As of December 31, 2017, 2016 and 2015, the Company had accrued approximately $1.5 million, $1.2 million, and $1.2 million, respectively, for interest and penalties. The Company files income tax returns in the U.S. and in foreign jurisdictions. We have no tax returns under examination by the Internal Revenue Service or state taxing authorities as of December 31, 2017. However, certain foreign jurisdictions are auditing our income tax returns for periods ranging from 2010 through 2014. The Company does not expect the results of these audits to have a material effect on our financial condition, results of operations, or cash flows. With few exceptions, the statute of limitations remains open in all jurisdictions for the tax years 2014 to the present.

EARNINGS PER SHARE

EARNINGS PER SHARE	12 Months Ended
	Dec. 31, 2017
EARNINGS PER SHARE	16. EARNINGS PER SHARE Basic earnings per share is computed using the weighted-average number of common shares outstanding during the applicable period. Diluted earnings per share is computed using the weighted-average number of common shares outstanding during the applicable period, plus the dilutive effect of outstanding options and RSUs, using the treasury stock method and the average market price of the Company’s common stock during the applicable period. Certain shares related to some of the Company’s outstanding stock options and RSUs were excluded from the computation of diluted earnings per share because they were antidilutive in the periods presented, but could be dilutive in the future. (in thousands except per share amounts) 2017 2016 2015 Basic Net income $ 32,934 $ 26,986 $ 36,322 Weighted-average common shares outstanding 77,431 76,343 76,507 Earnings per share, basic $ 0.43 $ 0.35 $ 0.47 Diluted Net income $ 32,934 $ 26,986 $ 36,322 Weighted-average effect of dilutive securities: Stock options 3,471 2,025 1,601 RSUs 1,930 1,364 935 Effect of assumed exercise of stock options and RSUs 5,401 3,389 2,536 Weighted-average common shares outstanding, assuming dilution 82,832 79,732 79,043 Earnings per share, diluted $ 0.40 $ 0.34 $ 0.46 Outstanding options and RSUs excluded as impact would be antidilutive 221 322 182

GEOGRAPHIC INFORMATION AND MAJO

GEOGRAPHIC INFORMATION AND MAJOR CLIENTS	12 Months Ended
	Dec. 31, 2017
GEOGRAPHIC INFORMATION AND MAJOR CLIENTS	17. GEOGRAPHIC INFORMATION AND MAJOR CLIENTS Geographic Information Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company develops and licenses its strategic software applications and Pega Platform, and provides consulting services, maintenance, and training related to its offerings. The Company derives substantially all of its revenue from the sale and support of one group of similar products and services—software that provides case management, business process management, and real-time decisioning solutions to improve customer engagement and operational excellence in the enterprise applications market. To assess performance, the Company’s CODM, who is the chief executive officer, reviews financial information on a consolidated basis. Therefore, the Company determined it has one reportable segment and one reporting unit. The Company’s international revenue is from clients based outside of the U.S. The Company derived its revenue from the following geographic areas: (Dollars in thousands) 2017 2016 2015 U.S. $ 474,819 56 % $ 430,562 57 % $ 379,936 56 % Other Americas 39,490 5 % 59,160 8 % 57,892 8 % U.K. 90,817 11 % 101,733 14 % 96,314 14 % Other EMEA (1) 130,889 16 % 92,540 12 % 87,240 13 % Asia Pacific 104,567 12 % 66,271 9 % 61,313 9 % $ 840,582 100 % $ 750,266 100 % $ 682,695 100 % (1) Includes the Middle East, Africa, and Europe excluding the U.K. Long-lived assets related to the Company’s U.S. and international operations were as follows: December 31, (Dollars in thousands) 2017 2016 U.S. $ 27,590 68 % $ 27,993 73 % India 6,703 17 % 7,158 19 % International, other 6,066 15 % 3,130 8 % $ 40,359 100 % $ 38,281 100 % Major Clients Clients accounting for 10% or more of the Company’s total revenue were as follows: (Dollars in thousands) 2017 2016 2015 Total revenue $ 840,582 $ 750,266 $ 682,695 Client A 10 % * * Clients accounting for 10% or more of the Company’s trade accounts receivable were as follows: (Dollars in thousands) December 31, 2017 2016 Trade accounts receivable $ 248,331 $ 265,028 Client A 12 % * * Client accounted for less than 10% of total revenue and trade accounts receivable The Company’s financial services, healthcare, and insurance clients as a group represent a significant amount of the Company’s revenues and receivables. However, the Company determined this concentration did not have a material impact on its allowance for sales credit memos as of December 31, 2017 In addition to accounts receivable, the Company is potentially subject to concentrations of credit risk from the Company’s cash, cash equivalents, and marketable securities. The Company’s cash and cash equivalents are generally held with large, diverse financial institutions worldwide to reduce the credit risk exposure. Investment policies have been implemented that limit purchases of marketable debt securities to investment-grade securities. Note 3 “Marketable Securities” and Note 5 “Fair Value Measurements” for further discussion.

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS	12 Months Ended
	Dec. 31, 2017
EMPLOYEE BENEFIT PLANS	18. EMPLOYEE BENEFIT PLANS The Company sponsors defined contribution plans for quantifying employees, including a 401(k) plan in the United States to which the Company makes discretionary matching contributions. The following expenses related to defined contribution plans were recorded in the Company’s consolidated statements of operations: (in thousands) 2017 2016 2015 U.S. 401(k) Plan $ 5,003 $ 4,510 $ 4,061 International Plans 9,096 7,635 6,428 $ 14,099 $ 12,145 $ 10,489

SELECTED QUARTERLY INFORMATION

SELECTED QUARTERLY INFORMATION (UNAUDITED)	12 Months Ended
	Dec. 31, 2017
SELECTED QUARTERLY INFORMATION (UNAUDITED)	19. SELECTED QUARTERLY INFORMATION (UNAUDITED) 2017 (in thousands, except per share amounts) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Revenue $ 223,247 $ 197,980 $ 179,815 $ 239,540 Gross profit 155,157 130,105 110,084 165,563 Income/(loss) from operations 31,238 1,750 (14,289 ) 19,961 Income/(loss) before provision for income taxes 31,800 1,560 (14,697 ) 18,437 Net income/(loss) 27,021 11,406 (1,812 ) (3,681 ) Net income/(loss) per share, basic $ 0.35 $ 0.15 $ (0.03 ) $ (0.04 ) Net income/(loss) per share, diluted $ 0.33 $ 0.14 $ (0.03 ) $ (0.04 ) 2016 (1) (in thousands, except per share amounts) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Revenue $ 178,858 $ 188,996 $ 182,802 $ 199,610 Gross profit 122,348 128,896 122,365 137,401 Income from operations 14,125 6,360 5,498 11,776 Income before provision for income taxes 13,493 5,498 5,515 10,696 Net income 10,400 4,536 3,301 8,749 Net income per share, basic $ 0.14 $ 0.06 $ 0.04 $ 0.11 Net income per share, diluted $ 0.13 $ 0.06 $ 0.04 $ 0.11 (1) The Company elected to early adopt ASU 2016-09 2016-09

SIGNIFICANT ACCOUNTING POLICI28

SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2017
Revenue recognition	Revenue recognition The Company’s revenue is derived primarily from software licenses, cloud arrangements, maintenance fees related to the Company’s software licenses, and consulting services. The Company’s license arrangements, whether involving a perpetual license or a term license, generally also contain multiple elements, including consulting services, training, and software maintenance services. Software revenue recognition requires judgment, including whether a software arrangement includes multiple elements, and if so, whether vendor-specific objective evidence (“VSOE”) of fair value exists for those elements. The amount of arrangement consideration allocated to undelivered elements is based on the VSOE of fair value for those elements and recognized as those elements are delivered. Any remaining portion of the total arrangement fee is allocated to the software license—the first delivered element. Revenue is recognized for each element when all of the revenue recognition criteria have been met. Revenue is recognized net of any taxes collected from clients and subsequently remitted to governmental authorities. Changes in the mix of the elements in a software arrangement, the ability to identify VSOE for those elements, the fair value of the respective elements, and changes to a product’s estimated life cycle could materially impact the amount of earned and unearned revenue. Before the Company can recognize revenue, the following four basic criteria must be met: • Persuasive evidence of an arrangement— • Delivery of product and services— • Fee is fixed or determinable— • Collection of fee is probable— Software license revenues Perpetual software license fees are recognized as revenue when the software is delivered, any acceptance required by the contract that is not perfunctory is obtained, no significant obligations or contingencies exist related to the software, all other undelivered elements in a multiple element arrangement possess VSOE, and all other revenue recognition criteria are met. Term software license fees are usually payable on a monthly, quarterly, or annual basis under license agreements that typically have a three to five-year term and may be renewed for additional terms at the client’s option. The Company recognizes term license revenue over the term of the agreement as payments become due or earlier if prepaid, provided all other criteria for revenue recognition have been met. Maintenance revenues First-year maintenance typically is sold with the related software license and renewed on an annual basis thereafter. Maintenance revenue is deferred and recognized ratably over the term of the support period, which is generally one year and subject to annual renewals. Perpetual software maintenance obligations are based on separately stated renewal rates in the arrangement that are substantive and therefore represent VSOE of fair value. Term license arrangements include separately stated maintenance fees and the Company uses stand-alone sales to determine VSOE of fair value. Services revenues The Company’s services revenue is comprised of fees for consulting services including software implementation, training, reimbursable expenses, and for sales of its Pega Cloud as-a-platform Revenue from training services and consulting services under time and materials contracts is recognized as services are performed. The Company has VSOE of fair value for its training services and consulting services under time and materials contracts in the Americas, Europe, and certain regions of Asia. Consulting services may sometimes be provided on a fixed-price basis. The Company does not have VSOE of fair value for fixed-price services or time and materials services in certain geographical regions. When these services are part of a multiple element arrangement, and the services are not essential to the functionality of the software, and when services, including maintenance, are the only undelivered element, the Company recognizes the revenue from the total arrangement ratably over the longer of the software maintenance period or the service period. Revenue from fixed-price services that are not bundled with a software license is generally recognized ratably over the service period, which is typically less than four months. Revenue from stand-alone sales of the Pega Cloud Dev/Test environment is recognized as services are performed because the Company has VSOE of fair value. Revenue from stand-alone sales of the Pega Cloud Production environment is recognized ratably over the term of the service. When implementation services are sold together with the Company’s Pega Cloud offering and these services have stand-alone value to the client, the Company accounts for these services separately from this offering. Stand-alone value is established through the client’s ability to buy these services from many trained partner system integrators and from transactions sold independently from the sale of Pega Cloud. Since these multiple-element arrangements are not software license sales, the Company applies a selling price hierarchy to determine the fair value of each element in the arrangement. Under the selling price hierarchy, each element’s fair value is determined based on its VSOE, if available. If VSOE does not exist, third-party evidence of fair value (“TPE”) will be considered, and estimated selling price (“ESP”) will be used if neither VSOE nor TPE is available. The Company generally does not have VSOE of its Pega Cloud offering and is not able to determine TPE as its sales strategy is customized to the needs of its clients and the Company’s products and services are dissimilar to comparable products or services in the marketplace. In determining ESP, the Company applies significant judgment as it weighs a variety of factors, based on the facts and circumstances of the arrangement. The Company typically arrives at an ESP for a service without VSOE or TPE by considering company-specific factors such as geographies, competitive landscape, and pricing practices used to establish bundled pricing and discounting. Deferred revenue Deferred software license revenue typically results from client billings for which all of the criteria to recognize revenue have not been met. Deferred maintenance revenue represents software license updates and product support contracts that are typically billed in advance and are recognized ratably over the support periods. Deferred services revenue represents advanced billings for consulting, hosting, and training services that are recognized as the services are performed.
Fair value of financial instruments	Fair value of financial instruments The principal financial instruments held by the Company consist of cash equivalents, marketable securities, derivative instruments, accounts receivable, and accounts payable. See Note 3 “Marketable Securities”, Note 4 “Derivative Instruments”, and Note 5 “Fair Value Measurements” for further discussion of financial instruments that are carried at fair value on a recurring basis.
Derivative instruments	Derivative instruments The Company has in the past used, but does not currently use, foreign currency forward contracts (“forward contracts”) to manage its exposures to changes in foreign currency exchange rates associated with its foreign currency denominated accounts receivable, intercompany receivable and payables, and cash. See Note 4 “Derivative Instruments” for further discussion.
Property and equipment	Property and equipment Property and equipment are recorded at cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets, which are three years for computer equipment and five years for furniture and fixtures. Leasehold improvements are amortized over the lesser of the term of the lease or the useful life of the asset. Repairs and maintenance costs are expensed as incurred.
Internal-use software	Internal-use The Company capitalizes and amortizes certain direct costs associated with computer software developed or purchased for internal use incurred during the application development stage. Costs related to preliminary project activities and post implementation activities are expensed as incurred. The Company amortizes capitalized software costs generally over three to five years commencing on the date the software is placed into service. During 2016, the Company placed into service computer software developed for internal use of $11.3 million, of which $1.1 million was capitalized in 2015 and $10.2 million was capitalized in 2016.
Goodwill	Goodwill Goodwill represents the residual purchase price paid in a business combination after the fair value of all identified assets and liabilities have been recorded. Goodwill is not amortized. The Company operates as a single reporting unit. The Company performed its qualitative assessment as of November 30, 2017, 2016, and 2015, and concluded it was not more likely than not that the fair value of its reporting unit was less than its carrying value.
Intangible and long-lived assets	Intangible and long-lived assets All of the Company’s intangible assets are amortized using the straight-line method over their estimated useful life. The Company evaluates its long-lived tangible and intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Impairment is assessed by comparing the undiscounted cash flows expected to be generated by the intangible asset to its carrying value. If impairment exists, the Company calculates the impairment by comparing the carrying value of the intangible asset to its fair value as determined by discounted expected cash flows. The Company did not record any impairments in 2017, 2016, or 2015.
Business combinations	Business combinations The Company uses its best estimates and assumptions to accurately assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. The Company’s estimates are inherently uncertain and subject to refinement. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. In addition, uncertain tax positions and tax-related
Research and development and software development costs	Research and development and software development costs Research and development costs are expensed as incurred. Capitalization of computer software developed for resale begins upon the establishment of technological feasibility, generally demonstrated by a working model or an operative version of the computer software product. Such costs have not been material to date as technological feasibility is established within a short time frame from the software’s general availability and, as a result, no costs were capitalized in 2017, 2016, or 2015.
Stock-based compensation	Stock-based compensation The Company recognizes stock-based compensation expense associated with equity awards based on the fair value of these awards at the grant date. Stock-based compensation is recognized over the requisite service period, which is generally the vesting period of the equity award, and is adjusted each period for anticipated forfeitures. See Note 14 “Stock-based Compensation” for discussion of the Company’s key assumptions included in determining the fair value of its equity awards at the grant date.
Foreign currency translation	Foreign currency translation The translation of assets and liabilities for the Company’s subsidiaries with functional currencies other than the U.S. Dollar are made at period-end
Accounting for income taxes	Accounting for income taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company regularly assesses the need for a valuation allowance against its deferred tax assets. Future realization of the Company’s deferred tax assets ultimately depends on the existence of sufficient taxable income within the available carryback or carryforward periods. Sources of taxable income include taxable income in prior carryback years, future reversals of existing taxable temporary differences, tax planning strategies, and future taxable income. The Company records a valuation allowance to reduce its deferred tax assets to an amount it believes is more-likely-than-not with-and-without The Company assesses its income tax positions and records tax benefits based upon management’s evaluation of the facts, circumstances, and information available at the reporting date. For those tax positions where it is more-likely-than-not more-likely-than-not non-current As a global company, the Company uses significant judgment to calculate and provide for income taxes in each of the tax jurisdictions in which it operates. In the ordinary course of the Company’s business, there are transactions and calculations undertaken whose ultimate tax outcome cannot be certain. Some of these uncertainties arise as a consequence of transfer pricing for transactions with the Company’s subsidiaries and nexus and tax credit estimates. In addition, the calculation of acquired tax attributes and the associated limitations are complex. See Note 15 “Income Taxes” for further information.
Advertising expense	Advertising expense Advertising costs are expensed as incurred. Advertising costs were $6.1 million, $8.9 million, and $9.8 million during 2017, 2016, and 2015, respectively.
New accounting pronouncements	New accounting pronouncements Stock-Based Compensation In May 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-09 Financial Instruments In June 2016, the FASB issued ASU No. 2016-13, available-for-sale Leases In February 2016, the FASB issued ASU No. 2016-02, right-of-use right-of-use Revenue In May 2014, the FASB issued ASU No. 2014-09, The Company has elected the full retrospective adoption model, effective January 1, 2018. The Company’s quarterly results beginning with the quarter ending March 31, 2018 and comparative prior periods will be compliant with ASC 606. The Company’s Annual Report on Form 10-K The Company has substantially completed the implementation of ASC 606 and has identified the necessary changes to its policies, processes, systems, and controls. However, due to the complex nature of the Company’s arrangements and recent updates to interpretive guidance, which were made as recently as the fall of 2017, the Company has not yet completed all of its internal control procedures. Based upon the work performed to date, the Company expects to record a cumulative-effect adjustment as of December 31, 2015 to increase retained earnings by approximately $205 million which includes a $30 million increase in retained earnings due to deferred commission expense and a $97 million decrease in retained earnings due to the resulting tax impact. We expect to fully disclose the impacts of the new standard in connection with our 10Q filing for the first quarter of 2018. The Company expects the following impacts upon adoption of the standard: • Currently, the Company recognizes revenue from term licenses and perpetual licenses with extended payment terms over the term of the agreement as payments become due or earlier if prepaid, provided all other criteria for revenue recognition have been met, and any corresponding maintenance over the term of the agreement. The adoption of ASC 606 will result in revenue for performance obligations being recognized as they are satisfied, which will typically occur upon delivery. Therefore, revenue from the term and perpetual license performance obligations with extended payment terms is recognized when control is transferred to the client. Any unrecognized license revenue from these arrangements, included in deferred revenue at December 31, 2015, will not be recognized in revenue in future periods but as a cumulative adjustment to retained earnings. Further, term license revenue from new arrangements executed in 2016 and 2017 will be recognized in full in the year that control of the license is transferred to the client instead of over the term of the agreement. Revenue from the maintenance performance obligations is expected to be recognized on a straight-line basis over the contractual term, consistent with the previous treatment. Due to the revenue from term and perpetual licenses with extended payment terms being recognized prior to amounts being billed to the client, the Company expects to recognize a material unbilled receivable on the balance sheet. • Currently, the Company allocates revenue to licenses under the residual method when it has Vendor Specific Objective Evidence (“VSOE”) for the remaining undelivered elements, which allocates any future credits or significant discounts entirely to the license. The adoption of ASC 606 will result in future credits, significant discounts, and material rights under ASC 606, generally allocated to all performance obligations based upon their relative selling price. Under ASC 606, additional license revenue from the reallocation of such arrangement considerations will be recognized when control is transferred to the client, which is generally upon delivery of the license. • Currently, the Company does not have VSOE, in software bundled arrangements, for fixed price services, time and materials services in certain geographical areas, and unspecified future products, which results in revenue being deferred in such instances until such time as VSOE exists for all undelivered elements or recognized ratably over the longest performance period. The adoption of ASC 606 eliminates the requirement for VSOE and replaces it with the concept of a stand-alone selling price. Once the transaction price is allocated to each of the performance obligations based on their relative stand-alone selling prices, the Company can recognize revenue as the performance obligations are delivered, either at a point in time or over time. Under ASC 606, license revenue will be recognized when control is transferred to the client, consulting revenue will be recognized over time based on input measures that reflect the Company’s performance on the contract. This will result in the acceleration of consulting revenue when compared to the current practice of ratable recognition for consulting when there is a lack of VSOE. • Sales commissions and other third party acquisition costs resulting directly from securing contracts with clients are currently expensed when incurred. ASC 340-40 “Accounting for Other Assets and Deferred Costs” will require these costs to be recognized as an asset when incurred and to be expensed over the associated contract term or estimated client life depending on the nature of the underlying contract. The Company expects this change to impact its commissions related to multi-year cloud offerings and term and perpetual licenses with additional rights of use that extend beyond one year which will require the allocation of a portion of the commission paid for term and perpetual licenses to future maintenance obligations when the commission rates within each arrangement are not commensurate. This change will impact retained earnings as of December 31, 2015 but will not have a significant impact in future periods. • ASC 606 provides additional accounting guidance for contract modifications whereby changes must be accounted for either as a retrospective change (creating either a catch up or deferral of past revenues), prospectively with a reallocation of revenues amongst identified performance obligations, or prospectively as separate contracts which will not require any reallocation. This may result in a difference in the timing of the recognition of revenue as compared to how contract modifications are recognized currently. • There will be a corresponding effect on tax liabilities in relation to all of the above impacts.

MARKETABLE SECURITIES (Tables)

MARKETABLE SECURITIES (Tables)	12 Months Ended
	Dec. 31, 2017
Schedule of Marketable Securities	(in thousands) December 31, 2017 Amortized Unrealized Unrealized Fair Municipal bonds $ 32,996 $ — $ (148 ) $ 32,848 Corporate bonds 28,757 1 (137 ) 28,621 $ 61,753 $ 1 $ (285 ) $ 61,469 (in thousands) December 31, 2016 Amortized Unrealized Unrealized Fair Municipal bonds $ 36,746 $ — $ (139 ) $ 36,607 Corporate bonds 26,610 1 (51 ) 26,560 $ 63,356 $ 1 $ (190 ) $ 63,167

DERIVATIVE INSTRUMENTS (Tables)

DERIVATIVE INSTRUMENTS (Tables)	12 Months Ended
	Dec. 31, 2017
Fair Value of Company Outstanding Forward Contracts	The fair value of the Company’s outstanding forward contracts was as follows: (in thousands) December 31, 2016 Recorded In: Fair Value Asset Derivatives Foreign currency forward contracts Other current assets $ 628 Liability Derivatives Foreign currency forward contracts Accrued expenses $ 883
Forward Contracts Outstanding with Total Notional Values	The Company had forward contracts outstanding with total notional values as of December 31, 2016 as follows: (in thousands) Euro € 29,820 British pound £ 6,440 Australian dollar A$ 22,010 United States dollar $ 73,125
Change in Fair Value of Forward Contracts	The income statement impact of the Company’s outstanding forward contracts and foreign currency transactions was as follows: 2017 2016 2015 Gain (loss) from the change in the fair value of forward contracts included in other expense, net $ 286 $ (5,643 ) $ (1,047 ) Foreign currency transaction (losses) gains from the remeasurement of foreign currency assets and liabilities (900 ) 2,247 (4,168 )

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	12 Months Ended
	Dec. 31, 2017
Assets and Liabilities Measured at Fair Value	The Company’s assets and liabilities measured at fair value on a recurring basis consisted of the following: (in thousands) Fair Value Measurements at Reporting Date Using Total Level 1 Level 2 Level 3 December 31, 2017 Fair Value Assets: Cash equivalents (1) $ 2,720 $ 40,051 $ — $ 42,771 Marketable securities: Municipal bonds $ — $ 32,848 $ — $ 32,848 Corporate bonds — 28,621 — 28,621 Total marketable securities $ — $ 61,469 $ — $ 61,469 Investments in privately-held companies (2) $ — $ — $ 1,030 $ 1,030 December 31, 2016 Fair Value Assets: Money market funds (1) $ 458 $ — $ — $ 458 Marketable securities: Municipal bonds $ — $ 36,607 $ — $ 36,607 Corporate bonds — 26,560 — 26,560 Total marketable securities $ — $ 63,167 $ — $ 63,167 Foreign currency forward contracts $ — $ 628 $ — $ 628 Fair Value Liabilities: Foreign currency forward contracts $ — $ 883 $ — $ 883 (1) Included in cash and cash equivalents in the consolidated balance sheets. (2) Included in other long-term assets in the consolidated balance sheets.

TRADE ACCOUNTS RECEIVABLE, NE32

TRADE ACCOUNTS RECEIVABLE, NET OF ALLOWANCE (Tables)	12 Months Ended
	Dec. 31, 2017
Schedule of Trade Accounts Receivable	Unbilled trade accounts receivable primarily relate to services earned under time and materials arrangements and to license, maintenance, and cloud arrangements that have commenced or been delivered in excess of scheduled invoicing. (in thousands) December 31, 2017 2016 Trade accounts receivable $ 225,923 $ 234,473 Unbilled accounts receivable 30,063 34,681 Total accounts receivable 255,986 269,154 Allowance for sales credit memos (7,655 ) (4,126 ) $ 248,331 $ 265,028
Activity of Allowance for Sales Credit Memos	The following reflects the activity of the allowance for sales credit memos: (in thousands) 2017 2016 2015 Balance at beginning of year $ 4,126 $ 4,631 $ 1,540 Provision for credit memos 7,052 3,290 8,005 Credit memos issued (3,523 ) (3,795 ) (4,914 ) $ 7,655 $ 4,126 $ 4,631

PROPERTY AND EQUIPMENT (Tables)

PROPERTY AND EQUIPMENT (Tables)	12 Months Ended
	Dec. 31, 2017
Property and Equipment	(in thousands) December 31, 2017 2016 Leasehold improvements $ 38,650 $ 32,852 Computer equipment 23,783 21,522 Furniture and fixtures 8,517 6,127 Computer software purchased 6,690 6,083 Computer software developed for internal use 12,596 12,069 Fixed assets in progress 2,167 772 92,403 79,425 Less: accumulated depreciation and amortization (52,044 ) (41,144 ) Property and equipment, net $ 40,359 $ 38,281

GOODWILL AND OTHER INTANGIBLE34

GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)	12 Months Ended
	Dec. 31, 2017
Changes in Carrying Amount of Goodwill	The following table presents the changes in the carrying amount of goodwill: (in thousands) 2017 2016 Balance as of January 1, $ 73,164 $ 46,776 Acquisitions — 26,689 Purchase price adjustments to goodwill (354 ) — Translation adjustments 142 (301 ) Balance as of December 31, $ 72,952 $ 73,164
Schedule of Amortizable Intangible Assets	Intangible assets are recorded at cost and are amortized using the straight-line method over their estimated useful lives. (in thousands) Range of Cost Accumulated Net book December 31, 2017 Client related intangibles 9-10 years $ 63,164 $ (44,835 ) $ 18,329 Technology 7-10 58,942 (45,372 ) 13,570 Other intangibles — 5,361 (5,361 ) — Total $ 127,467 $ (95,568 ) $ 31,899 December 31, 2016 Client related intangibles 4-10 $ 63,091 $ (37,573 ) $ 25,518 Technology 3-10 58,942 (40,269 ) 18,673 Other intangibles — 5,361 (5,361 ) — Total $ 127,394 $ (83,203 ) $ 44,191
Amortization Expense of Acquired Intangibles	Amortization expense of acquired intangibles was reflected in the Company’s consolidated statements of operations as follows: (in thousands) 2017 2016 2015 Cost of revenue $ 5,103 $ 5,986 $ 5,392 Selling and marketing 7,235 7,145 6,127 General and administrative — 277 683 $ 12,338 $ 13,408 $ 12,202
Estimated Future Amortization Expense Related to Intangible Assets	Future estimated amortization expense related to intangible assets as of December 31, 2017 was as follows: (in thousands) Future estimated amortization expense 2018 $ 11,345 2019 5,553 2020 2,657 2021 2,633 2022 and thereafter 9,711 $ 31,899

ACCRUED EXPENSES (Tables)

ACCRUED EXPENSES (Tables)	12 Months Ended
	Dec. 31, 2017
Schedule of Accrued Expenses	(in thousands) December 31, 2017 2016 Outside professional services $ 14,468 $ 10,204 Income and other taxes 7,420 10,422 Marketing and sales program expenses 6,444 3,707 Dividends payable 2,344 2,298 Employee related expenses 4,065 3,806 Other 10,767 6,314 $ 45,508 $ 36,751

DEFERRED REVENUE (Tables)

DEFERRED REVENUE (Tables)	12 Months Ended
	Dec. 31, 2017
Schedule of Deferred Revenue	(in thousands) December 31, December 31, Term license $ 16,853 $ 15,843 Perpetual license 19,277 23,189 Maintenance 126,083 112,397 Cloud 23,276 13,604 Consulting and Training 9,584 10,614 Current deferred revenue 195,073 175,647 Perpetual license 2,568 7,909 Maintenance 2,745 1,802 Cloud 1,278 1,278 Long-term deferred revenue 6,591 10,989 $ 201,664 $ 186,636

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	12 Months Ended
	Dec. 31, 2017
Future Minimum Rental Payments for Operating Leases	As of December 31, 2017, the Company’s future minimum rental payments required under operating leases with noncancellable terms in excess of one year were as follows: (in thousands) Operating Leases (1) 2018 $ 15,395 2019 13,881 2020 12,737 2021 11,066 2022 and thereafter 18,896 $ 71,975 (1) Operating leases include future minimum rent payments, net of estimated sublease income for facilities that the Company has vacated pursuant to its restructuring activities.

STOCKHOLDERS' EQUITY (Tables)

STOCKHOLDERS' EQUITY (Tables)	12 Months Ended
	Dec. 31, 2017
Summary of Repurchase Activity under Repurchase Programs	(in thousands) 2017 2016 2015 Shares Amount Shares Amount Shares Amount Authorization remaining, beginning of period $ 39,385 $ 40,534 $ 13,284 Authorizations — 25,879 50,000 Repurchases paid 96 (4,335 ) 1,078 (27,028 ) 944 (22,530 ) Repurchases unsettled 3 (158 ) — — 8 (220 ) Authorization remaining, end of period $ 34,892 $ 39,385 $ 40,534
Summary of Dividends Declared Per Share	(per share) 2017 2016 2015 Dividends Declared $ 0.12 $ 0.12 $ 0.12

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	12 Months Ended
	Dec. 31, 2017
Stock-Based Compensation Expense Included in Consolidated Statements of Operations	The following table presents the stock-based compensation expense included in the Company’s consolidated statements of operations: (in thousands) 2017 2016 2015 Cost of revenues $ 14,573 $ 11,459 $ 8,772 Selling and marketing 15,720 12,464 8,911 Research and development 13,618 10,043 8,116 General and administrative 9,402 6,513 4,255 Acquisition-related — 342 — Total stock-based compensation before tax $ 53,313 $ 40,821 $ 30,054 Income tax benefit $ (12,113 ) $ (12,198 ) $ (8,098 )
Weighted-Average Assumptions Used in Black-Scholes Option Valuation Model	The weighted-average assumptions used in the Black-Scholes option valuation model are as follows: 2017 2016 2015 Expected annual volatility (1) 35 % 40 % 45 % Expected term in years (2) 4.5 4.4 4.5 Risk-free interest rate (3) 1.85 % 1.21 % 1.34 % Expected annual dividend yield (4) 0.53 % 0.63 % 0.68 % • The expected annual volatility for each grant is determined based on the average of historical daily price changes of the Company’s common stock over a period of time which approximates the expected option term. • The expected option term for each grant is determined based on the historical exercise behavior of employees and post-vesting employment termination behavior. • The risk-free interest rate is based on the yield of U.S. Treasury securities with a maturity that is commensurate with the expected option term at the time of grant. • The expected annual dividend yield is based on the weighted-average of the dividend yield assumptions used for options granted during the applicable period.
Combined Stock Option Activity	The following table summarizes the combined stock option activity under the Company’s stock option plans for 2017: Shares (in thousands) Weighted-average Weighted-average Aggregate intrinsic (in thousands) Options outstanding as of January 1, 2017 7,463 $ 19.45 Granted 1,639 45.78 Exercised (1,741 ) 16.25 Forfeited (231 ) 25.30 Options outstanding as of December 31, 2017 7,130 $ 26.10 Vested and expected to vest as December 31, 2017 5,926 $ 25.20 7.2 $ 131,599 Exercisable as of December 31, 2017 2,800 $ 16.98 5.8 $ 84,479
Combined Restricted Stock Units Activity	The weighted-average grant-date fair value for RSUs granted in 2017, 2016, and 2015 was $46.07, $25.54, and $20.49, respectively. The following table summarizes the combined RSU activity for periodic grants and the CICP under the 2004 Plan for 2017: Shares Weighted- Grant-Date Aggregate Nonvested as of January 1, 2017 3,161 $ 23.39 Granted 1,148 46.07 Vested (1,188 ) 23.66 Forfeited (220 ) 27.06 Nonvested as of December 31, 2017 2,901 $ 31.97 $ 136,771 Expected to vest as of December 31, 2017 2,113 $ 32.74 $ 99,628

INCOME TAXES (Tables)

INCOME TAXES (Tables)	12 Months Ended
	Dec. 31, 2017
Components of Income before Provision for Income Taxes	The components of income before provision for income taxes are as follows: (in thousands) 2017 2016 2015 Domestic $ 18,605 $ 37,329 $ 63,124 Foreign 18,495 (2,127 ) (2,619 ) Income before provision for income taxes $ 37,100 $ 35,202 $ 60,505
Components of Provision for Income Taxes	The components of the provision for income taxes are as follows: (in thousands) 2017 2016 2015 Current: Federal $ (18,205 ) $ 6,741 $ 17,864 State 97 2,963 4,565 Foreign 8,479 4,322 3,853 Total current (benefits)/provision (9,629 ) 14,026 26,282 Deferred: Federal 19,683 (1,120 ) 2,075 State (2,158 ) (480 ) (466 ) Foreign (3,730 ) (4,210 ) (3,708 ) Total deferred provision/(benefit) 13,795 (5,810 ) (2,099 ) Provision for income taxes $ 4,166 $ 8,216 $ 24,183
Reconciliation of Effective Income Tax Rate from Statutory Federal Income Tax Rate	The effective income tax rate differed from the statutory federal income tax rate due to the following: 2017 2016 2015 Statutory federal income tax rate 35.0 % 35.0 % 35.0 % Valuation allowance 1.2 0.3 0.7 Transaction costs — 1.1 — State income taxes, net of federal benefit and tax credits (4.5 ) 3.7 4.6 Permanent differences 2.7 2.2 1.1 Domestic production activities — (3.2 ) (3.1 ) Federal research and experimentation credits (9.1 ) (2.3 ) (1.2 ) Tax effects of foreign activities (1.1 ) 5.2 2.0 Tax-exempt (0.3 ) (0.3 ) (0.1 ) Provision to return adjustments (5.2 ) 0.3 0.3 Non-deductible 5.0 6.2 3.3 Provision for uncertain tax positions 0.7 (2.3 ) (2.6 ) Excess tax benefits related to share-based compensation (66.0 ) (20.1 ) — Net deferred tax assets re-measurement (1) 51.8 — — Other 1.0 (2.5 ) — Effective income tax rate 11.2 % 23.3 % 40.0 % (1) Due to the impact of the Tax Reform Act.
Components of Net Deferred Tax Assets and Liabilities	Significant components of net deferred tax assets and liabilities are as follows: December 31, (in thousands) 2017 2016 Deferred tax assets: Net operating loss carryforwards $ 52,311 $ 69,307 Accruals and reserves 22,984 34,021 Software revenue 2,686 6,559 Depreciation 2,558 3,593 Tax credit carryforwards 13,056 8,094 Other 52 19 Total deferred tax assets 93,647 121,593 Less valuation allowances (27,993 ) (34,054 ) Total net deferred tax assets 65,654 87,539 Deferred tax liabilities: Intangibles (8,527 ) (17,641 ) Total deferred tax liabilities (8,527 ) (17,641 ) Deferred income taxes $ 57,127 $ 69,898
Reconciliation of Beginning and Ending Balances of Gross Unrecognized Tax Benefits	A reconciliation of the beginning and ending balances of the total amounts of gross unrecognized tax benefits is as follows: (in thousands) 2017 2016 2015 Balance as of January 1, $ 22,671 $ 23,972 $ 43,396 Additions based on tax positions related to the current year 452 80 817 Additions for tax positions of prior years 238 110 183 Additions for acquired uncertain tax benefits — 387 — Reductions for change in US federal tax rate (2,424 ) — — Reductions for tax positions of prior years (1,500 ) (1,541 ) (19,855 ) Reductions for a lapse of the applicable statute of limitations (287 ) (337 ) (569 ) Balance as of December 31, $ 19,150 $ 22,671 $ 23,972

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	12 Months Ended
	Dec. 31, 2017
Summary of Basic and Diluted Earnings Per Share	(in thousands except per share amounts) 2017 2016 2015 Basic Net income $ 32,934 $ 26,986 $ 36,322 Weighted-average common shares outstanding 77,431 76,343 76,507 Earnings per share, basic $ 0.43 $ 0.35 $ 0.47 Diluted Net income $ 32,934 $ 26,986 $ 36,322 Weighted-average effect of dilutive securities: Stock options 3,471 2,025 1,601 RSUs 1,930 1,364 935 Effect of assumed exercise of stock options and RSUs 5,401 3,389 2,536 Weighted-average common shares outstanding, assuming dilution 82,832 79,732 79,043 Earnings per share, diluted $ 0.40 $ 0.34 $ 0.46 Outstanding options and RSUs excluded as impact would be antidilutive 221 322 182

GEOGRAPHIC INFORMATION AND MA42

GEOGRAPHIC INFORMATION AND MAJOR CLIENTS (Tables)	12 Months Ended
	Dec. 31, 2017
Revenue by Geographic Area	The Company’s international revenue is from clients based outside of the U.S. The Company derived its revenue from the following geographic areas: (Dollars in thousands) 2017 2016 2015 U.S. $ 474,819 56 % $ 430,562 57 % $ 379,936 56 % Other Americas 39,490 5 % 59,160 8 % 57,892 8 % U.K. 90,817 11 % 101,733 14 % 96,314 14 % Other EMEA (1) 130,889 16 % 92,540 12 % 87,240 13 % Asia Pacific 104,567 12 % 66,271 9 % 61,313 9 % $ 840,582 100 % $ 750,266 100 % $ 682,695 100 % (1) Includes the Middle East, Africa, and Europe excluding the U.K.
Long-Lived Assets by Geographic Area	Long-lived assets related to the Company’s U.S. and international operations were as follows: (Dollars in thousands) December 31, 2017 2016 U.S. $ 27,590 68 % $ 27,993 73 % India 6,703 17 % 7,158 19 % International, other 6,066 15 % 3,130 8 % $ 40,359 100 % $ 38,281 100 %
Total Revenue of Major Clients	Clients accounting for 10% or more of the Company’s total revenue were as follows: (Dollars in thousands) 2017 2016 2015 Total revenue $ 840,582 $ 750,266 $ 682,695 Client A 10 % * *
Total Trade Accounts Receivable of Major Clients	Clients accounting for 10% or more of the Company’s trade accounts receivable were as follows: (Dollars in thousands) December 31, 2017 2016 Trade accounts receivable $ 248,331 $ 265,028 Client A 12 % * * Client accounted for less than 10% of total revenue and trade accounts receivable

EMPLOYEE BENEFIT PLANS (Tables)

EMPLOYEE BENEFIT PLANS (Tables)	12 Months Ended
	Dec. 31, 2017
Summary of Defined Contribution Plans Expenses	The following expenses related to defined contribution plans were recorded in the Company’s consolidated statements of operations: (in thousands) 2017 2016 2015 U.S. 401(k) Plan $ 5,003 $ 4,510 $ 4,061 International Plans 9,096 7,635 6,428 $ 14,099 $ 12,145 $ 10,489

SELECTED QUARTERLY INFORMATIO44

SELECTED QUARTERLY INFORMATION (UNAUDITED) (Tables)	12 Months Ended
	Dec. 31, 2017
Summary of Selected Quarterly Information	2017 (in thousands, except per share amounts) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Revenue $ 223,247 $ 197,980 $ 179,815 $ 239,540 Gross profit 155,157 130,105 110,084 165,563 Income/(loss) from operations 31,238 1,750 (14,289 ) 19,961 Income/(loss) before provision for income taxes 31,800 1,560 (14,697 ) 18,437 Net income/(loss) 27,021 11,406 (1,812 ) (3,681 ) Net income/(loss) per share, basic $ 0.35 $ 0.15 $ (0.03 ) $ (0.04 ) Net income/(loss) per share, diluted $ 0.33 $ 0.14 $ (0.03 ) $ (0.04 ) 2016 (1) (in thousands, except per share amounts) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Revenue $ 178,858 $ 188,996 $ 182,802 $ 199,610 Gross profit 122,348 128,896 122,365 137,401 Income from operations 14,125 6,360 5,498 11,776 Income before provision for income taxes 13,493 5,498 5,515 10,696 Net income 10,400 4,536 3,301 8,749 Net income per share, basic $ 0.14 $ 0.06 $ 0.04 $ 0.11 Net income per share, diluted $ 0.13 $ 0.06 $ 0.04 $ 0.11 (1) The Company elected to early adopt ASU 2016-09 2016-09

Significant Accounting Polici45

Significant Accounting Policies - Additional Information (Detail) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Significant Accounting Policies [Line Items]
Computer software developed for internal use into service			$ 11,300,000
Impairments recognized on assets		$ 0	0	$ 0
More-likely-than-not benefit likelihood percentage being realized upon ultimate settlement with taxing authority resulting from sustainability of tax examination		50.00%
Advertising costs		$ 6,100,000	8,900,000	9,800,000
Cumulative-effect adjustment from adoption of ASU 2014-09			321,000
Equipment
Significant Accounting Policies [Line Items]
Property and equipment, average useful life, years		3 years
Furniture and fixtures
Significant Accounting Policies [Line Items]
Property and equipment, average useful life, years		5 years
Research and Development and Software Development Costs
Significant Accounting Policies [Line Items]
Computer software capitalized during period		$ 0	0	0
Internal Use Software [Member]
Significant Accounting Policies [Line Items]
Computer software capitalized during period			10,200,000	$ 1,100,000
Retained Earnings
Significant Accounting Policies [Line Items]
Cumulative-effect adjustment from adoption of ASU 2014-09			$ 321,000
Accounting Standards Update 2014-09 | Retained Earnings | Expected Incremental Expense
Significant Accounting Policies [Line Items]
Cumulative-effect adjustment from adoption of ASU 2014-09	$ 205,000,000
Increase in retained earnings due to deferred commission expense	30,000,000
Decrease in retained earnings due to the resulting tax impact	$ (97,000,000)
Minimum | Capitalized Computer Software
Significant Accounting Policies [Line Items]
Property and equipment, average useful life, years		3 years
Maximum | Capitalized Computer Software
Significant Accounting Policies [Line Items]
Property and equipment, average useful life, years		5 years
Software Licenses | Minimum
Significant Accounting Policies [Line Items]
Term of license agreements		3 years
Software Licenses | Maximum
Significant Accounting Policies [Line Items]
Term of license agreements		5 years
Maintenance
Significant Accounting Policies [Line Items]
Deferred revenue, period of recognition		1 year
Professional Services Revenues | Maximum
Significant Accounting Policies [Line Items]
Deferred revenue, period of recognition		4 years

Schedule of Marketable Securiti

Schedule of Marketable Securities (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 61,753	$ 63,356
Unrealized Gains	1	1
Unrealized Losses	(285)	(190)
Fair Value	61,469	63,167
Municipal bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	32,996	36,746
Unrealized Losses	(148)	(139)
Fair Value	32,848	36,607
Corporate bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	28,757	26,610
Unrealized Gains	1	1
Unrealized Losses	(137)	(51)
Fair Value	$ 28,621	$ 26,560

Marketable Securities - Additio

Marketable Securities - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2017
Schedule of Available-for-sale Securities [Line Items]
Weighted-average remaining maturity period of marketable debt securities, months	12 months
Minimum
Schedule of Available-for-sale Securities [Line Items]
Remaining maturities of marketable debt securities	2017-10
Maximum
Schedule of Available-for-sale Securities [Line Items]
Remaining maturities of marketable debt securities	2020-09

Derivative Instruments - Additi

Derivative Instruments - Additional Information (Detail) $ in Millions	Dec. 31, 2016USD ($)
Foreign Exchange Forward
Derivative [Line Items]
Notional value	$ 128.4

Fair Value of Company Outstandi

Fair Value of Company Outstanding Forward Contracts (Detail) - Foreign Exchange Forward $ in Thousands	Dec. 31, 2016USD ($)
Accrued expenses
Derivative [Line Items]
Liability Derivatives	$ 883
Other current assets
Derivative [Line Items]
Asset Derivatives	$ 628

Forward Contracts Outstanding w

Forward Contracts Outstanding with Total Notional Values (Detail) - Dec. 31, 2016 - Foreign Exchange Forward € in Thousands, £ in Thousands, AUD in Thousands, $ in Thousands	USD ($)	AUD	GBP (£)	EUR (€)
Euro Member Countries, Euros
Derivative [Line Items]
Notional amount | €				€ 29,820
British Pounds
Derivative [Line Items]
Notional amount | £			£ 6,440
Australian Dollar
Derivative [Line Items]
Notional amount | AUD		AUD 22,010
United States of America, Dollars
Derivative [Line Items]
Notional amount | $	$ 73,125

Change in Fair Value of Forward

Change in Fair Value of Forward Contracts (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gain (loss) from the change in the fair value of forward contracts included in other expense, net	$ 286	$ (5,643)	$ (1,047)
Foreign currency transaction (losses) gains from the remeasurement of foreign currency assets and liabilities	$ (900)	$ 2,247	$ (4,168)

Fair Value Measurements - Addit

Fair Value Measurements - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amount of transfers between Level 1 and Level 2	$ 0	$ 0
Impairments recognized on assets	0	0	$ 0
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairments recognized on assets	$ 0	$ 0	$ 0

Assets and Liabilities Measured

Assets and Liabilities Measured at Fair Value (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands		Dec. 31, 2017	Dec. 31, 2016
Fair Value Assets
Total marketable securities		$ 61,469	$ 63,167
Foreign currency forward contracts
Fair Value Assets
Foreign currency forward contracts			628
Fair Value Liabilities
Foreign currency forward contracts			883
Money Market Funds
Fair Value Assets
Cash equivalents	[1]	42,771	458
Municipal bonds
Fair Value Assets
Total marketable securities		32,848	36,607
Corporate bonds
Fair Value Assets
Total marketable securities		28,621	26,560
Investments in Privately-Held Companies
Fair Value Assets
Investments in privately-held companies	[2]	1,030
Level 1 | Money Market Funds
Fair Value Assets
Cash equivalents	[1]	2,720	458
Level 2
Fair Value Assets
Total marketable securities		61,469	63,167
Level 2 | Foreign currency forward contracts
Fair Value Assets
Foreign currency forward contracts			628
Fair Value Liabilities
Foreign currency forward contracts			883
Level 2 | Money Market Funds
Fair Value Assets
Cash equivalents	[1]	40,051
Level 2 | Municipal bonds
Fair Value Assets
Total marketable securities		32,848	36,607
Level 2 | Corporate bonds
Fair Value Assets
Total marketable securities		28,621	$ 26,560
Level 3 | Investments in Privately-Held Companies
Fair Value Assets
Investments in privately-held companies	[2]	$ 1,030
[1]	Included in cash and cash equivalents in the consolidated balance sheets.
[2]	Included in other long-term assets in the consolidated balance sheets.

Schedule of Trade Accounts Rece

Schedule of Trade Accounts Receivable (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total accounts receivable	$ 255,986	$ 269,154
Allowance for sales credit memos	(7,655)	(4,126)
Total accounts receivable net	248,331	265,028
Trade accounts receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total accounts receivable	225,923	234,473
Unbilled accounts receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total accounts receivable	$ 30,063	$ 34,681

Activity of Allowance for Sales

Activity of Allowance for Sales Credit Memos (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance at beginning of year	$ 4,126	$ 4,631	$ 1,540
Provision for credit memos	7,052	3,290	8,005
Credit memos issued	(3,523)	(3,795)	(4,914)
Balance at end of year	$ 7,655	$ 4,126	$ 4,631

Property and Equipment (Detail)

Property and Equipment (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 92,403	$ 79,425
Less: accumulated depreciation and amortization	(52,044)	(41,144)
Property and equipment, net	40,359	38,281
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	38,650	32,852
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	23,783	21,522
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	8,517	6,127
Computer Software Purchased
Property, Plant and Equipment [Line Items]
Property and equipment, gross	6,690	6,083
Computer software developed for internal use
Property, Plant and Equipment [Line Items]
Property and equipment, gross	12,596	12,069
Fixed assets in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 2,167	$ 772

Property and Equipment - Additi

Property and Equipment - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 12.4	$ 11.2	$ 10.6

Acquisitions - Additional Infor

Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands	Apr. 11, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Business Acquisition [Line Items]
Purchase price of acquired company		$ 297	$ 49,113	$ 1,671
OpenSpan, Inc.
Business Acquisition [Line Items]
Purchase price of acquired company	$ 48,800
Cash acquired from acquisition	$ 1,800

Goodwill and Other Intangible59

Goodwill and Other Intangible Assets - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2017Segment
Goodwill and Other Intangible Assets [Line Items]
Number of reportable segment	1
Number of operating segments	1

Changes in Carrying Amount of G

Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Goodwill [Line Items]
Balance as of January 1,	$ 73,164	$ 46,776
Acquisitions		26,689
Purchase price adjustments to goodwill	(354)
Translation adjustments	142	(301)
Balance as of December 31,	$ 72,952	$ 73,164

Schedule of Amortizable Intangi

Schedule of Amortizable Intangible Asset (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Goodwill and Other Intangible Assets [Line Items]
Cost	$ 127,467	$ 127,394
Accumulated Amortization	(95,568)	(83,203)
Net book value	31,899	44,191
Client related intangibles
Goodwill and Other Intangible Assets [Line Items]
Cost	63,164	63,091
Accumulated Amortization	(44,835)	(37,573)
Net book value	18,329	25,518
Technology
Goodwill and Other Intangible Assets [Line Items]
Cost	58,942	58,942
Accumulated Amortization	(45,372)	(40,269)
Net book value	13,570	18,673
Other intangibles
Goodwill and Other Intangible Assets [Line Items]
Cost	5,361	5,361
Accumulated Amortization	$ (5,361)	$ (5,361)
Minimum | Client related intangibles
Goodwill and Other Intangible Assets [Line Items]
Range of Useful Lives	9 years	4 years
Minimum | Technology
Goodwill and Other Intangible Assets [Line Items]
Range of Useful Lives	7 years	3 years
Maximum | Client related intangibles
Goodwill and Other Intangible Assets [Line Items]
Range of Useful Lives	10 years	10 years
Maximum | Technology
Goodwill and Other Intangible Assets [Line Items]
Range of Useful Lives	10 years	10 years

Amortization Expense of Acquire

Amortization Expense of Acquired Intangibles (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Acquired Finite-Lived Intangible Assets [Line Items]
Total amortization expense	$ 12,338	$ 13,408	$ 12,202
Cost of revenue
Acquired Finite-Lived Intangible Assets [Line Items]
Total amortization expense	5,103	5,986	5,392
Selling and marketing
Acquired Finite-Lived Intangible Assets [Line Items]
Total amortization expense	$ 7,235	7,145	6,127
General and administrative
Acquired Finite-Lived Intangible Assets [Line Items]
Total amortization expense		$ 277	$ 683

Estimated Future Amortization E

Estimated Future Amortization Expense Related to Intangible Assets (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Goodwill and Other Intangible Assets [Line Items]
2,018	$ 11,345
2,019	5,553
2,020	2,657
2,021	2,633
2022 and thereafter	9,711
Net book value	$ 31,899	$ 44,191

Schedule of Accrued Expenses (D

Schedule of Accrued Expenses (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Schedule of Accrued Liabilities [Line Items]
Outside professional services	$ 14,468	$ 10,204
Income and other taxes	7,420	10,422
Marketing and sales program expenses	6,444	3,707
Dividends payable	2,344	2,298	$ 2,297
Employee related expenses	4,065	3,806
Other	10,767	6,314
Total accrued expenses	$ 45,508	$ 36,751

Schedule of Deferred Revenue (D

Schedule of Deferred Revenue (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Deferred Revenue Arrangement [Line Items]
Current deferred revenue	$ 195,073	$ 175,647
Long-term deferred revenue	6,591	10,989
Total deferred revenue	201,664	186,636
Term license
Deferred Revenue Arrangement [Line Items]
Current deferred revenue	16,853	15,843
Perpetual license
Deferred Revenue Arrangement [Line Items]
Current deferred revenue	19,277	23,189
Long-term deferred revenue	2,568	7,909
Maintenance
Deferred Revenue Arrangement [Line Items]
Current deferred revenue	126,083	112,397
Long-term deferred revenue	2,745	1,802
Cloud
Deferred Revenue Arrangement [Line Items]
Current deferred revenue	23,276	13,604
Long-term deferred revenue	1,278	1,278
Consulting and Training
Deferred Revenue Arrangement [Line Items]
Current deferred revenue	$ 9,584	$ 10,614

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Commitments and Contingencies Disclosure [Abstract]
Operating lease expiration year	2,023
Tenant allowance		$ 9.4
Rent expense under operating leases	$ 14.7	$ 13.4	$ 12.3

Future Minimum Rental Payments

Future Minimum Rental Payments for Operating Leases (Detail) $ in Thousands	Dec. 31, 2017USD ($)	[1]
Operating Leases
2,018	$ 15,395
2,019	13,881
2,020	12,737
2,021	11,066
2022 and thereafter	18,896
Total future minimum rental payments for operating leases	$ 71,975
[1]	Operating leases include future minimum rent payments, net of estimated sublease income for facilities that the Company has vacated pursuant to its restructuring activities.

Stockholders' Equity - Addition

Stockholders' Equity - Additional Information (Detail) - USD ($)	May 30, 2017	Dec. 31, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Shareholders Equity [Line Items]
Preferred stock, shares authorized		1,000,000	1,000,000	1,000,000
Common stock, shares authorized		200,000,000	200,000,000	200,000,000
Common stock, par value		$ 0.01	$ 0.01	$ 0.01
Common stock, shares issued		78,081,000	78,081,000	76,591,000
Common stock, shares outstanding		78,081,000	78,081,000	76,591,000
Aggregate amount of stock repurchases authorized		$ 195,000,000	$ 195,000,000
Expiration date, current stock repurchase program	Jun. 30, 2018
Dividend payments to shareholders			$ 9,277,000	$ 9,174,000	$ 9,194,000
Cash dividends declared, per share		$ 0.03	$ 0.12	$ 0.12	$ 0.12

Summary of Repurchase Activity

Summary of Repurchase Activity under Repurchase Programs (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Repurchase Program [Line Items]
Repurchases paid, shares	96	1,078	944
Repurchases unsettled, shares	3		8
Authorization remaining, beginning of period	$ 39,385,000	$ 40,534,000	$ 13,284,000
Authorizations		25,879,000	50,000,000
Repurchases paid	(4,335,000)	(27,028,000)	(22,530,000)
Repurchases unsettled	(158,000)		(220,000)
Authorization remaining, end of period	$ 34,892,000	$ 39,385,000	$ 40,534,000

Summary of Dividends Declared P

Summary of Dividends Declared Per Share (Detail) - $ / shares	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Repurchase Program [Line Items]
Cash dividends declared, per share	$ 0.03	$ 0.12	$ 0.12	$ 0.12

Stock-Based Compensation Expens

Stock-Based Compensation Expense Included in Consolidated Statements of Operations (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	$ 53,313	$ 40,821	$ 30,054
Income tax benefit	(12,113)	(12,198)	(8,098)
Cost of revenue
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	14,573	11,459	8,772
Selling and marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	15,720	12,464	8,911
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	13,618	10,043	8,116
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	$ 9,402	6,513	$ 4,255
Acquisition-related
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax		$ 342

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Jun. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option term	10 years
Stock-based compensation arrangement vesting period, in years	5 years
Shares remaining for issuance for future equity grants	9,200,000
Vesting one year from the grant date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage of stock units	20.00%
Vesting in quarterly installments over the remaining four years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage of stock units	80.00%
2006 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized	1,000,000
Stock price percentage of fair market value	85.00%
Stock purchase price percentage on completion date of offering period	95.00%
Aggregate number of shares issued under plan	400,000
Shares remaining for issuance for future equity grants	600,000
Corporate Incentive Compensation Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of common stock closing price determine RSU grants for employees	85.00%
2004 Long-Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized				30,000,000
Number of shares outstanding	10,000,000
Shares remaining for issuance for future equity grants	8,600,000
Employees
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued	1,600,000
Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued	1,600,000
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average grant-date fair value of options granted, per share	$ 13.79	$ 8.31	$ 7.62
Aggregate intrinsic value of options exercised	$ 62,600,000	$ 19,900,000	$ 18,600,000
Closing price of common stock	$ 47.15
Unrecognized stock-based compensation expense	$ 16,800,000
Weighted-average period of recognition of unrecognized stock-based compensation expense (in years)	2 years 2 months 12 days
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Closing price of common stock	$ 47.15
Unrecognized stock-based compensation expense	$ 32,400,000
Weighted-average period of recognition of unrecognized stock-based compensation expense (in years)	2 years 1 month 6 days
Weighted-average grant-date fair value of stock units granted	$ 46.07	$ 25.54	$ 20.49
Restricted stock units, fair value	$ 59,000,000	$ 29,200,000	$ 14,900,000
RSUs | Corporate Incentive Compensation Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation percentage of target incentive compensation eligible to be elected and received by employees	50.00%
RSUs | Non-employee directors | 2004 Long-Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Value of annual common stock grantable to non-employee directors				$ 500,000

Weighted Average Assumptions us

Weighted Average Assumptions used in Black Scholes Option Valuation Model (Detail)		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share Based Payment Award Stock Options Valuation Assumptions [Line Items]
Expected annual volatility	[1]	35.00%	40.00%	45.00%
Expected term in years	[2]	4 years 6 months	4 years 4 months 24 days	4 years 6 months
Risk-free interest rate	[3]	1.85%	1.21%	1.34%
Expected annual dividend yield	[4]	0.53%	0.63%	0.68%
[1]	The expected annual volatility for each grant is determined based on the average of historical daily price changes of the Company's common stock over a period of time which approximates the expected option term.
[2]	The expected option term for each grant is determined based on the historical exercise behavior of employees and post-vesting employment termination behavior.
[3]	The risk-free interest rate is based on the yield of U.S. Treasury securities with a maturity that is commensurate with the expected option term at the time of grant.
[4]	The expected annual dividend yield is based on the weighted-average of the dividend yield assumptions used for options granted during the applicable period.

Combined Stock Option Activity

Combined Stock Option Activity (Detail) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2017USD ($)$ / sharesshares
Number of shares
Beginning Balance | shares	7,463
Granted | shares	1,639
Exercised | shares	(1,741)
Forfeited | shares	(231)
Ending Balance | shares	7,130
Vested and expected to vest as December 31, 2017 | shares	5,926
Exercisable as of December 31, 2017 | shares	2,800
Weighted Average Exercise Price
Beginning Balance | $ / shares	$ 19.45
Granted | $ / shares	45.78
Exercised | $ / shares	16.25
Forfeited | $ / shares	25.30
Ending Balance | $ / shares	26.10
Vested and expected to vest as December 31, 2017 | $ / shares	25.20
Exercisable as of December 31, 2017 | $ / shares	$ 16.98
Weighted average remaining contractual term
Vested and expected to vest as December 31, 2017	7 years 2 months 12 days
Exercisable as of December 31, 2017	5 years 9 months 18 days
Aggregate Intrinsic Value
Vested and expected to vest as December 31, 2017 | $	$ 131,599
Exercisable as of December 31, 2017 | $	$ 84,479

Combined Restricted Stock Units

Combined Restricted Stock Units Activity (Detail) - RSUs - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Number of shares
Nonvested as of January 1, 2017	3,161
Granted	1,148
Vested	(1,188)
Forfeited	(220)
Nonvested as of December 31, 2017	2,901	3,161
Expected to vest as of December 31, 2017	2,113
Weighted average grant date fair value
Nonvested as of January 1, 2017	$ 23.39
Granted	46.07	$ 25.54	$ 20.49
Vested	23.66
Forfeited	27.06
Nonvested as of December 31, 2017	31.97	$ 23.39
Expected to vest as of December 31, 2017	$ 32.74
Aggregate Intrinsic value
Nonvested as of December 31, 2017	$ 136,771
Expected to vest as of December 31, 2017	$ 99,628

Components of Income Before Pro

Components of Income Before Provision for Income Taxes (Detail) - USD ($) $ in Thousands	3 Months Ended												12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	[1]	Sep. 30, 2016	[1]	Jun. 30, 2016	[1]	Mar. 31, 2016	[1]	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure Abstract
Domestic													$ 18,605	$ 37,329	$ 63,124
Foreign													18,495	(2,127)	(2,619)
Income before provision for income taxes	$ 18,437	$ (14,697)	$ 1,560	$ 31,800	$ 10,696		$ 5,515		$ 5,498		$ 13,493		$ 37,100	$ 35,202	$ 60,505
[1]	The Company elected to early adopt ASU 2016-09 in the fourth quarter of 2016, which requires, among other things, excess tax benefits to be recorded as a reduction of the provision for income taxes in the consolidated statement of operations, whereas they were previously recognized in equity. The Company is required to reflect any adoption adjustments as of January 1, 2016, the beginning of the annual period that includes the period of adoption. As such, certain information above includes the impact of the ASU 2016-09 adoption.

Components of Provision for Inc

Components of Provision for Income Taxes (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Components Of Income Tax Expense Benefit [Line Items]
Current, Federal	$ (18,205)	$ 6,741	$ 17,864
Current, State	97	2,963	4,565
Current, Foreign	8,479	4,322	3,853
Total current (benefits)/provision	(9,629)	14,026	26,282
Deferred, Federal	19,683	(1,120)	2,075
Deferred, State	(2,158)	(480)	(466)
Deferred, Foreign	(3,730)	(4,210)	(3,708)
Total deferred provision/(benefit)	13,795	(5,810)	(2,099)
Provision for income taxes	$ 4,166	$ 8,216	$ 24,183

Reconciliation of Effective Inc

Reconciliation of Effective Income Tax Rate from Statutory Federal Income Tax Rate (Detail)		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Reconciliation of Effective Income Tax Rate [Line Items]
Statutory federal income tax rate		35.00%	35.00%	35.00%
Valuation allowance		1.20%	0.30%	0.70%
Transaction costs			1.10%
State income taxes, net of federal benefit and tax credits		(4.50%)	3.70%	4.60%
Permanent differences		2.70%	2.20%	1.10%
Domestic production activities			(3.20%)	(3.10%)
Federal research and experimentation credits		(9.10%)	(2.30%)	(1.20%)
Tax effects of foreign activities		(1.10%)	5.20%	2.00%
Tax-exempt income		(0.30%)	(0.30%)	(0.10%)
Provision to return adjustments		(5.20%)	0.30%	0.30%
Non-deductible compensation		5.00%	6.20%	3.30%
Provision for uncertain tax positions		0.70%	(2.30%)	(2.60%)
Excess tax benefits related to share-based compensation		(66.00%)	(20.10%)
Net deferred tax assets re-measurement	[1]	51.80%
Other		1.00%	(2.50%)
Effective income tax rate		11.20%	23.30%	40.00%
[1]	Due to the impact of the Tax Reform Act.

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Jan. 01, 2016	Dec. 31, 2014
Income Tax Contingency [Line Items]
Statutory federal income tax rate			35.00%	35.00%	35.00%
Tax Cuts and Jobs Act 2017, Incomplete accounting provisional income tax expense (benefit)	$ 20,400
Valuation allowance, net increase (decrease)			$ 6,100
Reduction of income tax provision due to tax holidays			$ 1,300	$ 1,000	$ 900
Tax holiday expiration date			2,022
Net income per share of the benefit tax holiday			$ 0.02	$ 0.01	$ 0.01
Cumulative-effect adjustment from adoption of ASU 2016-09				$ 321
Long-term deferred income tax assets	57,127		$ 57,127	69,898
Unrecognized Tax Benefits	19,150		19,150	22,671	$ 23,972		$ 43,396
Unrecognized tax benefits that would decrease effective tax rate if recognized	1,500		1,500
Expected changes in unrecognized tax benefits in next 12 months that would reduce effective tax rate			500
Recognized interest expense				(600)	300
Accrued interest and penalties	1,500		$ 1,500	1,200	$ 1,200
Retained Earnings
Income Tax Contingency [Line Items]
Cumulative-effect adjustment from adoption of ASU 2016-09				$ 321
Earliest Tax Year | State and Foreign Country Jurisdiction
Income Tax Contingency [Line Items]
Tax assessment year			2,010
Latest Tax Year | State and Foreign Country Jurisdiction
Income Tax Contingency [Line Items]
Tax assessment year			2,014
Minimum
Income Tax Contingency [Line Items]
Net operating losses and credit expiration year			2,018
Maximum
Income Tax Contingency [Line Items]
Net operating losses and credit expiration year			2,037
Accounting Standards Update 2016-09
Income Tax Contingency [Line Items]
Long-term deferred income tax assets						$ 300
Accounting Standards Update 2016-09 | Retained Earnings
Income Tax Contingency [Line Items]
Cumulative-effect adjustment from adoption of ASU 2016-09						$ 300
Expected Incremental Expense
Income Tax Contingency [Line Items]
Statutory federal income tax rate		21.00%
Allowance for Change in Enacted Tax Rate [Member]
Income Tax Contingency [Line Items]
Valuation allowance, net increase (decrease)			$ 7,400
Foreign Exchange Rate Movements
Income Tax Contingency [Line Items]
Valuation allowance, net increase (decrease)			800
Research and Development Credit
Income Tax Contingency [Line Items]
Valuation allowance, net increase (decrease)			500
Foreign
Income Tax Contingency [Line Items]
Net operating losses	33,500		33,500
Re measurement of the Associated Deferred Tax Assets to the New Statutory Tax Rate
Income Tax Contingency [Line Items]
Unrecognized tax benefits that would decrease effective tax rate if recognized	2,400		2,400
Federal
Income Tax Contingency [Line Items]
Net operating losses	99,200		99,200
Tax credit	3,400		3,400
Net operating losses	60,200		60,200
Federal and State Tax Credits	100		100
Federal | OpenSpan, Inc.
Income Tax Contingency [Line Items]
Net operating losses	99,200		99,200
Tax credit	600		600
State
Income Tax Contingency [Line Items]
Net operating losses	3,300		3,300
Tax credit	1,800		1,800
State Tax Credits	600		600
Net operating losses	800		800
Federal and State Tax Credits	6,700		6,700
State | OpenSpan, Inc.
Income Tax Contingency [Line Items]
Net operating losses	1,000		1,000
Tax credit	$ 300		$ 300

Components of Net Deferred Tax

Components of Net Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Components Of Deferred Income Tax Assets And Liabilities [Line Items]
Net operating loss carryforwards	$ 52,311	$ 69,307
Accruals and reserves	22,984	34,021
Software revenue	2,686	6,559
Depreciation	2,558	3,593
Tax credit carryforwards	13,056	8,094
Other	52	19
Total deferred tax assets	93,647	121,593
Less valuation allowances	(27,993)	(34,054)
Total net deferred tax assets	65,654	87,539
Intangibles	(8,527)	(17,641)
Total deferred tax liabilities	(8,527)	(17,641)
Deferred income taxes	$ 57,127	$ 69,898

Reconciliation of Beginning and

Reconciliation of Beginning and Ending Balances of Gross Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Reconciliation of Unrecognized Tax Benefits [Line Items]
Balance as of January 1,	$ 22,671	$ 23,972	$ 43,396
Additions based on tax positions related to the current year	452	80	817
Additions for tax positions of prior years	238	110	183
Additions for acquired uncertain tax benefits		387
Reductions for change in US federal tax rate	(2,424)
Reductions for tax positions of prior years	(1,500)	(1,541)	(19,855)
Reductions for a lapse of the applicable statute of limitations	(287)	(337)	(569)
Balance as of December 31,	$ 19,150	$ 22,671	$ 23,972

Summary of Basic and Diluted Ea

Summary of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended												12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	[1]	Sep. 30, 2016	[1]	Jun. 30, 2016	[1]	Mar. 31, 2016	[1]	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Earning per share reconciliation
Net income	$ (3,681)	$ (1,812)	$ 11,406	$ 27,021	$ 8,749		$ 3,301		$ 4,536		$ 10,400		$ 32,934	$ 26,986	$ 36,322
Weighted-average common shares outstanding													77,431	76,343	76,507
Earnings per share, basic	$ (0.04)	$ (0.03)	$ 0.15	$ 0.35	$ 0.11		$ 0.04		$ 0.06		$ 0.14		$ 0.43	$ 0.35	$ 0.47
Net income	$ (3,681)	$ (1,812)	$ 11,406	$ 27,021	$ 8,749		$ 3,301		$ 4,536		$ 10,400		$ 32,934	$ 26,986	$ 36,322
Effect of assumed exercise of stock options and RSUs													5,401	3,389	2,536
Weighted-average common shares outstanding, assuming dilution													82,832	79,732	79,043
Earnings per share, diluted	$ (0.04)	$ (0.03)	$ 0.14	$ 0.33	$ 0.11		$ 0.04		$ 0.06		$ 0.13		$ 0.40	$ 0.34	$ 0.46
Outstanding options and RSUs excluded as impact would be antidilutive													221	322	182
Stock Options
Earning per share reconciliation
Weighted-average effect of dilutive securities													3,471	2,025	1,601
RSUs
Earning per share reconciliation
Weighted-average effect of dilutive securities													1,930	1,364	935
[1]	The Company elected to early adopt ASU 2016-09 in the fourth quarter of 2016, which requires, among other things, excess tax benefits to be recorded as a reduction of the provision for income taxes in the consolidated statement of operations, whereas they were previously recognized in equity. The Company is required to reflect any adoption adjustments as of January 1, 2016, the beginning of the annual period that includes the period of adoption. As such, certain information above includes the impact of the ASU 2016-09 adoption.

Geographic Information and Ma83

Geographic Information and Major Clients - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2017SegmentUnit
Geographic information and major clients
Number of reportable segment, customer engagement solutions | Segment	1
Number of reporting unit | Unit	1

Revenue from International Clie

Revenue from International Clients by Geographic Areas (Detail) - USD ($) $ in Thousands		3 Months Ended												12 Months Ended
		Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	[1]	Sep. 30, 2016	[1]	Jun. 30, 2016	[1]	Mar. 31, 2016	[1]	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Geographic revenue		$ 239,540	$ 179,815	$ 197,980	$ 223,247	$ 199,610		$ 182,802		$ 188,996		$ 178,858		$ 840,582	$ 750,266	$ 682,695
Geographic revenue percentage														100.00%	100.00%	100.00%
U.S.
Revenues from External Customers and Long-Lived Assets [Line Items]
Geographic revenue														$ 474,819	$ 430,562	$ 379,936
Geographic revenue percentage														56.00%	57.00%	56.00%
Other Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Geographic revenue														$ 39,490	$ 59,160	$ 57,892
Geographic revenue percentage														5.00%	8.00%	8.00%
U.K.
Revenues from External Customers and Long-Lived Assets [Line Items]
Geographic revenue														$ 90,817	$ 101,733	$ 96,314
Geographic revenue percentage														11.00%	14.00%	14.00%
Other EMEA
Revenues from External Customers and Long-Lived Assets [Line Items]
Geographic revenue	[2]													$ 130,889	$ 92,540	$ 87,240
Geographic revenue percentage	[2]													16.00%	12.00%	13.00%
Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Geographic revenue														$ 104,567	$ 66,271	$ 61,313
Geographic revenue percentage														12.00%	9.00%	9.00%
[1]	The Company elected to early adopt ASU 2016-09 in the fourth quarter of 2016, which requires, among other things, excess tax benefits to be recorded as a reduction of the provision for income taxes in the consolidated statement of operations, whereas they were previously recognized in equity. The Company is required to reflect any adoption adjustments as of January 1, 2016, the beginning of the annual period that includes the period of adoption. As such, certain information above includes the impact of the ASU 2016-09 adoption.
[2]	Includes the Middle East, Africa, and Europe excluding the U.K.

Long Lived Assets by Geographic

Long Lived Assets by Geographic Area (Detail) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Geographic Areas, Long-Lived Assets [Abstract]
Long-lived assets	$ 40,359	$ 38,281
Long-lived assets percentage	100.00%	100.00%
U.S.
Geographic Areas, Long-Lived Assets [Abstract]
Long-lived assets	$ 27,590	$ 27,993
Long-lived assets percentage	68.00%	73.00%
India
Geographic Areas, Long-Lived Assets [Abstract]
Long-lived assets	$ 6,703	$ 7,158
Long-lived assets percentage	17.00%	19.00%
International, other
Geographic Areas, Long-Lived Assets [Abstract]
Long-lived assets	$ 6,066	$ 3,130
Long-lived assets percentage	15.00%	8.00%

Total Revenue of Major Clients

Total Revenue of Major Clients (Detail) - USD ($) $ in Thousands

3 Months Ended

12 Months Ended

Dec. 31, 2017

Sep. 30, 2017

Jun. 30, 2017

Mar. 31, 2017

Dec. 31, 2016

[1]

Sep. 30, 2016

[1]

Jun. 30, 2016

[1]

Mar. 31, 2016

[1]

Dec. 31, 2017

Dec. 31, 2016

Dec. 31, 2015

Revenue, Major Customer [Line Items]

Total revenue

$ 239,540

$ 179,815

$ 197,980

$ 223,247

$ 199,610

$ 182,802

$ 188,996

$ 178,858

$ 840,582

$ 750,266

$ 682,695

Credit Concentration Risk | Total Revenue | Client A | Minimum

Revenue, Major Customer [Line Items]

Concentration risk, percentage

10.00%

[1]

The Company elected to early adopt ASU 2016-09 in the fourth quarter of 2016, which requires, among other things, excess tax benefits to be recorded as a reduction of the provision for income taxes in the consolidated statement of operations, whereas they were previously recognized in equity. The Company is required to reflect any adoption adjustments as of January 1, 2016, the beginning of the annual period that includes the period of adoption. As such, certain information above includes the impact of the ASU 2016-09 adoption.

Trade Accounts Receivable of Ma

Trade Accounts Receivable of Major Clients (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Revenue, Major Customer [Line Items]
Trade accounts receivable	$ 248,331	$ 265,028
Credit Concentration Risk | Trade accounts receivable | Client A
Revenue, Major Customer [Line Items]
Concentration risk, percentage	12.00%

Trade Accounts Receivable of 88

Trade Accounts Receivable of Major Clients (Parenthetical) (Detail) - Trade accounts receivable - Credit Concentration Risk - Client A	12 Months Ended
	Dec. 31, 2017
Revenue, Major Customer [Line Items]
Concentration risk, percentage	12.00%
Minimum
Revenue, Major Customer [Line Items]
Concentration risk, percentage	10.00%

Summary of Defined Contribution

Summary of Defined Contribution Plans Expenses (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Defined Contribution Plan Disclosure [Line Items]
Defined contribution plan, expense	$ 14,099	$ 12,145	$ 10,489
U.S. 401(k) Plan
Defined Contribution Plan Disclosure [Line Items]
Defined contribution plan, expense	5,003	4,510	4,061
International Plans
Defined Contribution Plan Disclosure [Line Items]
Defined contribution plan, expense	$ 9,096	$ 7,635	$ 6,428

Selected Quarterly Informatio90

Selected Quarterly Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended												12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	[1]	Sep. 30, 2016	[1]	Jun. 30, 2016	[1]	Mar. 31, 2016	[1]	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Quarterly Financial Information:
Revenue	$ 239,540	$ 179,815	$ 197,980	$ 223,247	$ 199,610		$ 182,802		$ 188,996		$ 178,858		$ 840,582	$ 750,266	$ 682,695
Gross profit	165,563	110,084	130,105	155,157	137,401		122,365		128,896		122,348		560,909	511,010	469,249
Income/(loss) from operations	19,961	(14,289)	1,750	31,238	11,776		5,498		6,360		14,125		38,660	37,759	64,661
Income/(loss) before provision for income taxes	18,437	(14,697)	1,560	31,800	10,696		5,515		5,498		13,493		37,100	35,202	60,505
Net income/(loss)	$ (3,681)	$ (1,812)	$ 11,406	$ 27,021	$ 8,749		$ 3,301		$ 4,536		$ 10,400		$ 32,934	$ 26,986	$ 36,322
Net income/(loss) per share, basic	$ (0.04)	$ (0.03)	$ 0.15	$ 0.35	$ 0.11		$ 0.04		$ 0.06		$ 0.14		$ 0.43	$ 0.35	$ 0.47
Net income/(loss) per share, diluted	$ (0.04)	$ (0.03)	$ 0.14	$ 0.33	$ 0.11		$ 0.04		$ 0.06		$ 0.13		$ 0.40	$ 0.34	$ 0.46
[1]	The Company elected to early adopt ASU 2016-09 in the fourth quarter of 2016, which requires, among other things, excess tax benefits to be recorded as a reduction of the provision for income taxes in the consolidated statement of operations, whereas they were previously recognized in equity. The Company is required to reflect any adoption adjustments as of January 1, 2016, the beginning of the annual period that includes the period of adoption. As such, certain information above includes the impact of the ASU 2016-09 adoption.