8x8 (EGHT) 10-Q 31 Jan 14 2014 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Dec. 31, 2013	Jan. 24, 2014
Document And Entity Information	'	'
Entity Registrant Name	'8X8 INC /DE/	'
Entity Central Index Key	'0001023731	'
Document Type	'10-Q	'
Document Period End Date	31-Dec-13	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--03-31	'
Is Entity a Well-known Seasoned Issuer?	'No	'
Is Entity a Voluntary Filer?	'No	'
Is Entity's Reporting Status Current?	'Yes	'
Entity Filer Category	'Accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	87,874,850
Document Fiscal Period Focus	'Q3	'
Document Fiscal Year Focus	'2014	'

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Dec. 31, 2013	Mar. 31, 2013
In Thousands, unless otherwise specified
Current assets:	'	'
Cash and cash equivalents	$172,114	$50,305
Short-term investments	1,901	1,964
Accounts receivable, net	5,169	3,880
Inventory	828	511
Deferred cost of goods sold	215	182
Deferred tax asset	4,532	6,096
Other current assets	1,999	732
Total current assets	186,758	63,670
Property and equipment, net	7,485	6,673
Intangible assets, net	15,606	10,194
Goodwill	38,235	25,150
Non-current deferred tax asset	47,366	46,352
Other assets	1,101	572
Total assets	296,551	152,611
Current liabilities:	'	'
Accounts payable	6,497	5,644
Accrued compensation	5,311	3,629
Accrued warranty	634	452
Accrued taxes	2,109	1,912
Deferred revenue	3,208	1,236
Other accrued liabilities	1,711	862
Total current liabilities	19,470	13,735
Non-current liabilities	1,672	1,817
Other non-current liabilities	12	26
Total liabilities	21,154	15,578
Commitments and contingencies (Note 8)	'	'
Stockholders' equity:	'	'
Common stock	88	72
Additional paid-in capital	379,802	246,176
Accumulated other comprehensive income (loss)	227	-36
Accumulated deficit	-104,720	-109,179
Total stockholders' equity	275,397	137,033
Total liabilities and stockholders' equity	$296,551	$152,611

CONDENSED_CONSOLIDATED_STATEME

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $)	3 Months Ended		9 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Condensed Consolidated Statements Of Income	'	'	'	'
Service revenue	$29,737	$24,023	$84,062	$69,314
Product revenue	3,008	2,382	8,749	6,656
Total revenue	32,745	26,405	92,811	75,970
Operating expenses:	'	'	'	'
Cost of service revenue	5,584	4,890	15,579	15,184
Cost of product revenue	4,041	3,203	11,171	8,585
Research and development	3,325	2,117	8,301	5,973
Sales and marketing	16,051	11,561	42,868	32,629
General and administrative	5,547	2,119	11,444	6,226
Gain on patent sale	0	0	0	-11,965
Total operating expenses	34,548	23,890	89,363	56,632
Income (loss) from operations	-1,803	2,515	3,448	19,338
Other income, net	586	73	602	90
Income (loss) from continuing operations before provision (benefit) for income taxes	-1,217	2,588	4,050	19,428
Provision (benefit) for income taxes	-1,306	814	481	7,494
Income from continuing operations	89	1,774	3,569	11,934
Income from discontinued operations, net of income tax provision	0	146	301	344
Gain on disposal of discontinued operations, net of income tax provision of $463	0	0	589	0
Net income	$89	$1,920	$4,459	$12,278
Income per share - continuing operations:	'	'	'	'
Basic	$0	$0.03	$0.05	$0.17
Diluted	$0	$0.03	$0.05	$0.16
Income per share - discontinued operations:	'	'	'	'
Basic	$0	$0	$0.01	$0
Diluted	$0	$0	$0.01	$0
Net income per share:	'	'	'	'
Basic	$0	$0.03	$0.06	$0.17
Diluted	$0	$0.03	$0.06	$0.16
Weighted average number of shares:	'	'	'	'
Basic	79,742	71,611	75,071	71,197
Diluted	83,182	74,988	78,389	74,483

CONDENSED_CONSOLIDATED_STATEME1

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Condensed Consolidated Statements Of Income	'	'	'	'
Discontinued Operation, Tax Effect of Income from Disposal of Discontinued Operation	$0	$0	$463	$0

CONDENSED_CONSOLIDATED_STATEME2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Statement of Comprehensive Income [Abstract]	'	'	'	'
Net income	$89	$1,920	$4,459	$12,278
Other comprehensive income (loss), net of tax	'	'	'	'
Unrealized gain (loss) on investments in securities	-8	-44	-63	23
Foreign currency translation adjustment	326	0	326	0
Comprehensive income	$407	$1,876	$4,722	$12,301

CONDENSED_CONSOLIDATED_STATEME3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities:	'	'
Net income	$4,459	$12,278
Adjustments to reconcile net income to net cash provided by operating activites:	'	'
Depreciation	1,888	1,816
Amortization of intangible assets	1,074	1,071
Amortization of capitalized software	92	0
Gain on disposal of discontinued operations	-589	0
Gain on escrow settlement	-565	0
Stock-based compensation	5,245	1,827
Deferred income tax provision	87	7,359
Other	490	409
Changes in assets and liabilities:	'	'
Accounts receivable, net	-1,104	-1,700
Inventory	-245	-25
Other current and noncurrent assets	-570	-48
Deferred cost of goods sold	211	-18
Accounts payable	-1,290	-38
Accrued compensation	1,217	663
Accrued warranty	182	35
Accrued taxes and fees	62	495
Deferred revenue	757	61
Other current and noncurrent liabilities	172	1,806
Net cash provided by operating activities	11,573	25,991
Cash flows from investing activities:	'	'
Purchases of property and equipment	-2,081	-5,245
Acquisition of business, net of cash acquired	-18,474	0
Proceeds from disposition of discontinued operations, net of transaction costs	3,000	0
Cost of capitalized software	-590	0
Net cash used in investing activities	-18,145	-5,245
Cash flows from financing activities:	'	'
Capital lease payments	-26	-73
Repurchase of common stock	-320	-285
Proceeds from issuance of common stock, net of issuance costs	125,758	0
Proceeds from issuance of common stock under employee stock plans	2,959	1,743
Net cash provided by financing activities	128,371	1,385
Effect of exchange rate changes on cash	10	0
Net increase in cash and cash equivalents	121,809	22,131
Cash and cash equivalents at the beginning of the period	50,305	22,426
Cash and cash equivalents at the end of the period	172,114	44,557
Supplemental cash flow information	'	'
Income taxes paid	479	415
Interest paid	$4	$8

DESCRIPTION_OF_THE_BUSINESS_No

DESCRIPTION OF THE BUSINESS - Note 1	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
DESCRIPTION OF THE BUSINESS - Note 1	'
	1. DESCRIPTION OF THE BUSINESS
	THE COMPANY
	8x8, Inc. ("8x8" or the "Company") develops and markets a comprehensive portfolio of cloud-based communication and collaboration solutions that include hosted cloud telephony, unified communications, contact center, video conferencing and virtual desktop software and services. These unified communication and collaboration services are offered from the Internet cloud via a software-as-a-service subscription. The Company also provides cloud-based computing services. As of December 31, 2013, the Company had approximately 36,800 business customers.
	The Company was incorporated in California in February 1987 and was reincorporated in Delaware in December 1996. The Company's fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in these notes to the condensed consolidated financial statements refers to the fiscal year ending March 31 of the calendar year indicated (for example, fiscal 2014 refers to the fiscal year ending March 31, 2014).
	Common Stock Offering
	In November 2013, the Company completed an underwritten registered offering of common stock in which it sold 14,375,000 shares for total cash proceeds of approximately $125.8 million, net of issuance costs of $0.6 million. The shares issued in the offering had been registered under a shelf registration statement previously filed with the Securities and Exchange Commission relating to up to $250,000,000 of the Company's securities. A member of the Company's board of directors participated in the offering and purchased 30,000 shares at the public offering price.
	Acquisition of Voicenet Solutions Limited
	On November 11, 2013, the Company entered into a share purchase agreement with the shareholders and optionholders of Voicenet Solutions Limited, a provider of cloud communications and collaboration services in the United Kingdom. See note 12.

BASIS_OF_PRESENTATION_Note_2

BASIS OF PRESENTATION - Note 2	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
BASIS OF PRESENTATION - Note 2	'
	2. BASIS OF PRESENTATION
	The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended March 31, 2013. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates.
	The March 31, 2013 year-end condensed consolidated balance sheet data in this document was derived from audited consolidated financial statements and does not include all of the disclosures required by U.S. generally accepted accounting principles. These condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements as of and for the fiscal year ended March 31, 2013 and notes thereto included in the Company's fiscal 2013 Annual Report on Form 10-K.
	RECLASSIFICATION
	Certain amounts previously reported within the Company's consolidated statements of income have been reclassified to conform to the current period presentation. The reclassification included certain prior-period amounts related to the Company's discontinued operations which have been reclassified to conform to the current period presentation.
	The reclassification had no impact on the Company's previously reported net income or basic and diluted net income per share amounts.
	The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.
	Service and Product Revenue
	The Company recognizes service revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, price is fixed or determinable and collectability is reasonably assured. The Company defers recognition of service revenues in instances when cash receipts are received before services are delivered and recognizes deferred revenues ratably as services are provided.
	The Company recognizes revenue from product sales for which there are no related services to be rendered upon shipment to customers provided that persuasive evidence of an arrangement exists, the price is fixed, title has transferred, collection of resulting receivables is reasonably assured, there are no customer acceptance requirements, and there are no remaining significant obligations. Gross outbound shipping and handling charges are recorded as revenue, and the related costs are included in cost of goods sold. Reserves for returns and allowances for customer sales are recorded at the time of shipment. In accordance with the ASC 985-605, the Company records shipments to distributors, retailers, and resellers, where the right of return exists, as deferred revenue. The Company defers recognition of revenue on sales to distributors, retailers, and resellers until products are resold to the customer.
	The Company records revenue net of any sales-related taxes that are billed to its customers. The Company believes this approach results in consolidated financial statements that are more easily understood by users.
	Under the terms of the Company's typical subscription agreement, new customers can terminate their service within 30 days of order placement and receive a full refund of fees previously paid. The Company has determined that it has sufficient history of subscriber conduct to make a reasonable estimate of cancellations within the 30-day trial period. Therefore, the Company recognizes new subscriber revenue in the month in which the new order was shipped, net of an allowance for expected cancellations.
	Multiple Element Arrangements
	Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 605-25 requires that revenue arrangements with multiple deliverables be divided into separate units of accounting if the deliverables in the arrangement meet specific criteria.  The provisioning of the 8x8 cloud service with the accompanying 8x8 IP telephone constitutes a revenue arrangement with multiple deliverables.  For arrangements with multiple deliverables, the Company allocates the arrangement consideration to all units of accounting based on their relative selling prices. In such circumstances, the accounting principles establish a hierarchy to determine the relative selling price to be used for allocating arrangement consideration to units of accounting as follows: (i) vendor-specific objective evidence of fair value ("VSOE"), (ii) third-party evidence of selling price ("TPE"), and (iii) best estimate of the selling price ("BESP").
	VSOE generally exists only when the Company sells the deliverable separately, on more than a limited basis, at prices within a relatively narrow range.  When VSOE cannot be established, the Company attempts to establish the selling price of deliverables based on relevant TPE. TPE is determined based on manufacturer's prices for similar deliverables when sold separately, when possible. When the Company is unable to establish selling price using VSOE or TPE, it uses a BESP for the allocation of arrangement consideration. The objective of BESP is to determine the price at which the Company would transact a sale if the product or service was sold on a stand-alone basis. BESP is generally used for offerings that are not typically sold on a stand-alone basis or for new or highly customized offerings. The Company determines BESP for a product or service by considering multiple factors including, but not limited to:
	the price list established by its management which is typically based on general pricing practices and targeted gross margin of products and services sold; and
	analysis of pricing history of new arrangements, including multiple element and stand-alone transactions.
	In accordance with the guidance of ASC 605-25, when the Company enters into revenue arrangements with multiple deliverables the Company allocates arrangement consideration, including activation fees, among the 8x8 IP telephones and subscriber services based on their relative selling prices. Arrangement consideration allocated to the IP telephones is recognized as product revenues during the period of the sale less the allowance for estimated returns during the 30-day trial period. Arrangement consideration allocated to subscriber services is recognized ratably as service revenues as the related services are provided, which is generally over the initial contract term.
	Deferred Cost of Goods Sold
	Deferred cost of goods sold represents the cost of products sold for which the end customer or distributor has a right of return. The cost of the products sold is recognized contemporaneously with the recognition of revenue, when the subscriber has accepted the service.
	Intangible Assets
	Amortization expense for the customer relationship intangible asset is included in sales and marketing expenses. Amortization expense for technology is included in cost of service revenue. The carrying values of intangible assets were as follows (in thousands):
			31-Dec-13									31-Mar-13
			Gross									Gross
			Carrying			Accumulated			Net Carrying			Carrying			Accumulated			Net Carrying
			Amount			Amortization			Amount			Amount			Amortization			Amount
	Technology	$	8,242		$	-1,874		$	6,368		$	8,242		$	-1,256		$	6,986
	Customer relationships		9,483			-1,202			8,281			3,305			-1,054			2,251
	Trade names/domains		957			-			957			957			-			957
	Total acquired identifiable
	intangible assets	$	18,682		$	-3,076		$	15,606		$	12,504		$	-2,310		$	10,194
	At December 31, 2013, annual amortization of intangible assets, based upon our existing intangible assets and current useful lives, is estimated to be the following (in thousands):
				Amount
	Remaining 2014		$	567
	2015			2,252
	2016			2,252
	2017			2,245
	2018			1,997
	Thereafter			5,336
	Total		$	14,649
	Research, Development and Software Costs
	The Company accounts for software to be sold or otherwise marketed in accordance with ASC 985-20 - Costs of Software to be Sold, Leased or Marketed, which requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. The Company defines establishment of technological feasibility as the completion of a working model. Software development costs for software to be sold or otherwise marketed incurred prior to the establishment of technological feasibility are included in research and development and are expensed as incurred. Software development costs incurred subsequent to the establishment of technological feasibility through the period of general market availability of the product are capitalized, if material.
	In the first nine months of fiscal 2014, the Company capitalized approximately $590,000 of software development costs in accordance with ASC 985-20. At December 31, 2013, total capitalized software development costs included in other long-term assets was approximately $779,000 and accumulated amortization costs related to capitalized software was approximately $92,000.
	Foreign Currency Translation
	The Company has determined that the functional currency of its UK foreign subsidiary is the subsidiary's local currency, the British Pound Sterling ("GBP"), which the Company believes most appropriately reflects the current economic facts and circumstances of the UK subsidiary's operations. The assets and liabilities of the subsidiary are translated at the applicable exchange rate as of the end of the balance sheet period and revenue and expenses are translated at an average rate over the period presented. Resulting currency translation adjustments are recorded as a component of accumulated other comprehensive income or loss within the stockholder's equity in the consolidated balance sheets.
	Stock Purchase Right/Restricted Stock Unit and Option Activity
	Stock purchase right activity for the nine months ended December 31, 2013 is summarized as follows:
						Weighted			Weighted
						Average			Average
						Grant-Date			Remaining
			Number of			Fair Market			Contractual
			Shares			Value			Term (in Years)
	Balance at March 31, 2013		958,575		$	4.11			2.52
	Granted		19,180			9.42
	Vested		-318,591			3.33
	Forfeited		-81,109			4.96
	Balance at December 31, 2013		578,055		$	4.59			2.04
	Restricted stock unit and performance stock unit activity for the nine months ended December 31, 2013 is summarized as follows:
									Weighted
						Weighted			Average
						Average			Remaining
			Number of			Purchase			Contractual
			Shares			Price			Term (in Years)
Balance at March 31, 2013		25,000		$	-			2.47
Granted		1,235,350			-
Vested		-1,250			-
Forfeited		-34,320			-
Balance at December 31, 2013		1,224,780		$	-			2.00
Option activity for the nine months ended December 31, 2013 is summarized as follows:
								Weighted
					Shares			Average
		Shares			Subject to			Exercise
		Available			Options			Price
		for Grant			Outstanding			Per Share
Balance at March 31, 2013		3,175,261			5,991,544		$	2.52
Change in options available for grant		1,000,000						-
Granted - options		-1,390,400			1,390,400			9.57
Stock purchase rights/restricted stock unit (1)		-1,254,530			-			-
Exercised		-			-921,685			2.41
Canceled/forfeited - options		56,048			-56,048			3.38
Canceled/forfeited - restricted stock unit		34,320
Termination of plans		-1,774			-			-
Balance at December 31, 2013		1,618,925			6,404,211		$	4.06
(1) The reduction to shares available for grant includes awards granted of 1,254,530 shares.
The following table summarizes the stock options outstanding and exercisable at December 31, 2013:
		Options Outstanding										Options Exercisable
					Weighted		Weighted								Weighted
					Average		Average								Average
					Exercise		Remaining			Aggregate					Exercise			Aggregate
Range of					Price		Contractual			Intrinsic					Price			Intrinsic
Exercise Price		Shares			Per Share		Life (Years)			Value		Shares			Per Share			Value
$0.55 - $1.26		1,735,000		$	1.04		4.0		$	15,806,760		1,735,000		$	1.04		$	15,806,760
$1.27 - $1.88		1,284,568		$	1.53		2.1			11,067,416		1,284,568		$	1.53			11,067,416
$1.89 - $5.87		1,963,492		$	4.45		5.8			11,187,811		981,709		$	3.99			6,044,878
$5.88 - $9.74		1,346,151		$	9.40		9.7			1,014,399		41,651		$	8.41			72,417
$9.75 - $10.97		75,000		$	10.97		9.8			-		-		$	-			-
		6,404,211							$	39,076,386		4,042,928					$	32,991,471
Stock-based Compensation Expense
The Company accounts for its employee stock options, stock purchase rights, restricted stock units, and restricted performance stock units granted under the 1996 Stock Plan, 1996 Director Option Plan, 1999 Nonstatutory Stock Option Plan, the 2006 Stock Plan, the 2003 Contactual Plan, the 2012 Equity Incentive Plan, the 2013 New Employee Inducement Incentive Plan and stock purchase rights under the 1996 Employee Stock Purchase Plan (collectively "Equity Compensation Plans") under the provisions of ASC 718 - Stock Compensation. Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as an expense over the employee's requisite service period (generally the vesting period of the equity grant), net of estimated forfeitures.
To value option grants, stock purchase rights and restricted stock units under the Equity Compensation Plans for stock-based compensation, the Company used the Black-Scholes option valuation model. Fair value determined using the Black-Scholes option valuation model varies based on assumptions used for the expected stock prices volatility, expected life, risk-free interest rates and future dividend payments. For the three and nine months ended December 31, 2013 and 2012, the Company used the historical volatility of its stock over a period equal to the expected life of the options. The expected life assumptions represent the weighted-average period stock-based awards are expecting to remain outstanding. These expected life assumptions were established through the review of historical exercise behavior of stock-based award grants with similar vesting periods. The risk-free interest rate is based on the closing market bid yields on actively traded U.S. treasury securities in the over-the-counter market for the expected term equal to the expected term of the option. The dividend yield assumption is based on the Company's history and expectation of future dividend payout. Compensation expense for stock-based payment awards is recognized using the straight-line single-option method and includes the impact of estimated forfeitures.
The Company issued restricted performance stock units to a group of executives with vesting that is contingent on both market performance and continued service. For the market-based restricted performance stock units issued during the nine months ended December 31, 2013:
the number of shares of the Company's stock to be received at vesting if applicable service requirements are also met will range from 0% to 100% of the target amount based total shareholder return ("TSR"), which compares the performance of the price per share of the Company's common stock with the NASDAQ Composite Index ("Index") for the three performance periods ending March 31, 2015, March 31, 2016 and March 31, 2017, in the following manner: where in each such measurement period, (1) if the performance return on the price per share of the Company’s common stock exceeds the performance return on the NASDAQ Composite Index, (which shall be determined by subtracting the percentage return on the NASDAQ Composite Index from the percentage return on the price per share of the Common Stock), then all of the TSR Performance Shares for such measurement period will be deemed earned and will vest; (2) if the performance return on the price per share of Common Stock is more than 50% lower than the performance return on the NASDAQ Composite Index, then none of the TSR Performance Shares for such measurement period will be deemed earned and will vest; and (3) if the performance return on the price per share of Common Stock is between 0% and 50% lower than the performance return on the NASDAQ Composite Index, then the number of TSR Performance Shares deemed earned and vesting for such measurement period will be reduced by 2% for each 1% by which the performance return on the NASDAQ Composite Index exceeds the performance return on the Common Stock, and
the number of shares of the Company's stock to be received at vesting will range from 0% or 100% of the target amount based on four tranches, with each tranche vesting at the later of (a) the satisfaction of the applicable service-based vesting requirement for that tranche, and (b) on the first date that the average stock price of the Company's common stock for a consecutive 30 trading day period exceeds 150% of the grant date stock price. The minimum service vesting requirement for each tranche is as follows:
Tranche 1: One year following the date of the grant
Tranche 2: Two years following the date of the grant
Tranche 3: Three years following the date of the grant
Tranche 4: Four years following the date of the grant
To value these market-based restricted performance stock units under the Equity Compensation Plans, the Company used a Monte Carlo simulation model on the date of grant.  Fair value determined using the Monte Carlo simulation model varies based on the assumptions used for the expected stock price volatility, the correlation coefficient between the Company and the NASDAQ Composite Index, risk free interest rates, and future dividend payments.  For the nine months ended December 31, 2013, the Company used the historical volatility and correlation of our stock and the Index over a period equal to the remaining performance period as of the grant date. The risk-free interest rate was based on the closing market bid yields on actively traded U.S. treasury securities in the over-the-counter market for the expected term equal to the remaining performance period as of the grant date. The dividend yield assumption was based on our history and expectation of future dividend payout.  Compensation expense for restricted stock units with performance and market conditions is recognized over the requisite service period using the straight-line method on a tranche by tranche basis and includes the impact of estimated forfeitures.
On October 18, 2013, the board of directors approved the modification of unvested stock options to purchase 74,479 shares of common stock and unvested stock purchase rights totaling 37,000 shares of common stock held by the Company's president upon his resignation. The options held by the Company's president upon his resignation, taken as a whole, had a weighted average exercise price of $4.05 per share and range from $2.72 to $5.87 per share, and a weighted average remaining vesting term of 0.5 years. Approximately $1,068,000 of the $3,232,000 of stock-based compensation charge in the third quarter of 2013 applied to the options held by the former president of the Company and was recorded in general and administrative expenses.
As of December 31, 2013, there was $18.8 million of unamortized stock-based compensation expense related to unvested stock awards which is expected to be recognized over a weighted average period of 3.02 years.
The following table summarizes the assumptions used to compute reported stock-based compensation to employees and directors for the three and nine months ended December 31, 2013 and 2012:
			Three Months Ended						Nine Months Ended
			December 31,						December 31,
			2013			2012			2013			2012
Expected volatility			63%			68%			64%			68%
Expected dividend yield			-			-			-			-
Risk-free interest rate			1.62%			0.68%			1.86%			0.70%
Weighted average expected option term			5.59 years			4.50 years			6.00 years			5.28 years
Weighted average fair value of options granted		$	5.64		$	3.18		$	5.64		$	3.32
In accordance with ASC 718 - Stock Compensation, the Company recorded $2,069,000 and $650,000 in compensation expense relative to stock-based awards for the three months ended December 31, 2013 and 2012, and $3,827,000 and $1,471,000 for the nine months ended December 31, 2013 and 2012, respectively.
Employee Stock Purchase Plan
Under the Company's Employee Stock Purchase Plan, or ESPP, eligible employees can participate and purchase common stock semi-annually through payroll deductions at a price equal to 85% of the fair market value of the common stock at the beginning of each one year offering period or the end of the applicable nine month purchase period within that offering period, whichever is lower. The contribution amount may not exceed 10% of an employee's base compensation, including commissions but not including bonuses and overtime. The Company accounts for the ESPP as a compensatory plan and recorded compensation expense of $95,000 and $115,000 for the three months ended December 31, 2013 and 2012, and $350,000 and $356,000 for the nine months ended December 31, 2013 and 2012, respectively, in accordance with ASC 718.
The estimated fair value of ESPP options granted under the Employee Stock Purchase Plan was estimated at the date of grant using Black-Scholes pricing model with the following weighted average assumptions:
			Three Months Ended						Nine Months Ended
			December 31,						December 31,
			2013			2012			2013			2012
Expected volatility			-			-			38%			34%
Expected dividend yield			-			-			-			-
Risk-free interest rate			-			-			0.11%			0.16%
Weighted average expected ESPP option term			-			-			0.75 years			0.75 years
Weighted average fair value of
ESPP options granted		$	-		$	-		$	2.6		$	1.45
As of December 31, 2013, there was $58,000 of total unrecognized compensation cost related to employee stock purchases. This cost is expected to be recognized over a weighted average period of 0.5 years.
ASC 718 requires the benefits of tax deductions in excess of recognized compensation costs to be reported as a financing cash flow, rather than as an operating cash flow. The future realization of tax benefits related to stock-based compensation is dependent upon the timing of employee exercises and future taxable income, among other factors. The Company did not realize any tax benefit from the stock-based compensation charges incurred during the three and nine months ended December 31, 2013 and 2012.
The following table summarizes the classification of stock-based compensation expense related to employee stock options and employee stock purchases under ASC 718 among the Company's operating functions for the three and nine months ended December 31, 2013 and 2012 which was recorded as follows (in thousands):
			Three Months Ended						Nine Months Ended
			December 31,						December 31,
			2013			2012			2013			2012
Cost of service revenue		$	101		$	63		$	237		$	149
Cost of product revenue			-			-			-			1
Research and development			339			125			634			295
Sales and marketing			660			355			1,400			979
General and administrative			2,132			222			2,974			403
Total stock-based compensation expense related to employee
stock options and employee stock purchases, pre-tax			3,232			765			5,245			1,827
Tax benefit			-			-			-			-
Stock-based compensation expense related to employee
stock options and employee stock purchases, net of tax		$	3,232		$	765		$	5,245		$	1,827
Recent Accounting Pronouncements
In July 2013, the FASB issued ASU No. 2013-11, "Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit when a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax credit Carryforward Exist ("ASU 2013-11"). ASU 2013-11 provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance requires an unrecognized tax benefit, or a portion of an unrecognized tax benefit, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except in certain situations. ASU 2013-11 will be effective for the fiscal years, and interim periods within those years, beginning after December 15, 2013, with early adoption permitted. The Company does not believe that the adoption of ASU 2013-11 will have a material impact on the Company's consolidated results of operation and financial condition.

FAIR_VALUE_MEASURMENT_Note_3

FAIR VALUE MEASURMENT - Note 3	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
FAIR VALUE MEASURMENT - Note 3	'
	3. FAIR VALUE MEASUREMENT
	The following tables present the Company's fair value hierarchy for assets and liabilities measured at fair value on a recurring basis at December 31, 2013 and March 31, 2013 (in thousands):
			Quoted Prices
			in Active
			Markets		Other		Significant
			for Identical		Observable		Unobservable		Balance at
			Assets		Inputs		Inputs		December 31,
			(Level 1)		(Level 2)		(Level 3)		2013
	Cash equivalents:
	Money market funds	$	14,379	$	-	$	-	$	14,379
	Short-term investments:
	Mutual funds		1,901		-		-		1,901
	Total	$	16,280	$	-	$	-	$	16,280
			Quoted Prices
			in Active
			Markets		Other		Significant
			for Identical		Observable		Unobservable		Balance at
			Assets		Inputs		Inputs		March 31,
			(Level 1)		(Level 2)		(Level 3)		2013
	Cash equivalents:
	Money market funds	$	14,376	$	-	$	-	$	14,376
	Short-term investments:
	Mutual funds		1,964		-		-		1,964
	Total	$	16,340	$	-	$	-	$	16,340

BALANCE_SHEET_DETAIL_Note_4

BALANCE SHEET DETAIL - Note 4	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
BALANCE SHEET DETAIL - Note 4	'
	4. BALANCE SHEET DETAIL
			December 31,		March 31,
			2013		2013
	Inventory (in thousands):
	Work-in-process	$	22	$	23
	Finished goods		806		488
		$	828	$	511

NET_INCOME_PER_SHARE_Note_5

NET INCOME PER SHARE - Note 5	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
NET INCOME PER SHARE - Note 5	'
	5. NET INCOME PER SHARE
	Basic net income per share is computed by dividing net income available to common stockholders (numerator) by the weighted average number of vested, unrestricted common shares outstanding during the period (denominator). Diluted net income per share is computed on the basis of the weighted average number of shares of common stock outstanding plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include shares issuable upon exercise of outstanding stock options and under the ESPP.
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
			(in thousands, except per share amounts)
	Numerator:
	Income from continuing operations	$	89	$	1,774	$	3,569	$	11,934
	Income from discontinued operations, net of income tax provision		-		146		890		344
	Net income available to common stockholders		89		1,920		4,459		12,278
	Denominator:
	Common shares		79,742		71,611		75,071		71,197
	Denominator for basic calculation		79,742		71,611		75,071		71,197
	Employee stock options		2,982		3,023		2,938		2,947
	Stock purchase rights		425		336		380		339
	Employee stock purchase plan		33		18		-		-
	Denominator for diluted calculation		83,182		74,988		78,389		74,483
	Income per share - continuing operations
	Basic	$	0.00	$	0.03	$	0.05	$	0.17
	Diluted	$	0.00	$	0.03	$	0.05	$	0.16
	Income per share - discontinued operations
	Basic	$	0.00	$	0.00	$	0.01	$	0.00
	Diluted	$	0.00	$	0.00	$	0.01	$	0.00
	Net income per share
	Basic	$	0.00	$	0.03	$	0.06	$	0.17
	Diluted	$	0.00	$	0.03	$	0.06	$	0.16
	The following shares attributable to outstanding stock options and stock purchase rights were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive (in thousands):
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Employee stock options		1,266		885		550		878
	Stock purchase rights		18		-		190		-
	Total anti-dilutive employee stock-based securities		1,284		885		740		878

INCOME_TAXES_Note_6

INCOME TAXES - Note 6	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
INCOME TAXES - Note 6	'
	6. INCOME TAXES
	For the three months ended December 31, 2013, the Company recorded a benefit for income taxes of $1.3 million.  For the nine months ended December 31, 2013, the Company recorded a provision for income taxes of $0.5 million which was primarily attributable to income from continuing operations ($0.7 million), income from discontinued operations ($0.2 million) and gain on disposal of discontinued operations ($0.5 million), reduced by a tax benefit for an adjustment to credit carryforwards ($0.9 million). For the three and nine months ended December 31, 2012, the Company recorded a provision for income taxes of $0.9 million and $7.7 million which was primarily attributable to income from continuing operations including the gain on sale of patents ($0.8 million and $7.5 million, respectively) and income from discontinued operations ($0.1 million and $0.2 million respectively).
	The effective tax rate is calculated by dividing the income tax provision by net income before income tax expense.
	At March 31, 2013, there were $3.0 million of unrecognized tax benefits that, if recognized, would have affected the effective tax rate. At December 31, 2013, the Company determined that it was more-likely-than-not that some of the unrecognized tax benefit from credit carryforwards should be realized which resulted in the recognition of $0.9 million benefit to income taxes. The Company does not expect the remaining unrecognized tax benefit to change materially in the next 12 months. To the extent that the remaining unrecognized tax benefits are ultimately recognized, they will have an impact on the effective tax rate in future periods.
	The Company is subject to taxation in the U.S., California and various other states and foreign jurisdictions in which it has or had a subsidiary or branch operations or it is collecting sales tax. All tax returns from fiscal 1995 to fiscal 2013 may be subject to examination by the Internal Revenue Service, California and various other states. As of January 24, 2014, there were no active federal or state income tax audits. Returns filed in foreign jurisdictions may be subject to examination for the fiscal years 2009 to 2013.

SEGMENT_REPORTING_Note_7

SEGMENT REPORTING - Note 7	9 Months Ended
	Dec. 31, 2013
Segment Reporting [Abstract]	'
SEGMENT REPORTING - Note 7	'
	7. SEGMENT REPORTING
	ASC 280, "Segment Reporting" establishes annual and interim reporting standards for an enterprise's business segments and related disclosures about its products, services, geographic areas and major customers. Under ASC 280, the method for determining what information to report is based upon the way management organizes the operating segments within the Company for making operating decisions and assessing financial performance. The Company has determined that it has only one reportable segment.
	No customer represented greater than 10% of the Company's total revenues for the three or nine months ended December 31, 2013 or 2012. The Company's revenue distribution by geographic region (based upon the destination of shipments and the customer's service address) was as follows:
			Three Months Ended			Nine Months Ended
			December 31,			December 31,
			2013		2012	2013	2012
	Americas (principally US)		96%		99%	98%	99%
	Europe		3%		0%	1%	0%
	Asia Pacific		1%		1%	1%	1%
			100%		100%	100%	100%
	Geographic area data is based upon the location of the property and equipment and is as follows (in thousands):
			December 31,		March 31,
			2013		2013
	United States	$	5,787	$	6,673
	United Kingdom		1,352		-
	Asia		346		-
	Total	$	7,485	$	6,673

COMMITMENTS_AND_CONTINGENCIES_

COMMITMENTS AND CONTINGENCIES - Note 8	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
COMMITMENTS AND CONTINGENCIES - Note 8	'
	8. COMMITMENTS AND CONTINGENCIES
	Guarantees
	Indemnifications
	In the normal course of business, the Company indemnifies other parties, including customers, lessors and parties to other transactions with the Company, with respect to certain matters. Under these arrangements, the Company typically agrees to hold the other party harmless against losses arising from a breach of representations or covenants, intellectual property infringement or other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. In addition, the Company has entered into indemnification agreements with its officers and directors.
	It is not possible to determine the maximum potential amount of the Company's exposure under these indemnification agreements due to the limited history of indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material impact on the Company's operating results, financial position or cash flows. Under some of these agreements, however, the Company's potential indemnification liability might not have a contractual limit.
	Product Warranties
	The Company accrues for the estimated costs that may be incurred under its product warranties upon revenue recognition. Changes in the Company's product warranty liability, which is included in cost of product revenue in the condensed consolidated statements of income, were as follows (in thousands):
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Balance at beginning of period	$	552	$	376	$	452	$	387
	Accruals for warranties		274		168		744		445
	Settlements		-192		-122		-562		-410
	Balance at end of period	$	634	$	422	$	634	$	422
	Minimum Third Party Customer Support Commitments
	In the third quarter of fiscal 2010, the Company amended a contract with one of its third party customer support vendors containing a minimum monthly commitment of approximately $430,000. The agreement requires a 150-day notice to terminate. The total remaining obligation under the amended contract is $2.2 million.
	Minimum Third Party Network Service Provider Commitments
	The Company entered into contracts with multiple vendors for third party network services that expire on various dates in fiscal 2014 through 2016. At December 31, 2013, future minimum annual payments under these third party network service contracts were as follows (in thousands):
	Year ending March 31:
	Remaining 2014			$	502
	2015				1,579
	2016				52
	Total minimum payments			$	2,133
	Legal Proceedings
	From time to time, the Company may become involved in various legal claims and litigation that arise in the normal course of its operations. While the results of such claims and litigation cannot be predicted with certainty, the Company is not currently aware of any such matters that it believes would have a material adverse effect on its financial position, results of operations or cash flows.
	On February 22, 2011, the Company was named a defendant in a lawsuit, Bear Creek Technologies, Inc. v. 8x8, Inc. et al., along with 20 other defendants. On August 17, 2011, the Company was dismissed without prejudice from this lawsuit under Rule 21 of the Federal Rules of Civil Procedure. On August 17, 2011, the Company was sued again by Bear Creek Technologies, Inc. in the United States District Court for the District of Delaware. The Company believes it has factual and legal defenses to these claims and is presenting a vigorous defense.  Further, on November 28, 2012, the U.S. Patent & Trademark Office initiated a Reexamination proceeding with a Reexamination Declaration explaining that there is a substantial new question of patentability, based on four separate grounds, affecting each claim of the patent which is the basis for the complaint filed against the Company.  On March 26, 2013, the USPTO issued a first Office Action in the Reexamination, with all claims of the '722 patent being rejected on each of the four separate grounds raised in the Request for Reexamination.  On July 10, 2013, the Company filed an informational pleading in support of (and joining) a pending motion to stay the proceeding in the District Court, which granted the motion on July 17, 2013, based on the possibility that at least one of the USPTO rejections will be upheld and considering the USPTO's conclusion that Bear Creek's patent suffers from a defective claim for priority. The Company cannot estimate potential liability in this case at this early stage of litigation.
	On October 25, 2011, the Company was named a defendant in a lawsuit, Klausner Technologies, Inc. v. Oracle Corporation et al., along with 30 other defendants. The lawsuit alleges infringement of a patent that is now believed to have expired. On November 1, 2011, Klausner dismissed the Complaint voluntarily and filed new complaints separating the defendants, including a new Complaint against 8x8. The Company believes it has factual and legal defenses to these claims and is presenting a vigorous defense. The Company has filed several motions, including a motion to transfer and a motion to dismiss the complaint on February 23, 2012. On March 21, 2013, the District Court granted 8x8's Motion to Change Venue, and has ordered the transfer of the case to the US District Court for the Northern District of California. The Company has not answered the complaint yet and cannot estimate potential liability in this case at this early stage of the litigation.
	State and Municipal Taxes
	From time to time, the Company has received inquiries from a number of state and municipal taxing agencies with respect to the remittance of taxes. The Company collects or has accrued for taxes that it believes are required to be remitted. The amounts that have been remitted have historically been within the accruals established by the Company.

GAIN_ON_SETTLEMENT_OF_ESCROW_C

GAIN ON SETTLEMENT OF ESCROW CLAIM -Note 9	9 Months Ended
	Dec. 31, 2013
Other Income and Expenses [Abstract]	'
GAIN ON SETTLEMENT OF ESCROW CLAIM - Note 9	'
	9. GAIN ON SETTLEMENT OF ESCROW CLAIM
	In December 2013, the Company settled an escrow claim for indemnification with the sellers of Contactual, Inc. Under the terms of the settlement, the Company recorded a gain of $0.6 million. Under the terms of the Contactual merger agreement and the escrow agreement, each indemnifying seller must pay his, her or its pro rata share of the obligations owed to the Company by January 30, 2014. Also, under the Contactual merger agreement each indemnifying seller may individually elect to pay such pro rata share in cash instead of shares of the Company's common stock in the escrow fund valued at the Company's average closing price of $4.146667 per share in his, her or its sole discretion. The settlement proceeds have been recognized in other income. Upon receipt of the cash or shares on or before January 30, 2014, the remaining escrow account balance will be released to the sellers.

PATENT_SALE_Note_10

PATENT SALE - Note 10	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
PATENT SALE - Note 10	'
	10. PATENT SALE
	On June 22, 2012, the Company entered into a patent purchase agreement and sold a family of patents to a third party for $12.0 million plus a future payment of up to a maximum of $3.0 million based on future license agreements entered into by the third party purchaser. In the fourth quarter of fiscal 2013, the Company collected and recognized a gain of $1.0 million attributable to a license agreement obtained by the third party purchaser. As of December 31, 2013, there remained a maximum of $2.0 million of potential future payments under the agreement based on future license agreements obtained by the third party purchaser. Under the terms and conditions of the patent purchase agreement, the Company has retained certain limited rights to continue to use the patents. The patent purchase agreement contains representations and warranties customary for transactions of this type.

DISCONTINUED_OPERATIONS_Note_1

DISCONTINUED OPERATIONS - Note 11	9 Months Ended
	Dec. 31, 2013
Discontinued Operations - Note 11	'
DISCONTINUED OPERATIONS - Note 11	'
	11. DISCONTINUED OPERATIONS
	On September 30, 2013, the Company completed the sale of its dedicated server hosting business to IRC Company, Inc. ("IRC") and, as a result, no longer provides dedicated server hosting services. In the transaction, IRC purchased 100% of the stock of Central Host, Inc., which had been wholly owned by the Company and all of the assets specific to the dedicated server hosting business.
	The Company sold its dedicated server hosting business for total consideration of $3.0 million in cash, which was received on October 1, 2013.
	The dedicated server hosting business has been reported as discontinued operations. The results of operations and financial position of these discontinued operations are as follows:
	Results of operations:
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Revenue	$	-	$	935	$	1,430	$	2,993
	Operating expense		-		690		922		2,417
	Income before income taxes		-		245		508		576
	Provision for income taxes		-		99		207		232
	Income from discontinued operations		-		146		301		344
	Gain on disposal of discontinued operations,
	net of income tax provision of $463k		-		-		589		-
	Financial position:
			December 31,		March 31,
			2013		2013
	Assets
	Property and equipment, net	$	-	$	845
	Intangible assets, net		-		8
	Goodwill		-		1,210
		$	-	$	2,063

ACQUISITION_Note_12

ACQUISITION - Note 12	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
ACQUISITIONS - Note 12	'
	12. ACQUISITION
	Voicenet Solutions Limited
	On November 11, 2013, the Company entered into a share purchase agreement with the shareholders and optionholders of Voicenet Solutions Limited ("Voicenet"), a provider of cloud communications and collaboration services in the United Kingdom (the "Transaction"). The Company completed the acquisition of Voicenet on November 29, 2013. The Company purchased all of the outstanding shares of Voicenet for total consideration transferred of $19.3 million; $3.0 million was placed in escrow and eligible for release to the Voicenet shareholders and optionholders in installments on the first and second anniversaries of the closing date. The shares of Voicenet are held by a wholly-owned subsidiary of 8x8 recently formed in the United Kingdom, such that Voicenet is an indirect, wholly-owned subsidiary of 8x8.
	The Company recorded the acquired tangible and identifiable intangible assets and liabilities assumed based on their estimated fair values. The excess of the consideration transferred over the aggregate fair values of the assets acquired and liabilities assumed is recorded as goodwill. The amount of goodwill recognized is primarily attributable to the operating synergies expected to be realized through the acquisition of Voicenet and the workforce of the acquired business. The finite−lived intangible assets consist of customer relationship, with an estimated weighted-average useful life of 7 years. The fair value assigned to identifiable intangible assets acquired was based on estimates and assumptions made by management using the excess earnings method. Intangible assets will be amortized on a straight-line basis.
	The preliminary fair values of the assets acquired and liabilities assumed are as follows (in thousands):
			Estimated
			Fair Value
	Assets acquired:
	Cash	$	854
	Current assets		1,134
	Property and equipment		956
	Intangible asset - customer relationship		6,381
	Total assets acquired		9,325
	Liabilities assumed:
	Current liabilities		-4,058
	Total liabilities assumed		-4,058
	Net identifiable assets acquired		5,267
	Goodwill		14,061
	Total consideration transferred	$	19,328
	Voicenet contributed revenue of approximately $0.8 million and a net loss of approximately $0.2 million for the period from the date of acquisition to December 31, 2013. The Company determined that the acquisition was not deemed to be a material business combination and it is impractical to include such pro forma information given the difficulty in obtaining the historical financial information of Voicenet. Inclusion of such information would require the Company to make estimates and assumptions regarding Voicenet's historical financial results that we believe may ultimately prove inaccurate.

Summary_of_Significant_Account

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Dec. 31, 2013
Notes to Financial Statements	'
Company	'
	THE COMPANY
	8x8, Inc. ("8x8" or the "Company") develops and markets a comprehensive portfolio of cloud-based communication and collaboration solutions that include hosted cloud telephony, unified communications, contact center, video conferencing and virtual desktop software and services. These unified communication and collaboration services are offered from the Internet cloud via a software-as-a-service subscription. The Company also provides cloud-based computing services. As of December 31, 2013, the Company had approximately 36,800 business customers.
	The Company was incorporated in California in February 1987 and was reincorporated in Delaware in December 1996.
Fiscal Period	'
	The Company's fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in these notes to the condensed consolidated financial statements refers to the fiscal year ending March 31 of the calendar year indicated (for example, fiscal 2014 refers to the fiscal year ending March 31, 2014).
Basis of Presentation	'
	The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended March 31, 2013. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates.
	The March 31, 2013 year-end condensed consolidated balance sheet data in this document were derived from audited consolidated financial statements and do not include all of the disclosures required by U.S. generally accepted accounting principles. These condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements as of and for the fiscal year ended March 31, 2013 and notes thereto included in the Company's fiscal 2013 Annual Report on Form 10-K.
Reclassification	'
	Certain amounts previously reported within the Company's consolidated statements of income have been reclassified to conform to the current period presentation. The reclassification included certain prior-period amounts related to the Company's discontinued operations which have been reclassified to conform to the current period presentation.
	The reclassification had no impact on the Company's previously reported net income or basic and diluted net income per share amounts.
	The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.
Service Revenue	'
	The Company recognizes service revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, price is fixed or determinable and collectability is reasonably assured. The Company defers recognition of service revenues in instances when cash receipts are received before services are delivered and recognizes deferred revenues ratably as services are provided.
Product Revenue	'
	The Company recognizes revenue from product sales for which there are no related services to be rendered upon shipment to customers provided that persuasive evidence of an arrangement exists, the price is fixed, title has transferred, collection of resulting receivables is reasonably assured, there are no customer acceptance requirements, and there are no remaining significant obligations. Gross outbound shipping and handling charges are recorded as revenue, and the related costs are included in cost of goods sold. Reserves for returns and allowances for customer sales are recorded at the time of shipment. In accordance with the ASC 985-605, the Company records shipments to distributors, retailers, and resellers, where the right of return exists, as deferred revenue. The Company defers recognition of revenue on sales to distributors, retailers, and resellers until products are resold to the customer.
	The Company records revenue net of any sales-related taxes that are billed to its customers. The Company believes this approach results in consolidated financial statements that are more easily understood by users.
	Under the terms of the Company's typical subscription agreement, new customers can terminate their service within 30 days of order placement and receive a full refund of fees previously paid. The Company has determined that it has sufficient history of subscriber conduct to make a reasonable estimate of cancellations within the 30-day trial period. Therefore, the Company recognizes new subscriber revenue in the month in which the new order was shipped, net of an allowance for expected cancellations.
Revenue Recognition for Multiple Element Arrangements	'
	Multiple Element Arrangements
	Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 605-25 requires that revenue arrangements with multiple deliverables be divided into separate units of accounting if the deliverables in the arrangement meet specific criteria.  The provisioning of the 8x8 cloud service with the accompanying 8x8 IP telephone constitutes a revenue arrangement with multiple deliverables.  For arrangements with multiple deliverables, the Company allocates the arrangement consideration to all units of accounting based on their relative selling prices. In such circumstances, the accounting principles establish a hierarchy to determine the relative selling price to be used for allocating arrangement consideration to units of accounting as follows: (i) vendor-specific objective evidence of fair value ("VSOE"), (ii) third-party evidence of selling price ("TPE"), and (iii) best estimate of the selling price ("BESP").
	VSOE generally exists only when the Company sells the deliverable separately, on more than a limited basis, at prices within a relatively narrow range.  When VSOE cannot be established, the Company attempts to establish the selling price of deliverables based on relevant TPE. TPE is determined based on manufacturer's prices for similar deliverables when sold separately, when possible. When the Company is unable to establish selling price using VSOE or TPE, it uses a BESP for the allocation of arrangement consideration. The objective of BESP is to determine the price at which the Company would transact a sale if the product or service was sold on a stand-alone basis. BESP is generally used for offerings that are not typically sold on a stand-alone basis or for new or highly customized offerings. The Company determines BESP for a product or service by considering multiple factors including, but not limited to:
	the price list established by its management which is typically based on general pricing practices and targeted gross margin of products and services sold; and
	analysis of pricing history of new arrangements, including multiple element and stand-alone transactions.
	In accordance with the guidance of ASC 605-25, when the Company enters into revenue arrangements with multiple deliverables the Company allocates arrangement consideration, including activation fees, among the 8x8 IP telephones and subscriber services based on their relative selling prices. Arrangement consideration allocated to the IP telephones is recognized as product revenues during the period of the sale less the allowance for estimated returns during the 30-day trial period. Arrangement consideration allocated to subscriber services is recognized ratably as service revenues as the related services are provided, which is generally over the initial contract term.
Deferred Cost of Goods Sold	'
	Deferred Cost of Goods Sold
	Deferred cost of goods sold represents the cost of products sold for which the end customer or distributor has a right of return. The cost of the products sold is recognized contemporaneously with the recognition of revenue, when the subscriber has accepted the service.
Intangible Assets	'
	Intangible Assets
	Amortization expense for the customer relationship intangible asset is included in sales and marketing expenses. Amortization expense for technology is included in cost of service revenue.
Research, Development and Software Costs	'
	Research, Development and Software Costs
	The Company accounts for software to be sold or otherwise marketed in accordance with ASC 985-20 - Costs of Software to be Sold, Leased or Marketed, which requires capitalization of certain software development costs subsequent to the establishment of technological feasibility. The Company defines establishment of technological feasibility as the completion of a working model. Software development costs for software to be sold or otherwise marketed incurred prior to the establishment of technological feasibility are included in research and development and are expensed as incurred. Software development costs incurred subsequent to the establishment of technological feasibility through the period of general market availability of the product are capitalized, if material.
	In the first nine months of fiscal 2014, the Company capitalized approximately $590,000 of software development costs in accordance with ASC 985-20. At December 31, 2013, total capitalized software development costs included in other long-term assets was approximately $779,000 and accumulated amortization costs related to capitalized software was approximately $92,000.
Foreign Currency Translation	'
	Foreign Currency Translation
	The Company has determined that the functional currency of its UK foreign subsidiary is the subsidiary's local currency, the British Pound Sterling ("GBP"), which the Company believes most appropriately reflects the current economic facts and circumstances of the UK subsidiary's operations. The assets and liabilities of the subsidiary are translated at the applicable exchange rate as of the end of the balance sheet period and revenue and expenses are translated at an average rate over the period presented. Resulting currency translation adjustments are recorded as a component of accumulated other comprehensive income or loss within the stockholder's equity in the consolidated balance sheets.
Accounting for Stock-Based Compensation	'
	Stock-based Compensation Expense
	The Company accounts for its employee stock options, stock purchase rights, restricted stock units, and restricted performance stock units granted under the 1996 Stock Plan, 1996 Director Option Plan, 1999 Nonstatutory Stock Option Plan, the 2006 Stock Plan, the 2003 Contactual Plan, the 2012 Equity Incentive Plan, the 2013 New Employee Inducement Incentive Plan and stock purchase rights under the 1996 Employee Stock Purchase Plan (collectively "Equity Compensation Plans") under the provisions of ASC 718 - Stock Compensation. Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as an expense over the employee's requisite service period (generally the vesting period of the equity grant), net of estimated forfeitures.
	To value option grants, stock purchase rights and restricted stock units under the Equity Compensation Plans for stock-based compensation, the Company used the Black-Scholes option valuation model. Fair value determined using the Black-Scholes option valuation model varies based on assumptions used for the expected stock prices volatility, expected life, risk-free interest rates and future dividend payments. For the three and nine months ended December 31, 2013 and 2012, the Company used the historical volatility of its stock over a period equal to the expected life of the options. The expected life assumptions represent the weighted-average period stock-based awards are expecting to remain outstanding. These expected life assumptions were established through the review of historical exercise behavior of stock-based award grants with similar vesting periods. The risk-free interest rate is based on the closing market bid yields on actively traded U.S. treasury securities in the over-the-counter market for the expected term equal to the expected term of the option. The dividend yield assumption is based on the Company's history and expectation of future dividend payout. Compensation expense for stock-based payment awards is recognized using the straight-line single-option method and includes the impact of estimated forfeitures.
	The Company issued restricted performance stock units to a group of executives with vesting that is contingent on both market performance and continued service. For the market-based restricted performance stock units issued during the nine months ended December 31, 2013:
	the number of shares of the Company's stock to be received at vesting if applicable service requirements are also met will range from 0% to 100% of the target amount based total shareholder return ("TSR"), which compares the performance of the price per share of the Company's common stock with the NASDAQ Composite Index ("Index") for the three performance periods ending March 31, 2015, March 31, 2016 and March 31, 2017, in the following manner: where in each such measurement period, (1) if the performance return on the price per share of the Company’s common stock exceeds the performance return on the NASDAQ Composite Index, (which shall be determined by subtracting the percentage return on the NASDAQ Composite Index from the percentage return on the price per share of the Common Stock), then all of the TSR Performance Shares for such measurement period will be deemed earned and will vest; (2) if the performance return on the price per share of Common Stock is more than 50% lower than the performance return on the NASDAQ Composite Index, then none of the TSR Performance Shares for such measurement period will be deemed earned and will vest; and (3) if the performance return on the price per share of Common Stock is between 0% and 50% lower than the performance return on the NASDAQ Composite Index, then the number of TSR Performance Shares deemed earned and vesting for such measurement period will be reduced by 2% for each 1% by which the performance return on the NASDAQ Composite Index exceeds the performance return on the Common Stock, and
	the number of shares of the Company's stock to be received at vesting will range from 0% or 100% of the target amount based on four tranches, with each tranche vesting at the later of (a) the satisfaction of the applicable service-based vesting requirement for that tranche, and (b) on the first date that the average stock price of the Company's common stock for a consecutive 30 trading day period exceeds 150% of the grant date stock price. The minimum service vesting requirement for each tranche is as follows:
	Tranche 1: One year following the date of the grant
	Tranche 2: Two years following the date of the grant
	Tranche 3: Three years following the date of the grant
	Tranche 4: Four years following the date of the grant
	To value these market-based restricted performance stock units under the Equity Compensation Plans, the Company used a Monte Carlo simulation model on the date of grant.  Fair value determined using the Monte Carlo simulation model varies based on the assumptions used for the expected stock price volatility, the correlation coefficient between the Company and the NASDAQ Composite Index, risk free interest rates, and future dividend payments.  For the nine months ended December 31, 2013, the Company used the historical volatility and correlation of our stock and the Index over a period equal to the remaining performance period as of the grant date. The risk-free interest rate was based on the closing market bid yields on actively traded U.S. treasury securities in the over-the-counter market for the expected term equal to the remaining performance period as of the grant date. The dividend yield assumption was based on our history and expectation of future dividend payout.  Compensation expense for restricted stock units with performance and market conditions is recognized over the requisite service period using the straight-line method on a tranche by tranche basis and includes the impact of estimated forfeitures.
	Employee Stock Purchase Plan
	Under the Company's Employee Stock Purchase Plan, or ESPP, eligible employees can participate and purchase common stock semi-annually through payroll deductions at a price equal to 85% of the fair market value of the common stock at the beginning of each one year offering period or the end of the applicable nine month purchase period within that offering period, whichever is lower. The contribution amount may not exceed 10% of an employee's base compensation, including commissions but not including bonuses and overtime. The Company accounts for the ESPP as a compensatory plan and recorded compensation expense of $95,000 and $115,000 for the three months ended December 31, 2013 and 2012, and $350,000 and $356,000 for the nine months ended December 31, 2013 and 2012, respectively, in accordance with ASC 718.
	ASC 718 requires the benefits of tax deductions in excess of recognized compensation costs to be reported as a financing cash flow, rather than as an operating cash flow. The future realization of tax benefits related to stock-based compensation is dependent upon the timing of employee exercises and future taxable income, among other factors. The Company did not realize any tax benefit from the stock-based compensation charges incurred during the three and nine months ended December 31, 2013 and 2012.
Net Income Per Share	'
	NET INCOME PER SHARE
	Basic net income per share is computed by dividing net income available to common stockholders (numerator) by the weighted average number of vested, unrestricted common shares outstanding during the period (denominator). Diluted net income per share is computed on the basis of the weighted average number of shares of common stock outstanding plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include shares issuable upon exercise of outstanding stock options and under the ESPP.
Segment Reporting	'
	ASC 280, "Segment Reporting” establishes annual and interim reporting standards for an enterprise’s business segments and related disclosures about its products, services, geographic areas and major customers. Under ASC 280, the method for determining what information to report is based upon the way management organizes the operating segments within the Company for making operating decisions and assessing financial performance. The Company has determined that it has only one reportable segment.
Indemnifications	'
	Indemnifications
	In the normal course of business, the Company indemnifies other parties, including customers, lessors and parties to other transactions with the Company, with respect to certain matters. Under these arrangements, the Company typically agrees to hold the other party harmless against losses arising from a breach of representations or covenants, intellectual property infringement or other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. In addition, the Company has entered into indemnification agreements with its officers and directors.
	It is not possible to determine the maximum potential amount of the Company's exposure under these indemnification agreements due to the limited history of indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material impact on the Company's operating results, financial position or cash flows. Under some of these agreements, however, the Company's potential indemnification liability might not have a contractual limit.
Product Warranties	'
	Product Warranties
	The Company accrues for the estimated costs that may be incurred under its product warranties upon revenue recognition.

Intangible_Assets_Tables

Intangible Assets (Tables)	9 Months Ended
	Dec. 31, 2013
Intangible Assets Tables	'
Carrying values of intangible assets	'
	The carrying values of intangible assets were as follows (in thousands):
			31-Dec-13							31-Mar-13
			Gross							Gross
			Carrying			Accumulated		Net Carrying		Carrying		Accumulated		Net Carrying
			Amount			Amortization		Amount		Amount		Amortization		Amount
	Technology	$	8,242		$	-1,874	$	6,368	$	8,242	$	-1,256	$	6,986
	Customer relationships		9,483			-1,202		8,281		3,305		-1,054		2,251
	Trade names/domains		957			-		957		957		-		957
	Total acquired identifiable
	intangible assets	$	18,682		$	-3,076	$	15,606	$	12,504	$	-2,310	$	10,194
Finite-lived intangible assets - future amortization expense	'
	At December 31, 2013, annual amortization of intangible assets, based upon our existing intangible assets and current useful lives, is estimated to be the following (in thousands):
				Amount
	Remaining 2014		$	567
	2015			2,252
	2016			2,252
	2017			2,245
	2018			1,997
	Thereafter			5,336
	Total		$	14,649

StockBased_Compensation_And_Em

Stock-Based Compensation And Employee Purchase Plans (Tables)	9 Months Ended
	Dec. 31, 2013
Employee Stock Purchase Plan	'
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]	'
	The estimated fair value of ESPP options granted under the Employee Stock Purchase Plan was estimated at the date of grant using Black-Scholes pricing model with the following weighted average assumptions:
			Three Months Ended						Nine Months Ended
			December 31,						December 31,
			2013			2012			2013		2012
	Expected volatility		-			-			38%		34%
	Expected dividend yield		-			-			-		-
	Risk-free interest rate		-			-			0.11%		0.16%
	Weighted average expected ESPP option term		-			-			0.75 years		0.75 years
	Weighted average fair value of
	ESPP options granted	$	-		$	-		$	2.6	$	1.45
Stock Options	'
Disclosure Of Share-Based Compensation Arrangements By Share-Based Payment Award	'
	Option activity for the nine months ended December 31, 2013 is summarized as follows:
								Weighted
					Shares			Average
		Shares			Subject to			Exercise
		Available			Options			Price
		for Grant			Outstanding			Per Share
	Balance at March 31, 2013	3,175,261			5,991,544		$	2.52
	Change in options available for grant	1,000,000						-
	Granted - options	-1,390,400			1,390,400			9.57
	Stock purchase rights/restricted stock unit (1)	-1,254,530			-			-
	Exercised	-			-921,685			2.41
	Canceled/forfeited - options	56,048			-56,048			3.38
	Canceled/forfeited - restricted stock unit	34,320
	Termination of plans	-1,774			-			-
	Balance at December 31, 2013	1,618,925			6,404,211		$	4.06
	(1) The reduction to shares available for grant includes awards granted of 1,254,530 shares.
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]	'
	The following table summarizes the assumptions used to compute reported stock-based compensation to employees and directors for the three and nine months ended December 31, 2013 and 2012:
			Three Months Ended						Nine Months Ended
			December 31,						December 31,
			2013			2012			2013		2012
	Expected volatility		63%			68%			64%		68%
	Expected dividend yield		-			-			-		-
	Risk-free interest rate		1.62%			0.68%			1.86%		0.70%
	Weighted average expected option term		5.59 years			4.50 years			6.00 years		5.28 years
	Weighted average fair value of options granted	$	5.64		$	3.18		$	5.64	$	3.32
Stock Purchase Rights	'
Disclosure Of Share-Based Compensation Arrangements By Share-Based Payment Award	'
	Stock purchase right activity for the nine months ended December 31, 2013 is summarized as follows:
					Weighted			Weighted
					Average			Average
					Grant-Date			Remaining
		Number of			Fair Market			Contractual
		Shares			Value			Term (in Years)
	Balance at March 31, 2013	958,575		$	4.11			2.52
	Granted	19,180			9.42
	Vested	-318,591			3.33
	Forfeited	-81,109			4.96
	Balance at December 31, 2013	578,055		$	4.59			2.04
Restricted Stock Units	'
Disclosure Of Share-Based Compensation Arrangements By Share-Based Payment Award	'
	Restricted stock unit and performance stock unit activity for the nine months ended December 31, 2013 is summarized as follows:
								Weighted
					Weighted			Average
					Average			Remaining
		Number of			Purchase			Contractual
		Shares			Price			Term (in Years)
	Balance at March 31, 2013	25,000		$	-			2.47
	Granted	1,235,350			-
	Vested	-1,250			-
	Forfeited	-34,320			-
	Balance at December 31, 2013	1,224,780		$	-			2.00

Stock_Options_Outstanding_And_

Stock Options Outstanding And Exercisable (Tables)	9 Months Ended
	Dec. 31, 2013
Stock Options Outstanding And Exercisable Tables	'
Summary Of Outstanding And Exercisable Stock Options	'
	The following table summarizes the stock options outstanding and exercisable at December 31, 2013:
		Options Outstanding						Options Exercisable
				Weighted	Weighted					Weighted
				Average	Average					Average
				Exercise	Remaining		Aggregate			Exercise		Aggregate
	Range of			Price	Contractual		Intrinsic			Price		Intrinsic
	Exercise Price	Shares		Per Share	Life (Years)		Value	Shares		Per Share		Value
	$0.55 - $1.26	1,735,000	$	1.04	4.0	$	15,806,760	1,735,000	$	1.04	$	15,806,760
	$1.27 - $1.88	1,284,568	$	1.53	2.1		11,067,416	1,284,568	$	1.53		11,067,416
	$1.89 - $5.87	1,963,492	$	4.45	5.8		11,187,811	981,709	$	3.99		6,044,878
	$5.88 - $9.74	1,346,151	$	9.40	9.7		1,014,399	41,651	$	8.41		72,417
	$9.75 - $10.97	75,000	$	10.97	9.8		-	-	$	-		-
		6,404,211				$	39,076,386	4,042,928			$	32,991,471

Distribution_of_StockBased_Com

Distribution of Stock-Based Compensation Plan Expense (Tables)	9 Months Ended
	Dec. 31, 2013
Distribution Of Stock-Based Compensation Plan Expense Tables	'
Schedule Of Stock-Based Compensation Expense By Statement Of Operations Line Item	'
	The following table summarizes the classification of stock-based compensation expense related to employee stock options and employee stock purchases under ASC 718 among the Company's operating functions for the three and nine months ended December 31, 2013 and 2012 which was recorded as follows (in thousands):
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Cost of service revenue	$	101	$	63	$	237	$	149
	Cost of product revenue		-		-		-		1
	Research and development		339		125		634		295
	Sales and marketing		660		355		1,400		979
	General and administrative		2,132		222		2,974		403
	Total stock-based compensation expense related to employee
	stock options and employee stock purchases, pre-tax		3,232		765		5,245		1,827
	Tax benefit		-		-		-		-
	Stock-based compensation expense related to employee
	stock options and employee stock purchases, net of tax	$	3,232	$	765	$	5,245	$	1,827

Fair_Value_Measurement_Tables

Fair Value Measurement (Tables)	9 Months Ended
	Dec. 31, 2013
Fair Value Measurement Tables	'
Fair Value Measurement (Tables)	'
	The following tables present the Company's fair value hierarchy for assets and liabilities measured at fair value on a recurring basis at December 31, 2013 and March 31, 2013 (in thousands):
			Quoted Prices
			in Active
			Markets		Other		Significant
			for Identical		Observable		Unobservable		Balance at
			Assets		Inputs		Inputs		December 31,
			(Level 1)		(Level 2)		(Level 3)		2013
	Cash equivalents:
	Money market funds	$	14,379	$	-	$	-	$	14,379
	Short-term investments:
	Mutual funds		1,901		-		-		1,901
	Total	$	16,280	$	-	$	-	$	16,280
			Quoted Prices
			in Active
			Markets		Other		Significant
			for Identical		Observable		Unobservable		Balance at
			Assets		Inputs		Inputs		March 31,
			(Level 1)		(Level 2)		(Level 3)		2013
	Cash equivalents:
	Money market funds	$	14,376	$	-	$	-	$	14,376
	Short-term investments:
	Mutual funds		1,964		-		-		1,964
	Total	$	16,340	$	-	$	-	$	16,340

Inventory_Tables

Inventory (Tables)	9 Months Ended
	Dec. 31, 2013
Inventory Tables	'
Inventory (Tables)	'
	Inventory was comprised of the following:
			December 31,		March 31,
			2013		2013
	Inventory (in thousands):
	Work-in-process	$	22	$	23
	Finished goods		806		488
		$	828	$	511

Net_Income_Per_Share_Tables

Net Income Per Share (Tables)	9 Months Ended
	Dec. 31, 2013
Net Income Per Share Tables	'
Net Income Per Share (Tables)	'
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
			(in thousands, except per share amounts)
	Numerator:
	Income from continuing operations	$	89	$	1,774	$	3,569	$	11,934
	Income from discontinued operations, net of income tax provision		-		146		890		344
	Net income available to common stockholders		89		1,920		4,459		12,278
	Denominator:
	Common shares		79,742		71,611		75,071		71,197
	Denominator for basic calculation		79,742		71,611		75,071		71,197
	Employee stock options		2,982		3,023		2,938		2,947
	Stock purchase rights		425		336		380		339
	Employee stock purchase plan		33		18		-		-
	Denominator for diluted calculation		83,182		74,988		78,389		74,483
	Income per share - continuing operations
	Basic	$	0.00	$	0.03	$	0.05	$	0.17
	Diluted	$	0.00	$	0.03	$	0.05	$	0.16
	Income per share - discontinued operations
	Basic	$	0.00	$	0.00	$	0.01	$	0.00
	Diluted	$	0.00	$	0.00	$	0.01	$	0.00
	Net income per share
	Basic	$	0.00	$	0.03	$	0.06	$	0.17
	Diluted	$	0.00	$	0.03	$	0.06	$	0.16
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	'
	The following shares attributable to outstanding stock options and stock purchase rights were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive (in thousands):
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Employee stock options		1,266		885		550		878
	Stock purchase rights		18		-		190		-
	Total anti-dilutive employee stock-based securities		1,284		885		740		878

Segment_Information_Tables

Segment Information (Tables)	9 Months Ended
	Dec. 31, 2013
Segment Information Tables	'
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas	'
	The Company’s revenue distribution by geographic region (based upon the destination of shipments and the customer’s service address) was as follows:
			Three Months Ended			Nine Months Ended
			December 31,			December 31,
			2013		2012	2013	2012
	Americas (principally US)		96%		99%	98%	99%
	Europe		3%		0%	1%	0%
	Asia Pacific		1%		1%	1%	1%
			100%		100%	100%	100%
	Geographic area data is based upon the location of the long-lived assets and is as follows (in thousands):
			December 31,		March 31,
			2013		2013
	United States	$	5,787	$	6,673
	United Kingdom		1,352		-
	Asia		346		-
	Total	$	7,485	$	6,673

Recovered_Sheet1

Commitments And Contingencies (Tables)	9 Months Ended
	Dec. 31, 2013
Commitments And Contingencies Tables	'
Product warranties	'
	Changes in the Company's product warranty liability, which is included in cost of product revenue in the condensed consolidated statements of income, were as follows (in thousands):
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Balance at beginning of period	$	552	$	376	$	452	$	387
	Accruals for warranties		274		168		744		445
	Settlements		-192		-122		-562		-410
	Balance at end of period	$	634	$	422	$	634	$	422
Minimum third party network service provider commitments	'
	At December 31, 2013, future minimum annual payments under these third party network service contracts were as follows (in thousands):
	Year ending March 31:
	Remaining 2014			$	502
	2015				1,579
	2016				52
	Total minimum payments			$	2,133

Discontinued_Operations_Tables

Discontinued Operations (Tables)	9 Months Ended
	Dec. 31, 2013
Discontinued Operations Tables	'
Schedule of Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures	'
	The results of operations and financial position of these discontinued operations are as follows:
	Results of operations:
			Three Months Ended				Nine Months Ended
			December 31,				December 31,
			2013		2012		2013		2012
	Revenue	$	-	$	935	$	1,430	$	2,993
	Operating expense		-		690		922		2,417
	Income before income taxes		-		245		508		576
	Provision for income taxes		-		99		207		232
	Income from discontinued operations		-		146		301		344
	Gain on disposal of discontinued operations,
	net of income tax provision of $463k		-		-		589		-
	Financial position:
			December 31,		March 31,
			2013		2013
	Assets
	Property and equipment, net	$	-	$	845
	Intangible assets, net		-		8
	Goodwill		-		1,210
		$	-	$	2,063

Acquisition_Tables

Acquisition (Tables)	9 Months Ended
	Dec. 31, 2013
Acquisition Tables	'
Schedule of Purchase Price Allocation	'
	The preliminary fair values of the assets acquired and liabilities assumed are as follows (in thousands):
			Estimated
			Fair Value
	Assets acquired:
	Cash	$	854
	Current assets		1,134
	Property and equipment		956
	Intangible asset - customer relationship		6,381
	Total assets acquired		9,325
	Liabilities assumed:
	Current liabilities		-4,058
	Total liabilities assumed		-4,058
	Net identifiable assets acquired		5,267
	Goodwill		14,061
	Total consideration transferred	$	19,328

Description_of_the_Business_Na

Description of the Business (Narrative) (Details) (USD $)	9 Months Ended
Share data in Thousands, unless otherwise specified	Dec. 31, 2013
Description Of Business Narrative Details	'
Approximate number of business customers	'36800
Year Founded	'1987
Entity Incorporation, Date of Incorporation	31-Dec-96
Entity Incorporation, State Country Name	'Delaware
Fiscal Year End Date	'--03-31
Common stock issued, shares	14,375
Net proceeds from sale of common stock	$125,800,000
Common shares puchased by member of board of directors	30
Value of securities in shelf registration statement previously filed	$250,000,000

Basis_of_Presentation_Service_

Basis of Presentation (Service and Product Revenue) (Narrative) (Details)	Dec. 31, 2013
Basis Of Presentation Service And Product Revenue Narrative Details	'
Trial period offered with all new services, days	30

Basis_of_Presentation_Goodwill

Basis of Presentation (Goodwill And Other Intangibles Schedule Of Intangibles) (Details) (USD $)	Dec. 31, 2013	Mar. 31, 2013
In Thousands, unless otherwise specified
Gross Carrying Amount	$18,682	$12,504
Accumulated Amortization	-3,076	-2,310
Net Carrying Amount	15,606	10,194
Technology	'	'
Gross Carrying Amount	8,242	8,242
Accumulated Amortization	-1,874	-1,256
Net Carrying Amount	6,368	6,986
Customer relationships	'	'
Gross Carrying Amount	9,483	3,305
Accumulated Amortization	-1,202	-1,054
Net Carrying Amount	8,281	2,251
Trade names domains	'	'
Gross Carrying Amount	957	957
Accumulated Amortization	0	0
Net Carrying Amount	$957	$957

Basis_of_Presentation_Goodwill1

Basis of Presentation (Goodwill And Other Intangibles Schedule Of Future Amortization Of Intangibles) (Details) (USD $)	Dec. 31, 2013
In Thousands, unless otherwise specified
Basis Of Presentation Goodwill And Other Intangibles Schedule Of Future Amortization Of Intangibles Details	'
Remaining 2014	$567
2015	2,252
2016	2,252
2017	2,245
2018	1,997
Thereafter	5,336
Total	$14,649

Basis_of_Presentation_Software

Basis of Presentation (Software Development Costs) (Details) (Software Development Costs, USD $)	9 Months Ended
	Dec. 31, 2013
Software Development Costs	'
Costs capitalized during the period	$590,000
Total costs	779,000
Accumulated amortization	$92,000

Basis_of_Presentation_Schedule

Basis of Presentation (Schedule Of Stock Purchase Right Activity) (Details) (USD $)	9 Months Ended
	Dec. 31, 2013
	Y
Basis Of Presentation Schedule Of Stock Purchase Right Activity Details	'
Balance at March 31, 2013	958,575
Granted	19,180
Released	-318,591
Forfeited	-81,109
Balance at December 31, 2013	578,055
Weighted-average grant date fair market value, March 31, 2013	$4.11
Weighted-average grant date fair market value of restricted stock rights granted	$9.42
Weighted-average grant date fair market value, released during period	$3.33
Weighted-average grant date fair market value, forfeited during period	$4.96
Weighted-average grant date fair market value, December 31, 2013	$4.59
Weighted-average remaining contractual term, in years, March 31, 2013	'2 years 6 months 7 days
Weighted-average remaining contractual term, in years, December 31, 2013	2.04

Basis_of_Presentation_Schedule1

Basis of Presentation (Schedule Of Restricted Stock Unit and Performance Stock Unit Activity) (Details)	9 Months Ended
	Dec. 31, 2013	Mar. 31, 2013
Basis Of Presentation Schedule Of Restricted Stock Unit And Performance Stock Unit Activity Details	'	'
Balance at March 31, 2013	25,000	'
Granted	1,235,350	'
Vested	-1,250	'
Forfeited	-34,320	'
Balance at December 31, 2013	1,224,780	'
RSU Weighted-average remaining contractual term, in years	'	2.47
RSU Weighted-average remaining contractual term, in years, end of period	2	'

Basis_of_Presentation_Schedule2

Basis of Presentation (Schedule Of Option Activity) (Details) (USD $)	9 Months Ended
	Dec. 31, 2013
Basis Of Presentation Schedule Of Option Activity Details	'
Balance at March 31, 2013	5,991,544
Granted - options	1,390,400
Exercised	-921,685
Cancelled/forfeited	-56,048
Termination of plans	0
Balance at December 31, 2013	6,404,211
Shares available for grant at March 31, 2013	3,175,261
Change in options available for grant	1,000,000
Granted options, shares available for grant	-1,390,400
Stock purchase rights/restricted stock unit (1)	-1,254,530	[1]
Restricted Stock Units	0
Exercised	0
Cancelled/forfeited shares available for grant	56,048
Cancelled/forfeited - Restricted Stock Units	34,320
Termination of plans shares available for grant	-1,774
Shares available for grant, at December 31, 2013	1,618,925
Weighted-average exercise price of options outstanding, at March 31, 2013	$2.52
Weighted-average exercise price of options granted during period	$9.57
Weighted-average exercise price of stock purchases rights during period	$0
Weighted-average exercise price of options exercised during the period	$2.41
Weighted-average exercise price of options forfeited, cancelled or expired during the period	$3.38
Weighted-average exercise price of options termination of plans during period	$0
Weighted-average exercise price of options outstanding at December 31, 2013	$4.06
[1]	The reduction to shares available for grant includes awards granted of 1,254,530 shares

Basis_of_Presentation_Summary_

Basis of Presentation (Summary Of Stock Options Outstanding And Exercisable) (Details) (USD $)	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2013
			$0.55 - $1.26	$1.27 - $1.88	$1.89 - $5.87	$5.88 - $9.74	$9.75 - $10.97	$0.55 - $10.97
Range of Exercise Prices, Minimum	'	'	$0.55	$1.27	$1.89	$5.88	$9.75	$0.55
Range of Exercise Prices, Maximum	'	'	$1.26	$1.88	$5.87	$9.74	$10.97	$10.97
Options Outstanding, Number of Shares	6,404,211	5,991,544	1,735,000	1,284,568	1,963,492	1,346,151	75,000	6,404,211
Options Outstanding, Weighted-Average Exercise Price Per Share	$4.06	$2.52	$1.04	$1.53	$4.45	$9.40	$10.97	'
Options Outstanding, Weighted-Average Remaining Contractual Term (in years)	'	'	'4 years	'2 years 36 days	'5 years 288 days	'9 years 252 days	'9 years 288 days	'
Options Outstanding, Aggregate Intrinsic Value	'	'	$15,806,760	$11,067,416	$11,187,811	$1,014,399	$0	$39,076,386
Options Exercisable, Number of Shares	'	'	1,735,000	1,284,568	981,709	41,651	0	4,042,928
Options Exercisable, Weighted-Average Exercise Price Per Share	'	'	$1.04	$1.53	$3.99	$8.41	$0	'
Options Exercisable, Aggregate Intrinsic Value	'	'	$15,806,760	$11,067,416	$6,044,878	$72,417	$0	$32,991,471

Stock_Plans_Assumptions_Used_I

Stock Plans (Assumptions Used In Black-Scholes Model) (Details) (USD $)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Option Grants and Stock Purchase Rights	'	'	'	'
Expected volatility	63.00%	68.00%	64.00%	68.00%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Risk-free interest rate	1.62%	0.68%	1.86%	0.70%
Weighted average expected ESPP option term, in years	'5 years 212 days	'4 years 183 days	'6 years	'5 years 102 days
Weighted average fair value of ESPP options granted, per share	$5.64	$3.18	$5.64	$3.32
Employee Stock Purchase Plan Rights	'	'	'	'
Expected volatility	0.00%	0.00%	38.00%	34.00%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Risk-free interest rate	0.00%	0.00%	0.11%	0.16%
Weighted average expected ESPP option term, in years	'	'	'0 years 9 months 0 days	'0 years 9 months 0 days
Weighted average fair value of ESPP options granted, per share	$0	$0	$2.60	$1.45

Basis_of_Presentation_Schedule3

Basis of Presentation (Schedule Of Stock-Based Compensation Expense By Statement Of Operations) (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Stock-based employee compensation expense related to employee stock options and employee stock purchases, pre tax	$3,232	$765	$5,245	$1,827
Tax benefit	0	0	0	0
Stock-based employee compensation expense related to employee stock options and employee stock purchases, net of tax	3,232	765	5,245	1,827
Cost of service revenue	'	'	'	'
Stock-based employee compensation expense related to employee stock options and employee stock purchases, pre tax	101	63	237	149
Cost of product revenue	'	'	'	'
Stock-based employee compensation expense related to employee stock options and employee stock purchases, pre tax	0	0	0	1
Research and development	'	'	'	'
Stock-based employee compensation expense related to employee stock options and employee stock purchases, pre tax	339	125	634	295
Sales and marketing	'	'	'	'
Stock-based employee compensation expense related to employee stock options and employee stock purchases, pre tax	660	355	1,400	979
General and administrative	'	'	'	'
Stock-based employee compensation expense related to employee stock options and employee stock purchases, pre tax	$2,132	$222	$2,974	$403

Basis_of_Presentation_Stock_Op

Basis of Presentation (Stock Option Narrative) (Details) (USD $)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Stock-based compensation expense	'	'	$5,245,000	$1,827,000
Stock-Based Awards	'	'	'	'
Unamortized stock-based compensation expense related to unvested stock awards	18,800,000	'	18,800,000	'
Weighted average period of recognition for unrecognized compensation costs (in years)	'	'	'3 years 7 days	'
Tax benefit attributable to stock options exercised	'	'	0	0
Stock-based compensation expense	2,069,000	650,000	3,827,000	1,471,000
Employee Stock Purchase Plan	'	'	'	'
Unamortized stock-based compensation expense related to unvested stock awards	58,000	'	58,000	'
Weighted average period of recognition for unrecognized compensation costs (in years)	'	'	'0 years 6 months	'
Tax benefit attributable to stock options exercised	'	'	0	0
Stock-based compensation expense	$95,000	$115,000	$350,000	$356,000

Fair_Value_Measurement_Details

Fair Value Measurement (Details) (USD $)	Dec. 31, 2013	Mar. 31, 2013
In Thousands, unless otherwise specified
Cash equivalents:	'	'
Money market funds	$14,379	$14,376
Short-term investments:	'	'
Mutual funds	1,901	1,964
Total	16,280	16,340
Quoted Prices in Active Markets for Identical Assets (Level 1)	'	'
Cash equivalents:	'	'
Money market funds	14,379	14,376
Short-term investments:	'	'
Mutual funds	1,901	1,964
Total	16,280	16,340
Other Observable Inputs (Level 2)	'	'
Cash equivalents:	'	'
Money market funds	0	0
Short-term investments:	'	'
Mutual funds	0	0
Total	0	0
Significant Unobservable Inputs (Level 3)	'	'
Cash equivalents:	'	'
Money market funds	0	0
Short-term investments:	'	'
Mutual funds	0	0
Total	$0	$0

Balance_Sheet_Detail_Inventory

Balance Sheet Detail (Inventory Components) (Details) (USD $)	Dec. 31, 2013	Mar. 31, 2013
In Thousands, unless otherwise specified
Balance Sheet Detail Inventory Components Details	'	'
Work-in-process	$22	$23
Finished goods	806	488
Inventory, net	$828	$511

Net_Income_Per_Share_Details

Net Income Per Share (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Net Income Per Share Details	'	'	'	'
Income from continuing operations	$89	$1,774	$3,569	$11,934
Income from discontinued operations, net of income tax provision	0	146	890	344
Net income available to common stockholders	$89	$1,920	$4,459	$12,278
Common shares	79,742	71,611	75,071	71,197
Denominator for basic calculation	79,742	71,611	75,071	71,197
Employee stock options	2,982	3,023	2,938	2,947
Stock purchase rights	425	336	380	339
Employee stock purchase plan	33	18	0	0
Denominator for diluted calculation	83,182	74,988	78,389	74,483
Income per share - continuing operations:	'	'	'	'
Basic	$0	$0.03	$0.05	$0.17
Diluted	$0	$0.03	$0.05	$0.16
Income per share - discontinued operations:	'	'	'	'
Basic	$0	$0	$0.01	$0
Diluted	$0	$0	$0.01	$0
Net income per share	'	'	'	'
Basic	$0	$0.03	$0.06	$0.17
Diluted	$0	$0.03	$0.06	$0.16

Net_Income_Per_Share_Options_a

Net Income Per Share (Options and Rights Excluded) (Details)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Anti-dilutive shares	1,284	885	740	878
Employee stock options	'	'	'	'
Anti-dilutive shares	1,266	885	550	878
Stock purchase rights	'	'	'	'
Anti-dilutive shares	18	0	190	0

Income_Taxes_Narrative_Details

Income Taxes (Narrative) (Details) (USD $)	9 Months Ended
In Millions, unless otherwise specified	Dec. 31, 2013	Mar. 31, 2013
Income Taxes Narrative Details	'	'
Unrecognized tax benefits	$3	$3
Open Tax Year	'1995	'

Segment_Reporting_Revenue_by_G

Segment Reporting Revenue by Geographic Area (Details)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Disclosure on Geographic Areas, Revenue from External Customers	'100%	'100%	'100%	'100%
Number of customers at more than 10% of revenue	'	'	'0	'0
Americas	'	'	'	'
Disclosure on Geographic Areas, Revenue from External Customers	'96%	'99%	'98%	'99%
Europe	'	'	'	'
Disclosure on Geographic Areas, Revenue from External Customers	'3%	'0%	'1%	'0%
Asia Pacific	'	'	'	'
Disclosure on Geographic Areas, Revenue from External Customers	'1%	'1%	'1%	'1%

Segment_Reporting_LongLived_As

Segment Reporting Long-Lived Assets by Geographic Area (in thousands) (Details)	9 Months Ended	12 Months Ended
	Dec. 31, 2013	Mar. 31, 2013
United States	'	'
Disclosure on Geographic Areas, Long-Lived Assets	'$5,787	'$6,673
United Kingdom	'	'
Disclosure on Geographic Areas, Long-Lived Assets	'$1,352	'0
Asia	'	'
Disclosure on Geographic Areas, Long-Lived Assets	'$346	'0

Recovered_Sheet2

Commitments and Contingencies (Product Warranties) (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Commitments And Contingencies Product Warranties Details	'	'	'	'
Balance at beginning of period	$552	$376	$452	$387
Accruals for warranties	274	168	744	445
Settlements	-192	-122	-562	-410
Balance at end of period	$634	$422	$634	$422

Commitments_and_Contingencies_1

Commitments and Contingencies (Service Provider Contracts) (Details) (USD $)	Dec. 31, 2013
In Thousands, unless otherwise specified
Commitments And Contingencies Service Provider Contracts Details	'
Remaining 2014	$502
2015	1,579
2016	52
Total minimum payments	$2,133

Commitments_and_Contingencies_2

Commitments and Contingencies (CustomerSupport Commitments) (Narrative) (Details) (USD $)	Dec. 31, 2013
Commitments And Contingencies Customersupport Commitments Narrative Details	'
Third party customer support vendor minimum monthly commitment	$430,000
Third party customer support vendor maximum obligation	$2,200,000
Advance termination notice required, days	150

Patent_Sale_Narrative_Details

Patent Sale (Narrative) (Details) (USD $)	3 Months Ended	9 Months Ended
In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2013	Dec. 31, 2012
Patent Sale Narrative Details	'	'	'
Sale of patents	$1	$0	$12
Future maximum patent license collection	$2	'	'

Discontinued_Operations_Detail

Discontinued Operations (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Mar. 31, 2013
Results of Operations	'	'	'	'	'
Revenue	$0	$935	$1,430	$2,993	'
Operating expense	0	690	922	2,417	'
Income before income taxes	0	245	508	576	'
Provision for income taxes	0	99	207	232	'
Income from discontinued operations	0	146	301	344	'
Gain on disposal of discontinued operations. net of income tax provision of $463k	0	0	589	0	'
Income tax provision on gain on disposal	0	0	463	0	'
Assets	'	'	'	'	'
Property and equipment, net	0	'	0	'	845
Intangible assets, net	0	'	0	'	8
Goodwill	0	'	0	'	1,210
Total assets	$0	'	$0	'	$2,063

Acquisition_Purchase_Informati

Acquisition (Purchase Information) (Details) (USD $)	Nov. 30, 2013
In Thousands, unless otherwise specified
Assets acquired:	'
Cash	$854
Current assets	1,134
Property and equipment	956
Intangible asset - caustomer relationship	6,381
Total assets acquired	9,325
Liabilities assumed:	'
Current liabilities	-4,058
Total liabilities assumed	-4,058
Net identifiable assets acquired	5,267
Goodwill	14,061
Total consideration transferred	$19,328

Acquisition_Purchase_Informati1

Acquisition (Purchase Information Narrative) (Details) (USD $)	1 Months Ended	9 Months Ended
In Thousands, unless otherwise specified	Nov. 30, 2013	Dec. 31, 2013
Acquisition Purchase Information Narrative Details	'	'
Business Acquisition, Name of Acquired Entity	'	'
	Voicenet Solutions Limited
Business Acquisition, Description of Acquired Entity	'	'
	On November 11, 2013, the Company entered into a share purchase agreement with the shareholders and optionholders of Voicenet Solutions Limited ("Voicenet"), a provider of cloud communications and collaboration services in the United Kingdom (the "Transaction").
Business Acquisition, Date of Acquisition Agreement	11-Nov-13	'
Business Acquisition, Effective Date of Acquisition	29-Nov-13	'
Payments to Acquire Businesses, Gross	$19,300	'
Payments placed in escrow	3,000	'
Voicenet contributed revenue	'	800
Voicenet net loss	'	$200