Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 05, 2016 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | AKAMAI TECHNOLOGIES INC | |
Entity Central Index Key | 1,086,222 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 175,591,774 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 312,912 | $ 289,473 |
Marketable securities | 524,958 | 460,088 |
Accounts receivable, net of reserves of $9,380 and $7,364 at March 31, 2016, and December 31, 2015, respectively | 365,103 | 380,399 |
Prepaid expenses and other current assets | 127,855 | 123,228 |
Total current assets | 1,330,828 | 1,253,188 |
Property and equipment, net | 770,197 | 753,180 |
Marketable securities | 685,362 | 774,674 |
Goodwill | 1,152,376 | 1,150,244 |
Acquired intangible assets, net | 149,379 | 156,095 |
Deferred income tax assets | 3,490 | 4,700 |
Other assets | 92,120 | 89,603 |
Total assets | 4,183,752 | 4,181,684 |
Current liabilities: | ||
Accounts payable | 63,822 | 61,982 |
Accrued expenses | 197,487 | 216,166 |
Deferred revenue | 64,905 | 54,154 |
Other current liabilities | 7,019 | 138 |
Total current liabilities | 333,233 | 332,440 |
Deferred revenue | 4,238 | 4,163 |
Deferred income tax liabilities | 11,706 | 12,888 |
Convertible senior notes | 623,485 | 618,047 |
Other liabilities | 97,508 | 93,268 |
Total liabilities | $ 1,070,170 | $ 1,060,806 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value; 5,000,000 shares authorized; 700,000 shares designated as Series A Junior Participating Preferred Stock; no shares issued or outstanding | $ 0 | $ 0 |
Common stock, $0.01 par value; 700,000,000 shares authorized; 178,270,472 shares issued and 176,050,217 shares outstanding at March 31, 2016, and 177,212,181 shares issued and outstanding at December 31, 2015 | 1,783 | 1,772 |
Additional paid-in capital | 4,451,319 | 4,437,420 |
Accumulated other comprehensive loss | (28,792) | (41,453) |
Treasury stock, at cost, 2,220,255 shares at March 31, 2016, and no shares at December 31, 2015 | (108,725) | 0 |
Accumulated deficit | (1,202,003) | (1,276,861) |
Total stockholders’ equity | 3,113,582 | 3,120,878 |
Total liabilities and stockholders’ equity | $ 4,183,752 | $ 4,181,684 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Accounts receivable reserve (in dollars) | $ 9,380 | $ 7,364 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares designated as Series A Junior Participating Preferred Stock | 700,000 | 700,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 700,000,000 | 700,000,000 |
Common stock, shares issued | 178,270,472 | 177,212,181 |
Common stock, shares outstanding | 176,050,217 | 177,212,181 |
Treasury stock, shares | 2,220,255 | 0 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||
Revenue | $ 567,725 | $ 526,536 |
Costs and operating expenses: | ||
Cost of revenue (exclusive of amortization of acquired intangible assets shown below) | 194,736 | 169,294 |
Research and development | 40,842 | 35,828 |
Sales and marketing | 102,211 | 103,479 |
General and administrative | 102,283 | 89,592 |
Amortization of acquired intangible assets | 6,716 | 6,780 |
Restructuring charges | 6,818 | 42 |
Total costs and operating expenses | 453,606 | 405,015 |
Income from operations | 114,119 | 121,521 |
Interest income | 3,320 | 3,001 |
Interest expense | (4,653) | (4,576) |
Other expense, net | (189) | (301) |
Income before provision for income taxes | 112,597 | 119,645 |
Provision for income taxes | 37,739 | 41,899 |
Net income | $ 74,858 | $ 77,746 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.42 | $ 0.44 |
Diluted (in dollars per share) | $ 0.42 | $ 0.43 |
Shares used in per share calculations: | ||
Basic (in shares) | 176,403 | 178,545 |
Diluted (in shares) | 177,539 | 180,825 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 74,858 | $ 77,746 |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments | 9,653 | (8,415) |
Unrealized gains on investments, net of income tax provision of $1,783 and $1,213 for the three months ended March 31, 2016 and 2015, respectively | 3,008 | 2,113 |
Other comprehensive income (loss) | 12,661 | (6,302) |
Comprehensive income | $ 87,519 | $ 71,444 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Provision on change in unrealized gain (loss) on investments, net | $ 1,783 | $ 1,213 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net income | $ 74,858 | $ 77,746 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 80,669 | 70,460 |
Stock-based compensation | 31,741 | 29,669 |
Excess tax benefits from stock-based compensation | (1,135) | (13,128) |
Provision for deferred income taxes | 1,072 | 8,305 |
Amortization of debt discount and issuance costs | 4,653 | 4,576 |
Other non-cash reconciling items, net | 2,752 | 443 |
Changes in operating assets and liabilities, net of effects of acquisitions: | ||
Accounts receivable | 15,906 | (32,552) |
Prepaid expenses and other current assets | (3,481) | (1,817) |
Accounts payable and accrued expenses | (32,377) | (52,703) |
Deferred revenue | 10,653 | 6,947 |
Other current liabilities | 6,876 | 42 |
Other non-current assets and liabilities | (1,949) | 1,741 |
Net cash provided by operating activities | 190,238 | 99,729 |
Cash flows from investing activities: | ||
Cash paid for acquired businesses, net of cash acquired | 0 | (16,062) |
Purchases of property and equipment | (41,806) | (91,924) |
Capitalization of internal-use software development costs | (40,534) | (45,145) |
Purchases of short- and long-term marketable securities | (95,843) | (97,304) |
Proceeds from sales of short- and long-term marketable securities | 0 | 2,008 |
Proceeds from maturities of short- and long-term marketable securities | 125,109 | 305,647 |
Other non-current assets and liabilities | (2,354) | (82) |
Net cash (used in) provided by investing activities | (55,428) | 57,138 |
Cash flows from financing activities: | ||
Proceeds related to the issuance of common stock under stock plans | 18,350 | 24,440 |
Excess tax benefits from stock-based compensation | 1,135 | 13,128 |
Employee taxes paid related to net share settlement of stock-based awards | (26,496) | (31,101) |
Repurchases of common stock | (108,725) | (62,680) |
Net cash used in financing activities | (115,736) | (56,213) |
Effects of exchange rate changes on cash and cash equivalents | 4,365 | (6,747) |
Net increase in cash and cash equivalents | 23,439 | 93,907 |
Cash and cash equivalents at beginning of period | 289,473 | 238,650 |
Cash and cash equivalents at end of period | 312,912 | 332,557 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 28,010 | 24,131 |
Non-cash investing activities: | ||
Purchases of property and equipment and capitalization of internal-use software development costs included in accounts payable and accrued expenses | 19,518 | 31,565 |
Capitalization of stock-based compensation | $ 5,203 | $ 4,144 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Basis of Presentation | Nature of Business and Basis of Presentation Akamai Technologies, Inc. (the “Company”) provides cloud services for delivering, optimizing and securing content and business applications over the Internet. The Company's globally-distributed platform comprises over 216,000 servers in more than 1,500 networks in approximately 120 countries. The Company was incorporated in Delaware in 1998 and is headquartered in Cambridge, Massachusetts. The Company currently operates in one industry segment: providing cloud services for delivering, optimizing and securing content and business applications over the Internet. The accompanying interim consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. These financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in the accompanying financial statements. Certain information and footnote disclosures normally included in the Company’s annual audited consolidated financial statements and accompanying notes have been condensed in, or omitted from, these interim financial statements. Accordingly, the unaudited consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s annual report on Form 10-K for the year ended December 31, 2015 , filed with the Securities and Exchange Commission (the "Commission") on February 29, 2016. The results of operations presented in this quarterly report on Form 10-Q are not necessarily indicative of the results of operations that may be expected for any future periods. In the opinion of management, these unaudited consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, that are necessary for a fair statement of the results of all interim periods reported herein. Newly-Adopted Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued updated guidance to simplify the presentation of debt issuance costs on the balance sheet. This guidance moved debt issuance costs from the assets section of the balance sheet to the liabilities section as a direct deduction from the carrying amount of the debt issued. The Company retrospectively adopted the guidance on January 1, 2016. The prior period consolidated balance sheet presented, as of December 31, 2015, was revised to reclassify $6.2 million of debt issuance costs included in other assets to convertible senior notes. This had the impact of reducing the Company's total assets and total liabilities by $6.2 million , as of December 31, 2015. The revision had no impact on the Company's results of operations, financial position or cash flows. In September 2015, the FASB issued updated guidance that eliminates the requirement to restate prior period financial statements for measurement period adjustments. In an effort to reduce complexity in financial reporting, the new guidance requires that the cumulative impact of a measurement period adjustment, including the impact on prior periods, be recognized in the reporting period in which the adjustment is identified. The standard was effective for and adopted by the Company on January 1, 2016. This guidance did not have an impact on the Company's results of operations, financial condition or cash flows as the measurement periods for the Company's 2015 acquisitions were closed as of December 31, 2015. Recent Accounting Pronouncements In May 2014, the FASB issued updated guidance and disclosure requirements for recognizing revenue. The new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This standard will be effective for the Company on January 1, 2018, and may be applied retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is evaluating the potential impact of adopting this new accounting guidance. In February 2016, the FASB issued guidance that requires companies to present assets and liabilities arising from leases on the consolidated balance sheets. This new standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a corresponding lease liability on the consolidated balance sheets for all leases with terms longer than 12 months. This standard will be effective for the Company on January 1, 2019, and is to be applied using a modified retrospective approach. Early adoption is permitted. The Company is evaluating the potential impact of adopting this new accounting guidance. In March 2016, the FASB issued guidance that is intended to simplify aspects of how share-based payments are accounted for and presented in financial statements. This guidance requires that entities record all tax effects of share-based payments at settlement or expiration through the income statement. The standard also amends how windfall tax benefits are recognized, the minimum statutory tax withholding requirements and how entities elect to recognize share-based payment forfeitures. This guidance will be effective for the Company on January 1, 2017, and portions will be required to be applied on a retrospective or modified retrospective basis. Early adoption is permitted. The Company is evaluating the potential impact of adopting this new accounting guidance. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following is a summary of available-for-sale marketable securities held as of March 31, 2016 and December 31, 2015 (in thousands): Gross Unrealized Classification on Balance Sheet Amortized Cost Gains Losses Aggregate Fair Value Short-Term Marketable Securities Long-Term Marketable Securities As of March 31, 2016 Commercial paper $ 2,495 $ — $ (1 ) $ 2,494 $ 2,494 $ — Corporate bonds 962,932 1,203 (506 ) 963,629 479,400 484,229 U.S. government agency obligations 241,315 289 (26 ) 241,578 43,064 198,514 $ 1,206,742 $ 1,492 $ (533 ) $ 1,207,701 $ 524,958 $ 682,743 As of December 31, 2015 Commercial paper $ 2,491 $ — $ (4 ) $ 2,487 $ 2,487 $ — Corporate bonds 995,100 73 (3,365 ) 991,808 432,585 559,223 U.S. government agency obligations 239,587 41 (575 ) 239,053 25,016 214,037 $ 1,237,178 $ 114 $ (3,944 ) $ 1,233,348 $ 460,088 $ 773,260 The Company offers certain qualified employees the ability to participate in a non-qualified deferred compensation plan. The mutual funds held by the Company that are associated with this plan are classified as restricted trading securities. These securities are not included in the available-for-sale securities table above but are included in marketable securities in the consolidated balance sheets. Unrealized gains and unrealized temporary losses on investments classified as available-for-sale are included within accumulated other comprehensive loss in the consolidated balance sheets. Upon realization, those amounts are reclassified from accumulated other comprehensive loss to interest income in the statements of income. As of March 31, 2016, the Company held for investment corporate bonds with a fair value of $76.4 million , which are classified as available-for-sale marketable securities and had been in a continuous unrealized loss position for more than 12 months. The unrealized losses are not significant and are attributable to changes in interest rates. The Company does not believe any unrealized losses represent other than temporary impairments based on the evaluation of available evidence. As of December 31, 2015 , the Company held for investment corporate bonds with a fair value of $71.4 million that had been in a continuous unrealized loss position for more than 12 months. The following table details the fair value measurements within the fair value hierarchy of the Company’s financial assets at March 31, 2016 and December 31, 2015 (in thousands): Total Fair Value Fair Value Measurements at Reporting Date Using Level 1 Level 2 Level 3 As of March 31, 2016 Cash Equivalents and Marketable Securities: Money market funds $ 22,035 $ 22,035 $ — $ — Commercial paper 2,494 — 2,494 — Corporate bonds 963,629 — 963,629 — U.S. government agency obligations 241,578 — 241,578 — Mutual funds 2,619 2,619 — — $ 1,232,355 $ 24,654 $ 1,207,701 $ — As of December 31, 2015 Cash Equivalents and Marketable Securities: Money market funds $ 1,250 $ 1,250 $ — $ — Commercial paper 2,487 — 2,487 — Corporate bonds 991,808 — 991,808 — U.S. government agency obligations 239,053 — 239,053 — Mutual funds 1,414 1,414 — — $ 1,236,012 $ 2,664 $ 1,233,348 $ — As of March 31, 2016 and December 31, 2015 , the Company grouped money market funds and mutual funds using a Level 1 valuation because market prices for such investments are readily available in active markets. As of March 31, 2016 and December 31, 2015 , the Company grouped commercial paper, corporate bonds and U.S. government agency obligations using a Level 2 valuation because quoted prices for identical or similar assets are available in markets that are inactive. The Company did not have any transfers of assets between Level 1, Level 2 or Level 3 of the fair value measurement hierarchy during the three months ended March 31, 2016 . When developing fair value estimates, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. When available, the Company uses quoted market prices to measure fair value. The valuation technique used to measure fair value for the Company's Level 1 and Level 2 assets is a market approach, using prices and other relevant information generated by market transactions involving identical or comparable assets. If market prices are not available, the fair value measurement is based on models that use primarily market-based parameters including yield curves, volatilities, credit ratings and currency rates. In certain cases where market rate assumptions are not available, the Company is required to make judgments about assumptions market participants would use to estimate the fair value of a financial instrument. Contractual maturities of the Company’s available-for-sale marketable securities held as of March 31, 2016 and December 31, 2015 were as follows (in thousands): March 31, December 31, Due in 1 year or less $ 524,958 $ 460,088 Due after 1 year through 5 years 682,743 773,260 $ 1,207,701 $ 1,233,348 |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 31, 2016 | |
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |
Accounts Receivable | Accounts Receivable Net accounts receivable consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands): March 31, December 31, Trade accounts receivable $ 267,809 $ 262,885 Unbilled accounts receivable 106,674 124,878 Gross accounts receivable 374,483 387,763 Allowance for doubtful accounts (1,189 ) (906 ) Reserve for cash-basis customers (8,191 ) (6,458 ) Total accounts receivable reserves (9,380 ) (7,364 ) Accounts receivable, net $ 365,103 $ 380,399 |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets The change in the carrying amount of goodwill for the three months ended March 31, 2016 was as follows (in thousands): Balance as of January 1, 2016 $ 1,150,244 Foreign currency translation 2,132 Balance as of March 31, 2016 $ 1,152,376 The Company tests goodwill for impairment at least annually. Through the date the consolidated financial statements were issued, no triggering events had occurred that would indicate a potential impairment exists. Acquired intangible assets that are subject to amortization consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands): March 31, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Accumulated Net Completed technology $ 120,791 $ (61,792 ) $ 58,999 $ 120,791 $ (58,633 ) $ 62,158 Customer-related intangible assets 191,710 (105,705 ) 86,005 191,710 (102,872 ) 88,838 Non-compete agreements 6,540 (3,949 ) 2,591 6,540 (3,374 ) 3,166 Trademarks and trade names 3,700 (1,916 ) 1,784 3,700 (1,767 ) 1,933 Acquired license rights 490 (490 ) — 490 (490 ) — Total $ 323,231 $ (173,852 ) $ 149,379 $ 323,231 $ (167,136 ) $ 156,095 Aggregate expense related to amortization of acquired intangible assets for the three months ended March 31, 2016 and 2015 was $6.7 million and $6.8 million , respectively. Based on the Company’s acquired intangible assets as of March 31, 2016 , aggregate expense related to amortization of acquired intangible assets is expected to be $19.8 million for the remainder of 2016 , and $27.8 million , $23.7 million , $21.7 million and $17.7 million for 2017 , 2018 , 2019 and 2020 , respectively. |
Convertible Senior Notes
Convertible Senior Notes | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes In February 2014, the Company issued $690.0 million in par value of convertible senior notes due 2019 (the "Notes"). The Notes are senior unsecured obligations of the Company, do not bear regular interest and mature on February 15, 2019 , unless repurchased or converted prior to maturity. At their option, holders may convert their Notes prior to the close of business on the business day immediately preceding August 15, 2018 only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ended June 30, 2014 (and only during such calendar quarter), if the last reported sale price of the Company's common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; or • during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day; or upon the occurrence of specified corporate events. On or after August 15, 2018 , holders may convert all or any portion of their Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date, regardless of the foregoing circumstances. Upon conversion, the Company, at its election, may pay or deliver to holders cash, shares of the Company's common stock or a combination of cash and shares of the Company's common stock. The initial conversion rate is 11.1651 shares of the Company's common stock per $1,000 principal amount, which is equivalent to an initial conversion price of approximately $89.56 per share, subject to adjustments in certain events, and represents a potential conversion into 7.7 million shares. In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying cost of the liability component was calculated by measuring the fair value of a similar debt obligation that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the Notes. The difference between the principal amount of the Notes and the proceeds allocated to the liability component (“debt discount”) is amortized to interest expense using the effective interest method over the term of the Notes. The equity component is recorded in additional paid-in capital in the consolidated balance sheet and will not be remeasured as long as it continues to meet the conditions for equity classification. In accounting for the transaction costs related to the issuance of the Notes, the Company allocated the total transaction costs incurred to the liability and equity components based on their relative values. Transaction costs attributable to the liability component are being amortized to interest expense over the term of the Notes, and transaction costs attributable to the equity component are netted with the equity component of the Notes in stockholders’ equity. The Notes consist of the following components (in thousands): March 31, 2016 December 31, 2015 Liability component: Principal $ 690,000 $ 690,000 Less: debt discount and issuance costs, net of amortization (66,515 ) (71,953 ) Net carrying amount $ 623,485 $ 618,047 Equity component: $ 101,276 $ 101,276 The estimated fair value of the Notes at March 31, 2016 was $673.3 million . The fair value was determined based on data points other than quoted prices that are observable, either directly or indirectly, and has been classified as Level 2 within the fair value hierarchy. Based on the closing price of the Company's common stock of $55.57 on March 31, 2016 , the value of the Notes if converted to common stock was less than the principal amount of $690.0 million . The Company used $62.0 million of the proceeds from the offering to repurchase shares of its common stock, concurrently with the issuance of the Notes. The repurchases were made in accordance with the share repurchase program previously approved by the Board of Directors (Note 7). Additionally, $23.3 million of the proceeds was used for the net cost of convertible note hedge and warrant transactions. The Company intends to use the remaining net proceeds for working capital, share repurchases and other general corporate purposes, as well as for potential additional acquisitions and strategic transactions. Note Hedge To minimize the impact of potential dilution upon conversion of the Notes, the Company entered into convertible note hedge transactions with respect to its common stock in February 2014. The Company paid $101.3 million for the note hedge transactions. The note hedge transactions cover approximately 7.7 million shares of the Company’s common stock at a strike price that corresponds to the initial conversion price of the Notes, also subject to adjustment, and are exercisable upon conversion of the Notes. The note hedge transactions are intended to reduce dilution in the event of conversion of the Notes. Warrants Separately, in February 2014, the Company entered into warrant transactions, whereby the Company sold warrants to acquire, subject to anti-dilution adjustments, up to 7.7 million shares of the Company’s common stock at a strike price of approximately $104.49 per share. The Company received aggregate proceeds of $78.0 million from the sale of the warrants. The convertible note hedge and warrant transactions will generally have the effect of increasing the conversion price of the Notes to approximately $104.49 per share. Interest Expense The Notes do not bear regular interest, but have an effective interest rate of 3.2% attributable to the conversion feature. The following table sets forth total interest expense included in the statements of income related to the Notes (in thousands): For the Three Months 2016 2015 Amortization of debt discount and issuance costs $ 5,438 $ 5,251 Capitalization of interest expense (785 ) (675 ) Total interest expense $ 4,653 $ 4,576 |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies The Company is conducting an internal investigation, with the assistance of outside counsel, relating to sales practices in a country outside the U.S. that represented less than 1% of the Company’s revenue during the three months ended March 31, 2016 , and in each of the years ended December 31, 2015, 2014 and 2013. The internal investigation includes a review of compliance with the requirements of the U.S. Foreign Corrupt Practices Act and other applicable laws and regulations by employees in that market. In February 2015, the Company voluntarily contacted the Commission and Department of Justice to advise both agencies of this internal investigation. The Company is cooperating with those agencies. As of the filing of these financial statements, the Company cannot predict the outcome of this matter. During the first quarter of 2016, the Company recorded an immaterial provision in its consolidated financial statements reflecting amounts the Company expects it will be required to disgorge in connection with this matter. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Share Repurchase Program In October 2013, the Board of Directors authorized a $750.0 million share repurchase program, effective from October 16, 2013 through December 31, 2016. In February 2016, the Board of Directors authorized a new $1.0 billion share repurchase program that superseded the October 2013 program and is effective from February 9, 2016 through December 31, 2018. The Company's goal for the share repurchase program is to offset the dilution created by its employee equity compensation programs and provide the flexibility to return capital to shareholders as business and market conditions warrant. During the three months ended March 31, 2016 , the Company repurchased 2.2 million shares of its common stock for $108.7 million . Stock-Based Compensation The following table summarizes stock-based compensation included in the Company’s consolidated statements of income for the three months ended March 31, 2016 and 2015 (in thousands): For the Three Months 2016 2015 Cost of revenue $ 3,970 $ 3,163 Research and development 6,438 5,366 Sales and marketing 12,352 12,983 General and administrative 8,981 8,157 Total stock-based compensation 31,741 29,669 Provision for income taxes (12,133 ) (11,702 ) Total stock-based compensation, net of income taxes $ 19,608 $ 17,967 In addition to the amounts of stock-based compensation reported in the table above, the Company’s consolidated statements of income for the three months ended March 31, 2016 and 2015 include stock-based compensation reflected as a component of amortization of capitalized internal-use software of $3.3 million and $3.0 million , respectively, before taxes. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The following table summarizes the changes in accumulated other comprehensive loss, which is reported as a component of stockholders' equity, for the three months ended March 31, 2016 (in thousands): Foreign Currency Translation Net Unrealized Gains on Investments Total Balance as of January 1, 2016 $ (44,936 ) $ 3,483 $ (41,453 ) Other comprehensive gain 9,653 3,008 12,661 Balance as of March 31, 2016 $ (35,283 ) $ 6,491 $ (28,792 ) The tax effect on accumulated unrealized gain on investments was insignificant as of March 31, 2016 and December 31, 2015 . Amounts reclassified from accumulated other comprehensive loss to net income were insignificant for the three months ended March 31, 2016 . |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s effective income tax rate was 33.5% and 35.0% for the three months ended March 31, 2016 and 2015 , respectively. The effective income tax rate is based on estimated income for the year, the estimated composition of the income in different jurisdictions and discrete adjustments, if any, in the applicable quarterly periods, including retroactive changes in tax legislation, settlements of tax audits or assessments, the resolution or identification of tax position uncertainties and acquisitions of other companies. For the three months ended March 31, 2016 , the effective income tax rate was lower than the federal statutory tax rate due to the composition of income from foreign jurisdictions that is taxed at lower rates compared to the statutory tax rates in the U.S. and the U.S. federal, state and foreign research and development credits, partially offset by the effects of accounting for stock-based compensation in accordance with the authoritative guidance for share-based payments and state income taxes. For the three months ended March 31, 2015 , the effective income tax rate equaled the federal statutory tax rate. The effects of accounting for stock-based compensation in accordance with the authoritative guidance for share-based payments and state income taxes caused the Company's tax rate to be higher than the federal statutory tax rate; however, those items were offset by the composition of income from foreign jurisdictions that is taxed at lower rates compared to the statutory tax rates in the U.S and the domestic production activities deduction. |
Net Income per Share
Net Income per Share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share Reconciliation [Abstract] | |
Net Income per Share | Net Income per Share Basic net income per share is computed using the weighted average number of common shares outstanding during the applicable period. Diluted net income per share is computed using the weighted average number of common shares outstanding during the period, plus the dilutive effect of potential common stock. Potential common stock consists of shares issuable pursuant to stock options, restricted stock units (“RSUs”), deferred stock units ("DSUs"), convertible senior notes and warrants issued by the Company. The dilutive effect of outstanding awards and convertible securities is reflected in diluted earnings per share by application of the treasury stock method. The following table sets forth the components used in the computation of basic and diluted net income per share for the three months ended March 31, 2016 and 2015 (in thousands, except per share data): For the Three Months 2016 2015 Numerator: Net income $ 74,858 $ 77,746 Denominator: Shares used for basic net income per share 176,403 178,545 Effect of dilutive securities: Stock options 403 996 RSUs and DSUs 733 1,284 Convertible senior notes — — Warrants related to issuance of convertible senior notes — — Shares used for diluted net income per share 177,539 180,825 Basic net income per share $ 0.42 $ 0.44 Diluted net income per share $ 0.42 $ 0.43 For the three months ended March 31, 2016 and 2015 , certain potential outstanding shares from stock options, service-based RSUs, convertible notes and warrants were excluded from the computation of diluted net income per share because the effect of including these items was anti-dilutive. Additionally, certain performance-based RSUs were excluded from the computation of diluted net income per share because the underlying performance conditions for such RSUs had not been met as of these dates. The number of potentially outstanding shares excluded from the computation of diluted net income per share for the three months ended March 31, 2016 and 2015 (in thousands) are as follows: For the Three Months 2016 2015 Stock options 104 26 Service-based RSUs 4,662 622 Performance-based RSUs 1,348 1,148 Convertible senior notes 7,704 7,704 Warrants related to issuance of convertible senior notes 7,704 7,704 The calculation of assumed proceeds used to determine the diluted weighted average shares outstanding under the treasury stock method in the periods presented was adjusted by tax windfalls and shortfalls associated with all of the Company’s outstanding stock awards. Such windfalls and shortfalls are computed by comparing the tax deductible amount of outstanding stock awards to their grant-date fair values and multiplying the results by the applicable statutory tax rate. A positive result creates a windfall, which increases the assumed proceeds, and a negative result creates a shortfall, which reduces the assumed proceeds. |
Nature of Business and Basis 18
Nature of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Newly-Adopted and Recent Accounting Pronouncements | Newly-Adopted Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued updated guidance to simplify the presentation of debt issuance costs on the balance sheet. This guidance moved debt issuance costs from the assets section of the balance sheet to the liabilities section as a direct deduction from the carrying amount of the debt issued. The Company retrospectively adopted the guidance on January 1, 2016. The prior period consolidated balance sheet presented, as of December 31, 2015, was revised to reclassify $6.2 million of debt issuance costs included in other assets to convertible senior notes. This had the impact of reducing the Company's total assets and total liabilities by $6.2 million , as of December 31, 2015. The revision had no impact on the Company's results of operations, financial position or cash flows. In September 2015, the FASB issued updated guidance that eliminates the requirement to restate prior period financial statements for measurement period adjustments. In an effort to reduce complexity in financial reporting, the new guidance requires that the cumulative impact of a measurement period adjustment, including the impact on prior periods, be recognized in the reporting period in which the adjustment is identified. The standard was effective for and adopted by the Company on January 1, 2016. This guidance did not have an impact on the Company's results of operations, financial condition or cash flows as the measurement periods for the Company's 2015 acquisitions were closed as of December 31, 2015. Recent Accounting Pronouncements In May 2014, the FASB issued updated guidance and disclosure requirements for recognizing revenue. The new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This standard will be effective for the Company on January 1, 2018, and may be applied retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is evaluating the potential impact of adopting this new accounting guidance. In February 2016, the FASB issued guidance that requires companies to present assets and liabilities arising from leases on the consolidated balance sheets. This new standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a corresponding lease liability on the consolidated balance sheets for all leases with terms longer than 12 months. This standard will be effective for the Company on January 1, 2019, and is to be applied using a modified retrospective approach. Early adoption is permitted. The Company is evaluating the potential impact of adopting this new accounting guidance. In March 2016, the FASB issued guidance that is intended to simplify aspects of how share-based payments are accounted for and presented in financial statements. This guidance requires that entities record all tax effects of share-based payments at settlement or expiration through the income statement. The standard also amends how windfall tax benefits are recognized, the minimum statutory tax withholding requirements and how entities elect to recognize share-based payment forfeitures. This guidance will be effective for the Company on January 1, 2017, and portions will be required to be applied on a retrospective or modified retrospective basis. Early adoption is permitted. The Company is evaluating the potential impact of adopting this new accounting guidance. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Marketable Securities | The following is a summary of available-for-sale marketable securities held as of March 31, 2016 and December 31, 2015 (in thousands): Gross Unrealized Classification on Balance Sheet Amortized Cost Gains Losses Aggregate Fair Value Short-Term Marketable Securities Long-Term Marketable Securities As of March 31, 2016 Commercial paper $ 2,495 $ — $ (1 ) $ 2,494 $ 2,494 $ — Corporate bonds 962,932 1,203 (506 ) 963,629 479,400 484,229 U.S. government agency obligations 241,315 289 (26 ) 241,578 43,064 198,514 $ 1,206,742 $ 1,492 $ (533 ) $ 1,207,701 $ 524,958 $ 682,743 As of December 31, 2015 Commercial paper $ 2,491 $ — $ (4 ) $ 2,487 $ 2,487 $ — Corporate bonds 995,100 73 (3,365 ) 991,808 432,585 559,223 U.S. government agency obligations 239,587 41 (575 ) 239,053 25,016 214,037 $ 1,237,178 $ 114 $ (3,944 ) $ 1,233,348 $ 460,088 $ 773,260 |
Schedule of Fair Value Measurement | The following table details the fair value measurements within the fair value hierarchy of the Company’s financial assets at March 31, 2016 and December 31, 2015 (in thousands): Total Fair Value Fair Value Measurements at Reporting Date Using Level 1 Level 2 Level 3 As of March 31, 2016 Cash Equivalents and Marketable Securities: Money market funds $ 22,035 $ 22,035 $ — $ — Commercial paper 2,494 — 2,494 — Corporate bonds 963,629 — 963,629 — U.S. government agency obligations 241,578 — 241,578 — Mutual funds 2,619 2,619 — — $ 1,232,355 $ 24,654 $ 1,207,701 $ — As of December 31, 2015 Cash Equivalents and Marketable Securities: Money market funds $ 1,250 $ 1,250 $ — $ — Commercial paper 2,487 — 2,487 — Corporate bonds 991,808 — 991,808 — U.S. government agency obligations 239,053 — 239,053 — Mutual funds 1,414 1,414 — — $ 1,236,012 $ 2,664 $ 1,233,348 $ — |
Schedule of Contractual Maturities of Marketable Securities and Other Investment Related Assets | Contractual maturities of the Company’s available-for-sale marketable securities held as of March 31, 2016 and December 31, 2015 were as follows (in thousands): March 31, December 31, Due in 1 year or less $ 524,958 $ 460,088 Due after 1 year through 5 years 682,743 773,260 $ 1,207,701 $ 1,233,348 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |
Schedule of Accounts Receivable | Net accounts receivable consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands): March 31, December 31, Trade accounts receivable $ 267,809 $ 262,885 Unbilled accounts receivable 106,674 124,878 Gross accounts receivable 374,483 387,763 Allowance for doubtful accounts (1,189 ) (906 ) Reserve for cash-basis customers (8,191 ) (6,458 ) Total accounts receivable reserves (9,380 ) (7,364 ) Accounts receivable, net $ 365,103 $ 380,399 |
Goodwill and Acquired Intangi21
Goodwill and Acquired Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The change in the carrying amount of goodwill for the three months ended March 31, 2016 was as follows (in thousands): Balance as of January 1, 2016 $ 1,150,244 Foreign currency translation 2,132 Balance as of March 31, 2016 $ 1,152,376 |
Schedule of Acquired Intangible Assets | Acquired intangible assets that are subject to amortization consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands): March 31, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Accumulated Net Completed technology $ 120,791 $ (61,792 ) $ 58,999 $ 120,791 $ (58,633 ) $ 62,158 Customer-related intangible assets 191,710 (105,705 ) 86,005 191,710 (102,872 ) 88,838 Non-compete agreements 6,540 (3,949 ) 2,591 6,540 (3,374 ) 3,166 Trademarks and trade names 3,700 (1,916 ) 1,784 3,700 (1,767 ) 1,933 Acquired license rights 490 (490 ) — 490 (490 ) — Total $ 323,231 $ (173,852 ) $ 149,379 $ 323,231 $ (167,136 ) $ 156,095 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Senior Notes | The Notes consist of the following components (in thousands): March 31, 2016 December 31, 2015 Liability component: Principal $ 690,000 $ 690,000 Less: debt discount and issuance costs, net of amortization (66,515 ) (71,953 ) Net carrying amount $ 623,485 $ 618,047 Equity component: $ 101,276 $ 101,276 |
Schedule of Interest Expense | The following table sets forth total interest expense included in the statements of income related to the Notes (in thousands): For the Three Months 2016 2015 Amortization of debt discount and issuance costs $ 5,438 $ 5,251 Capitalization of interest expense (785 ) (675 ) Total interest expense $ 4,653 $ 4,576 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stock-Based Compensation Expense | The following table summarizes stock-based compensation included in the Company’s consolidated statements of income for the three months ended March 31, 2016 and 2015 (in thousands): For the Three Months 2016 2015 Cost of revenue $ 3,970 $ 3,163 Research and development 6,438 5,366 Sales and marketing 12,352 12,983 General and administrative 8,981 8,157 Total stock-based compensation 31,741 29,669 Provision for income taxes (12,133 ) (11,702 ) Total stock-based compensation, net of income taxes $ 19,608 $ 17,967 |
Accumulated Other Comprehensi24
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in accumulated other comprehensive loss, which is reported as a component of stockholders' equity, for the three months ended March 31, 2016 (in thousands): Foreign Currency Translation Net Unrealized Gains on Investments Total Balance as of January 1, 2016 $ (44,936 ) $ 3,483 $ (41,453 ) Other comprehensive gain 9,653 3,008 12,661 Balance as of March 31, 2016 $ (35,283 ) $ 6,491 $ (28,792 ) |
Net Income per Share (Tables)
Net Income per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share Reconciliation [Abstract] | |
Schedule of Components Used in Diluted and Basic Income Per Common Share | The following table sets forth the components used in the computation of basic and diluted net income per share for the three months ended March 31, 2016 and 2015 (in thousands, except per share data): For the Three Months 2016 2015 Numerator: Net income $ 74,858 $ 77,746 Denominator: Shares used for basic net income per share 176,403 178,545 Effect of dilutive securities: Stock options 403 996 RSUs and DSUs 733 1,284 Convertible senior notes — — Warrants related to issuance of convertible senior notes — — Shares used for diluted net income per share 177,539 180,825 Basic net income per share $ 0.42 $ 0.44 Diluted net income per share $ 0.42 $ 0.43 |
Schedule of Shares Excluded from Computation of Diluted Earnings Per Share | The number of potentially outstanding shares excluded from the computation of diluted net income per share for the three months ended March 31, 2016 and 2015 (in thousands) are as follows: For the Three Months 2016 2015 Stock options 104 26 Service-based RSUs 4,662 622 Performance-based RSUs 1,348 1,148 Convertible senior notes 7,704 7,704 Warrants related to issuance of convertible senior notes 7,704 7,704 |
Nature of Business and Basis 26
Nature of Business and Basis of Presentation - Narrative (Details) server in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2016networksegmentcountryserver | Dec. 31, 2015USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of servers (over 216,000) | server | 216 | |
Number of networks (more than 1,500) | network | 1,500 | |
Approximate number of countries in which servers are located (approximately 120) | country | 120 | |
Number of industry segments | segment | 1 | |
Accounting Standards Update 2015-03 [Member] | Other Assets [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Debt issuance costs | $ (6.2) | |
Accounting Standards Update 2015-03 [Member] | Convertible senior notes | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Debt issuance costs | $ 6.2 |
Fair Value Measurements - Marke
Fair Value Measurements - Marketable Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 1,206,742 | $ 1,237,178 |
Gross Unrealized Gains | 1,492 | 114 |
Gross Unrealized Losses | (533) | (3,944) |
Aggregate Fair Value | 1,207,701 | 1,233,348 |
Short-Term Marketable Securities | 524,958 | 460,088 |
Long-Term Marketable Securities | 682,743 | 773,260 |
Commercial paper | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,495 | 2,491 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (1) | (4) |
Aggregate Fair Value | 2,494 | 2,487 |
Short-Term Marketable Securities | 2,494 | 2,487 |
Long-Term Marketable Securities | 0 | 0 |
Corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 962,932 | 995,100 |
Gross Unrealized Gains | 1,203 | 73 |
Gross Unrealized Losses | (506) | (3,365) |
Aggregate Fair Value | 963,629 | 991,808 |
Short-Term Marketable Securities | 479,400 | 432,585 |
Long-Term Marketable Securities | 484,229 | 559,223 |
Available-for-sale marketable securities, continuous unrealized loss position for more than 12 months | 76,400 | 71,400 |
U.S. government agency obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 241,315 | 239,587 |
Gross Unrealized Gains | 289 | 41 |
Gross Unrealized Losses | (26) | (575) |
Aggregate Fair Value | 241,578 | 239,053 |
Short-Term Marketable Securities | 43,064 | 25,016 |
Long-Term Marketable Securities | $ 198,514 | $ 214,037 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value Measurement (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | $ 1,207,701 | $ 1,233,348 |
Commercial paper | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 2,494 | 2,487 |
Corporate bonds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 963,629 | 991,808 |
U.S. government agency obligations | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 241,578 | 239,053 |
Level 1 | ||
Cash Equivalents and Marketable Securities: | ||
Cash equivalents and marketable securities | 24,654 | 2,664 |
Level 1 | Money market funds | ||
Cash Equivalents and Marketable Securities: | ||
Money market funds | 22,035 | 1,250 |
Level 1 | Commercial paper | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | 0 |
Level 1 | Corporate bonds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | 0 |
Level 1 | U.S. government agency obligations | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | 0 |
Level 1 | Mutual funds | ||
Cash Equivalents and Marketable Securities: | ||
Cash equivalents and marketable securities | 2,619 | 1,414 |
Level 2 | ||
Cash Equivalents and Marketable Securities: | ||
Cash equivalents and marketable securities | 1,207,701 | 1,233,348 |
Level 2 | Money market funds | ||
Cash Equivalents and Marketable Securities: | ||
Money market funds | 0 | 0 |
Level 2 | Commercial paper | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 2,494 | 2,487 |
Level 2 | Corporate bonds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 963,629 | 991,808 |
Level 2 | U.S. government agency obligations | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 241,578 | 239,053 |
Level 2 | Mutual funds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | |
Cash equivalents and marketable securities | 0 | |
Level 3 | ||
Cash Equivalents and Marketable Securities: | ||
Cash equivalents and marketable securities | 0 | 0 |
Level 3 | Money market funds | ||
Cash Equivalents and Marketable Securities: | ||
Money market funds | 0 | 0 |
Level 3 | Commercial paper | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | 0 |
Level 3 | Corporate bonds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | 0 |
Level 3 | U.S. government agency obligations | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | 0 |
Level 3 | Mutual funds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 0 | |
Cash equivalents and marketable securities | 0 | |
Total Fair Value | ||
Cash Equivalents and Marketable Securities: | ||
Cash equivalents and marketable securities | 1,232,355 | 1,236,012 |
Total Fair Value | Money market funds | ||
Cash Equivalents and Marketable Securities: | ||
Money market funds | 22,035 | 1,250 |
Total Fair Value | Commercial paper | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 2,494 | 2,487 |
Total Fair Value | Corporate bonds | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 963,629 | 991,808 |
Total Fair Value | U.S. government agency obligations | ||
Cash Equivalents and Marketable Securities: | ||
Aggregate Fair Value | 241,578 | 239,053 |
Total Fair Value | Mutual funds | ||
Cash Equivalents and Marketable Securities: | ||
Cash equivalents and marketable securities | $ 2,619 | $ 1,414 |
Fair Value Measurements - Contr
Fair Value Measurements - Contractual Maturities (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Fair Value Disclosures [Abstract] | ||
Due in 1 year or less | $ 524,958 | $ 460,088 |
Due after 1 year through 5 years | 682,743 | 773,260 |
Aggregate Fair Value | $ 1,207,701 | $ 1,233,348 |
Accounts Receivable - Schedule
Accounts Receivable - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross accounts receivable | $ 374,483 | $ 387,763 |
Allowance for doubtful accounts | (1,189) | (906) |
Reserve for cash-basis customers | (8,191) | (6,458) |
Total accounts receivable reserves | (9,380) | (7,364) |
Accounts receivable, net | 365,103 | 380,399 |
Unbilled accounts receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross accounts receivable | 106,674 | 124,878 |
Trade accounts receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Gross accounts receivable | $ 267,809 | $ 262,885 |
Goodwill and Acquired Intangi31
Goodwill and Acquired Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Schedule of Goodwill [Roll Forward] | |
Balance as of January 1, 2016 | $ 1,150,244 |
Foreign currency translation | 2,132 |
Balance as of March 31, 2016 | $ 1,152,376 |
Goodwill and Acquired Intangi32
Goodwill and Acquired Intangible Assets - Schedule of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 323,231 | $ 323,231 |
Accumulated Amortization | (173,852) | (167,136) |
Net Carrying Amount | 149,379 | 156,095 |
Completed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 120,791 | 120,791 |
Accumulated Amortization | (61,792) | (58,633) |
Net Carrying Amount | 58,999 | 62,158 |
Customer-related intangible assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 191,710 | 191,710 |
Accumulated Amortization | (105,705) | (102,872) |
Net Carrying Amount | 86,005 | 88,838 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 6,540 | 6,540 |
Accumulated Amortization | (3,949) | (3,374) |
Net Carrying Amount | 2,591 | 3,166 |
Trademarks and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3,700 | 3,700 |
Accumulated Amortization | (1,916) | (1,767) |
Net Carrying Amount | 1,784 | 1,933 |
Acquired license rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 490 | 490 |
Accumulated Amortization | (490) | (490) |
Net Carrying Amount | $ 0 | $ 0 |
Goodwill and Acquired Intangi33
Goodwill and Acquired Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of acquired intangible assets | $ 6,716 | $ 6,780 |
Future amortization expense to be recognized in remainder of 2016 | 19,800 | |
Future amortization expense 2017 | 27,800 | |
Future amortization expense 2018 | 23,700 | |
Future amortization expense 2019 | 21,700 | |
Future amortization expense 2020 | $ 17,700 |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) $ / shares in Units, shares in Millions | 1 Months Ended | 3 Months Ended | ||
Feb. 28, 2014USD ($)d$ / sharesshares | Mar. 31, 2016USD ($)$ / shares | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | |
Debt Instrument [Line Items] | ||||
Debt issued | $ 690,000,000 | $ 690,000,000 | $ 690,000,000 | |
Conversion rate (in shares) | 11.1651 | |||
Principal amount per conversion | $ 1,000 | |||
Conversion price (in dollars per share) | $ / shares | $ 89.56 | |||
Threshold trading days exceeding price | d | 20 | |||
Threshold consecutive trading days exceeding price | 30 days | |||
Threshold greater than percentage of stock price trigger | 130.00% | |||
Threshold trading days not exceeding price | d | 5 | |||
Threshold consecutive trading days not exceeding price | 5 days | |||
Threshold less than percentage of stock price trigger | 98.00% | |||
Potential conversion shares of convertible debt (in shares) | shares | 7.7 | |||
Fair value of convertible senior notes | $ 673,300,000 | |||
Closing price of common stock (in dollars per share) | $ / shares | $ 55.57 | |||
Repurchases of common stock | $ 62,000,000 | $ 108,725,000 | $ 62,680,000 | |
Payments for purchase of convertible note hedge and warrant transactions | 23,300,000 | |||
Payments for note hedge transactions | $ 101,300,000 | |||
Note hedge shares outstanding (in shares) | shares | 7.7 | |||
Warrants outstanding (in shares) | shares | 7.7 | |||
Warrant strike price (in dollars per share) | $ / shares | $ 104.49 | |||
Proceeds from sale of warrants | $ 78,000,000 | |||
Effective interest rate | 3.20% |
Convertible Senior Notes - Sche
Convertible Senior Notes - Schedule of Convertible Senior Notes (Details) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 | Feb. 28, 2014 |
Liability component: | |||
Principal | $ 690,000,000 | $ 690,000,000 | $ 690,000,000 |
Less: debt discount and issuance costs, net of amortization | (66,515,000) | (71,953,000) | |
Net carrying amount | 623,485,000 | 618,047,000 | |
Convertible senior notes | |||
Liability component: | |||
Equity component: | $ 101,276,000 | $ 101,276,000 |
Convertible Senior Notes - Sc36
Convertible Senior Notes - Schedule of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Debt Disclosure [Abstract] | ||
Amortization of debt discount and issuance costs | $ 5,438 | $ 5,251 |
Capitalization of interest expense | (785) | (675) |
Total interest expense | $ 4,653 | $ 4,576 |
Contingencies (Details)
Contingencies (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Percentage revenue representation for investigation of sales practices (less than 1%) | 1.00% | 1.00% | 1.00% | 1.00% |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) shares in Millions | 1 Months Ended | 3 Months Ended | |||
Feb. 28, 2014 | Mar. 31, 2016 | Mar. 31, 2015 | Feb. 29, 2016 | Oct. 31, 2013 | |
Class of Stock [Line Items] | |||||
Stock repurchase program, authorized amount | $ 1,000,000,000 | $ 750,000,000 | |||
Repurchases of common stock | $ (62,000,000) | $ (108,725,000) | $ (62,680,000) | ||
Amortization expense from capitalized stock-based compensation | $ 3,300,000 | $ 3,000,000 | |||
Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Shares repurchased during period (in shares) | 2.2 | ||||
Repurchases of common stock | $ (108,700,000) |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Stock Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 31,741 | $ 29,669 |
Provision for income taxes | (12,133) | (11,702) |
Total stock-based compensation, net of income taxes | 19,608 | 17,967 |
Cost of revenues | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 3,970 | 3,163 |
Research and development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 6,438 | 5,366 |
Sales and marketing | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | 12,352 | 12,983 |
General and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total stock-based compensation | $ 8,981 | $ 8,157 |
Accumulated Other Comprehensi40
Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Income Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance as of January 1, 2016 | $ (41,453) | |
Other comprehensive gain | 12,661 | $ (6,302) |
Balance as of March 31, 2016 | (28,792) | |
Foreign Currency Translation | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance as of January 1, 2016 | (44,936) | |
Other comprehensive gain | 9,653 | |
Balance as of March 31, 2016 | (35,283) | |
Net Unrealized Gains on Investments | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance as of January 1, 2016 | 3,483 | |
Other comprehensive gain | 3,008 | |
Balance as of March 31, 2016 | $ 6,491 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | 33.50% | 35.00% |
Net Income per Share - Schedule
Net Income per Share - Schedule of Components Used in Diluted and Basic Income Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Numerator [Abstract] | ||
Net income (in dollars) | $ 74,858 | $ 77,746 |
Denominator [Abstract] | ||
Shares used for basic net income per share | 176,403 | 178,545 |
Effect of dilutive securities: | ||
Convertible senior notes | 0 | 0 |
Warrants related to issuance of convertible senior notes | 0 | 0 |
Shares used for diluted net income per share | 177,539 | 180,825 |
Basic net income per share (in dollars per share) | $ 0.42 | $ 0.44 |
Diluted net income per share (in dollars per share) | $ 0.42 | $ 0.43 |
Stock options | ||
Effect of dilutive securities: | ||
Dilutive securities | 403 | 996 |
RSUs and deferred stock units | ||
Effect of dilutive securities: | ||
Dilutive securities | 733 | 1,284 |
Net Income per Share - Schedu43
Net Income per Share - Schedule of Shares Excluded from Computation of Diluted EPS (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 104 | 26 |
Service-based RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 4,662 | 622 |
Performance-based RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 1,348 | 1,148 |
Convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 7,704 | 7,704 |
Warrants related to issuance of convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities | 7,704 | 7,704 |