Align Technology (ALGN) 10-Q 4 May 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2017	Apr. 28, 2017
Document Information [Line Items]
Trading Symbol	ALGN
Entity Registrant Name	ALIGN TECHNOLOGY INC
Entity Central Index Key	1,097,149
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		80,331,340

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Income Statement [Abstract]
Net revenues	$ 310,341	$ 238,720
Cost of net revenues	74,716	58,093
Gross profit	235,625	180,627
Operating expenses:
Selling, general and administrative	151,148	112,210
Research and development	22,804	15,083
Total operating expenses	173,952	127,293
Income from operations	61,673	53,334
Interest and other income (expense), net	1,645	(427)
Net income before provision (benefit) for income taxes and equity in losses of investee	63,318	52,907
Provision (benefit) for income taxes	(7,223)	12,361
Equity in losses of investee, net of tax	1,121	0
Net income	$ 69,420	$ 40,546
Net income per share:
Basic (in usd per share)	$ 0.87	$ 0.51
Diluted (in usd per share)	$ 0.85	$ 0.50
Shares used in computing net income per share:
Basic (in shares)	79,904	79,831
Diluted (in shares)	81,534	81,320

CONDENSED CONSOLIDATED STATEME3

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 69,420	$ 40,546
Net change in foreign currency translation adjustment	(459)	(150)
Change in unrealized gains on investments, net of tax	15	1,152
Other comprehensive income (loss)	(444)	1,002
Comprehensive income	$ 68,976	$ 41,548

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 261,027	$ 389,275
Marketable securities, short-term	284,559	250,981
Accounts receivable, net of allowance for doubtful accounts and returns of $5,253 and $4,310, respectively	267,128	247,415
Inventories	35,174	27,131
Prepaid expenses and other current assets	70,279	38,176
Total current assets	918,167	952,978
Marketable securities, long-term	98,574	59,783
Property, plant and equipment, net	231,692	175,167
Equity method investments	43,940	45,061
Goodwill and intangible assets, net	92,447	81,998
Deferred tax assets	60,068	67,844
Other assets	14,405	13,320
Total assets	1,459,293	1,396,151
Current liabilities:
Accounts payable	37,028	28,596
Accrued liabilities	125,631	134,332
Deferred revenues	202,895	191,407
Total current liabilities	365,554	354,335
Income tax payable	46,322	45,133
Other long-term liabilities	2,542	1,294
Total liabilities	414,418	400,762
Commitments and contingencies (Note 8 and 9)
Stockholders' equity:
Preferred stock, $0.0001 par value (5,000 shares authorized; none issued)	0	0
Common stock, $0.0001 par value (200,000 shares authorized; 80,324 and 79,553 issued and outstanding, respectively)	8	8
Additional paid-in capital	850,092	864,871
Accumulated other comprehensive income (loss), net	(1,382)	(938)
Retained earnings	196,157	131,448
Total stockholders’ equity	1,044,875	995,389
Total liabilities and stockholders’ equity	$ 1,459,293	$ 1,396,151

CONDENSED CONSOLIDATED BALANCE5

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Accounts receivable, allowance for doubtful accounts and returns	$ 5,253	$ 4,310
Preferred stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	5,000	5,000
Preferred stock, shares issued	0	0
Common stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	200,000	200,000
Common stock, shares issued	80,324	79,553
Common stock, shares outstanding	80,324	79,553

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 69,420	$ 40,546
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred taxes	7,789	(6,113)
Depreciation and amortization	7,867	4,792
Stock-based compensation	14,812	12,524
Net tax benefits from stock-based awards	0	7,220
Excess tax benefit from share-based payment arrangements	0	(8,082)
Equity in losses of investee	1,121	0
Other non-cash operating activities	2,079	3,754
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable	(24,525)	(20,839)
Inventories	(7,923)	(3,155)
Prepaid expenses and other assets	(527)	(618)
Accounts payable	5,522	447
Accrued and other long-term liabilities	(39,702)	(14,544)
Deferred revenues	11,688	14,748
Net cash provided by operating activities	47,621	30,680
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions, net of cash acquired	(8,953)	0
Purchase of property, plant and equipment	(59,569)	(20,207)
Purchase of marketable securities	(169,777)	(143,926)
Proceeds from maturities of marketable securities	87,003	128,524
Proceeds from sales of marketable securities	11,684	293
Loan advance to privately held companies	(8,000)	0
Other investing activities	2,314	0
Net cash used in investing activities	(145,298)	(35,316)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock	7,288	5,384
Common stock repurchases	(3,793)	0
Excess tax benefit from share-based payment arrangements	0	8,082
Employees’ taxes paid upon the vesting of restricted stock units	(36,496)	(22,572)
Net cash used in financing activities	(33,001)	(9,106)
Effect of foreign exchange rate changes on cash and cash equivalents	2,430	446
Net decrease in cash and cash equivalents	(128,248)	(13,296)
Cash and cash equivalents, beginning of the period	389,275	167,714
Cash and cash equivalents, end of the period	261,027	154,418
SUPPLEMENTAL CASH FLOW INFORMATION:
Accounts payable or accrued liabilities related to property, plant and equipment	$ 7,662	$ 10,842

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by Align Technology, Inc. (“we”, “our”, or “Align”) in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") and contain all adjustments, including normal recurring adjustments, necessary to state fairly our results of operations for the three months ended March 31, 2017 and 2016 , our comprehensive income for the three months ended March 31, 2017 and 2016 , our financial position as of March 31, 2017 and our cash flows for the three months ended March 31, 2017 and 2016 . The Condensed Consolidated Balance Sheet as of December 31, 2016 was derived from the December 31, 2016 audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The results of operations for the three months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 or any other future period, and we make no representations related thereto. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Quantitative and Qualitative Disclosures About Market Risk” and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, in our Annual Report on Form 10-K for the year ended December 31, 2016 . Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles ("GAAP") in the United States of America (“U.S.”) requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, we evaluate our estimates, including those related to the fair values of financial instruments, long-lived assets and goodwill, equity method investments, useful lives of intangible assets and property and equipment, revenue recognition, stock-based compensation, equity losses of investee, income taxes and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Recent Accounting Pronouncements (i) New Accounting Updates Recently Adopted In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-09, " Improvements to Employee Share-Based Payment Accounting " (Topic 718) . We adopted the standard in the first quarter of fiscal year 2017. With this adoption, excess tax benefits related to stock-based compensation expense are reflected in our condensed consolidated statement of operations as a component of the provision for income taxes instead of additional paid-in capital in our condensed consolidated balance sheet. For the three months ended March 31, 2017, we recognized excess tax benefits of $21.3 million in our provision for income taxes. Excess tax benefits from share-based payment arrangements are classified as an operating activity in our condensed consolidated statement of cash flows in the same manner as other cash flows related to income taxes. We have elected to apply the standard on a prospective basis. In addition, we elected to continue to estimate expected forfeitures rather than as they occur to determine the amount of compensation cost to be recognized in each period. In October 2016, the FASB issued ASU 2016-16, "Intra-Entity Transfers of Assets Other Than Inventory," (Topic 740) which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. We early adopted the standard in the first quarter of fiscal year 2017 by applying the modified retrospective approach. For the three months ended March 31, 2017, we recognized a $1.3 million decrease to retained earnings as a cumulative-effect adjustment. (ii) Recent Accounting Updates Not Yet Effective In May 2014, the FASB released ASU 2014-9, " Revenue from Contracts with Customers, " (Topic 606) to supersede nearly all existing revenue recognition guidance under GAAP. The core principle of the standard is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for the goods or services. The new standard defines a five step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. We are required to adopt this standard starting in the first quarter of fiscal year 2018 using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within the standard; or (ii) retrospective with the cumulative effect of initially applying the standard recognized at the date of initial application and providing certain additional disclosures as defined per the standard. We plan to adopt the standard in the first quarter of fiscal year 2018 by applying the full retrospective method. Our ability to adopt using the full retrospective method is dependent on the completion of our analysis of information necessary to restate prior period financial statements. We are continuing to assess the impact of the adoption of this update on our consolidated financial statements and related disclosures. In April 2016, the FASB released ASU 2016-10, " Revenue from Contracts with Customers, " to clarify the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the principles for those areas of the ASU 2014-9 issued in May 2014. The effective date and the transition requirement of the amendments in this update are the same as the effective date and transition requirements of Topic 606. In May 2016, the FASB released ASU 2016-12, " Revenue from Contracts with Customers, " to address certain issues in the Topic 606 guidance on assessing the collectability, presentation of sales taxes, non-cash consideration, and completed contracts and contract modifications at transition. The ASU provides narrow-scope improvements and practical expedients to the ASU 2014-9 issued in May 2014. The effective date and the transition requirement of the amendments in this update are the same as the effective date and transition requirements of Topic 606. In December 2016, the FASB released ASU 2016-20, " Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers, " to clarify certain aspects of guidance in the Topic 606 including its scope, disclosure requirements and contract cost accounting, while retaining the principles for those areas of the ASU 2014-9 issued in May 2014. The effective date and the transition requirement of the amendments in this update are the same as the effective date and transition requirements of Topic 606. In February 2016, the FASB issued ASU 2016-02, “ Leases ” (Topic 842). The FASB issued this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The updated guidance is effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the standard is permitted. We plan to adopt the standard in the first quarter of fiscal year 2019 by electing practical expedients available in the standard. While we are currently evaluating the impact of the adoption of this guidance on our consolidated financial statements, we expect the adoption will have a material increase in the assets and liabilities of our consolidated balance sheet. In June 2016, the FASB issued ASU 2016-13, “ Financial Instruments - Credit Losses ” (Topic 326) . The FASB issued this update to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The amendments in this update replace the existing guidance of incurred loss impairment methodology with an approach that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The updated guidance is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption of the update is permitted as of the fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, "Classification of Certain Cash Receipts and Cash Payments" (Topic 230). This FASB clarifies the presentation and classification of certain cash receipts and cash payments in the statements of cash flows. The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2017. Early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows - Restricted Cash," which provides guidance to address the classification and presentation of changes in restricted cash in the statements of cash flows . The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2017 on a retrospective basis, and early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-01, “ Business Combinations (Topic 805): Clarifying the Definition of a Business, ” to clarify the definition of a business when evaluating whether transactions should be accounted for as acquisitions of assets or businesses. The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2017 on a retrospective basis, early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment," to simply the subsequent measurement of goodwill by eliminating step two from the goodwill impairment test. Under the amendments, an entity will recognize an impairment charge for the amount by which the carrying value exceeds the fair value. The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2019 on a prospective basis, early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures.

Marketable Securities and Fair

Marketable Securities and Fair Value Measurements	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Marketable Securities and Fair Value Measurements	Note 2. Marketable Securities and Fair Value Measurements As of March 31, 2017 and December 31, 2016, the estimated fair value of our short-term and long-term marketable securities, classified as available for sale, are as follows (in thousands): Short-term March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial paper $ 42,160 $ — $ — $ 42,160 Corporate bonds 152,169 30 (107 ) 152,092 Municipal securities 3,853 — (1 ) 3,852 U.S. government agency bonds 21,879 — (16 ) 21,863 U.S. government treasury bonds 54,767 — (28 ) 54,739 Certificates of deposit 9,787 — — 9,787 Asset-backed securities 66 — — 66 Total marketable securities, short-term $ 284,681 $ 30 $ (152 ) $ 284,559 Long-term March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government agency bonds $ 11,295 $ 19 $ (12 ) $ 11,302 Corporate bonds 79,267 48 (65 ) 79,250 U.S. government treasury bonds 8,034 3 (15 ) 8,022 Total marketable securities, long-term $ 98,596 $ 70 $ (92 ) $ 98,574 Short-term December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial paper $ 42,397 $ — $ (6 ) $ 42,391 Corporate bonds 122,788 22 (121 ) 122,689 Municipal securities 5,852 — (5 ) 5,847 U.S. government agency bonds 28,903 9 (4 ) 28,908 U.S. government treasury bonds 45,146 7 (7 ) 45,146 Certificates of deposit 6,000 — — 6,000 Total marketable securities, short-term $ 251,086 $ 38 $ (143 ) $ 250,981 Long-term December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government agency bonds $ 6,805 $ — $ (16 ) $ 6,789 Corporate bonds 40,889 8 (85 ) 40,812 U.S. government treasury bonds 12,016 5 (16 ) 12,005 Asset-backed securities 177 — — 177 Total marketable securities, long-term $ 59,887 $ 13 $ (117 ) $ 59,783 Cash and cash equivalents are not included in the table above as the gross unrealized gains and losses are not material. We have no short-term or long-term investments that have been in a continuous material unrealized loss position for greater than twelve months as of March 31, 2017 and December 31, 2016. Amounts reclassified to earnings from accumulated other comprehensive income (loss), net related to unrealized gains or losses were not material for the three months ended March 31, 2017 and 2016. For the three months ended March 31, 2017 and 2016, realized gains or losses were not material. Our fixed-income securities investment portfolio consists of investments that have a maximum effective maturity of 27 months. The securities that we invest in are generally deemed to be low risk based on their credit ratings from the major rating agencies. The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. As interest rates increase, those securities purchased at a lower yield show a mark-to-market unrealized loss. The unrealized losses are due primarily to changes in credit spreads and interest rates. We expect to realize the full value of all these investments upon maturity or sale. The weighted average remaining duration of these securities was approximately 9 months and 7 months as of March 31, 2017 and December 31, 2016 , respectively. As the carrying value approximates the fair value for our short-term and long-term marketable securities shown in the tables above, the following table summarizes the fair value of our short-term and long-term marketable securities classified by maturity as of March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 December 31, 2016 One year or less $ 284,559 $ 250,981 Due in greater than one year 98,574 59,783 Total available for sale short-term and long-term marketable securities $ 383,133 $ 310,764 Fair Value Measurements We measure the fair value of our cash equivalents and marketable securities as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We use the GAAP fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value: Level 1 — Quoted (unadjusted) prices in active markets for identical assets or liabilities. Our Level 1 assets consist of money market funds and U.S. government treasury bonds. We did not hold any Level 1 liabilities as of March 31, 2017 and December 31, 2016. Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. Our Level 2 assets consist of commercial paper, corporate bonds, municipal securities, certificates of deposit, U.S. government agency bonds, asset-backed securities and our Israeli funds that are mainly invested in insurance policies. We obtain fair values for our Level 2 investments. Our custody bank and asset managers independently use professional pricing services to gather pricing data which may include quoted market prices for identical or comparable financial instruments, or inputs other than quoted prices that are observable either directly or indirectly, and we are ultimately responsible for these underlying estimates. We did not hold any Level 2 liabilities as of March 31, 2017 and December 31, 2016. Level 3 — Unobservable inputs to the valuation methodology that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation. Our Level 3 assets consist of long-term notes receivable and are included in other assets on our condensed consolidated balance sheet. In 2016, we entered into a long-term notes receivable for $2.0 million . As of March 31, 2017, the fair value of the long-term receivable was $2.1 million as compared to $2.0 million as of December 31, 2016, the change was recognized in our earnings during the first quarter of 2017. We did not hold any Level 3 liabilities as of March 31, 2017 and December 31, 2016. The following tables summarize our financial assets measured at fair value on a recurring basis as of March 31, 2017 and December 31, 2016 (in thousands): Description Balance as of March 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Cash equivalents: Money market funds $ 141,256 $ 141,256 $ — $ — Commercial paper 20,026 — 20,026 — U.S. government treasury bonds 5,521 5,521 — — Municipal securities 2,001 — 2,001 — Short-term investments: Commercial paper 42,160 — 42,160 — Corporate bonds 152,092 — 152,092 — Municipal securities 3,852 — 3,852 — U.S. government agency bonds 21,863 — 21,863 — U.S. government treasury bonds 54,739 54,739 — — Certificates of deposit 9,787 — 9,787 — Asset-backed securities 66 — 66 — Long-term investments: U.S. government agency bonds 11,302 — 11,302 — Corporate bonds 79,250 — 79,250 — U.S. government treasury bonds 8,022 8,022 — — Prepaid expenses and other current assets: Israeli funds 3,191 — 3,191 — Other assets: Long-term notes receivable 2,084 — — 2,084 $ 557,212 $ 209,538 $ 345,590 $ 2,084 Description Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Cash equivalents: Money market funds $ 87,179 $ 87,179 $ — $ — Commercial paper 2,499 — 2,499 — Corporate bonds 750 — 750 — Short-term investments: Commercial paper 42,391 — 42,391 — Corporate bonds 122,689 — 122,689 — Municipal securities 5,847 — 5,847 — U.S. government agency bonds 28,908 — 28,908 — U.S. government treasury bonds 45,146 45,146 — — Certificates of deposit 6,000 — 6,000 — Long-term investments: U.S. government agency bonds 6,789 — 6,789 — Corporate bonds 40,812 — 40,812 — U.S. government treasury bonds 12,005 12,005 — — Asset-backed securities 177 — 177 — Prepaid expenses and other current assets: Israeli funds 2,956 — 2,956 — Other assets: Long-term notes receivable 2,047 — — 2,047 $ 406,195 $ 144,330 $ 259,818 $ 2,047 Derivative Financial Instruments We have in the past and may in the future enter into foreign currency forward contracts to minimize the short-term impact of foreign currency exchange rate fluctuations associated with certain assets and liabilities. We had no foreign exchange forward contracts outstanding as of March 31, 2017 and no net gain or loss from the settlement of foreign currency forward contracts during the three months ended March 31, 2017. The net gain or loss on forward contracts was not material during the three months ended March 31, 2016. Certain investments in private companies contain embedded derivatives, which do not require bifurcation as we elected to measure these investments at fair value.

Balance Sheet Components

Balance Sheet Components	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Balance Sheet Components	Balance Sheet Components Inventories Inventories consist of the following (in thousands): March 31, December 31, Raw materials $ 14,630 $ 9,793 Work in process 14,061 10,773 Finished goods 6,483 6,565 Total inventories $ 35,174 $ 27,131 Accrued Liabilities Accrued liabilities consist of the following (in thousands): March 31, December 31, Accrued payroll and benefits $ 56,292 $ 79,214 Accrued sales and marketing expenses 14,230 11,970 Accrued sales rebate 10,751 10,342 Accrued sales tax and value added tax 7,080 5,032 Accrued income taxes 4,760 4,210 Accrued professional fees 4,092 3,604 Accrued warranty 4,301 3,841 Other accrued liabilities 24,125 16,119 Total accrued liabilities $ 125,631 $ 134,332 Warranty We regularly review the accrued balances and update these balances based on historical warranty trends. Actual warranty costs incurred have not materially differed from those accrued; however, future actual warranty costs could differ from the estimated amounts. Warranty accrual as of March 31, 2017 and 2016 consists of the following activity (in thousands): Three Months Ended 2017 2016 Balance at beginning of period $ 3,841 $ 2,638 Charged to cost of revenues 1,822 816 Actual warranty expenditures (1,362 ) (750 ) Balance at end of period $ 4,301 $ 2,704

Equity Method Investments

Equity Method Investments	3 Months Ended
	Mar. 31, 2017
Equity Method Investments and Joint Ventures [Abstract]
Equity Method Investments	Equity Method Investments On July 25, 2016, we acquired a 17% equity interest, on a fully diluted basis, in SmileDirectClub, LLC (“SDC”) for $46.7 million , and account for this as an equity method investment. The investment is reported in our condensed consolidated balance sheet under equity method investments, and we record our proportional share of SDC's earnings or losses within equity in losses of investee in our condensed consolidated statement of operations. As of March 31, 2017, the balance of our equity method investments was $43.9 million . Concurrently with the investment, on July 25, 2016, we also entered into a supply agreement with SDC to manufacture clear aligners for SDC's doctor-led, at-home program for simple teeth straightening. The term of the supply agreement expires on December 31, 2019. We commenced supplying aligners to SDC in October 2016. The sale of aligners to SDC and the income from the supply agreement are reported in our Clear Aligner business segment after eliminating outstanding intercompany transactions.

Business Combinations

Business Combinations	3 Months Ended
	Mar. 31, 2017
Business Combinations [Abstract]
Business Combinations	Business Combinations During the first quarter of 2017, we completed the acquisitions of certain of our distributors for the total estimated cash consideration of approximately $9.5 million including cash acquired. We preliminary recorded $1.9 million of net tangible liabilities, $8.2 million of identifiable intangible assets and $3.2 million of goodwill. The preliminary fair values of net tangible liabilities and identifiable intangible assets acquired are based on preliminary valuations, and our estimates and assumptions are subject to change within the measurement period (up to one year from the acquisition date). The goodwill is primarily related to the benefit we expect to obtain from direct sales as we believe that the transition from our distributor arrangements to a direct sales model will increase our net revenues in the region as we will experience higher average sales prices (“ASP”) compared to our discounted ASP under the distribution agreements. The goodwill is not deductible for tax purposes. Pro forma results of operations for these acquisitions have not been presented as they are not material to our results of operations, either individually or in aggregate, for the three months ended March 31, 2017.

Goodwill and Long-lived Assets

Goodwill and Long-lived Assets	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Goodwill and Long-lived Assets	Goodwill and Intangible Assets Goodwill The change in the carrying value of goodwill for the three months ended March 31, 2017 , all attributable to our Clear Aligner reporting unit, is as follows (in thousands): Total Balance as of December 31, 2016 $ 61,044 Goodwill from distributor acquisitions 3,247 Adjustments 1 254 Balance as of March 31, 2017 $ 64,545 1 The adjustments to goodwill during the period were a result of foreign currency translation. During the fourth quarter of fiscal 2016, we performed the annual goodwill impairment testing and found no impairment as the fair value of our Clear Aligner reporting unit was significantly in excess of the carrying value. Intangible Long-Lived Assets Acquired intangible long-lived assets are being amortized as follows (in thousands): Weighted Average Amortization Period (in years) Gross Carrying Amount as of March 31, 2017 Accumulated Amortization Accumulated Impairment Loss Net Carrying Trademarks 15 $ 7,100 $ (1,665 ) $ (4,179 ) $ 1,256 Existing technology 13 12,600 (4,282 ) (4,328 ) 3,990 Customer relationships 11 33,500 (13,284 ) (10,751 ) 9,465 Reacquired rights 1 3 7,500 (125 ) — 7,375 Patents 8 6,316 (912 ) — 5,404 Other 1 548 (136 ) — 412 Total intangible assets $ 67,564 $ (20,404 ) $ (19,258 ) $ 27,902 Weighted Average Amortization Period (in years) Gross Carrying Amount as of December 31, 2016 Accumulated Amortization Accumulated Impairment Loss Net Carrying Value as of December 31, 2016 Trademarks 15 $ 7,100 $ (1,631 ) $ (4,179 ) $ 1,290 Existing technology 13 12,600 (4,141 ) (4,328 ) 4,131 Customer relationships 11 33,500 (12,819 ) (10,751 ) 9,930 Patents 8 6,316 (713 ) — 5,603 Total intangible assets $ 59,516 $ (19,304 ) $ (19,258 ) $ 20,954 1 The fair value of reacquired rights obtained from distributor acquisitions during the three months ended March 31, 2017 is valued using the income approach. In addition, we effectively settled the pre-existing relationship with the distributors by assessing whether the distributor agreements include favorable or unfavorable terms compared to current market rates. Based on the assessment, we determined that the distributor agreements had terms that are consistent with market rates and, therefore, no settlement gains or losses are recorded associated with the acquisitions during the three months ended March 31, 2017. The total estimated annual future amortization expense for these acquired intangible assets as of March 31, 2017 is as follows (in thousands): Remainder of 2017 $ 4,713 2018 5,989 2019 5,873 2020 3,758 2021 3,339 Thereafter 4,230 Total $ 27,902 Amortization for the three months ended March 31, 2017 was $1.4 million.

Credit Facilities

Credit Facilities	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Credit Facilities	Credit Facilities The credit facility provides for a $50.0 million revolving line of credit with a $10.0 million letter of credit sublimit. The credit facility requires us to comply with specific financial conditions and performance requirements. On February 10, 2017, we amended the credit facility and extended maturity date to March 22, 2018. The loans bear interest, at our option, at a fluctuating rate per annum equal to the daily one-month adjusted LIBOR rate plus a spread of 1.75% or an adjusted LIBOR rate (based on one, three, six or twelve-month interest periods) plus a spread of 1.75% . As of March 31, 2017 , we had no outstanding borrowings under this credit facility and were in compliance with the conditions and performance requirements.

Legal Proceedings (Notes)

Legal Proceedings (Notes)	3 Months Ended
	Mar. 31, 2017
Legal Proceedings [Abstract]
Legal Proceedings	Legal Proceedings Securities Class Action Lawsuit On November 28, 2012, plaintiff City of Dearborn Heights Act 345 Police & Fire Retirement System filed a lawsuit against Align, Thomas M. Prescott (“Mr. Prescott”), Align’s former President and Chief Executive Officer, and Kenneth B. Arola (“Mr. Arola”), Align’s former Vice President, Finance and Chief Financial Officer, in the United States District Court for the Northern District of California on behalf of a purported class of purchasers of our common stock (the “Securities Action”). On July 11, 2013, an amended complaint was filed, which named the same defendants, on behalf of a purported class of purchasers of our common stock between January 31, 2012 and October 17, 2012. The amended complaint alleged that Align, Mr. Prescott and Mr. Arola violated Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and that Mr. Prescott and Mr. Arola violated Section 20(a) of the Securities Exchange Act of 1934. Specifically, the amended complaint alleged that during the purported class period defendants failed to take an appropriate goodwill impairment charge related to the April 29, 2011 acquisition of Cadent Holdings, Inc. in the fourth quarter of 2011, the first quarter of 2012 or the second quarter of 2012, which rendered our financial statements and projections of future earnings materially false and misleading and in violation of U.S. GAAP. The amended complaint sought monetary damages in an unspecified amount, costs and attorneys’ fees. On December 9, 2013, the court granted defendants’ motion to dismiss with leave for plaintiff to file a second amended complaint. Plaintiff filed a second amended complaint on January 8, 2014 on behalf of the same purported class. The second amended complaint states the same claims as the amended complaint. On August 22, 2014, the court granted our motion to dismiss without leave to amend. On September 22, 2014, Plaintiff filed a notice of appeal to the Ninth Circuit Court of Appeals. Briefing for the appeal was completed in May 2015 and the Ninth Circuit held oral arguments in October 2016. Align intends to vigorously defend itself against these allegations. Align is currently unable to predict the outcome of this amended complaint and therefore cannot determine the likelihood of loss nor estimate a range of possible loss, if any. Shareholder Derivative Lawsuit On February 1, 2013, plaintiff Gary Udis filed a shareholder derivative lawsuit against several of Align’s current and former officers and directors in the Superior Court of California, County of Santa Clara. The complaint alleges that our reported income and earnings were materially overstated because of a failure to timely write down goodwill related to the April 29, 2011 acquisition of Cadent Holdings, Inc., and that defendants made allegedly false statements concerning our forecasts. The complaint asserts various state law causes of action, including claims of breach of fiduciary duty, unjust enrichment, and insider trading, among others. The complaint seeks unspecified damages on behalf of Align, which is named solely as nominal defendant against whom no recovery is sought. The complaint also seeks an order directing Align to reform and improve its corporate governance and internal procedures, and seeks restitution in an unspecified amount, costs, and attorneys’ fees. On July 8, 2013, an Order was entered staying this derivative lawsuit until an initial ruling on our first motion to dismiss the Securities Action. On January 15, 2014, an Order was entered staying this derivative lawsuit until an initial ruling on our second motion to dismiss the Securities Action. On October 14, 2014, an Order was entered staying this derivative lawsuit until a ruling by the Ninth Circuit in the Securities Action discussed above. Align is currently unable to predict the outcome of this complaint and therefore cannot determine the likelihood of loss nor estimate a range of possible losses, if any. In addition, in the course of Align's operations, Align is involved in a variety of claims, suits, investigations, and proceedings, including actions with respect to intellectual property claims, patent infringement claims, government investigations, labor and employment claims, breach of contract claims, tax, and other matters. Regardless of the outcome, these proceedings can have an adverse impact on us because of defense costs, diversion of management resources, and other factors. Although the results of complex legal proceedings are difficult to predict and Align's view of these matters may change in the future as litigation and events related thereto unfold; Align currently does not believe that these matters, individually or in the aggregate, will materially affect Align's financial position, results of operations or cash flows.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Commitments and Contingencies	Commitments and Contingencies Operating Leases As of March 31, 2017 , minimum future lease payments for non-cancelable operating leases are as follows (in thousands): Fiscal Year Ending December 31, Operating Leases Remainder of 2017 $ 10,113 2018 10,920 2019 8,930 2020 7,133 2021 6,481 Thereafter 9,170 Total minimum future lease payments $ 52,747 Other Commitments On July 25, 2016, we entered into a Loan and Security Agreement (the "Loan Agreement") with SmileDirectClub, LLC ("SDC") where we agreed to provide a loan of up to $15.0 million in one or more advances to SDC (the "Loan Facility"). Available advances under the Loan Facility are subject to a borrowing base of 80% of SDC's eligible accounts receivable, determined in accordance with the terms of the Loan Agreement, and the satisfaction of other customary conditions. The advances bear interest, paid quarterly, at the rate of 7% per annum. Advances that are repaid or prepaid may be reborrowed. All outstanding principal and accrued and unpaid interest on the advances are due and payable on July 25, 2021. SDC's obligations in respect of the Loan Agreement are collateralized by a security interest in substantially all of SDC's assets. As of March 31, 2017, $8.0 million of advances under the Loan Facility were issued and outstanding ( Refer to Note 4 "Equity Method Investments" of the Notes to Condensed Consolidated Financial Statements for more information on our investments in SDC). We have entered into certain investments with a privately held company where we have committed to purchase up to $5.0 million in convertible promissory notes. The first convertible promissory note for $2.0 million was issued in July 2016 and is outstanding as of March 31, 2017. The remaining $3.0 million is conditioned upon achievement of various business milestones. The notes all mature on December 30, 2018 and accrue interest annually at 2.5% . Off-Balance Sheet Arrangements As of March 31, 2017 , we had no off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our consolidated financial condition, results of operations, liquidity, capital expenditures or capital resources. Indemnification Provisions In the normal course of business to facilitate transactions in our services and products, we indemnify certain parties: customers, vendors, lessors and other parties with respect to certain matters, including, but not limited to, services to be provided by us and intellectual property infringement claims made by third parties. In addition, we have entered into indemnification agreements with our directors and our executive officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. Several of these agreements limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to make a reasonable estimate of the maximum potential amount under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement. Additionally, we have a limited history of prior indemnification claims and the payments we have made under such agreements have not had a material adverse effect on our results of operations, cash flows, or financial position. However, to the extent that valid indemnification claims arise in the future, future payments by us could be significant and could have a material adverse effect on our results of operations or cash flows in a particular period. As of March 31, 2017 , we did not have any material indemnification claims that were probable or reasonably possible.

Stock-based Compensation

Stock-based Compensation	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Stock-based Compensation	Stockholders' Equity Summary of Stock-Based Compensation Expense As of March 31, 2017 , the 2005 Incentive Plan (as amended) has a total reserve of 27,783,379 shares of which 6,982,718 shares are available for issuance. Stock-based compensation is based on the estimated fair value of awards, net of estimated forfeitures, and recognized over the requisite service period. Estimated forfeitures are based on historical experience at the time of grant and may be revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The stock-based compensation related to all of our stock-based awards and employee stock purchases for the three months ended March 31, 2017 and 2016 is as follows (in thousands): Three Months Ended 2017 2016 Cost of net revenues $ 925 $ 961 Selling, general and administrative 11,716 9,834 Research and development 2,171 1,729 Total stock-based compensation $ 14,812 $ 12,524 Stock Options We have not granted options since 2011 and all outstanding options were fully vested and associated stock-based compensation expenses were recognized as of December 31, 2015. Activity for the three months ended March 31, 2017 under the stock option plans is set forth below (in thousands, except years and per share amounts): Number of Shares Underlying Stock Options Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value Outstanding as of December 31, 2016 222 $ 14.90 Granted — — Exercised (82 ) 17.35 Cancelled or expired (4 ) 18.16 Outstanding as of March 31, 2017 136 $ 13.33 1.35 $ 13,809 Vested and expected to vest at March 31, 2017 136 $ 13.33 1.35 $ 13,809 Exercisable at March 31, 2017 136 $ 13.33 1.35 $ 13,809 Restricted Stock Units (“RSUs”) The fair value of nonvested RSUs is based on our closing stock price on the date of grant. A summary for the three months ended March 31, 2017 is as follows (in thousands, except years and per share amounts): Shares Underlying RSUs Weighted Average Grant Date Fair Value Weighted Remaining Vesting Period (in years) Aggregate Intrinsic Value Nonvested as of December 31, 2016 1,789 $ 58.39 Granted 371 102.24 Vested and released (689 ) 51.59 Forfeited (19 ) 60.29 Nonvested as of March 31, 2017 1,452 $ 72.80 1.70 $ 166,598 As of March 31, 2017 , the total unamortized compensation cost related to RSUs, net of estimated forfeitures, was $86.9 million , which we expect to recognize over a weighted average period of 2.6 years. On an annual basis, we grant market-performance based restricted stock units (“MSUs”) to our executive officers. Each MSU represents the right to one share of Align’s common stock. The actual number of MSUs which will be eligible to vest will be based on the performance of Align’s stock price relative to the performance of the NASDAQ Composite Index over the vesting period, generally two to three years, up to 200% of the MSUs initially granted. The following table summarizes the MSU performance for the three months ended March 31, 2017 (in thousands, except years): Number of Shares Underlying MSUs Weighted Average Grant Date Fair Value Weighted Average Remaining Vesting Period (in years) Aggregate Intrinsic Value Nonvested as of December 31, 2016 520 $ 60.49 Granted 201 87.11 Vested and released (283 ) 49.51 Forfeited (10 ) 64.50 Nonvested as of March 31, 2017 428 $ 78.53 1.72 $ 49,107 As of March 31, 2017 , we expect to recognize $19.4 million of total unamortized compensation cost, net of estimated forfeitures, related to MSUs over a weighted average period of 1.7 years. Employee Stock Purchase Plan ("ESPP") In May 2010, our shareholders approved the 2010 Employee Stock Purchase Plan ("2010 Purchase Plan") which will continue until terminated by either the Board of Directors or its administrator. The maximum number of shares available for purchase under the 2010 Purchase Plan is 2,400,000 shares. As of March 31, 2017 , 821,770 shares remain available for future issuance. The fair value of the option component of the 2010 Purchase Plan shares was estimated at the grant date using the Black-Scholes option pricing model with the following weighted average assumptions: Three Months Ended 2017 2016 Expected term (in years) 1.2 1.3 Expected volatility 26.1 % 33.7 % Risk-free interest rate 0.9 % 0.8 % Expected dividends — — Weighted average fair value at grant date $ 26.09 $ 19.96 As of March 31, 2017 , there was $3.9 million of total unamortized compensation costs related to employee stock purchases which we expect to be recognized over a weighted average period of 1.0 year.

Common Stock Repurchase Program

Common Stock Repurchase Program	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Common Stock Repurchase	Common Stock Repurchase April 2014 Repurchase Program In April 2014, we announced that our Board of Directors had authorized a stock repurchase program ("April 2014 Repurchase Program") pursuant to which we may purchase up to $300.0 million of our common stock over the next three years. During the three months ended March 31, 2017, we repurchased on the open market approximately 0.04 million shares of our common stock at an average price of $96.37 per share, including commission for an aggregate purchase price of approximately $3.8 million . All repurchased shares were retired. As of March 31, 2017, we completed our April 2014 Repurchase Program. April 2016 Repurchase Program On April 28, 2016, we announced that our Board of Directors had authorized an additional plan to repurchase up to $300.0 million of the Company's stock ("the April 2016 Repurchase Plan"). Any purchases under this stock repurchase program may be made, from time-to-time, pursuant to open market purchases (including pursuant to Rule 10b5-1 plans), privately-negotiated transactions, accelerated stock repurchases, block trades or derivative contracts or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Securities Exchange Act of 1934. As of March 31, 2017, there were no repurchases under this plan. On May 2, 2017, we entered into an accelerated share repurchase ("ASR") to repurchase $50.0 million of our common stock (the "2017 ASR"). We paid $50.0 million on May 3, 2017 and received an initial delivery of approximately 0.3 million shares based on current market prices. The final number of shares to be repurchased will be based on our volume-weighted average stock price under the term of the 2017 ASR, less an agreed upon discount.

Accounting for Income Taxes

Accounting for Income Taxes	3 Months Ended
	Mar. 31, 2017
Accounting for Income Taxes	Accounting for Income Taxes Our provision (benefit) for income taxes was $ (7.2) million and $ 12.4 million for the three months ended March 31, 2017 and 2016 , respectively. This represents effective tax rates of (11.4)% and 23.4% , respectively. For the three months ended March 31, 2017, our effective tax rate differs from the statutory federal income tax rate of 35% as a result of recognition of excess tax benefits related to stock-based compensation and certain foreign earnings, primarily from the Netherlands and Costa Rica, which are subject to lower tax rates. For the three months ended March 31, 2016, our effective tax rate differs from the statutory federal income tax rate of 35% due to certain foreign earnings, primarily from Costa Rica, which are subject to a lower tax rate, state income tax expense, the tax impact of certain stock-based compensation charges and unrecognized tax benefits. The decrease in effective tax rate for the three months ended March 31, 2017 compared to the same period in 2016 is primarily attributable to the adoption of ASU 2016-09 which requires excess tax benefits related to stock-based compensation to be recognized as a reduction of income tax expense along with certain of our foreign earnings being taxed at a lower rate relative to the U.S. federal statutory rate as a result of our international corporate restructuring. For the three months ended March 31, 2017, we recognized excess tax benefits of $21.3 million in our provision for income taxes. We exercise significant judgment in regards to estimates of future market growth, forecasted earnings and projected taxable income in determining the provision for income taxes and for purposes of assessing our ability to utilize any future benefit from deferred tax assets. Our total gross unrecognized tax benefits, excluding interest and penalties, was $47.2 million and $46.4 million as of March 31, 2017 and December 31, 2016 , respectively, all of which would impact our effective tax rate if recognized. Our total interest and penalties accrued as of March 31, 2017 was $2.5 million . We have elected to recognize interest and penalties related to unrecognized tax benefits as a component of income taxes. We do not expect any significant changes to the amount of unrecognized tax benefit within the next twelve months. We file U.S. federal, U.S. state, and non-U.S. income tax returns. Our major tax jurisdictions include U.S. federal, the State of California and the Netherlands. For U.S. federal and state tax returns, we are no longer subject to tax examinations for years before 2000. With few exceptions, we are no longer subject to examination by foreign tax authorities for years before 2007. Our subsidiary in Israel is under audit by the local tax authorities for calendar years 2006 through 2013. On July 1, 2016, we implemented a new international corporate structure. This changed the structure of our international procurement and sales operations, as well as realigned the ownership and use of intellectual property among our wholly-owned subsidiaries. We continue to anticipate that an increasing percentage of our consolidated pre-tax income will be derived from, and reinvested in our foreign operations. We believe that income taxed in certain foreign jurisdictions at a lower rate relative to the U.S. federal statutory rate will have a beneficial impact on our worldwide effective tax rate over time. In June 2009, the Costa Rica Ministry of Foreign Trade, an agency of the Government of Costa Rica, granted a twelve year extension of certain income tax incentives, which were previously granted in 2002. The incentive tax rates expire over various years, starting in June 2017. We are seeking a renewal of these income tax incentives before they expire. Under these incentives, all of the income in Costa Rica during these twelve year incentive periods is subject to a reduced tax rate. In order to receive the benefit of these incentives, we must hire specified numbers of employees and maintain certain minimum levels of fixed asset investment in Costa Rica. If we do not fulfill these conditions for any reason, our incentive could lapse, and our income in Costa Rica would be subject to taxation at higher rates, which could have a negative impact on our operating results. The Costa Rica corporate income tax rate that would apply, absent the incentives, is 30% for 2017 and 2016. For the three months ended March 31, 2017, the reduction in income taxes was minimal primarily due to the new international corporate structure implemented on July 1, 2016. For the three months ended March 31, 2016, income taxes were reduced by $8.6 million representing a benefit to diluted net income per share of $0.11 . We maintain sufficient cash reserves in the U.S. and do not intend to repatriate our foreign earnings which have not already been subject to U.S. income tax. As a result, income taxes have not been provided on these foreign earnings. If these earnings were distributed in the form of dividends or otherwise, or if the shares of the relevant foreign subsidiaries were sold or otherwise transferred, we would be subject to additional U.S. income taxes subject to an adjustment for foreign tax credits and foreign withholding taxes. We intend to use the undistributed earnings for local operating expansions and to meet local operating working capital needs. In addition, a significant amount of the cash earned by foreign subsidiaries is deployed to effect this international restructure.

Net Income Per Share

Net Income Per Share	3 Months Ended
	Mar. 31, 2017
Net Income Per Share	Net Income per Share Basic net income per share is computed using the weighted average number of shares of common stock outstanding during the period. Diluted net income per share is computed using the weighted average number of shares of common stock, adjusted for any dilutive effect of potential common stock. Potential common stock, computed using the treasury stock method, includes RSU, MSU, stock options and our ESPP. The following table sets forth the computation of basic and diluted net income per share attributable to common stock (in thousands, except per share amounts): Three Months Ended 2017 2016 Numerator: Net income $ 69,420 $ 40,546 Denominator: Weighted-average common shares outstanding, basic 79,904 79,831 Dilutive effect of potential common stock 1,630 1,489 Total shares, diluted 81,534 81,320 Net income per share, basic $ 0.87 $ 0.51 Net income per share, diluted $ 0.85 $ 0.50 For the three months ended March 31, 2017 and 2016, the anti-dilutive effect on net income per share from RSUs, MSUs, and ESPP was not material.

Segments and Geographical Infor

Segments and Geographical Information	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Segments and Geographical Information	Segments and Geographical Information Segment Information Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. Our CODM is our Chief Executive Officer. We report segment information based on the management approach. The management approach designates the internal reporting used by CODM for decision making and performance assessment as the basis for determining our reportable segments. The performance measures of our reportable segments include net revenues and gross profit. In the fourth quarter of 2016, management decided to change the way it internally assesses the performance of our reportable segments by including income from operations measure in the performance metrics. Income from operations for each segment includes all geographic revenues, related cost of net revenues and operating expenses directly attributable to the segment. Certain operating expenses are attributable to operating segments and each allocation is measured differently based on the specific facts and circumstances of the costs being allocated. Costs not specifically allocated to segment income from operations include various corporate expenses such as stock-based compensation and costs related to IT, facilities, human resources and accounting and finance, legal and regulatory, and other separately managed general and administrative costs outside the operating segments. We have included the new performance measure in the prior period presentation to conform to the current year's presentation. We have grouped our operations into two reportable segments which are also our reporting units: Clear Aligner segment and Scanner segment. • Our Clear Aligner segment consists of our Invisalign System products along with our training and ancillary products for malocclusion. Clear Aligner segment also includes revenue from the sale of aligners to SDC under our supply agreement which is recorded after eliminating outstanding intercompany transactions. • Our Scanner and Services ("Scanner") segment consists of intraoral scanning systems and additional services available with the intraoral scanners that provide digital alternatives to the traditional cast models. This segment includes our iTero scanner and OrthoCAD services. These reportable operating segments are based on how our CODM views and evaluates our operations as well as allocation of resources. The following information relates to these segments (in thousands): Three Months Ended Net revenues 2017 2016 Clear Aligner $ 282,399 $ 219,698 Scanner 27,942 19,022 Total net revenues $ 310,341 $ 238,720 Gross profit Clear Aligner $ 219,947 $ 172,067 Scanner 15,678 8,560 Total gross profit $ 235,625 $ 180,627 Income from operations Clear Aligner $ 114,734 $ 96,650 Scanner 6,004 1,542 Unallocated corporate expenses (59,065 ) (44,858 ) Total income from operations $ 61,673 $ 53,334 Depreciation and amortization Clear Aligner $ 4,363 $ 3,152 Scanner 1,037 1,048 Unallocated corporate expenses 2,467 592 Total depreciation and amortization $ 7,867 $ 4,792 The following table reconciles total segment income from operations in the table above to net income before provision for income taxes and equity losses of investee (in thousands): Three Months Ended 2017 2016 Total segment income from operations $ 120,738 $ 98,192 Unallocated corporate expenses (59,065 ) (44,858 ) Total income from operations 61,673 53,334 Interest and other income (expense), net 1,645 (427 ) Net income before provision (benefit) for income taxes and equity in losses of investee $ 63,318 $ 52,907 Geographical Information Net revenues are presented below by geographic area (in thousands): Three Months Ended 2017 2016 Net revenues (1) : United States (2) $ 183,273 $ 166,101 The Netherlands (2) 105,650 47,400 Other International 21,418 25,219 Total net revenues $ 310,341 $ 238,720 (1) Net revenues are attributed to countries based on location of where revenue is recognized. (2) Effective July 2016, we implemented a new international corporate structure. This changed the structure of our international procurement and sales operations. Tangible long-lived assets are presented below by geographic area (in thousands): March 31, December 31, 2016 Long-lived assets (1) : The Netherlands $ 120,513 $ 111,515 United States 86,252 43,278 Mexico 17,952 17,918 Other International 6,975 2,456 Total long-lived assets $ 231,692 $ 175,167 (1) Long-lived assets are attributed to countries based on entity that owns the assets.

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Basis of presentation	Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by Align Technology, Inc. (“we”, “our”, or “Align”) in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") and contain all adjustments, including normal recurring adjustments, necessary to state fairly our results of operations for the three months ended March 31, 2017 and 2016 , our comprehensive income for the three months ended March 31, 2017 and 2016 , our financial position as of March 31, 2017 and our cash flows for the three months ended March 31, 2017 and 2016 . The Condensed Consolidated Balance Sheet as of December 31, 2016 was derived from the December 31, 2016 audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The results of operations for the three months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 or any other future period, and we make no representations related thereto. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Quantitative and Qualitative Disclosures About Market Risk” and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, in our Annual Report on Form 10-K for the year ended December 31, 2016 .
Use of estimates	Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles ("GAAP") in the United States of America (“U.S.”) requires our management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, we evaluate our estimates, including those related to the fair values of financial instruments, long-lived assets and goodwill, equity method investments, useful lives of intangible assets and property and equipment, revenue recognition, stock-based compensation, equity losses of investee, income taxes and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.
Recent Accounting Pronouncements	Recent Accounting Pronouncements (i) New Accounting Updates Recently Adopted In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-09, " Improvements to Employee Share-Based Payment Accounting " (Topic 718) . We adopted the standard in the first quarter of fiscal year 2017. With this adoption, excess tax benefits related to stock-based compensation expense are reflected in our condensed consolidated statement of operations as a component of the provision for income taxes instead of additional paid-in capital in our condensed consolidated balance sheet. For the three months ended March 31, 2017, we recognized excess tax benefits of $21.3 million in our provision for income taxes. Excess tax benefits from share-based payment arrangements are classified as an operating activity in our condensed consolidated statement of cash flows in the same manner as other cash flows related to income taxes. We have elected to apply the standard on a prospective basis. In addition, we elected to continue to estimate expected forfeitures rather than as they occur to determine the amount of compensation cost to be recognized in each period. In October 2016, the FASB issued ASU 2016-16, "Intra-Entity Transfers of Assets Other Than Inventory," (Topic 740) which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. We early adopted the standard in the first quarter of fiscal year 2017 by applying the modified retrospective approach. For the three months ended March 31, 2017, we recognized a $1.3 million decrease to retained earnings as a cumulative-effect adjustment. (ii) Recent Accounting Updates Not Yet Effective In May 2014, the FASB released ASU 2014-9, " Revenue from Contracts with Customers, " (Topic 606) to supersede nearly all existing revenue recognition guidance under GAAP. The core principle of the standard is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for the goods or services. The new standard defines a five step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing GAAP including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. We are required to adopt this standard starting in the first quarter of fiscal year 2018 using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within the standard; or (ii) retrospective with the cumulative effect of initially applying the standard recognized at the date of initial application and providing certain additional disclosures as defined per the standard. We plan to adopt the standard in the first quarter of fiscal year 2018 by applying the full retrospective method. Our ability to adopt using the full retrospective method is dependent on the completion of our analysis of information necessary to restate prior period financial statements. We are continuing to assess the impact of the adoption of this update on our consolidated financial statements and related disclosures. In April 2016, the FASB released ASU 2016-10, " Revenue from Contracts with Customers, " to clarify the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the principles for those areas of the ASU 2014-9 issued in May 2014. The effective date and the transition requirement of the amendments in this update are the same as the effective date and transition requirements of Topic 606. In May 2016, the FASB released ASU 2016-12, " Revenue from Contracts with Customers, " to address certain issues in the Topic 606 guidance on assessing the collectability, presentation of sales taxes, non-cash consideration, and completed contracts and contract modifications at transition. The ASU provides narrow-scope improvements and practical expedients to the ASU 2014-9 issued in May 2014. The effective date and the transition requirement of the amendments in this update are the same as the effective date and transition requirements of Topic 606. In December 2016, the FASB released ASU 2016-20, " Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers, " to clarify certain aspects of guidance in the Topic 606 including its scope, disclosure requirements and contract cost accounting, while retaining the principles for those areas of the ASU 2014-9 issued in May 2014. The effective date and the transition requirement of the amendments in this update are the same as the effective date and transition requirements of Topic 606. In February 2016, the FASB issued ASU 2016-02, “ Leases ” (Topic 842). The FASB issued this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The updated guidance is effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the standard is permitted. We plan to adopt the standard in the first quarter of fiscal year 2019 by electing practical expedients available in the standard. While we are currently evaluating the impact of the adoption of this guidance on our consolidated financial statements, we expect the adoption will have a material increase in the assets and liabilities of our consolidated balance sheet. In June 2016, the FASB issued ASU 2016-13, “ Financial Instruments - Credit Losses ” (Topic 326) . The FASB issued this update to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The amendments in this update replace the existing guidance of incurred loss impairment methodology with an approach that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The updated guidance is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption of the update is permitted as of the fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, "Classification of Certain Cash Receipts and Cash Payments" (Topic 230). This FASB clarifies the presentation and classification of certain cash receipts and cash payments in the statements of cash flows. The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2017. Early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows - Restricted Cash," which provides guidance to address the classification and presentation of changes in restricted cash in the statements of cash flows . The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2017 on a retrospective basis, and early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-01, “ Business Combinations (Topic 805): Clarifying the Definition of a Business, ” to clarify the definition of a business when evaluating whether transactions should be accounted for as acquisitions of assets or businesses. The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2017 on a retrospective basis, early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment," to simply the subsequent measurement of goodwill by eliminating step two from the goodwill impairment test. Under the amendments, an entity will recognize an impairment charge for the amount by which the carrying value exceeds the fair value. The amendments are effective for fiscal years and interim periods within those years beginning after December 15, 2019 on a prospective basis, early adoption is permitted. We are currently evaluating the impact of this guidance on our consolidated financial statements and related disclosures.

Marketable Securities and Fai22

Marketable Securities and Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Short-Term And Long-Term Marketable Securities	As of March 31, 2017 and December 31, 2016, the estimated fair value of our short-term and long-term marketable securities, classified as available for sale, are as follows (in thousands): Short-term March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial paper $ 42,160 $ — $ — $ 42,160 Corporate bonds 152,169 30 (107 ) 152,092 Municipal securities 3,853 — (1 ) 3,852 U.S. government agency bonds 21,879 — (16 ) 21,863 U.S. government treasury bonds 54,767 — (28 ) 54,739 Certificates of deposit 9,787 — — 9,787 Asset-backed securities 66 — — 66 Total marketable securities, short-term $ 284,681 $ 30 $ (152 ) $ 284,559 Long-term March 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government agency bonds $ 11,295 $ 19 $ (12 ) $ 11,302 Corporate bonds 79,267 48 (65 ) 79,250 U.S. government treasury bonds 8,034 3 (15 ) 8,022 Total marketable securities, long-term $ 98,596 $ 70 $ (92 ) $ 98,574 Short-term December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial paper $ 42,397 $ — $ (6 ) $ 42,391 Corporate bonds 122,788 22 (121 ) 122,689 Municipal securities 5,852 — (5 ) 5,847 U.S. government agency bonds 28,903 9 (4 ) 28,908 U.S. government treasury bonds 45,146 7 (7 ) 45,146 Certificates of deposit 6,000 — — 6,000 Total marketable securities, short-term $ 251,086 $ 38 $ (143 ) $ 250,981 Long-term December 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. government agency bonds $ 6,805 $ — $ (16 ) $ 6,789 Corporate bonds 40,889 8 (85 ) 40,812 U.S. government treasury bonds 12,016 5 (16 ) 12,005 Asset-backed securities 177 — — 177 Total marketable securities, long-term $ 59,887 $ 13 $ (117 ) $ 59,783
Investments Classified by Contractual Maturity Date [Table Text Block]	As the carrying value approximates the fair value for our short-term and long-term marketable securities shown in the tables above, the following table summarizes the fair value of our short-term and long-term marketable securities classified by maturity as of March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 December 31, 2016 One year or less $ 284,559 $ 250,981 Due in greater than one year 98,574 59,783 Total available for sale short-term and long-term marketable securities $ 383,133 $ 310,764
Financial Assets Measured At Fair Value On Recurring Basis	The following tables summarize our financial assets measured at fair value on a recurring basis as of March 31, 2017 and December 31, 2016 (in thousands): Description Balance as of March 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Cash equivalents: Money market funds $ 141,256 $ 141,256 $ — $ — Commercial paper 20,026 — 20,026 — U.S. government treasury bonds 5,521 5,521 — — Municipal securities 2,001 — 2,001 — Short-term investments: Commercial paper 42,160 — 42,160 — Corporate bonds 152,092 — 152,092 — Municipal securities 3,852 — 3,852 — U.S. government agency bonds 21,863 — 21,863 — U.S. government treasury bonds 54,739 54,739 — — Certificates of deposit 9,787 — 9,787 — Asset-backed securities 66 — 66 — Long-term investments: U.S. government agency bonds 11,302 — 11,302 — Corporate bonds 79,250 — 79,250 — U.S. government treasury bonds 8,022 8,022 — — Prepaid expenses and other current assets: Israeli funds 3,191 — 3,191 — Other assets: Long-term notes receivable 2,084 — — 2,084 $ 557,212 $ 209,538 $ 345,590 $ 2,084 Description Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Cash equivalents: Money market funds $ 87,179 $ 87,179 $ — $ — Commercial paper 2,499 — 2,499 — Corporate bonds 750 — 750 — Short-term investments: Commercial paper 42,391 — 42,391 — Corporate bonds 122,689 — 122,689 — Municipal securities 5,847 — 5,847 — U.S. government agency bonds 28,908 — 28,908 — U.S. government treasury bonds 45,146 45,146 — — Certificates of deposit 6,000 — 6,000 — Long-term investments: U.S. government agency bonds 6,789 — 6,789 — Corporate bonds 40,812 — 40,812 — U.S. government treasury bonds 12,005 12,005 — — Asset-backed securities 177 — 177 — Prepaid expenses and other current assets: Israeli funds 2,956 — 2,956 — Other assets: Long-term notes receivable 2,047 — — 2,047 $ 406,195 $ 144,330 $ 259,818 $ 2,047

Balance Sheet Components (Table

Balance Sheet Components (Tables)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Schedule of Inventories	Inventories consist of the following (in thousands): March 31, December 31, Raw materials $ 14,630 $ 9,793 Work in process 14,061 10,773 Finished goods 6,483 6,565 Total inventories $ 35,174 $ 27,131
Schedule of Accrued Liabilities	Accrued liabilities consist of the following (in thousands): March 31, December 31, Accrued payroll and benefits $ 56,292 $ 79,214 Accrued sales and marketing expenses 14,230 11,970 Accrued sales rebate 10,751 10,342 Accrued sales tax and value added tax 7,080 5,032 Accrued income taxes 4,760 4,210 Accrued professional fees 4,092 3,604 Accrued warranty 4,301 3,841 Other accrued liabilities 24,125 16,119 Total accrued liabilities $ 125,631 $ 134,332
Warranty Accrual	Warranty accrual as of March 31, 2017 and 2016 consists of the following activity (in thousands): Three Months Ended 2017 2016 Balance at beginning of period $ 3,841 $ 2,638 Charged to cost of revenues 1,822 816 Actual warranty expenditures (1,362 ) (750 ) Balance at end of period $ 4,301 $ 2,704

Goodwill and Long-lived Assets

Goodwill and Long-lived Assets (Tables)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Summary of Goodwill by Reportable Segment	The change in the carrying value of goodwill for the three months ended March 31, 2017 , all attributable to our Clear Aligner reporting unit, is as follows (in thousands): Total Balance as of December 31, 2016 $ 61,044 Goodwill from distributor acquisitions 3,247 Adjustments 1 254 Balance as of March 31, 2017 $ 64,545 1 The adjustments to goodwill during the period were a result of foreign currency translation.
Schedule Of Amortized Intangible Assets	Acquired intangible long-lived assets are being amortized as follows (in thousands): Weighted Average Amortization Period (in years) Gross Carrying Amount as of March 31, 2017 Accumulated Amortization Accumulated Impairment Loss Net Carrying Trademarks 15 $ 7,100 $ (1,665 ) $ (4,179 ) $ 1,256 Existing technology 13 12,600 (4,282 ) (4,328 ) 3,990 Customer relationships 11 33,500 (13,284 ) (10,751 ) 9,465 Reacquired rights 1 3 7,500 (125 ) — 7,375 Patents 8 6,316 (912 ) — 5,404 Other 1 548 (136 ) — 412 Total intangible assets $ 67,564 $ (20,404 ) $ (19,258 ) $ 27,902 Weighted Average Amortization Period (in years) Gross Carrying Amount as of December 31, 2016 Accumulated Amortization Accumulated Impairment Loss Net Carrying Value as of December 31, 2016 Trademarks 15 $ 7,100 $ (1,631 ) $ (4,179 ) $ 1,290 Existing technology 13 12,600 (4,141 ) (4,328 ) 4,131 Customer relationships 11 33,500 (12,819 ) (10,751 ) 9,930 Patents 8 6,316 (713 ) — 5,603 Total intangible assets $ 59,516 $ (19,304 ) $ (19,258 ) $ 20,954 1 The fair value of reacquired rights obtained from distributor acquisitions during the three months ended March 31, 2017 is valued using the income approach. In addition, we effectively settled the pre-existing relationship with the distributors by assessing whether the distributor agreements include favorable or unfavorable terms compared to current market rates. Based on the assessment, we determined that the distributor agreements had terms that are consistent with market rates and, therefore, no settlement gains or losses are recorded associated with the acquisitions during the three months ended March 31, 2017.
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense	The total estimated annual future amortization expense for these acquired intangible assets as of March 31, 2017 is as follows (in thousands): Remainder of 2017 $ 4,713 2018 5,989 2019 5,873 2020 3,758 2021 3,339 Thereafter 4,230 Total $ 27,902

Commitments and Contingencies (

Commitments and Contingencies (Tables)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Schedule of Future Lease Payments	As of March 31, 2017 , minimum future lease payments for non-cancelable operating leases are as follows (in thousands): Fiscal Year Ending December 31, Operating Leases Remainder of 2017 $ 10,113 2018 10,920 2019 8,930 2020 7,133 2021 6,481 Thereafter 9,170 Total minimum future lease payments $ 52,747

Stock-based Compensation (Table

Stock-based Compensation (Tables)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Stock-based Compensation Expense	The stock-based compensation related to all of our stock-based awards and employee stock purchases for the three months ended March 31, 2017 and 2016 is as follows (in thousands): Three Months Ended 2017 2016 Cost of net revenues $ 925 $ 961 Selling, general and administrative 11,716 9,834 Research and development 2,171 1,729 Total stock-based compensation $ 14,812 $ 12,524
Stock Option Activity	Activity for the three months ended March 31, 2017 under the stock option plans is set forth below (in thousands, except years and per share amounts): Number of Shares Underlying Stock Options Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value Outstanding as of December 31, 2016 222 $ 14.90 Granted — — Exercised (82 ) 17.35 Cancelled or expired (4 ) 18.16 Outstanding as of March 31, 2017 136 $ 13.33 1.35 $ 13,809 Vested and expected to vest at March 31, 2017 136 $ 13.33 1.35 $ 13,809 Exercisable at March 31, 2017 136 $ 13.33 1.35 $ 13,809
Summary Of Nonvested Shares	A summary for the three months ended March 31, 2017 is as follows (in thousands, except years and per share amounts): Shares Underlying RSUs Weighted Average Grant Date Fair Value Weighted Remaining Vesting Period (in years) Aggregate Intrinsic Value Nonvested as of December 31, 2016 1,789 $ 58.39 Granted 371 102.24 Vested and released (689 ) 51.59 Forfeited (19 ) 60.29 Nonvested as of March 31, 2017 1,452 $ 72.80 1.70 $ 166,598
Summary Of Nonvested Shares	The following table summarizes the MSU performance for the three months ended March 31, 2017 (in thousands, except years): Number of Shares Underlying MSUs Weighted Average Grant Date Fair Value Weighted Average Remaining Vesting Period (in years) Aggregate Intrinsic Value Nonvested as of December 31, 2016 520 $ 60.49 Granted 201 87.11 Vested and released (283 ) 49.51 Forfeited (10 ) 64.50 Nonvested as of March 31, 2017 428 $ 78.53 1.72 $ 49,107
Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions	The fair value of the option component of the 2010 Purchase Plan shares was estimated at the grant date using the Black-Scholes option pricing model with the following weighted average assumptions: Three Months Ended 2017 2016 Expected term (in years) 1.2 1.3 Expected volatility 26.1 % 33.7 % Risk-free interest rate 0.9 % 0.8 % Expected dividends — — Weighted average fair value at grant date $ 26.09 $ 19.96

Net Income Per Share (Tables)

Net Income Per Share (Tables)	3 Months Ended
	Mar. 31, 2017
Schedule Of Earnings Per Share Basic And Diluted	The following table sets forth the computation of basic and diluted net income per share attributable to common stock (in thousands, except per share amounts): Three Months Ended 2017 2016 Numerator: Net income $ 69,420 $ 40,546 Denominator: Weighted-average common shares outstanding, basic 79,904 79,831 Dilutive effect of potential common stock 1,630 1,489 Total shares, diluted 81,534 81,320 Net income per share, basic $ 0.87 $ 0.51 Net income per share, diluted $ 0.85 $ 0.50

Segments and Geographical Inf28

Segments and Geographical Information (Tables)	3 Months Ended
	Mar. 31, 2017
Notes To Financial Statements [Abstract]
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas	These reportable operating segments are based on how our CODM views and evaluates our operations as well as allocation of resources. The following information relates to these segments (in thousands): Three Months Ended Net revenues 2017 2016 Clear Aligner $ 282,399 $ 219,698 Scanner 27,942 19,022 Total net revenues $ 310,341 $ 238,720 Gross profit Clear Aligner $ 219,947 $ 172,067 Scanner 15,678 8,560 Total gross profit $ 235,625 $ 180,627 Income from operations Clear Aligner $ 114,734 $ 96,650 Scanner 6,004 1,542 Unallocated corporate expenses (59,065 ) (44,858 ) Total income from operations $ 61,673 $ 53,334 Depreciation and amortization Clear Aligner $ 4,363 $ 3,152 Scanner 1,037 1,048 Unallocated corporate expenses 2,467 592 Total depreciation and amortization $ 7,867 $ 4,792 The following table reconciles total segment income from operations in the table above to net income before provision for income taxes and equity losses of investee (in thousands): Three Months Ended 2017 2016 Total segment income from operations $ 120,738 $ 98,192 Unallocated corporate expenses (59,065 ) (44,858 ) Total income from operations 61,673 53,334 Interest and other income (expense), net 1,645 (427 ) Net income before provision (benefit) for income taxes and equity in losses of investee $ 63,318 $ 52,907 Geographical Information Net revenues are presented below by geographic area (in thousands): Three Months Ended 2017 2016 Net revenues (1) : United States (2) $ 183,273 $ 166,101 The Netherlands (2) 105,650 47,400 Other International 21,418 25,219 Total net revenues $ 310,341 $ 238,720 (1) Net revenues are attributed to countries based on location of where revenue is recognized. (2) Effective July 2016, we implemented a new international corporate structure. This changed the structure of our international procurement and sales operations. Tangible long-lived assets are presented below by geographic area (in thousands): March 31, December 31, 2016 Long-lived assets (1) : The Netherlands $ 120,513 $ 111,515 United States 86,252 43,278 Mexico 17,952 17,918 Other International 6,975 2,456 Total long-lived assets $ 231,692 $ 175,167 (1) Long-lived assets are attributed to countries based on entity that owns the assets.

Summary of Significant Accoun29

Summary of Significant Accounting Policies - Narrative (Details) $ in Millions	3 Months Ended
	Mar. 31, 2017USD ($)
Accounting Standards Update 2016-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Tax benefit	$ 21.3
Retained Earnings | Accounting Standards Update 2016-16
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Decrease to retained earnings	$ 1.3

Short-Term and Long-Term Market

Short-Term and Long-Term Marketable Securities (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Total available for sale short-term and long-term marketable securities	$ 383,133	$ 310,764
Fair Value, Measurements, Recurring [Member] | Short-term Investments
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	284,681	251,086
Gross Unrealized Gains	30	38
Gross Unrealized Losses	(152)	(143)
Total available for sale short-term and long-term marketable securities	284,559	250,981
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Commercial paper
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	42,160	42,397
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	(6)
Total available for sale short-term and long-term marketable securities	42,160	42,391
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Corporate bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	152,169	122,788
Gross Unrealized Gains	30	22
Gross Unrealized Losses	(107)	(121)
Total available for sale short-term and long-term marketable securities	152,092	122,689
Fair Value, Measurements, Recurring [Member] | Short-term Investments | U.S. government agency bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	21,879	28,903
Gross Unrealized Gains	0	9
Gross Unrealized Losses	(16)	(4)
Total available for sale short-term and long-term marketable securities	21,863	28,908
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Municipal securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	3,853	5,852
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(1)	(5)
Total available for sale short-term and long-term marketable securities	3,852	5,847
Fair Value, Measurements, Recurring [Member] | Short-term Investments | U.S. government treasury bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	54,767	45,146
Gross Unrealized Gains	0	7
Gross Unrealized Losses	(28)	(7)
Total available for sale short-term and long-term marketable securities	54,739	45,146
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Certificates of deposit
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	9,787	6,000
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Total available for sale short-term and long-term marketable securities	9,787	6,000
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Asset-backed securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	66
Gross Unrealized Gains	0
Gross Unrealized Losses	0
Total available for sale short-term and long-term marketable securities	66
Fair Value, Measurements, Recurring [Member] | Long-term Investments
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	98,596	59,887
Gross Unrealized Gains	70	13
Gross Unrealized Losses	(92)	(117)
Total available for sale short-term and long-term marketable securities	98,574	59,783
Fair Value, Measurements, Recurring [Member] | Long-term Investments | Corporate bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	79,267	40,889
Gross Unrealized Gains	48	8
Gross Unrealized Losses	(65)	(85)
Total available for sale short-term and long-term marketable securities	79,250	40,812
Fair Value, Measurements, Recurring [Member] | Long-term Investments | U.S. government agency bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	11,295	6,805
Gross Unrealized Gains	19	0
Gross Unrealized Losses	(12)	(16)
Total available for sale short-term and long-term marketable securities	11,302	6,789
Fair Value, Measurements, Recurring [Member] | Long-term Investments | U.S. government treasury bonds
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	8,034	12,016
Gross Unrealized Gains	3	5
Gross Unrealized Losses	(15)	(16)
Total available for sale short-term and long-term marketable securities	$ 8,022	12,005
Fair Value, Measurements, Recurring [Member] | Long-term Investments | Asset-backed securities
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost		177
Gross Unrealized Gains		0
Gross Unrealized Losses		0
Total available for sale short-term and long-term marketable securities		$ 177

Marketable Securities and Fai31

Marketable Securities and Fair Value Measurements Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Maturity Period Used To Classify Investments	9 months	7 months
Maximum
Schedule of Available-for-sale Securities [Line Items]
Maturity Period Used To Classify Investments	27 months
Fair Value, Inputs, Level 3
Schedule of Available-for-sale Securities [Line Items]
Fair value	$ 2,084		$ 2,047
Other Assets | Fair Value, Inputs, Level 3
Schedule of Available-for-sale Securities [Line Items]
Fair value			$ 2,000

Marketable Securities and Fai32

Marketable Securities and Fair Value Measurements Available For Sale Securities (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Investments, Debt and Equity Securities [Abstract]
One year or less	$ 284,559	$ 250,981
Due in greater than one year	98,574	59,783
Total available for sale short-term and long-term marketable securities	$ 383,133	$ 310,764

Summary of Financial Assets Mea

Summary of Financial Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	$ 383,133	$ 310,764
Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Long-term notes receivable	2,084	2,047
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Long-term notes receivable	2,084	2,047
Assets, Fair Value Disclosure	557,212	406,195
Fair Value, Measurements, Recurring [Member] | Prepaid expenses and other current assets
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Other assets	3,191	2,956
Fair Value, Measurements, Recurring [Member] | Cash Equivalents | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	141,256	87,179
Fair Value, Measurements, Recurring [Member] | Cash Equivalents | Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	20,026	2,499
Fair Value, Measurements, Recurring [Member] | Cash Equivalents | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	5,521
Fair Value, Measurements, Recurring [Member] | Cash Equivalents | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	2,001
Fair Value, Measurements, Recurring [Member] | Cash Equivalents | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents		750
Fair Value, Measurements, Recurring [Member] | Short-term Investments
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	284,559	250,981
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	42,160	42,391
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	152,092	122,689
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	3,852	5,847
Fair Value, Measurements, Recurring [Member] | Short-term Investments | U.S. government agency bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	21,863	28,908
Fair Value, Measurements, Recurring [Member] | Short-term Investments | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	54,739	45,146
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	9,787	6,000
Fair Value, Measurements, Recurring [Member] | Short-term Investments | Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	66
Fair Value, Measurements, Recurring [Member] | Long-term Investments
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	98,574	59,783
Fair Value, Measurements, Recurring [Member] | Long-term Investments | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	79,250	40,812
Fair Value, Measurements, Recurring [Member] | Long-term Investments | U.S. government agency bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	11,302	6,789
Fair Value, Measurements, Recurring [Member] | Long-term Investments | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	8,022	12,005
Fair Value, Measurements, Recurring [Member] | Long-term Investments | Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments		177
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Long-term notes receivable	2,084	2,047
Assets, Fair Value Disclosure	2,084	2,047
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Long-term notes receivable	0	0
Assets, Fair Value Disclosure	209,538	144,330
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Prepaid expenses and other current assets
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Other assets	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash Equivalents | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	141,256	87,179
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash Equivalents | Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash Equivalents | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	5,521
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash Equivalents | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash Equivalents | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents		0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | U.S. government agency bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	54,739	45,146
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term Investments | Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term Investments | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term Investments | U.S. government agency bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term Investments | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	8,022	12,005
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term Investments | Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments		0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Long-term notes receivable	0	0
Assets, Fair Value Disclosure	345,590	259,818
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Prepaid expenses and other current assets
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Other assets	3,191	2,956
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Cash Equivalents | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	0	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Cash Equivalents | Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	20,026	2,499
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Cash Equivalents | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Cash Equivalents | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents	2,001
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Cash Equivalents | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Cash equivalents		750
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	42,160	42,391
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	152,092	122,689
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	3,852	5,847
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | U.S. government agency bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	21,863	28,908
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	0	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	9,787	6,000
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Short-term Investments | Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	66
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Long-term Investments | Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	79,250	40,812
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Long-term Investments | U.S. government agency bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	11,302	6,789
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Long-term Investments | U.S. government treasury bonds
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments	$ 0	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) | Long-term Investments | Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Investments		$ 177

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Disclosure Inventories [Abstract]
Raw materials	$ 14,630	$ 9,793
Work in process	14,061	10,773
Finished goods	6,483	6,565
Total inventories	$ 35,174	$ 27,131

Accrued Liabilities (Details)

Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Disclosure Accrued Liabilities [Abstract]
Accrued payroll and benefits	$ 56,292	$ 79,214
Accrued sales and marketing expenses	14,230	11,970
Accrued sales rebate	10,751	10,342
Accrued sales tax and value added tax	7,080	5,032
Accrued income taxes	4,760	4,210
Accrued professional fees	4,092	3,604
Accrued warranty	4,301	3,841
Other accrued liabilities	24,125	16,119
Total accrued liabilities	$ 125,631	$ 134,332

Warranty Accrual Activity (Deta

Warranty Accrual Activity (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance at beginning of period	$ 3,841	$ 2,638
Charged to cost of revenues	1,822	816
Actual warranty expenditures	(1,362)	(750)
Balance at end of period	$ 4,301	$ 2,704

Equity Method Investments (Deta

Equity Method Investments (Details) - USD ($) $ in Thousands	Jul. 25, 2016	Mar. 31, 2017	Dec. 31, 2016
Schedule of Equity Method Investments [Line Items]
Equity method investments		$ 43,940	$ 45,061
SDC
Schedule of Equity Method Investments [Line Items]
Ownership	17.00%
Payments to acquire	$ 46,700
Equity method investments		$ 43,900

Business Combinations (Details)

Business Combinations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Goodwill and intangible assets, net	$ 92,447	$ 81,998
Certain Distributors
Business Acquisition [Line Items]
Cash consideration	9,500
Net tangible liabilities	1,900
Intangibles acquired	8,200
Goodwill and intangible assets, net	$ 3,200

Change in Carrying Value of Goo

Change in Carrying Value of Goodwill (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2017USD ($)
Goodwill [Roll Forward]
Balance as of December 31, 2016	$ 81,998
Balance as of March 31, 2017	92,447
Clear Aligner
Goodwill [Roll Forward]
Balance as of December 31, 2016	61,044
Goodwill from distributor acquisitions	3,247
Adjustments	254
Balance as of March 31, 2017	$ 64,545

Intangible Assets (Details)

Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount, beginning balance	$ 67,564		$ 59,516
Accumulated Amortization	(20,404)		(19,304)
Accumulated Impairment Loss	(19,258)		(19,258)
Net Carrying Value, ending balance	$ 27,902		20,954
Trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in years)	15 years	15 years
Gross Carrying Amount, beginning balance	$ 7,100		7,100
Accumulated Amortization	(1,665)		(1,631)
Accumulated Impairment Loss	(4,179)		(4,179)
Net Carrying Value, ending balance	$ 1,256		1,290
Existing technology
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in years)	13 years	13 years
Gross Carrying Amount, beginning balance	$ 12,600		12,600
Accumulated Amortization	(4,282)		(4,141)
Accumulated Impairment Loss	(4,328)		(4,328)
Net Carrying Value, ending balance	$ 3,990		4,131
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in years)	11 years	11 years
Gross Carrying Amount, beginning balance	$ 33,500		33,500
Accumulated Amortization	(13,284)		(12,819)
Accumulated Impairment Loss	(10,751)		(10,751)
Net Carrying Value, ending balance	$ 9,465		9,930
Reacquired rights
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in years)	3 years
Gross Carrying Amount, beginning balance	$ 7,500
Accumulated Amortization	(125)
Accumulated Impairment Loss	0
Net Carrying Value, ending balance	$ 7,375
Patents
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in years)	8 years	8 years
Gross Carrying Amount, beginning balance	$ 6,316		6,316
Accumulated Amortization	(912)		(713)
Accumulated Impairment Loss	0		0
Net Carrying Value, ending balance	$ 5,404		$ 5,603
Other
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in years)	1 year
Gross Carrying Amount, beginning balance	$ 548
Accumulated Amortization	(136)
Accumulated Impairment Loss	0
Net Carrying Value, ending balance	$ 412

Total Estimated Annual Future A

Total Estimated Annual Future Amortization Expense for Acquired Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Disclosure Total Estimated Annual Future Amortization Expense For Acquired Intangible Assets [Abstract]
Remainder of 2017	$ 4,713
2,018	5,989
2,019	5,873
2,020	3,758
2,021	3,339
Thereafter	4,230
Net Carrying Value, ending balance	$ 27,902	$ 20,954

Credit Facilities - Additional

Credit Facilities - Additional Information (Details) - USD ($) $ in Millions	Mar. 22, 2013	Mar. 31, 2017
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.75%
Revolving Credit Facility [Member] | Wells Fargo [Member]
Line of Credit Facility [Line Items]
Line of credit, available borrowings	$ 50
Letter of Credit [Member] | Wells Fargo [Member]
Line of Credit Facility [Line Items]
Line of credit, available borrowings	$ 10
Line of Credit Facility, Amount Outstanding		$ 0

Minimum Future Lease Payments f

Minimum Future Lease Payments for Non-Cancelable Leases (Details) - USD ($)	Jul. 25, 2016	Mar. 31, 2017	Jul. 14, 2016
Disclosure Minimum Future Lease Payments For Non Cancelable Leases [Abstract]
Remainder of 2017		$ 10,113,000
2,018		10,920,000
2,019		8,930,000
2,020		7,133,000
2,021		6,481,000
Thereafter		9,170,000
Total minimum lease payments		52,747,000
Commitments To Purchase Convertible Promissory Notes With Private Company
Other Commitments [Line Items]
Commitment		5,000,000
First note			$ 2,000,000
Second note		$ 3,000,000
Maturity date		Dec. 30, 2018
Interest		2.50%
SDC
Other Commitments [Line Items]
Borrowing base as a percentage of accounts receivable	80.00%
Stated rate	7.00%
Advances outstanding		$ 8,000,000
Maximum | SDC
Other Commitments [Line Items]
Loan facility	$ 15,000,000

Stock-based Compensation - Addi

Stock-based Compensation - Additional Information (Details) $ in Millions	3 Months Ended
	Mar. 31, 2017USD ($)shares
Incentive Plan 2005
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares reserved for issuance	27,783,379
Number of shares available for issuance	6,982,718
Employee Stock Purchase Plan 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares available	2,400,000
Number of shares remaining	821,770
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unamortized compensation cost | $	$ 86.9
Weighted average period of total unamortized cost (in years)	2 years 7 months 6 days
Market Performance Based Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unamortized compensation cost | $	$ 19.4
Weighted average period of total unamortized cost (in years)	1 year 8 months 12 days
Market Performance Based Restricted Stock Units | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of granted market-performance based restricted stock units	2 years
Market Performance Based Restricted Stock Units | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of granted market-performance based restricted stock units	3 years
Percentage of market-performance based restricted stock units eligible to vest over the vesting period	200.00%
Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unamortized compensation cost | $	$ 3.9
Weighted average period of total unamortized cost (in years)	1 year

Stock-Based Compensation Expens

Stock-Based Compensation Expense Related to All Stock-Based Awards and Employee Stock Purchases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 14,812	$ 12,524
Cost of net revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	925	961
Selling, general and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	11,716	9,834
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 2,171	$ 1,729

Activity Under Stock Option Pla

Activity Under Stock Option Plans (Details) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017USD ($)$ / sharesshares
Number of Shares Underlying Stock Options
Outstanding as of December 31, 2016 | shares	222
Granted | shares	0
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares	$ 0
Exercised | shares	(82)
Cancelled or expired | shares	(4)
Outstanding as of March 31, 2017 | shares	136
Vested and expected to vest at March 31, 2017 | shares	136
Exercisable at March 31, 2017 | shares	136
Weighted Average Exercise Price per Share
Outstanding as of December 31, 2016 | $ / shares	$ 14.90
Exercised | $ / shares	17.35
Cancelled or expired | $ / shares	18.16
Outstanding as of March 31, 2017 | $ / shares	13.33
Vested and expected to vest at March 31, 2017 | $ / shares	13.33
Exercisable at March 31, 2017 | $ / shares	$ 13.33
Weighted Average Remaining Contractual Term
Outstanding as of March 31, 2017	1 year 4 months 6 days
Vested and expected to vest at March 31, 2017	1 year 4 months 6 days
Exercisable at March 31, 2017	1 year 4 months 6 days
Aggregate Intrinsic Value
Outstanding as of March 31, 2017 | $	$ 13,809
Vested and expected to vest at March 31, 2017 | $	13,809
Exercisable at March 31, 2017 | $	$ 13,809

Summary of Nonvested Shares (De

Summary of Nonvested Shares (Details) - Restricted Stock Units (RSUs) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017USD ($)$ / sharesshares
Number of Shares Underlying RSUs
Nonvested as of December 31, 2016 | shares	1,789
Granted | shares	371
Vested and released | shares	(689)
Forfeited | shares	(19)
Nonvested as of March 31, 2017 | shares	1,452
Weighted Average Grant Date Fair Value
Nonvested as of December 31, 2016 | $ / shares	$ 58.39
Granted | $ / shares	102.24
Vested and released | $ / shares	51.59
Forfeited | $ / shares	60.29
Nonvested as of March 31, 2017 | $ / shares	$ 72.80
Weighted Remaining Vesting Period
Nonvested as of March 31, 2017	1 year 8 months 12 days
Aggregate Intrinsic Value
Nonvested as of March 31, 2017 | $	$ 166,598

Summary of MSU Performance (Det

Summary of MSU Performance (Details) - Market Performance Based Restricted Stock Units $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017USD ($)$ / sharesshares
Number of Shares Underlying MSUs
Nonvested as of December 31, 2016 | shares	520
Granted | shares	201
Vested and released | shares	(283)
Forfeited | shares	(10)
Nonvested as of March 31, 2017 | shares	428
Weighted Average Grant Date Fair Value
Nonvested as of December 31, 2016 | $ / shares	$ 60.49
Granted | $ / shares	87.11
Vested and released | $ / shares	49.51
Forfeited | $ / shares	64.50
Nonvested as of March 31, 2017 | $ / shares	$ 78.53
Weighted Average Remaining Vesting Period
Nonvested as of March 31, 2017	1 year 8 months 19 days
Aggregate Intrinsic Value
Nonvested as of March 31, 2017 | $	$ 49,107

Stock-based Compensation Stock-

Stock-based Compensation Stock-based Compensation Employee Stock Purchase Plan (Details) - $ / shares	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Expected term (in years)	1 year 2 months 12 days	1 year 3 months 18 days
Expected volatility	26.10%	33.70%
Risk-free interest rate	0.93%	0.77%
Expected dividends	0.00%	0.00%
Weighted average fair value at grant date (USD per Share)	$ 26.09	$ 19.96

Common Stock Repurchase Progr50

Common Stock Repurchase Program - Additional Information (Details) - USD ($)	May 03, 2017	Apr. 30, 2014	Mar. 31, 2017	Apr. 28, 2016
April 2014 Stock Repurchase Program
Share Repurchases [Line Items]
Repurchase of common stock, common stock authorized		$ 300,000,000
Stock repurchase program, period		3 years
Accelerated share repurchase (shares)			40,000
Market price ($ per share)			$ 96.37
Repurchased			$ 3,800,000
April 2016 Repurchase
Share Repurchases [Line Items]
Repurchase of common stock, common stock authorized				$ 300,000,000
Subsequent Event | 2017 Stock Repurchase Program
Share Repurchases [Line Items]
Repurchase of common stock, common stock authorized	$ 50,000,000
Accelerated share repurchase (shares)	300,000
Payments - accelerated share repurchase	$ (50,000,000)

Accounting for Income Taxes - A

Accounting for Income Taxes - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Income Taxes [Line Items]
Provision (benefit) for income taxes	$ (7,223)	$ 12,361
Effective income tax rate, continuing operations	(11.40%)	23.40%
Unrecognized tax benefits	$ 47,200		$ 46,400
Accrued penalties and interest	$ 2,500
Tax Holiday effect		$ 8,600
Tax holiday effect on diluted earnings per share		$ 0.11
Foreign Tax Authority [Member]
Income Taxes [Line Items]
Foreign income tax rate	30.00%
Accounting Standards Update 2016-09
Income Taxes [Line Items]
Tax benefit	$ 21,300

Computation of Basic and Dilute

Computation of Basic and Diluted Net Income Per Share Attributable to Common Stock (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share [Abstract]
Net income	$ 69,420	$ 40,546
Weighted-average common shares outstanding, basic	79,904	79,831
Dilutive effect of potential common stock	1,630	1,489
Total shares, diluted	81,534	81,320
Net income per share, basic	$ 0.87	$ 0.51
Net income per share, diluted	$ 0.85	$ 0.50

Segments and Geographical Inf53

Segments and Geographical Information - Additional Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2017USD ($)segment	Dec. 31, 2016USD ($)
Segment Reporting Information [Line Items]
Long-lived assets	$ 231,692	$ 175,167
Number of reportable segments | segment	2
Netherlands
Segment Reporting Information [Line Items]
Long-lived assets	$ 120,513	$ 111,515

Segment Information (Details)

Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting Information [Line Items]
Revenue	$ 310,341	$ 238,720
Gross profit	235,625	180,627
Income from operations	61,673	53,334
Depreciation and amortization	7,867	4,792
Interest and other income (expense), net	1,645	(427)
Net income before provision (benefit) for income taxes and equity in losses of investee	63,318	52,907
Operating segments
Segment Reporting Information [Line Items]
Income from operations	120,738	98,192
Clear Aligner
Segment Reporting Information [Line Items]
Revenue	282,399	219,698
Gross profit	219,947	172,067
Income from operations	114,734	96,650
Depreciation and amortization	4,363	3,152
Scanner
Segment Reporting Information [Line Items]
Revenue	27,942	19,022
Gross profit	15,678	8,560
Income from operations	6,004	1,542
Depreciation and amortization	1,037	1,048
Unallocated corporate expenses
Segment Reporting Information [Line Items]
Income from operations	(59,065)	(44,858)
Depreciation and amortization	$ 2,467	$ 592

Net Revenues by Geographic Area

Net Revenues by Geographic Area (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting Information [Line Items]
Net revenues	$ 310,341	$ 238,720
United States
Segment Reporting Information [Line Items]
Net revenues	183,273	166,101
Netherlands
Segment Reporting Information [Line Items]
Net revenues	105,650	47,400
Other international
Segment Reporting Information [Line Items]
Net revenues	$ 21,418	$ 25,219

Long-Lived Assets by Geographic

Long-Lived Assets by Geographic Area (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Long-lived assets	$ 231,692	$ 175,167
United States
Segment Reporting Information [Line Items]
Long-lived assets	86,252	43,278
Netherlands
Segment Reporting Information [Line Items]
Long-lived assets	120,513	111,515
Mexico
Segment Reporting Information [Line Items]
Long-lived assets	17,952	17,918
Other international
Segment Reporting Information [Line Items]
Long-lived assets	$ 6,975	$ 2,456