Qualys (QLYS) 10-Q 4 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 31, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	QUALYS, INC.
Entity Central Index Key	1,107,843
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		35,692,293

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 98,299	$ 91,698
Short-term investments	111,678	87,268
Accounts receivable, net of allowance of $744 and $769 as of September 30, 2016 and December 31, 2015, respectively	41,910	42,325
Prepaid expenses and other current assets	9,072	7,945
Total current assets	260,959	229,236
Long-term investments	64,930	43,277
Property and equipment, net	40,670	31,329
Deferred tax assets, net	15,141	16,079
Intangible assets, net	1,080	1,360
Goodwill	317	317
Other noncurrent assets	1,939	1,916
Total assets	385,036	323,514
Current liabilities:
Accounts payable	1,491	2,368
Accrued liabilities	16,324	11,786
Deferred revenues, current	109,026	98,025
Total current liabilities	126,841	112,179
Deferred revenues, noncurrent	14,416	14,564
Other noncurrent liabilities	2,386	1,205
Total liabilities	143,643	127,948
Commitments and contingencies (Note 5)
Stockholders’ equity:
Preferred stock, $0.001 par value; 20,000,000 shares authorized, no shares issued and outstanding at September 30, 2016 and December 31, 2015	0	0
Common stock, $0.001 par value; 1,000,000,000 shares authorized; 35,680,925 and 34,414,631 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively	36	34
Additional paid-in capital	255,509	223,228
Accumulated other comprehensive income (loss)	16	(211)
Accumulated deficit	(14,168)	(27,485)
Total stockholders’ equity	241,393	195,566
Total liabilities and stockholders’ equity	$ 385,036	$ 323,514

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 744	$ 769
Preferred stock, par or stated value per share (USD per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par or stated value per share (USD per share)	$ 0.001	$ 0.001
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	35,680,925	34,414,631
Common stock, shares outstanding	35,680,925	34,414,631

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues
Revenues	$ 50,987	$ 42,469	$ 145,701	$ 119,839
Cost of revenues	11,288	8,762	30,796	24,883
Gross profit	39,699	33,707	114,905	94,956
Operating expenses:
Research and development	9,405	7,564	26,382	21,919
Sales and marketing	14,240	12,282	42,624	36,501
General and administrative	8,067	6,983	24,603	19,426
Total operating expenses	31,712	26,829	93,609	77,846
Income from operations	7,987	6,878	21,296	17,110
Other income (expense), net:
Interest expense	(9)	0	(23)	(4)
Interest income	363	153	903	386
Other expense, net	(124)	(307)	(442)	(485)
Total other income (expense), net	230	(154)	438	(103)
Income before income taxes	8,217	6,724	21,734	17,007
Provision for income taxes	3,221	2,601	8,417	6,566
Net income	$ 4,996	$ 4,123	$ 13,317	$ 10,441
Net income per share:
Basic (USD per share)	$ 0.14	$ 0.12	$ 0.38	$ 0.31
Diluted (USD per share)	$ 0.13	$ 0.11	$ 0.35	$ 0.27
Weighted average shares used in computing net income per share:
Basic (shares)	35,477	34,119	35,074	33,967
Diluted (shares)	38,712	37,938	38,205	38,202

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Statement of Comprehensive Income [Abstract]
Net income	$ 4,996	$ 4,123	$ 13,317	$ 10,441
Available-for-sale investments:
Change in net unrealized gain (loss) on investments, net of tax	(58)	15	140	25
Less: reclassification adjustment for net realized gain (loss) included in net income	(38)	(5)	87	2
Net change, net of tax	(96)	10	227	27
Other comprehensive income (loss), net	(96)	10	227	27
Comprehensive income	$ 4,900	$ 4,133	$ 13,544	$ 10,468

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net income	$ 13,317	$ 10,441
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	12,364	10,424
Bad debt expense	152	629
Loss on disposal of property and equipment	39	9
Stock-based compensation	15,122	12,678
Amortization of premiums and accretion of discounts on investments	617	429
Excess tax benefits from stock-based compensation	(4,832)	(315)
Deferred income taxes	931	5,105
Changes in operating assets and liabilities:
Accounts receivable	263	(5,512)
Prepaid expenses and other assets	(1,196)	(2,143)
Accounts payable	(877)	(3,606)
Accrued liabilities	6,763	2,735
Deferred revenues	10,853	10,612
Other noncurrent liabilities	1,188	182
Net cash provided by operating activities	54,704	41,668
Cash flows from investing activities:
Purchases of investments	(180,161)	(88,694)
Sales and maturities of investments	133,708	73,340
Purchases of property and equipment	(18,809)	(14,865)
Capitalized software development costs	0	(99)
Net cash used in investing activities	(65,262)	(30,318)
Cash flows from financing activities:
Proceeds from exercise of stock options	12,529	6,594
Excess tax benefits from stock-based compensation	4,832	315
Payments for taxes related to net share settlement of equity awards	(202)	0
Net cash provided by financing activities	17,159	6,909
Net increase in cash and cash equivalents	6,601	18,259
Cash and cash equivalents at beginning of period	91,698	76,504
Cash and cash equivalents at end of period	98,299	94,763
Non-cash investing and financing activities:
Accounts receivable	2,606	0
Vesting of early exercised common stock options	$ 0	$ 16

The Company and Summary of Sign

The Company and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Accounting Policies [Abstract]
The Company and Summary of Significant Accounting Policies	The Company and Summary of Significant Accounting Policies Description of Business Qualys, Inc. (the “Company”) was incorporated in the state of Delaware on December 30, 1999. The Company is headquartered in Redwood City, California and has majority-owned subsidiaries throughout the world. The Company is a pioneer and leading provider of cloud-based security and compliance solutions that enable organizations to identify security risks to their IT infrastructures, help protect their IT systems and applications from ever-evolving cyber-attacks and achieve compliance with internal policies and external regulations. The Company’s cloud solutions address the growing security and compliance complexities and risks that are amplified by the dissolving boundaries between internal and external IT infrastructures and web environments, the rapid adoption of cloud computing and the proliferation of geographically dispersed IT assets. Organizations can use the Company’s integrated suite of solutions delivered on its Qualys Cloud Platform to cost-effectively obtain a unified view of their security and compliance posture across globally-distributed IT infrastructures. Basis of Presentation The accompanying unaudited condensed consolidated financial statements and condensed footnotes have been prepared by the Company in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") for interim financial information as well as the instructions to Form 10-Q and the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet as of December 31, 2015 , included herein, was derived from the audited financial statements as of that date but does not include all disclosures, including notes required by U.S. GAAP. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the financial position, results of operations and cash flows for the interim periods. The results of operations for the three and nine month periods ended September 30, 2016 are not necessarily indicative of the results of operations expected for the entire year ending December 31, 2016 or for any other future annual or interim period. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC on February 26, 2016. Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany transactions and balances have been eliminated upon consolidation. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported results of operations during the reporting period. The Company’s management regularly assesses these estimates, which primarily affect revenue recognition, the valuation of accounts receivable, goodwill and intangible assets, stock-based compensation and the provision for income taxes. Actual results could differ from those estimates and such differences may be material to the accompanying condensed consolidated financial statements. Concentration of Credit Risk The Company invests its cash and cash equivalents with major financial institutions. Cash balances with any one institution at times may be in excess of federally insured limits. Cash equivalents are invested in high-quality investment grade financial instruments and are diversified. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. Credit risk with respect to accounts receivable is dispersed due to the large number of customers. Collateral is not required for accounts receivable. The Company maintains an allowance for potential credit losses based upon the expected collectability of accounts receivable. The Company writes off its receivables once collection efforts are unsuccessful. As of September 30, 2016 , there is one customer with a multi-year contract that accounted for approximately 10% of the Company's accounts receivable balance. As of December 31, 2015 , no customer or channel partner accounted for more than 10% of the Company's accounts receivable balance. Cash, Cash Equivalents, Short-Term and Long-Term Investments Cash and cash equivalents include cash held in banks, highly liquid money market funds, commercial paper and fixed-income U.S. government agency securities, all with original maturities of three months or less when acquired. The Company’s investments consist of fixed-income U.S. government agency securities, corporate bonds, asset-backed securities, and commercial paper. Management determines the appropriate classification of the Company's investments at the time of purchase and reevaluates such designation at each balance sheet date. The Company classifies its investments as either short-term or long-term based on each instrument's underlying contractual maturity date. Cash equivalents are stated at cost, which approximates fair market value. Short-term and long-term investments are classified as available-for-sale and are carried at fair value. Unrealized gains and losses in fair value are reported in other comprehensive income (loss). When the available-for-sale securities are sold, cost is based on the specific identification method, and the realized gains and losses are included in other income (expense) in the condensed consolidated statements of operations. Short-term and long-term investments are reviewed quarterly for impairment that is deemed to be other-than-temporary. An investment is considered other-than-temporarily impaired when its fair value is below its amortized cost and (1) there is an intent to sell the security, (2) it is “more likely than not” that the security will be sold before recovery of its amortized cost basis or (3) the present value of expected cash flows from the investment is not expected to recover the entire amortized cost basis. Declines in value that are considered to be other-than-temporary and adjustments to amortized cost for the amortization of premiums and the accretion of discounts are recorded in other income (expense). Interest and dividends are recorded in interest income as earned. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standard Update (“ASU”) amending revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU will be effective for fiscal years, and interim periods within those years, beginning after December 15, 2017, but entities will be permitted to early adopt the standard only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized on date of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In January 2016, the FASB issued an ASU that will impact certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This guidance is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In February 2016, the FASB issued an ASU which requires, among other things, lease assets and lease liabilities arising from leases, including operating leases, to be recognized on the balance sheet. In addition, the ASU requires disclosing key information about leasing arrangements. This guidance supersedes existing lease guidance and is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In March 2016, the FASB issued an ASU intended to simplify and improve various aspects related to how employee-share based payment transactions are accounted for and presented in the financial statements. The ASU addresses income tax consequences, classification of awards as either equity or liabilities, classification on the statement of cash flows and forfeiture rate calculations. This guidance is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For certain of the Company’s financial instruments, including certain cash equivalents, accounts receivable, accounts payable, and other current liabilities, the carrying amounts approximate their fair values due to the relatively short maturity of these balances. The Company measures and reports certain cash equivalents, investments and derivative foreign currency forward contracts at fair value in accordance with the provisions of the authoritative accounting guidance that addresses fair value measurements. This guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 —Valuations based on quoted prices in active markets for identical assets or liabilities. Level 2 —Valuations based on other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3— Valuations based on inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The Company's financial instruments consist of assets and liabilities measured using Level 1 and 2 inputs. Level 1 assets include a highly liquid money market fund, which is valued using unadjusted quoted prices that are available in an active market for an identical asset. Level 2 assets include fixed-income U.S. government agency securities, commercial paper, corporate bonds, asset-backed securities and derivative financial instruments consisting of foreign currency forward contracts. The securities, bonds and commercial paper are valued using prices from independent pricing services based on quoted prices in active markets for similar instruments or on industry models using data inputs such as interest rates and prices that can be directly observed or corroborated in active markets. The foreign currency forward contracts are valued usi ng observable inputs, such as quotations on forward foreign exchange points and foreign interest rates. The Company's cash and cash equivalents, short-term investments, and long-term investments consist of the following: September 30, 2016 Amortized Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Cash and cash equivalents: Cash $ 58,277 $ — $ — $ 58,277 Money market funds 19,713 — — 19,713 Commercial paper 20,308 1 — 20,309 Total 98,298 1 — 98,299 Short-term investments: Commercial paper 6,863 1 — 6,864 Corporate bonds 11,173 6 (9 ) 11,170 Asset-backed securities 256 — — 256 U.S. government agencies 93,372 26 (10 ) 93,388 Total 111,664 33 (19 ) 111,678 Long-term investments: Asset-backed securities 5,696 9 — 5,705 U.S. government agencies 43,776 25 (26 ) 43,775 Corporate bonds 15,457 6 (13 ) 15,450 Total 64,929 40 (39 ) 64,930 Total $ 274,891 $ 74 $ (58 ) $ 274,907 December 31, 2015 Amortized Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Cash and cash equivalents: Cash $ 61,372 $ — $ — $ 61,372 Money market funds 3,980 — — 3,980 U.S. government agencies 8,999 1 — 9,000 Commercial paper 17,345 1 — 17,346 Total 91,696 2 — 91,698 Short-term investments: Commercial paper 10,447 1 — 10,448 Corporate bonds 12,448 — (13 ) 12,435 U.S. government agencies 64,422 3 (40 ) 64,385 Total 87,317 4 (53 ) 87,268 Long-term investments: Asset-backed securities 7,007 — (18 ) 6,989 U.S. government agencies 32,683 — (142 ) 32,541 Corporate bonds 3,751 — (4 ) 3,747 Total 43,441 — (164 ) 43,277 Total $ 222,454 $ 6 $ (217 ) $ 222,243 The following table shows the changes to accumulated other comprehensive income for the nine months ended September 30, 2016: Unrealized Gain (Loss) on Investments Balance at December 31, 2015 $ (211 ) Change in net realized gain (loss) on investments 140 Amounts reclassified for net realized gain (loss) included in net income 87 Other comprehensive income 227 Balance at September 30, 2016 $ 16 The following table sets forth by level within the fair value hierarchy the fair value of the Company's available-for-sale securities measured on a recurring basis, excluding cash and money market funds: September 30, 2016 Level 1 Level 2 Level 3 Fair Value (in thousands) Commercial paper $ — $ 27,173 $ — $ 27,173 U.S. government agencies — 137,163 — 137,163 Corporate bonds — 26,620 — 26,620 Asset-backed securities — 5,961 — 5,961 Total $ — $ 196,917 $ — $ 196,917 December 31, 2015 Level 1 Level 2 Level 3 Fair Value (in thousands) Commercial paper $ — $ 27,794 $ — $ 27,794 U.S. government agencies — 105,926 — 105,926 Corporate bonds — 16,182 — 16,182 Asset-backed securities — 6,989 — 6,989 Total $ — $ 156,891 $ — $ 156,891 There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy, as determined at the end of each reporting period. The following summarizes the fair value of securities classified as available-for-sale by contractual, or effective, maturity: September 30, 2016 Mature within One Year After One Year through Two Years Over Two Years Fair Value (in thousands) Commercial paper $ 27,173 $ — $ — $ 27,173 U.S. government agencies 97,192 39,971 — 137,163 Corporate bonds 12,833 13,787 — 26,620 Asset-backed securities 5,961 — — 5,961 Total $ 143,159 $ 53,758 $ — $ 196,917 Derivative Financial Instruments Derivative financial instruments are utilized by the Company to reduce foreign currency exchange risks. The Company uses foreign currency forward contracts to mitigate the impact of foreign currency fluctuations of certain non-U.S. dollar denominated asset positions, primarily cash and accounts receivable. These contracts are recorded within prepaid expenses and other current assets or accrued liabilities in the condensed consolidated balance sheets. Gains and losses resulting from currency exchange rate movements on these forward contracts are recognized in other income (expense) in the accompanying condensed consolidated statements of operations in the period in which the exchange rates change and offset the foreign currency gains and losses on the underlying exposure being hedged. The Company does not enter into derivative financial instruments for trading or speculative purposes. At September 30, 2016 , the Company had two outstanding forward contrac ts with notional amounts of 7.5 million Euros and 4.5 million British Pounds, which expired on October 31, 2016 . At December 31, 2015 , the Company had two outstanding forward contracts with notional amounts of 6.1 million Euros and 2.6 million British Pounds, which expired on January 31, 2016 . These forward contracts were entered into at the end of each month, and thus the fair value of these contracts was $0 at September 30, 2016 and December 31, 2015 . These derivatives did not meet the criteria to be designated as hedges. These instruments were valued using Level 2 inputs. The following summarizes the gains (losses) recognized from forward contracts and other foreign currency transactions: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Net gain (loss) from forward contracts $ (82 ) $ 109 $ (9 ) $ 498 Other foreign currency transactions losses (2 ) (377 ) (276 ) (890 ) Total foreign exchange loss, net $ (84 ) $ (268 ) $ (285 ) $ (392 )

Property and Equipment, Net

Property and Equipment, Net	9 Months Ended
	Sep. 30, 2016
Property, Plant and Equipment [Abstract]
Property and Equipment, Net	Property and Equipment, Net Property and equipment consists of the following: September 30, December 31, 2016 2015 (in thousands) Computer equipment $ 59,142 $ 48,192 Computer software 19,621 12,484 Furniture, fixtures and equipment 3,200 2,804 Scanner appliances 24,491 22,627 Leasehold improvements 3,521 3,367 Total property and equipment 109,975 89,474 Less: accumulated depreciation and amortization (69,305 ) (58,145 ) Property and equipment, net $ 40,670 $ 31,329 Physical scanner appliances and other computer equipment that are or will be subject to subscriptions by customers have a net carrying value of $8.8 million and $8.4 million at September 30, 2016 and December 31, 2015 , respectively, including assets that have not been placed in service of $1.6 million and $1.4 million, respectively. Other fixed assets not placed in service at September 30, 2016 and December 31, 2015 , included in computer equipment and leasehold improvements, are approximately $2.8 million and $4.3 million , respectively. Depreciation and amortization expense relating to property and equipment was $4.4 million and $3.7 million for the three months ended September 30, 2016 and 2015 , respectively, and $12.0 million and $10.1 million for the nine months ended September 30, 2016 and 2015, respectively.

Goodwill and Intangible Assets,

Goodwill and Intangible Assets, Net	9 Months Ended
	Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets, Net	Goodwill and Intangible Assets, Net Intangible assets consist primarily of existing technology and a patent license acquired in business combinations. Acquired intangibles are amortized on a straight-line basis over the respective estimated useful lives of the assets. The carrying values of intangible assets are as follows (in thousands): September 30, 2016 December 31, 2015 Estimated Lives Cost Accumulated Amortization Net Book Value Accumulated Amortization Net Book Value Existing technology 7 years $ 1,910 $ (1,660 ) $ 250 $ (1,456 ) $ 454 Patent license 14 years 1,388 (598 ) 790 (522 ) 866 Total intangibles subject to amortization $ 3,298 $ (2,258 ) 1,040 $ (1,978 ) 1,320 Intangible assets not subject to amortization 40 40 Total intangible assets, net $ 1,080 $ 1,360 Intangibles amortization expense was $0.1 million for the three months ended September 30, 2016 and 2015 and $0.3 million for the nine months ended September 30, 2016 and 2015. As of September 30, 2016 , the Company expects amortization expense in future periods to be as follows (in thousands): Remainder of 2016 $ 93 2017 282 2018 100 2019 100 2020 100 2021 and thereafter 365 Total expected future amortization expense $ 1,040 Goodwill, which is not subject to amortization, totaled $0.3 million as of September 30, 2016 and December 31, 2015 .

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Leases The Company leases certain computer equipment and its corporate office and data center facilities under noncancelable operating leases for varying periods through 2022. The following are the minimum annual lease payments due under operating leases at September 30, 2016 (in thousands): Remainder of 2016 $ 1,211 2017 3,474 2018 1,495 2019 1,175 2020 961 2021 and thereafter 712 Total minimum lease payments $ 9,028 Rent expense was $1.8 million and $1.6 million for the three months ended September 30, 2016 and 2015 , respectively, and $5.3 million and $4.8 million for the nine months ended September 30, 2016 and 2015, respectively. Although certain of the operating lease agreements provide for escalating rent payments over the terms of the leases, rent expense under these agreements is recognized on a straight-line basis. As of September 30, 2016 and December 31, 2015 , the Company has accrued $0.4 million and $0.5 million , respectively, of deferred rent related to these agreements, which is reflected in accrued liabilities and other noncurrent liabilities in the accompanying condensed consolidated balance sheets. Indemnifications The Company from time to time enters into certain types of contracts that contingently require it to indemnify various parties against claims from third parties. These contracts primarily relate to (i) the Company's by-laws, under which it must indemnify directors and executive officers, and may indemnify other officers and employees, for liabilities arising out of their relationship, (ii) contracts under which the Company must indemnify directors and certain officers for liabilities arising out of their relationship, and (iii) contracts under which the Company may be required to indemnify customers or resellers from certain liabilities arising from potential infringement of intellectual property rights, as well as potential damages caused by limited product defects. To date, the Company has not incurred and has not recorded any liability in connection with such indemnifications. The Company maintains director and officer insurance, which may cover certain liabilities arising from its obligation to indemnify its directors. Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a liability for such matters when it is probable a loss has been incurred and such loss can be reasonably estimated. At September 30, 2016 , the Company has not recorded any material liabilities in accordance with accounting for contingencies.

Stock-based Compensation

Stock-based Compensation	9 Months Ended
	Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation	Stock-based Compensation Equity Incentive Plans 2012 Equity Incentive Plan Under the 2012 Equity Incentive Plan (the "2012 Plan"), the Company is authorized to grant to eligible participants incentive stock options (“ISOs”), non-statutory stock options (“NSOs”), stock appreciation rights ("SARs"), restricted stock awards ("RSAs"), restricted stock units ("RSUs"), performance units and performance shares equivalent to up to 8,069,184 shares of common stock. Options may be granted with an exercise price that is at least equal to the fair market value of the Company's stock at the date of grant and are exercisable when vested. As of September 30, 2016 , 1,478,776 shares were available for grant under the 2012 Plan. 2000 Equity Incentive Plan Under the 2000 Equity Incentive Plan (the "2000 Plan"), the Company was authorized to grant to eligible participants either ISOs or NSOs. The 2000 Plan was terminated in connection with the closing of the initial public offering ("IPO"), and accordingly, no shares are currently available for grant under the 2000 Plan. The 2000 Plan continues to govern outstanding awards granted thereunder. Stock-based compensation The following table shows a summary of the stock-based compensation expense included in the condensed consolidated statements of operation for the three and nine months ended September 30, 2016 and 2015. Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Cost of revenues $ 516 $ 333 $ 1,318 $ 1,005 Research and development 1,585 1,294 4,373 3,584 Sales and marketing 821 1,015 3,459 2,806 General and administrative 2,181 1,779 5,972 5,283 Total stock-based compensation $ 5,103 $ 4,421 $ 15,122 $ 12,678 As of September 30, 2016 , the Company had $25.1 million of total unrecognized employee compensation cost related to unvested option awards that it expects to recognize over a weighted-average period of 2.9 years, and $9.2 million of unrecognized compensation cost related to unvested RSUs that it expects to recognize over a weighted-average period of 3.4 years. Compensation cost is recognized on a straight-line basis over the service period. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Stock Options Employee Stock-based Compensation The fair value of each option granted to employees is estimated on the date of grant using the Black-Scholes option-pricing model based on the following assumptions: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Expected term (in years) 5.0 to 5.9 4.9 to 5.9 5.0 to 5.9 4.9 to 5.9 Volatility 49% 46% 45% to 49% 45% to 48% Risk-free interest rate 1.1% 1.6% 1.1% to 1.3% 1.3% to 1.65% Dividend yield —% —% —% —% The expected term of the options is based on evaluations of historical and expected future employee exercise behavior. The risk-free interest rate is based on the U.S. Treasury rates at the date of grant with maturity dates approximately equal to the expected term at the grant date. Volatility is based on a combination of the historical volatility of the Company and of several public entities that are similar to the Company. The Company bases volatility on this combination because it does not have sufficient historical transactions in its own shares on which to solely base expected volatility. The Company has not historically declared any dividends and does not expect to in the future. Non-Employee Stock-based Compensation The Company records compensation representing the fair value of stock options granted to non-employees. Non-employee stock-based compensation is recognized over the vesting periods of the options. The value of options granted to non-employees is remeasured as they vest over their respective performance period. Stock Option Plan Activity A summary of the Company’s stock option activity is as follows: Outstanding Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value (in thousands) December 31, 2015 7,579,058 $ 16.88 5.9 $ 131,345 Granted 2,007,683 $ 26.06 Exercised (1,250,532 ) $ 10.02 Canceled (651,821 ) $ 31.63 September 30, 2016 7,684,388 $ 19.15 6.3 $ 149,030 Vested and expected to vest - September 30, 2016 7,085,321 $ 18.25 6.0 $ 143,568 Exercisable - September 30, 2016 4,955,900 $ 13.69 4.7 $ 122,586 Restricted Stock The terms and conditions of RSUs and RSAs, including vesting criteria and timing are set by the board of directors. The cost of RSUs and RSAs is determined using the fair value of the Company’s common stock on the date of grant. Compensation cost is recognized on a straight-line basis over the requisite service period of each grant, adjusted for estimated forfeitures. A summary of the Company’s RSU and RSA activity is as follows: Outstanding RSUs and RSAs Weighted Average Fair Value Per Share December 31, 2015 47,500 $ 37.28 Granted 588,527 $ 27.19 Released (22,162 ) $ 28.23 Canceled (78,710 ) $ 31.89 September 30, 2016 535,155 $ 27.35 Outstanding and expected to vest - September 30, 2016 363,539 $ 27.41

Other Income (Expense), Net

Other Income (Expense), Net	9 Months Ended
	Sep. 30, 2016
Other Income and Expenses [Abstract]
Other Income (Expense), Net	Other Income (Expense), Net Other income (expense), net consists of the following: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Foreign exchange gain (loss) $ (84 ) $ (268 ) $ (285 ) $ (392 ) Other income (expense) (40 ) (39 ) (157 ) (93 ) Other expense, net $ (124 ) $ (307 ) $ (442 ) $ (485 )

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2016
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company recorded an income tax provision of $3.2 million and $2.6 million for the three months ended September 30, 2016 and 2015, respectively. The effective income tax rate was approximately 39.2% and 38.7% for the three months ended September 30, 2016 and 2015, respectively. The Company recorded an income tax provision of $8.4 million and $6.6 million for the nine months ended September 30, 2016 and 2015 , respectively. The effective income tax rate for the nine months ended September 30, 2016 and 2015 was approximately 38.7% and 38.6% , respectively. As of September 30, 2016 , the Company had unrecognized tax benefits of $4.2 million , of which $2.5 million , if recognized, would favorably impact the Company's effective tax rate. As of December 31, 2015 , the Company had unrecognized tax benefits of $3.5 million , of which $2.1 million , if recognized, would favorably impact the Company's effective tax rate. The Company does not anticipate a material change in its unrecognized tax benefits in the next 12 months.

Segment Information and Informa

Segment Information and Information about Geographic Area	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Segment Information and Information about Geographic Area	Segment Information and Information about Geographic Area The Company operates in one segment. The Company’s chief operating decision maker is the Chairman, President and Chief Executive Officer, who makes operating decisions, assesses performance and allocates resources on a consolidated basis. All of the Company’s principal operations and decision-making functions are located in the United States. Revenues by geographic area, based on the location of the customer, are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) United States $ 35,965 $ 29,993 $ 102,850 $ 84,463 Foreign 15,022 12,476 42,851 35,376 Total revenues $ 50,987 $ 42,469 $ 145,701 $ 119,839 Property and equipment, net, by geographic area, are as follows: September 30, December 31, 2016 2015 (in thousands) United States $ 32,429 $ 25,623 Foreign 8,241 5,706 Total property and equipment, net $ 40,670 $ 31,329

Net Income Per Share

Net Income Per Share	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Net Income Per Share	Net Income Per Share The computations for basic and diluted net income per share are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands, except per share data) Numerator: Net income $ 4,996 $ 4,123 $ 13,317 $ 10,441 Denominator: Weighted-average shares used in computing net income per share: Basic 35,477 34,119 35,074 33,967 Effect of potentially dilutive securities: Common stock options 3,103 3,819 3,089 4,235 Restricted stock units 132 — 42 — Diluted 38,712 37,938 38,205 38,202 Net income per share: Basic $ 0.14 $ 0.12 $ 0.38 $ 0.31 Diluted $ 0.13 $ 0.11 $ 0.35 $ 0.27 Potentially dilutive securities not included in the calculation of diluted net income per share because doing so would be antidilutive are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Common stock options 2,881 1,889 3,594 1,409 Restricted stock units — — 38 — 2,881 1,889 3,632 1,409

Subsequent Event

Subsequent Event	9 Months Ended
	Sep. 30, 2016
Subsequent Events [Abstract]
Subsequent Event	Subsequent Event On October 14, 2016, the Company entered into a lease agreement for its new headquarter office facility. The lease commences May 1, 2018 and has a ten -year term through April 2028. The total commitment of $37.8 million is payable monthly with escalating rental payments throughout the lease term. The Company will be provided access to the facility on or around February 1, 2017 to begin construction of certain leasehold improvements. In connection with this lease, the Company has provided the landlord with a $1.2 million standby letter of credit to secure the Company’s obligations through the end of the lease term.

The Company and Summary of Si18

The Company and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Accounting Policies [Abstract]
Description Of Business	Description of Business Qualys, Inc. (the “Company”) was incorporated in the state of Delaware on December 30, 1999. The Company is headquartered in Redwood City, California and has majority-owned subsidiaries throughout the world. The Company is a pioneer and leading provider of cloud-based security and compliance solutions that enable organizations to identify security risks to their IT infrastructures, help protect their IT systems and applications from ever-evolving cyber-attacks and achieve compliance with internal policies and external regulations. The Company’s cloud solutions address the growing security and compliance complexities and risks that are amplified by the dissolving boundaries between internal and external IT infrastructures and web environments, the rapid adoption of cloud computing and the proliferation of geographically dispersed IT assets. Organizations can use the Company’s integrated suite of solutions delivered on its Qualys Cloud Platform to cost-effectively obtain a unified view of their security and compliance posture across globally-distributed IT infrastructures.
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements and condensed footnotes have been prepared by the Company in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") for interim financial information as well as the instructions to Form 10-Q and the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet as of December 31, 2015 , included herein, was derived from the audited financial statements as of that date but does not include all disclosures, including notes required by U.S. GAAP. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the financial position, results of operations and cash flows for the interim periods. The results of operations for the three and nine month periods ended September 30, 2016 are not necessarily indicative of the results of operations expected for the entire year ending December 31, 2016 or for any other future annual or interim period. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC on February 26, 2016.
Principles of Consolidation	Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany transactions and balances have been eliminated upon consolidation.
Use of Estimates	Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported results of operations during the reporting period. The Company’s management regularly assesses these estimates, which primarily affect revenue recognition, the valuation of accounts receivable, goodwill and intangible assets, stock-based compensation and the provision for income taxes. Actual results could differ from those estimates and such differences may be material to the accompanying condensed consolidated financial statements.
Concentration of Credit Risk	Concentration of Credit Risk The Company invests its cash and cash equivalents with major financial institutions. Cash balances with any one institution at times may be in excess of federally insured limits. Cash equivalents are invested in high-quality investment grade financial instruments and are diversified. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk. Credit risk with respect to accounts receivable is dispersed due to the large number of customers. Collateral is not required for accounts receivable. The Company maintains an allowance for potential credit losses based upon the expected collectability of accounts receivable. The Company writes off its receivables once collection efforts are unsuccessful.
Cash, Cash Equivalents, Short-Term and Long-Term Investments	Cash, Cash Equivalents, Short-Term and Long-Term Investments Cash and cash equivalents include cash held in banks, highly liquid money market funds, commercial paper and fixed-income U.S. government agency securities, all with original maturities of three months or less when acquired. The Company’s investments consist of fixed-income U.S. government agency securities, corporate bonds, asset-backed securities, and commercial paper. Management determines the appropriate classification of the Company's investments at the time of purchase and reevaluates such designation at each balance sheet date. The Company classifies its investments as either short-term or long-term based on each instrument's underlying contractual maturity date. Cash equivalents are stated at cost, which approximates fair market value. Short-term and long-term investments are classified as available-for-sale and are carried at fair value. Unrealized gains and losses in fair value are reported in other comprehensive income (loss). When the available-for-sale securities are sold, cost is based on the specific identification method, and the realized gains and losses are included in other income (expense) in the condensed consolidated statements of operations. Short-term and long-term investments are reviewed quarterly for impairment that is deemed to be other-than-temporary. An investment is considered other-than-temporarily impaired when its fair value is below its amortized cost and (1) there is an intent to sell the security, (2) it is “more likely than not” that the security will be sold before recovery of its amortized cost basis or (3) the present value of expected cash flows from the investment is not expected to recover the entire amortized cost basis. Declines in value that are considered to be other-than-temporary and adjustments to amortized cost for the amortization of premiums and the accretion of discounts are recorded in other income (expense). Interest and dividends are recorded in interest income as earned.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standard Update (“ASU”) amending revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU will be effective for fiscal years, and interim periods within those years, beginning after December 15, 2017, but entities will be permitted to early adopt the standard only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized on date of adoption. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In January 2016, the FASB issued an ASU that will impact certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This guidance is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In February 2016, the FASB issued an ASU which requires, among other things, lease assets and lease liabilities arising from leases, including operating leases, to be recognized on the balance sheet. In addition, the ASU requires disclosing key information about leasing arrangements. This guidance supersedes existing lease guidance and is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In March 2016, the FASB issued an ASU intended to simplify and improve various aspects related to how employee-share based payment transactions are accounted for and presented in the financial statements. The ASU addresses income tax consequences, classification of awards as either equity or liabilities, classification on the statement of cash flows and forfeiture rate calculations. This guidance is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.
Fair Value of Financial Instruments	Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For certain of the Company’s financial instruments, including certain cash equivalents, accounts receivable, accounts payable, and other current liabilities, the carrying amounts approximate their fair values due to the relatively short maturity of these balances. The Company measures and reports certain cash equivalents, investments and derivative foreign currency forward contracts at fair value in accordance with the provisions of the authoritative accounting guidance that addresses fair value measurements. This guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 —Valuations based on quoted prices in active markets for identical assets or liabilities. Level 2 —Valuations based on other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3— Valuations based on inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The Company's financial instruments consist of assets and liabilities measured using Level 1 and 2 inputs. Level 1 assets include a highly liquid money market fund, which is valued using unadjusted quoted prices that are available in an active market for an identical asset. Level 2 assets include fixed-income U.S. government agency securities, commercial paper, corporate bonds, asset-backed securities and derivative financial instruments consisting of foreign currency forward contracts. The securities, bonds and commercial paper are valued using prices from independent pricing services based on quoted prices in active markets for similar instruments or on industry models using data inputs such as interest rates and prices that can be directly observed or corroborated in active markets. The foreign currency forward contracts are valued usi ng observable inputs, such as quotations on forward foreign exchange points and foreign interest rates.

Fair Value of Financial Instr19

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Schedule of Cash and Cash Equivalents, Available-for-sale Securities Reconciliation	The Company's cash and cash equivalents, short-term investments, and long-term investments consist of the following: September 30, 2016 Amortized Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Cash and cash equivalents: Cash $ 58,277 $ — $ — $ 58,277 Money market funds 19,713 — — 19,713 Commercial paper 20,308 1 — 20,309 Total 98,298 1 — 98,299 Short-term investments: Commercial paper 6,863 1 — 6,864 Corporate bonds 11,173 6 (9 ) 11,170 Asset-backed securities 256 — — 256 U.S. government agencies 93,372 26 (10 ) 93,388 Total 111,664 33 (19 ) 111,678 Long-term investments: Asset-backed securities 5,696 9 — 5,705 U.S. government agencies 43,776 25 (26 ) 43,775 Corporate bonds 15,457 6 (13 ) 15,450 Total 64,929 40 (39 ) 64,930 Total $ 274,891 $ 74 $ (58 ) $ 274,907 December 31, 2015 Amortized Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Cash and cash equivalents: Cash $ 61,372 $ — $ — $ 61,372 Money market funds 3,980 — — 3,980 U.S. government agencies 8,999 1 — 9,000 Commercial paper 17,345 1 — 17,346 Total 91,696 2 — 91,698 Short-term investments: Commercial paper 10,447 1 — 10,448 Corporate bonds 12,448 — (13 ) 12,435 U.S. government agencies 64,422 3 (40 ) 64,385 Total 87,317 4 (53 ) 87,268 Long-term investments: Asset-backed securities 7,007 — (18 ) 6,989 U.S. government agencies 32,683 — (142 ) 32,541 Corporate bonds 3,751 — (4 ) 3,747 Total 43,441 — (164 ) 43,277 Total $ 222,454 $ 6 $ (217 ) $ 222,243
Schedule of changes to accumulated other comprehensive income	The following table shows the changes to accumulated other comprehensive income for the nine months ended September 30, 2016: Unrealized Gain (Loss) on Investments Balance at December 31, 2015 $ (211 ) Change in net realized gain (loss) on investments 140 Amounts reclassified for net realized gain (loss) included in net income 87 Other comprehensive income 227 Balance at September 30, 2016 $ 16
Schedule of Assets Measured on Recurring Basis	The following table sets forth by level within the fair value hierarchy the fair value of the Company's available-for-sale securities measured on a recurring basis, excluding cash and money market funds: September 30, 2016 Level 1 Level 2 Level 3 Fair Value (in thousands) Commercial paper $ — $ 27,173 $ — $ 27,173 U.S. government agencies — 137,163 — 137,163 Corporate bonds — 26,620 — 26,620 Asset-backed securities — 5,961 — 5,961 Total $ — $ 196,917 $ — $ 196,917 December 31, 2015 Level 1 Level 2 Level 3 Fair Value (in thousands) Commercial paper $ — $ 27,794 $ — $ 27,794 U.S. government agencies — 105,926 — 105,926 Corporate bonds — 16,182 — 16,182 Asset-backed securities — 6,989 — 6,989 Total $ — $ 156,891 $ — $ 156,891
Schedule of Available-for-Sale Securities by Contractual Maturity	The following summarizes the fair value of securities classified as available-for-sale by contractual, or effective, maturity: September 30, 2016 Mature within One Year After One Year through Two Years Over Two Years Fair Value (in thousands) Commercial paper $ 27,173 $ — $ — $ 27,173 U.S. government agencies 97,192 39,971 — 137,163 Corporate bonds 12,833 13,787 — 26,620 Asset-backed securities 5,961 — — 5,961 Total $ 143,159 $ 53,758 $ — $ 196,917
Summary of Gains (Losses) Recognized From Forward Contracts and Other Foreign Currency Transactions	The following summarizes the gains (losses) recognized from forward contracts and other foreign currency transactions: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Net gain (loss) from forward contracts $ (82 ) $ 109 $ (9 ) $ 498 Other foreign currency transactions losses (2 ) (377 ) (276 ) (890 ) Total foreign exchange loss, net $ (84 ) $ (268 ) $ (285 ) $ (392 )

Property and Equipment, Net (Ta

Property and Equipment, Net (Tables)	9 Months Ended
	Sep. 30, 2016
Property, Plant and Equipment [Abstract]
Property and equipment, net	Property and equipment consists of the following: September 30, December 31, 2016 2015 (in thousands) Computer equipment $ 59,142 $ 48,192 Computer software 19,621 12,484 Furniture, fixtures and equipment 3,200 2,804 Scanner appliances 24,491 22,627 Leasehold improvements 3,521 3,367 Total property and equipment 109,975 89,474 Less: accumulated depreciation and amortization (69,305 ) (58,145 ) Property and equipment, net $ 40,670 $ 31,329

Goodwill and Intangible Asset21

Goodwill and Intangible Assets, Net (Tables)	9 Months Ended
	Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Carrying value of intangible assets	The carrying values of intangible assets are as follows (in thousands): September 30, 2016 December 31, 2015 Estimated Lives Cost Accumulated Amortization Net Book Value Accumulated Amortization Net Book Value Existing technology 7 years $ 1,910 $ (1,660 ) $ 250 $ (1,456 ) $ 454 Patent license 14 years 1,388 (598 ) 790 (522 ) 866 Total intangibles subject to amortization $ 3,298 $ (2,258 ) 1,040 $ (1,978 ) 1,320 Intangible assets not subject to amortization 40 40 Total intangible assets, net $ 1,080 $ 1,360
Intangible assets future periods amortization expense	As of September 30, 2016 , the Company expects amortization expense in future periods to be as follows (in thousands): Remainder of 2016 $ 93 2017 282 2018 100 2019 100 2020 100 2021 and thereafter 365 Total expected future amortization expense $ 1,040

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Schedule of Future Minimum Lease Payments for Operating Leases	The following are the minimum annual lease payments due under operating leases at September 30, 2016 (in thousands): Remainder of 2016 $ 1,211 2017 3,474 2018 1,495 2019 1,175 2020 961 2021 and thereafter 712 Total minimum lease payments $ 9,028

Stock-based Compensation (Table

Stock-based Compensation (Tables)	9 Months Ended
	Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Employee stock-based compensation	The following table shows a summary of the stock-based compensation expense included in the condensed consolidated statements of operation for the three and nine months ended September 30, 2016 and 2015. Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Cost of revenues $ 516 $ 333 $ 1,318 $ 1,005 Research and development 1,585 1,294 4,373 3,584 Sales and marketing 821 1,015 3,459 2,806 General and administrative 2,181 1,779 5,972 5,283 Total stock-based compensation $ 5,103 $ 4,421 $ 15,122 $ 12,678
Fair value assumptions of options granted to employees	The fair value of each option granted to employees is estimated on the date of grant using the Black-Scholes option-pricing model based on the following assumptions: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Expected term (in years) 5.0 to 5.9 4.9 to 5.9 5.0 to 5.9 4.9 to 5.9 Volatility 49% 46% 45% to 49% 45% to 48% Risk-free interest rate 1.1% 1.6% 1.1% to 1.3% 1.3% to 1.65% Dividend yield —% —% —% —%
Stock option activity	A summary of the Company’s stock option activity is as follows: Outstanding Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value (in thousands) December 31, 2015 7,579,058 $ 16.88 5.9 $ 131,345 Granted 2,007,683 $ 26.06 Exercised (1,250,532 ) $ 10.02 Canceled (651,821 ) $ 31.63 September 30, 2016 7,684,388 $ 19.15 6.3 $ 149,030 Vested and expected to vest - September 30, 2016 7,085,321 $ 18.25 6.0 $ 143,568 Exercisable - September 30, 2016 4,955,900 $ 13.69 4.7 $ 122,586
Restricted stock units activity	A summary of the Company’s RSU and RSA activity is as follows: Outstanding RSUs and RSAs Weighted Average Fair Value Per Share December 31, 2015 47,500 $ 37.28 Granted 588,527 $ 27.19 Released (22,162 ) $ 28.23 Canceled (78,710 ) $ 31.89 September 30, 2016 535,155 $ 27.35 Outstanding and expected to vest - September 30, 2016 363,539 $ 27.41

Other Income (Expense), Net (Ta

Other Income (Expense), Net (Tables)	9 Months Ended
	Sep. 30, 2016
Other Income and Expenses [Abstract]
Schedule of Other Nonoperating Income (Expense)	Other income (expense), net consists of the following: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Foreign exchange gain (loss) $ (84 ) $ (268 ) $ (285 ) $ (392 ) Other income (expense) (40 ) (39 ) (157 ) (93 ) Other expense, net $ (124 ) $ (307 ) $ (442 ) $ (485 )

Segment Information and Infor25

Segment Information and Information about Geographic Area (Tables)	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Revenues and property and equipment, net, by geographic area	Revenues by geographic area, based on the location of the customer, are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) United States $ 35,965 $ 29,993 $ 102,850 $ 84,463 Foreign 15,022 12,476 42,851 35,376 Total revenues $ 50,987 $ 42,469 $ 145,701 $ 119,839 Property and equipment, net, by geographic area, are as follows: September 30, December 31, 2016 2015 (in thousands) United States $ 32,429 $ 25,623 Foreign 8,241 5,706 Total property and equipment, net $ 40,670 $ 31,329

Net Income Per Share (Tables)

Net Income Per Share (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	The computations for basic and diluted net income per share are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands, except per share data) Numerator: Net income $ 4,996 $ 4,123 $ 13,317 $ 10,441 Denominator: Weighted-average shares used in computing net income per share: Basic 35,477 34,119 35,074 33,967 Effect of potentially dilutive securities: Common stock options 3,103 3,819 3,089 4,235 Restricted stock units 132 — 42 — Diluted 38,712 37,938 38,205 38,202 Net income per share: Basic $ 0.14 $ 0.12 $ 0.38 $ 0.31 Diluted $ 0.13 $ 0.11 $ 0.35 $ 0.27
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	Potentially dilutive securities not included in the calculation of diluted net income per share because doing so would be antidilutive are as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 (in thousands) Common stock options 2,881 1,889 3,594 1,409 Restricted stock units — — 38 — 2,881 1,889 3,632 1,409

The Company and Summary of Si27

The Company and Summary of Significant Accounting Policies (Details) - customer	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2015
Accounts Receivable | Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, number of customers	0	0	1

Fair Value of Financial Instr28

Fair Value of Financial Instruments - Cash and Cash Equivalents, Available-for-sale Securities Reconciliation (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	$ 274,891	$ 222,454
Unrealized Gains	74	6
Unrealized Losses	(58)	(217)
Fair Value	274,907	222,243
Cash and cash equivalents
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	98,298	91,696
Unrealized Gains	1	2
Unrealized Losses	0	0
Fair Value	98,299	91,698
Short-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	111,664	87,317
Unrealized Gains	33	4
Unrealized Losses	(19)	(53)
Fair Value	111,678	87,268
Long-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	64,929	43,441
Unrealized Gains	40	0
Unrealized Losses	(39)	(164)
Fair Value	64,930	43,277
Cash | Cash and cash equivalents
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	58,277	61,372
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	58,277	61,372
Money market funds | Cash and cash equivalents
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	19,713	3,980
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	19,713	3,980
Commercial paper | Cash and cash equivalents
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	20,308	17,345
Unrealized Gains	1	1
Unrealized Losses	0	0
Fair Value	20,309	17,346
Commercial paper | Short-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	6,863	10,447
Unrealized Gains	1	1
Unrealized Losses	0	0
Fair Value	6,864	10,448
Corporate bonds | Short-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	11,173	12,448
Unrealized Gains	6	0
Unrealized Losses	(9)	(13)
Fair Value	11,170	12,435
Corporate bonds | Long-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	15,457	3,751
Unrealized Gains	6	0
Unrealized Losses	(13)	(4)
Fair Value	15,450	3,747
Asset backed securities | Short-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	256
Unrealized Gains	0
Unrealized Losses	0
Fair Value	256
Asset backed securities | Long-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	5,696	7,007
Unrealized Gains	9	0
Unrealized Losses	0	(18)
Fair Value	5,705	6,989
US government agencies | Cash and cash equivalents
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost		8,999
Unrealized Gains		1
Unrealized Losses		0
Fair Value		9,000
US government agencies | Short-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	93,372	64,422
Unrealized Gains	26	3
Unrealized Losses	(10)	(40)
Fair Value	93,388	64,385
US government agencies | Long-term investments
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract]
Amortized Cost	43,776	32,683
Unrealized Gains	25	0
Unrealized Losses	(26)	(142)
Fair Value	$ 43,775	$ 32,541

Fair Value of Financial Instr29

Fair Value of Financial Instruments - Changes in Other Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance			$ 195,566
Change in net realized gain (loss) on investments	$ (58)	$ 15	140	$ 25
Amounts reclassified for net realized gain (loss) included in net income	(38)	(5)	87	2
Other comprehensive income (loss), net	(96)	$ 10	227	$ 27
Ending balance	241,393		241,393
Unrealized Gain (Loss) on Investments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance			(211)
Change in net realized gain (loss) on investments			140
Amounts reclassified for net realized gain (loss) included in net income			87
Other comprehensive income (loss), net			227
Ending balance	$ 16		$ 16

Fair Value of Financial Instr30

Fair Value of Financial Instruments - Fair Value Hierarchy (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	$ 196,917
Level 1 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	$ 0
Level 2 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	196,917	156,891
Level 3 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Commercial paper
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	27,173
Commercial paper | Level 1 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Commercial paper | Level 2 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	27,173	27,794
Commercial paper | Level 3 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
US government agencies
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	137,163
US government agencies | Level 1 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
US government agencies | Level 2 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	137,163	105,926
US government agencies | Level 3 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Corporate bonds
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	26,620
Corporate bonds | Level 1 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Corporate bonds | Level 2 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	26,620	16,182
Corporate bonds | Level 3 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Asset backed securities
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	5,961
Asset backed securities | Level 1 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Asset backed securities | Level 2 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	5,961	6,989
Asset backed securities | Level 3 | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	0	0
Fair Value | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	196,917	156,891
Fair Value | Commercial paper | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	27,173	27,794
Fair Value | US government agencies | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	137,163	105,926
Fair Value | Corporate bonds | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	26,620	16,182
Fair Value | Asset backed securities | Recurring Basis
Assets, Fair Value Disclosure [Abstract]
Available-for-sale securities, fair value	$ 5,961	$ 6,989

Fair Value of Financial Instr31

Fair Value of Financial Instruments - Contractual Maturity (Details) $ in Thousands	Sep. 30, 2016USD ($)
Schedule of Available-for-sale Securities [Line Items]
Mature within One Year	$ 143,159
After One Year through Two Years	53,758
Over Two Years	0
Fair Value	196,917
Commercial paper
Schedule of Available-for-sale Securities [Line Items]
Mature within One Year	27,173
After One Year through Two Years	0
Over Two Years	0
Fair Value	27,173
US government agencies
Schedule of Available-for-sale Securities [Line Items]
Mature within One Year	97,192
After One Year through Two Years	39,971
Over Two Years	0
Fair Value	137,163
Corporate bonds
Schedule of Available-for-sale Securities [Line Items]
Mature within One Year	12,833
After One Year through Two Years	13,787
Over Two Years	0
Fair Value	26,620
Asset backed securities
Schedule of Available-for-sale Securities [Line Items]
Mature within One Year	5,961
After One Year through Two Years	0
Over Two Years	0
Fair Value	$ 5,961

Fair Value of Financial Instr32

Fair Value of Financial Instruments - Derivatives (Details) € in Millions, £ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016GBP (£)contract	Sep. 30, 2016EUR (€)contract	Sep. 30, 2016USD ($)contract	Dec. 31, 2015GBP (£)contract	Dec. 31, 2015EUR (€)contract	Dec. 31, 2015USD ($)contract
Derivatives, Fair Value [Line Items]
Foreign currency contract, asset, fair value disclosure										$ 0
Foreign currency transaction gains (losses)	$ (2,000)	$ (377,000)	$ (276,000)	$ (890,000)
Forward Contracts
Derivatives, Fair Value [Line Items]
Derivative, number of instruments held | contract					2	2	2	2	2	2
Derivative, notional amount					£ 4.5	€ 7.5		£ 2.6	€ 6.1
Foreign currency contract, asset, fair value disclosure							$ 0

Fair Value of Financial Instr33

Fair Value of Financial Instruments - Gains (Losses) Recognized (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Derivative Instruments, Gain (Loss) [Line Items]
Foreign exchange gain (loss)	$ (2)	$ (377)	$ (276)	$ (890)
Total foreign exchange loss, net	(84)	(268)	(285)	(392)
Forward Contracts
Derivative Instruments, Gain (Loss) [Line Items]
Gains (losses) recognized	$ (82)	$ 109	$ (9)	$ 498

Property and Equipment, Net (De

Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Property and equipment	$ 109,975		$ 109,975		$ 89,474
Less: accumulated depreciation and amortization	(69,305)		(69,305)		(58,145)
Property and equipment, net	40,670		40,670		31,329
Depreciation and amortization expense	4,400	$ 3,700	12,000	$ 10,100
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment	59,142		59,142		48,192
Computer software
Property, Plant and Equipment [Line Items]
Property and equipment	19,621		19,621		12,484
Furniture, fixtures and equipment
Property, Plant and Equipment [Line Items]
Property and equipment	3,200		3,200		2,804
Scanner appliances
Property, Plant and Equipment [Line Items]
Property and equipment	24,491		24,491		22,627
Scanner appliances and other computer equipment subject to subscription
Property, Plant and Equipment [Line Items]
Property and equipment, net	8,800		8,800		8,400
Scanner appliances and other computer equipment not placed in service
Property, Plant and Equipment [Line Items]
Property and equipment	1,600		1,600		1,400
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment	3,521		3,521		3,367
Other fixed assets not placed in service
Property, Plant and Equipment [Line Items]
Property and equipment	$ 2,800		$ 2,800		$ 4,300

Goodwill and Intangible Asset35

Goodwill and Intangible Assets, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Schedule of Goodwill and Intangible Assets [Line Items]
Cost	$ 3,298		$ 3,298		$ 3,298
Accumulated Amortization	(2,258)		(2,258)		(1,978)
Net Book Value	1,040		1,040		1,320
Intangible assets not subject to amortization	40		40		40
Total intangible assets, net	1,080		1,080		1,360
Amortization of intangible assets	100	$ 100	300	$ 300
Goodwill	317		$ 317		317
Existing technology
Schedule of Goodwill and Intangible Assets [Line Items]
Estimated Lives			7 years
Cost	1,910		$ 1,910		1,910
Accumulated Amortization	(1,660)		(1,660)		(1,456)
Net Book Value	250		$ 250		454
Patent license
Schedule of Goodwill and Intangible Assets [Line Items]
Estimated Lives			14 years
Cost	1,388		$ 1,388		1,388
Accumulated Amortization	(598)		(598)		(522)
Net Book Value	$ 790		$ 790		$ 866

Goodwill and Intangible Asset36

Goodwill and Intangible Assets, Net Future Amortization (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2016	$ 93
2,017	282
2,018	100
2,019	100
2,020	100
2021 and thereafter	365
Net Book Value	$ 1,040	$ 1,320

Commitments and Contingencies

Commitments and Contingencies - Schedule of Leases (Details) $ in Thousands	Sep. 30, 2016USD ($)
Operating Leases
Remainder of 2016	$ 1,211
2,017	3,474
2,018	1,495
2,019	1,175
2,020	961
2021 and thereafter	712
Total minimum lease payments	$ 9,028

Commitments and Contingencies38

Commitments and Contingencies - Lease Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 1.8	$ 1.6	$ 5.3	$ 4.8
Deferred rent credit	$ 0.4		$ 0.4

Stock-based Compensation - Sto

Stock-based Compensation - Stock Options (Details) - 2012 Equity Incentive Plan	Sep. 30, 2016shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized	8,069,184
Number of shares available for grant	1,478,776

Stock-based Compensation - Exp

Stock-based Compensation - Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total employee stock-based compensation	$ 5,103	$ 4,421	$ 15,122	$ 12,678
Stock Options
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized employee compensation cost	25,100		$ 25,100
Unrecognized employee compensation cost, period for recognition			2 years 10 months 24 days
Restricted Stock Units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized employee compensation cost	9,200		$ 9,200
Unrecognized employee compensation cost, period for recognition			3 years 4 months 24 days
Cost of revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total employee stock-based compensation	516	333	$ 1,318	1,005
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total employee stock-based compensation	1,585	1,294	4,373	3,584
Sales and marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total employee stock-based compensation	821	1,015	3,459	2,806
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total employee stock-based compensation	$ 2,181	$ 1,779	$ 5,972	$ 5,283

Stock-based Compensation - Fai

Stock-based Compensation - Fair Value Assumptions, Stock Options (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	49.00%	46.00%
Risk-free interest rate	1.10%	1.60%
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%	0.00%	0.00%	0.00%
Minimum | Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	5 years	4 years 10 months 24 days	5 years	4 years 10 months 24 days
Volatility	48.00%		45.00%	45.00%
Risk-free interest rate			1.10%	1.30%
Maximum | Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	5 years 10 months 24 days	5 years 10 months 24 days	5 years 10 months 24 days	5 years 10 months 24 days
Volatility	49.00%		49.00%	48.00%
Risk-free interest rate			1.30%	1.65%

Stock-based Compensation - S42

Stock-based Compensation - Stock Option Plan Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Outstanding Shares
Beginning balance (in shares)	7,579,058
Granted (in shares)	2,007,683
Exercised (in shares)	(1,250,532)
Canceled (in shares)	(651,821)
Ending balance (in shares)	7,684,388	7,579,058
Vested and expected to vest (in shares)	7,085,321
Exercisable (in shares)	4,955,900
Weighted Average Exercise Price
Weighted average exercise price, Beginning balance (in dollars per share)	$ 16.88
Weighted average exercise price, granted (in dollars per share)	26.06
Weighted average exercise price, exercised (in dollars per share)	10.02
Weighted average exercise price, canceled (in dollars per share)	31.63
Weighted average exercise price, Ending balance (in dollars per share)	19.15	$ 16.88
Weighted average exercise price, Vested and expected to vest (in dollars per share)	18.25
Weighted average exercise price, Exercisable (in dollars per share)	$ 13.69
Weighted Average Remaining Contractual Life
Weighted average remaining contractual life (in years)	6 years 3 months 18 days	5 years 10 months 24 days
Weighted average remaining contractual life, Vested and expected to vest (in years)	6 years
Weighted average remaining contractual life, Exercisable (in years)	4 years 8 months 12 days
Aggregate Intrinsic Value
Aggregate intrinsic value	$ 149,030	$ 131,345
Aggregate intrinsic value, Vested and expected to vest	143,568
Aggregate intrinsic value, Exercisable	$ 122,586

Stock-based Compensation - Res

Stock-based Compensation - Restricted Stock (Details) - Restricted Stock Units	9 Months Ended
	Sep. 30, 2016$ / sharesshares
Outstanding RSUs and RSAs
Beginning balance (in shares) | shares	47,500
Granted (in shares) | shares	588,527
Released (in shares) | shares	(22,162)
Canceled (in shares) | shares	(78,710)
Ending balance (in shares) | shares	535,155
Outstanding and expected to vest (in shares) | shares	363,539
Weighted Average Fair Value
Beginning balance (usd per share) | $ / shares	$ 37.28
Granted (usd per share) | $ / shares	27.19
Released (usd per share) | $ / shares	28.23
Canceled (usd per share) | $ / shares	31.89
Ending balance (usd per share) | $ / shares	27.35
Outstanding and expected to vest (usd per share) | $ / shares	$ 27.41

Other Income (Expense), Net (De

Other Income (Expense), Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Other Income and Expenses [Abstract]
Foreign exchange gain (loss)	$ (84)	$ (268)	$ (285)	$ (392)
Other income (expense)	(40)	(39)	(157)	(93)
Other expense, net	$ (124)	$ (307)	$ (442)	$ (485)

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 3,221	$ 2,601	$ 8,417	$ 6,566
Effective income tax rate	39.20%	38.70%	38.70%	38.60%
Unrecognized tax benefits	$ 4,200		$ 4,200		$ 3,500
Unrecognized tax benefits that would impact effective tax rate	$ 2,500		$ 2,500		$ 2,100

Segment Information and Infor46

Segment Information and Information about Geographic Area (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)segment	Sep. 30, 2015USD ($)	Dec. 31, 2015USD ($)
Segment Reporting Information [Line Items]
Number of operating segments (in segment) | segment			1
Revenues	$ 50,987	$ 42,469	$ 145,701	$ 119,839
Property and equipment, net	40,670		40,670		$ 31,329
United States
Segment Reporting Information [Line Items]
Revenues	35,965	29,993	102,850
Property and equipment, net	32,429		32,429		25,623
Other
Segment Reporting Information [Line Items]
Revenues	15,022	$ 12,476	42,851
Property and equipment, net	$ 8,241		$ 8,241		$ 5,706

Net Income Per Share (Details)

Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Numerator:
Net income	$ 4,996	$ 4,123	$ 13,317	$ 10,441
Denominator:
Basic (shares)	35,477	34,119	35,074	33,967
Common stock options (shares)	3,103	3,819	3,089	4,235
Restricted stock units (shares)	132	0	42
Diluted (shares)	38,712	37,938	38,205	38,202
Basic (USD per share)	$ 0.14	$ 0.12	$ 0.38	$ 0.31
Diluted (USD per share)	$ 0.13	$ 0.11	$ 0.35	$ 0.27
Antidilutive Securities
Antidilutive securities (shares)	2,881	1,889	3,632	1,409
Stock Options
Antidilutive Securities
Antidilutive securities (shares)	2,881	1,889	3,594	1,409
Restricted Stock Units
Antidilutive Securities
Antidilutive securities (shares)	0	0	38	0

Subsequent Event (Details)

Subsequent Event (Details) - USD ($) $ in Thousands	Oct. 14, 2016	Sep. 30, 2016
Subsequent Event [Line Items]
Total lease commitment		$ 9,028
Subsequent Event
Subsequent Event [Line Items]
Lease term (in years)	10 years
Total lease commitment	$ 37,800
Subsequent Event | Standby letter of credit
Subsequent Event [Line Items]
Letter of credit to secure the Company's lease obligations	$ 1,200