Shutterfly (SFLY) Inactive 10-Q9 Aug 182018 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2018	Aug. 06, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	SHUTTERFLY INC
Entity Central Index Key	1,125,920
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		33,442,465
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2018

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 146,701	$ 489,894
Short-term investments	53,890	178,021
Accounts receivable, net	58,578	82,317
Inventories	15,269	11,019
Prepaid expenses and other current assets	112,196	41,383
Total current assets	386,634	802,634
Long-term investments	24,974	9,242
Property and equipment, net	392,662	266,860
Intangible assets, net	341,769	29,671
Goodwill	841,374	408,975
Other assets	23,623	17,418
Total assets	2,011,036	1,534,800
Current liabilities:
Current portion of long-term debt	15,249	297,054
Accounts payable	33,178	91,473
Accrued liabilities	146,372	159,248
Deferred revenue	29,448	24,649
Total current liabilities	224,247	572,424
Long-term debt	1,094,347	292,457
Other liabilities	148,146	119,195
Total liabilities	1,466,740	984,076
Commitments and contingencies (Note 11)
Stockholders’ equity:
Common stock, $0.0001 par value; 100,000 shares authorized; 33,381 and 32,297 shares issued and outstanding on June 30, 2018 and December 31, 2017, respectively	3	3
Additional paid-in capital	1,036,962	996,301
Accumulated other comprehensive income	4,164	1,778
Accumulated deficit	(496,833)	(447,358)
Total stockholders' equity	544,296	550,724
Total liabilities and stockholders' equity	$ 2,011,036	$ 1,534,800

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Stockholders’ equity:
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	33,381,000	32,297,000
Common stock, shares outstanding (in shares)	33,381,000	32,297,000

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Net revenue	$ 443,372	$ 209,032	$ 643,097	$ 401,004
Cost of net revenue	233,228	118,205	359,275	234,324
Restructuring	0	196	0	1,436
Gross profit	210,144	90,631	283,822	165,244
Operating expenses:
Technology and development	44,420	39,398	82,924	85,353
Sales and marketing	130,643	42,987	168,363	85,874
General and administrative	55,040	27,511	86,604	55,306
Capital lease termination	0	8,098	0	8,098
Restructuring	2,952	4,477	2,952	12,213
Total operating expenses	233,055	122,471	340,843	246,844
Loss from operations	(22,911)	(31,840)	(57,021)	(81,600)
Interest expense	(17,769)	(5,955)	(27,402)	(11,919)
Interest and other income, net	1,561	244	3,310	433
Loss before income taxes	(39,119)	(37,551)	(81,113)	(93,086)
Benefit from income taxes	12,607	14,713	27,436	37,054
Net loss	$ (26,512)	$ (22,838)	$ (53,677)	$ (56,032)
Net loss per share - basic and diluted (in dollars per share)	$ (0.80)	$ (0.68)	$ (1.63)	$ (1.67)
Weighted-average shares outstanding - basic and diluted (in shares)	33,234	33,579	32,970	33,646
Cost of net revenue
Stock-based compensation for operating segments	$ 943	$ 1,074	$ 1,942	$ 2,243
Technology and development
Stock-based compensation for operating segments	2,571	2,179	5,001	4,875
Sales and marketing
Stock-based compensation for operating segments	2,941	2,980	6,445	6,153
General and administrative
Stock-based compensation for operating segments	5,242	4,236	10,001	8,703
Restructuring
Stock-based compensation for operating segments	$ 0	$ 0	$ 0	$ 814

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Statement of Comprehensive Income [Abstract]
Net loss	$ (26,512)	$ (22,838)	$ (53,677)	$ (56,032)
Other comprehensive income (loss), net of reclassification adjustments:
Foreign currency translation losses	(401)	0	(401)	0
Unrealized losses on investments, net	(16)	(15)	(46)	(28)
Tax benefit on unrealized losses on investments, net	4	6	11	16
Unrealized gains on cash flow hedges	1,000	0	3,770	0
Tax expense on unrealized gains on cash flow hedges	(249)	0	(948)	0
Other comprehensive income (loss), net of tax	338	(9)	2,386	(12)
Comprehensive loss	$ (26,174)	$ (22,847)	$ (51,291)	$ (56,044)

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash flows from operating activities:
Net loss	$ (53,677)	$ (56,032)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	50,111	45,121
Amortization of intangible assets	15,164	8,200
Amortization of debt discount and issuance costs	7,009	7,524
Stock-based compensation expense	23,389	21,974
Loss on disposal of property and equipment	154	467
Deferred income taxes	17,571	(7,103)
Restructuring	752	10,764
Other	(272)	0
Changes in operating assets and liabilities, net of acquisition:
Accounts receivable	30,767	27,286
Inventories	15,607	1,415
Prepaid expenses and other assets	(42,795)	(19,776)
Accounts payable	(69,708)	(39,949)
Accrued and other liabilities	(130,127)	(58,605)
Net cash used in operating activities	(136,055)	(58,714)
Cash flows from investing activities:
Acquisition of business, net of cash acquired	(890,052)	0
Purchases of property and equipment	(17,692)	(8,176)
Capitalization of software and website development costs	(21,392)	(17,058)
Purchases of investments	(9,523)	(39,805)
Proceeds from the maturities of investments	174,329	19,033
Proceeds from the sales of investments	45,106	0
Proceeds from sale of property and equipment	1,132	11,678
Net cash used in investing activities	(718,092)	(34,328)
Cash flows from financing activities:
Proceeds from issuance of common stock upon exercise of stock options	16,577	520
Repurchases of common stock	0	(50,000)
Principal payments of capital lease and financing obligations	(9,396)	(20,621)
Principal payments of borrowings	(302,608)	0
Proceeds from borrowings, net of issuance costs	806,652	0
Net cash provided by (used in) financing activities	511,225	(70,101)
Effect of exchange rate changes on cash and cash equivalents	(271)	0
Net decrease in cash and cash equivalents	(343,193)	(163,143)
Cash and cash equivalents, beginning of period	489,894	289,224
Cash and cash equivalents, end of period	146,701	126,081
Supplemental schedule of non-cash investing / financing activities:
Net (decrease) increase in accrued purchases of property and equipment	(1,200)	745
Net increase in accrued capitalized software and website development costs	1,119	270
Stock-based compensation capitalized with software and website development costs	697	758
Property and equipment acquired under capital leases	2,969	6,228
Increase (Decrease) In Receivables From Sale Of Property And Equipment	$ 0	$ 9,250

The Company and Summary of Sign

The Company and Summary of Significant Accounting Policies	6 Months Ended
The Company and Summary of Significant Accounting Policies	Jun. 30, 2018
Accounting Policies [Abstract]
The Company and Summary of Significant Accounting Policies	The Company and Summary of Significant Accounting Policies Shutterfly, Inc., (the “Company” or "Shutterfly") is the leading digital retailer and manufacturer of high-quality personalized products and services. Founded and incorporated in the state of Delaware in 1999, Shutterfly brings your photos to life in photo books, gifts, and cards and stationery - through its flagship Shutterfly products, premium offerings in its Tiny Prints boutique, as well as wedding invitations and stationery for every step of the wedding planning process; and BorrowLenses, the premier online marketplace for photographic and video equipment rentals. Shutterfly, Inc. also operates Shutterfly Business Solutions (“SBS”), delivering high quality digital printing services to the enterprise market. The Company is headquartered in Redwood City, California. On April 2, 2018, the Company completed its acquisition of Lifetouch Inc. ("Lifetouch"), the leading professional photographer of children and families in the United States and Canada. Professional photographers at Lifetouch capture the classic images of school-age children under the Lifetouch brand. In addition, Prestige Portraits help high school and college seniors celebrate those graduation milestones. Lifetouch also provides schools with yearbooks and memory books and churches and other groups with pictorial directories and images for purchase. Over 400 retail studios operated by Lifetouch under the JCPenney Portrait brand also provide professional photographic services for infants, toddlers, families and business professionals throughout the United States. As a result of the acquisition, the Company has a new operating segment for the Lifetouch business (refer to Note 10 - Segment Reporting for further details). Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and, accordingly, do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements include the accounts of Shutterfly, Inc. and its wholly owned subsidiaries including the financial results of Lifetouch which are included prospectively from the acquisition date of April 2, 2018. In the opinion of management, all adjustments, consisting primarily of normal recurring accruals, considered necessary for a fair statement of the Company’s results of operations for the interim periods reported and of its financial condition as of the date of the interim balance sheet have been included. Operating results for the three and six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018 , or for any other period. The December 31, 2017 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes for the year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K. Tax Cuts and Jobs Act As of December 31, 2017, the Company recorded provisional estimates of the tax impacts of the enactment of the Tax Cuts and Jobs Act (the “Tax Act”). The Company provisionally recorded an income tax benefit related to the Tax Act primarily for the impact of the remeasurement of its deferred tax assets and liabilities at the newly enacted 21% tax rate, the enhanced accelerated depreciation deductions available on qualified property, and estimates of other elements of the Tax Act. The Company's accounting for the Tax Act as of December 31, 2017 was incomplete due to the complexity involved and the absence of regulatory guidance, and therefore its provisional accounting was based on reasonable estimates. In accordance with Staff Accounting Bulletin 118, the measurement period extends up to one year from the enactment date. As the Company completes its analysis of regulatory guidance, adjustments to its provisional amounts may have a material impact to the Company’s provision for income taxes in the period they are recognized. For the three and six months ended June 30, 2018 , the Company did not record any adjustments to its provisional amounts. The Company expects to complete its analysis by the fourth quarter of 2018. Foreign Currency Translation Policy As a result of the acquisition of Lifetouch, the Company has subsidiaries in Canada for which the functional currency is the local currency. As such, exchange rate fluctuations for these subsidiaries are included in stockholders' equity as a component of accumulated other comprehensive income. Prior to the acquisition of Lifetouch, the Company only had one foreign subsidiary in Israel for which the functional currency is the U.S. Dollar and exchange rate fluctuations are recorded as part of earnings. Recently Adopted Accounting Pronouncements In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606 ) (“ASC 606”). This new standard replaces all current GAAP guidance on this topic and eliminates all industry-specific guidance. The new revenue recognition guidance provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange of those goods or services. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective transition method. Refer to Note 2 - Revenue for further details. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments. The Company adopted ASU 2016-15 as of January 1, 2018 on a retrospective basis with no material impact to the consolidated statements of cash flows for the six months ended June 30, 2018 and 2017. Recent Accounting Pronouncements Pending Adoption In February 2018, the FASB issued ASU No. 2018-02, Income Statement, Reporting Comprehensive Income (Topic 220) : Reclassification of Certain Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”), which allows a reclassification of stranded tax effects from accumulated other comprehensive income to retained earnings, as a result of the Tax Act. ASU 2018-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018, with early adoption permitted and can be applied either in the period of adoption or retrospectively to all applicable periods. The Company does not expect that the pending adoption of ASU 2018-02 will have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The new guidance requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous guidance. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 on a modified retrospective basis, and earlier adoption is permitted. The Company anticipates that most of its operating lease commitments will be subject to the new standard and recognized as lease liabilities and right-of-use assets upon adoption, which will increase the total assets and total liabilities. The Company is currently evaluating the accounting transition and disclosure requirements of this standard, and due to the magnitude of leases assumed in the recent acquisition of Lifetouch, the Company cannot currently estimate the financial statement impact of adoption. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires measurement and recognition of expected credit losses for financial assets held. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Earlier adoption is permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is evaluating the impact of adopting this new accounting guidance on the consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) . The updated guidance simplifies the measurement of goodwill impairment by removing step two of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments should be applied on a prospective basis. The new standard is effective for annual or any interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019 with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is evaluating the impact this new accounting guidance will have on the consolidated financial statements.

Revenues

Revenues	6 Months Ended
Revenues	Jun. 30, 2018
Revenue from Contract with Customer [Abstract]
Revenues	Revenue Adoption of ASC 606, Revenue from Contracts with Customers The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective transition method. Under the modified retrospective method, ASC 606 is only applied to contracts that were not complete as of the adoption date. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC 605, Revenue Recognition . As a result of the adoption of ASC 606, the Company identified an impact related to timing and measurement of breakage revenue for the Shutterfly consumer and the Lifetouch businesses and for one of the Company's significant multiple-element arrangements in connection with the SBS business. Upon adoption of ASC 606, the Company recognized the expected breakage amounts as revenue in proportion to the pattern of rights exercised by the customer, rather than the previous method of recognizing breakage revenue when the Company believed the redemption was remote. As it relates to timing and measurement of one of the Company's multiple-element arrangements in connection with the SBS business, deferred revenue was previously recognized over the stated term of the contract. Upon adoption of ASC 606, deferred revenue for this particular arrangement is now recognized ratably over a period of time that is shorter than the stated contract term, as this arrangement does not contain substantive termination penalties after a certain initial number of years within the contractual term. The cumulative impact of the adoption of ASC 606 resulted in a decrease to opening accumulated deficit of $4.2 million as of January 1, 2018, which consisted of a decrease in total liabilities of $5.1 million primarily related to deferred revenue and a decrease in total assets of $0.9 million primarily related to deferred costs. The impact as a result of applying ASC 606 was: • an increase of $0.7 million and $1.2 million to net revenue for the three and six months ended June 30, 2018 , respectively; and • a decrease to deferred revenue of $7.5 million as of June 30, 2018 . The impact to other accounts is not material as of June 30, 2018 and for the three and six months ended June 30, 2018 . Revenue Recognition Policy The Company derives its revenue from Shutterfly Consumer, Lifetouch and SBS product sales, net of applicable sales tax and allowances for returns. Revenue is recognized when control of the promised products or services is transferred to its customers in an amount that reflects the consideration it expects to be entitled to in exchange for those products or services. Shipping charged to its customers is recognized upon shipment and the related shipping costs are recognized as cost of net revenue. Shutterfly Consumer and Lifetouch. The Company’s Shutterfly Consumer revenue is primarily derived from the sale of products such as, professionally-bound photo books, cards and stationery, custom home décor products and unique photo gifts, calendars and prints, etc. Customers place Shutterfly Consumer product orders through the Shutterfly website or mobile apps and pay primarily using credit cards. The Company’s Lifetouch revenue is primarily derived from the sale of photographic and publishing products. Customers place Lifetouch product orders through the Lifetouch website, via order forms or in person at the JCPenney photo studios and churches. Customers pay using credit cards, or fill out an order form and enclose exact payment. Revenue is recognized upon shipment of the fulfilled orders, which generally occurs upon delivering to the carrier. If multiple products are ordered together, each product is a separate performance obligation, and the transaction price is allocated to each performance obligation based upon standalone selling price as each performance obligation is satisfied. The Company generally determines the standalone selling prices based on the prices charged to its customers or using expected cost plus margin. For flash deal promotions through group buying websites, the Company recognizes revenue on a gross basis, as it is the primary obligor, when redeemed items are shipped. Revenue from sales of flash deal promotions are deferred until shipment of fulfilled orders or until unredeemed flash deal promotions are recognized as breakage revenue. The Company recognizes the expected breakage amounts as revenue in proportion to the pattern of rights exercised by the customer. The Company periodically provides incentive offers to its new customers in exchange for setting up an account as well as to its existing customers to encourage purchases. These incentive offers are readily available to all of its customers. Therefore, these do not represent a performance obligation as its customers are not required to enter into any enforceable commitment by receiving these incentive offers. The discounts are treated as a price reduction when accepted and used by customers. Production costs related to free products are included in cost of net revenue upon redemption. SBS. The Company’s SBS revenue is derived from personalized direct marketing and other end-consumer communications as well as just-in-time, inventory-free printing for its business customers. The services that the Company promises to its SBS customers are typically composed of a series of services that are performed over time. The Company accounts for these series of services as one performance obligation which represents a series of distinct services that are substantially the same and have the same pattern of transfer. The Company recognizes revenue from the satisfaction of performance obligations when it invoices its customers (that is, when it has the contractual right to bill under the contract). The Company has the contractual right to consideration from its customers in an amount that corresponds directly with the value to the customer of the services it has performed to date. For contracts that do not contain a significant non-refundable up-front fee, the Company applies the “right to invoice” practical expedient as it has the right to consideration from its customers in an amount that corresponds directly with the value to the customer of the services it has performed to date. For contracts that contain a significant non-refundable up-front fee, the Company considers whether these fees are related to the transfer of a promised good or service to the customer, and therefore represent a performance obligation. When the up-front fees do not represent a distinct performance obligation, the Company recognizes revenue ratably over the period for which there is a significant termination contractual penalty. The Company's incremental direct costs of obtaining a contract consist of Lifetouch and SBS sales commissions. The Company does not defer such incremental direct costs as the related performance obligations are satisfied within a short period of time and the Company elected to apply the practical expedient per ASC 340-40-25-4 related to expensing contract acquisition costs with the amortization period of less than one year. The Company does not provide any financing service to its customer as payment term. Deferred Revenue The Company records deferred revenue when cash payments are received in advance of our performance and primarily relate to flash deal promotions, gift cards, yearbooks and portrait proofs as well as up-front fees received from an SBS customer. The decrease of $0.6 million in deferred revenue balance during the six months ended June 30, 2018 is primarily driven by the aforementioned impact of ASC 606 adoption and $3.3 million of revenue recognized that was included in deferred revenue balance as of December 31, 2017 . The decrease is partially offset by the assumed deferred revenue from the acquisition of Lifetouch (deferred revenue balance as of June 30, 2018 for Lifetouch is $8.5 million ) and by cash payments received in advance of the Company's performance obligations during the six months ended June 30, 2018 . Net Revenue by Brand The following table disaggregates the Company’s net revenue by brand for the three and six months ended June 30, 2018 and 2017 (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Shutterfly consumer net revenue: Shutterfly brand $ 154,181 $ 139,908 $ 296,845 $ 263,811 Tiny Prints Boutique (1) 1,397 — 3,500 — Tiny Prints (1) — 12,917 — 23,382 Wedding Paper Divas (2) — 11,365 — 25,655 MyPublisher (3) — 6,056 — 10,992 Other 9,425 8,844 16,717 15,895 Shutterfly consumer net revenue 165,003 179,090 317,062 339,735 Lifetouch net revenue (4) 228,560 — 228,560 — Shutterfly Business Solutions net revenue 49,809 29,942 97,475 61,269 Net revenue $ 443,372 $ 209,032 $ 643,097 $ 401,004 (1) On June 28, 2017, the Company created a Tiny Prints boutique on a dedicated tab on Shutterfly.com and shut down the legacy Tiny Prints website. (2) On September 13, 2017, the Company launched the new Shutterfly Wedding Shop and shut down the Wedding Paper Divas legacy website. (3) The MyPublisher brand was shut down on May 15, 2017. (4) On April 2, 2018, the Company acquired Lifetouch.

Acquisition

Acquisition	6 Months Ended
Acquisition	Jun. 30, 2018
Business Combinations [Abstract]
Acquisition	Acquisition On January 30, 2018, the Company entered into a Stock Purchase Agreement (the “Purchase Agreement”) with Lifetouch and Lifetouch Inc. Employee Stock Ownership Trust (collectively, the “Seller”). On April 2, 2018, pursuant to the Purchase Agreement, the Company completed the acquisition of 100% of the issued and outstanding shares of common stock of Lifetouch from the Seller. Under the terms of the Purchase Agreement, the consideration for the acquisition consisted of an all-cash purchase price of $825.0 million subject to certain adjustments based on a determination of Closing Net Working Capital, Transaction Expenses, Cash and Investments, and Closing Indebtedness, as defined in the Purchase Agreement. The Company financed the all-cash purchase price with an incremental $825.0 million term loan issuance under its existing credit agreement, which closed simultaneous with the acquisition (refer to Note 9 - Debt for further details). Lifetouch provides the Company with a highly complementary business. Lifetouch will be able to offer Shutterfly’s broader product range to Lifetouch customers, as well as to accelerate the development of Lifetouch’s online order-taking platform. The Company expects to gain access to many Lifetouch customers as Shutterfly customers, where they will benefit from Shutterfly’s leading cloud-based photo management service, product creation capabilities, mobile apps, and broad product range. The Company elected to treat the acquisition of Lifetouch as an asset acquisition under section 338(h)(10) of the U.S. Internal Revenue Service tax code. As such, the goodwill that the Company recognizes as part of the Lifetouch acquisition will be deductible for U.S. income tax purposes. The goodwill recognized represents the assembled workforce of Lifetouch and the value of growth in revenue from future customers of Lifetouch. During the three and six months ended June 30, 2018 , the Company recorded approximately $8.0 million and $12.6 million , respectively, of direct and incremental costs associated with acquisition-related activities. These costs were incurred primarily for banking, legal, and professional fees associated with the Lifetouch acquisition. These costs were recorded in general and administrative expenses in the consolidated statement of operations. During the three and six months ended June 30, 2018 , Lifetouch contributed to $228.6 million to net revenue and $124.2 million to gross profit, respectively. Under the terms of the Purchase Agreement, the amount of consideration that the Company paid consisted of an all-cash purchase price of $825.0 million subject to certain adjustments based on a determination of Closing Net Working Capital, Transaction Expenses, Cash and Investments, and Indebtedness, as defined by the Purchase Agreement. The total preliminary purchase consideration paid by the Company during the second quarter of 2018 was $982.0 million . The following table shows the calculation of how the preliminary purchase consideration paid by the Company was determined in accordance with the Purchase Agreement (in thousands): Cash consideration at closing $ 825,000 Less: Closing Indebtedness (1) (27,742 ) Less: Net Working Capital Adjustment (1) (10,559 ) Less: Transaction Expenses (1)(2) (17,614 ) Add: Closing Cash and Investments (1) 212,872 Purchase price adjustments 156,957 Total preliminary purchase consideration $ 981,957 (1) As defined in the Purchase Agreement. (2) Transaction expenses incurred by Lifetouch in connection with the transaction as defined by the Purchase Agreement. In accordance with ASC 805, Business Combinations , the Company has recorded the acquired assets (including identifiable intangible assets) and liabilities assumed at the acquisition date fair values. The purchase price allocation for the Lifetouch acquisition is preliminary and subject to revision as additional information about fair value of assets acquired and liabilities assumed becomes available. Additional information that existed as of the acquisition date but at that time was unknown may become known during the remainder of the measurement period, a period not to exceed 12 months from the acquisition date. The following table shows the preliminary allocation of the total purchase price to the net assets acquired based on their estimated fair values as of April 2, 2018 (in thousands): Cash and cash equivalents $ 91,905 Investments 101,269 Accounts receivable, net 7,029 Inventories 19,857 Property and equipment, net 135,968 Intangible assets, net 326,700 Goodwill 432,399 Prepaid expenses and other assets 32,281 Accounts payable (15,331 ) Deferred revenue, current portion (29,984 ) Notes payable (9,065 ) Accrued and other liabilities (111,071 ) Total $ 981,957 The following table shows the valuation of the intangible assets acquired from Lifetouch along with their estimated remaining useful lives: Approximate Fair Value (in thousands) Weighted Average Life (in years) Customer contracts and related relationships $ 200,100 10 Developed technology 68,600 5 Trade names / trademarks / domain name 57,600 5 Favorable/unfavorable leases 400 7 Total intangible assets $ 326,700 Identifiable Intangible Assets Customer contracts and related relationships. These assets primarily relate to the existing relationships that Lifetouch has developed with a number of schools and preschools. These relationships provide economic value to the Company and therefore were valued separately from goodwill. The Company valued these assets utilizing a form of the income approach known as the "Multi-Period Excess Earnings Method" ("MPEEM") since these customer assets were identified as the primary asset. Under the MPEEM, the value of these assets was estimated based on the expected future economic earnings attributable to the assets. The key assumptions used in the valuation of these assets include future revenue from existing customers and estimated expenses forecast, contributory asset charges (such as cash-free debt-free working capital, fixed assets, brand assets and assembled workforce), the discount rate, expected tax rate(s) and tax amortization benefit. Developed technology. Lifetouch has a number of developed technology platforms that are internally-used (e.g., field operations management and production management systems) and customer-facing (e.g., order management and yearbook design systems). These technologies will continue to be used by the Company. Given that the technologies are specific to Lifetouch and have minimal possibility of being licensed out to third parties, the "Cost to Recreate Method" under the Cost approach was used to value this asset. The key assumptions used in the valuation of these assets include direct and indirect developer costs, developer's profit, and opportunity cost. Trade names / trademarks / domain name. Lifetouch is the leading provider of school photography services in the U.S. and has a number of registered trade names, trademarks and domain names that are recognized and well known in the marketplace. These brand names are expected to continue to be used, providing economic value to the Company, and therefore were valued separately from goodwill. The "Relief from Royalty Method" of the income approach was used in the valuation of trade names, trademarks and domain names. Unaudited Pro Forma Financial Information The following table summarizes the pro forma consolidated information for the Company assuming the acquisition of Lifetouch had occurred as of January 1, 2017. The unaudited pro forma information for all periods presented includes the business combination accounting effects resulting from the acquisition, including amortization for intangible assets acquired, depreciation expense for tangible assets acquired, interest expense for the additional indebtedness incurred to complete the acquisition, acquisition-related charges and the impact of adopting ASC 606. The impact of applying ASC 606 to Lifetouch’s historical periods as presented below was not material. The pro forma results also include the effects of the purchase accounting adjustments for the fair value of deferred revenue and inventory. The unaudited pro forma financial information as presented below is for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal 2017. Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2018 2017 2018 2017 Total net revenue $ 476,723 $ 470,531 $ 810,917 $ 789,010 Net loss $ 14,791 $ (3,488 ) $ (69,359 ) $ (115,667 ) Basic earnings per share $ 0.45 $ (0.10 ) $ (2.10 ) $ (3.44 ) Diluted earnings per share $ 0.41 $ (0.10 ) $ (2.10 ) $ (3.44 )

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
Stock-Based Compensation	Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-Based Compensation	Stock-Based Compensation Stock Option Activity A summary of the Company’s stock option activity for the six months ended June 30, 2018 is as follows (share numbers and aggregate intrinsic values in thousands): Number of Options Outstanding (in thousands) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Balance as of December 31, 2017 1,529 $ 46.77 Granted 228 $ 76.73 Exercised (361 ) $ 45.87 Forfeited, cancelled or expired (28 ) $ 45.49 Balance as of June 30, 2018 1,368 $ 52.03 5.5 $ 51,997 Options vested and expected to vest as of June 30, 2018 1,264 $ 51.48 5.4 $ 48,748 Options vested as of June 30, 2018 338 $ 47.12 5.0 $ 14,514 During the six months ended June 30, 2018 , the Company granted options to purchase an aggregate of approximately 228,000 shares of common stock with an estimated weighted-average grant-date fair value of $23.57 . The total intrinsic value of options exercised during the three months ended June 30, 2018 and 2017 was $2.8 million and $0.6 million , respectively. The total intrinsic value of options exercised during the six months ended June 30, 2018 and 2017 was $10.7 million and $0.7 million , respectively. Net cash proceeds from the exercise of stock options for the three months ended June 30, 2018 and 2017 were $2.8 million and $0.4 million , respectively. Net cash proceeds from the exercise of stock options for the six months ended June 30, 2018 and 2017 were $16.6 million and $0.5 million , respectively. Valuation of Stock Options The Company estimates the fair value of each option award on the date of grant using the Black-Scholes option-pricing model. The Company calculates volatility using an average of its historical and implied volatilities as it has sufficient public trading history to cover the entire expected term. The expected term of options gives consideration to historical exercises, post-vest cancellations and the options contractual term. The risk-free rate for the expected term of the option is based on the U.S. Treasury Constant Maturity at the time of grant. The assumptions used to value options granted during the three and six months ended June 30, 2018 and 2017 are as follows (there were no option awards granted during the three months ended June 30, 2018): Three Months Ended Six Months Ended June 30, June 30, 2017 2018 2017 Dividend yield — — — Annual risk-free rate of return 1.8 % 2.6 % 1.9 % Expected volatility 30.0 % 33.7 % 29.8 % Expected term (years) 4.1 4.1 4.1 Restricted Stock Unit Activity The Company grants restricted stock units (“RSUs”) and performance-based restricted stock units ("PBRSUs") to its employees under the provisions of the 2015 Equity Incentive Plan and inducement awards to certain new employees upon hire in accordance with Nasdaq Listing Rule 5635(c)(4). The cost of RSUs is determined using the fair value of the Company’s common stock on the date of grant. RSUs typically vest and are settled annually, based on a four -year total vesting term. Compensation cost associated with RSUs is amortized on a straight-line basis over the requisite service period. A summary of the Company’s RSU activity for the six months ended June 30, 2018 , is as follows (share numbers in thousands): Number of Units Outstanding Weighted Average Grant Date Fair Value Awarded and unvested as of December 31, 2017 2,293 $ 44.64 Granted 629 $ 76.93 Vested (720 ) $ 45.01 Forfeited (127 ) $ 45.45 Awarded and unvested as of June 30, 2018 2,075 $ 54.24 RSUs expected to vest as of June 30, 2018 1,746 Employee stock-based compensation expense recognized in the three and six months ended June 30, 2018 and 2017 was calculated based on awards ultimately expected to vest and has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. At June 30, 2018 , the Company had $87.8 million of total unrecognized stock-based compensation expense, net of estimated forfeitures, related to stock options, RSUs and PBRSUs that will be recognized over a weighted-average period of approximately two years.

Net Loss Per Share

Net Loss Per Share	6 Months Ended
Net Loss Per Share	Jun. 30, 2018
Earnings Per Share [Abstract]
Net Loss Per Share	Net Loss Per Share Basic net loss per share attributed to common shares is computed by dividing the net loss attributable to common shares for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share attributed to common shares is computed by dividing the net loss attributable to common shares for the period by the weighted-average number of common and potential common shares outstanding during the period, if the effect of each class of potential common shares is dilutive. Potential common shares include RSUs and incremental shares of common stock issuable upon the exercise of stock options, and conversion of warrants. A summary of the net loss per share for the three and six months ended June 30, 2018 and 2017 is as follows (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Net loss per share: Numerator Net loss $ (26,512 ) $ (22,838 ) $ (53,677 ) $ (56,032 ) Denominator for basic and diluted net loss per share Weighted-average common shares outstanding 33,234 33,579 32,970 33,646 Net loss per share - basic and diluted $ (0.80 ) $ (0.68 ) $ (1.63 ) $ (1.67 ) The following weighted-average outstanding stock options and RSUs were excluded from the computation of diluted net loss per common share for the periods presented because including them would have had an anti-dilutive effect (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Stock options and RSUs 3,571 4,060 3,629 4,004 As described in Note 9 - Debt, the Company entered into warrant transactions (the "Warrant") in May 2013. The average market value per share of the Company's common stock for the three months ended June 30, 2018 , as measured under the Warrant, exceeded the strike price of the Warrant. The dilutive effect of the potential exercise of the Warrant of approximately 345,000 shares was excluded from the computation of diluted net loss per common share for the three months ended June 30, 2018 because including it would have had an anti-dilutive effect. The average market value per share of the Company's common stock for the six months ended June 30, 2018 , as measured under the Warrant, did not exceed the strike price of the Warrant. With respect to the convertible senior notes issued in 2013 as described in Note 9 - Debt , the Company settled the principal of the convertible senior notes in cash upon their maturity in May 2018. The weighted-average impact to dilution for the period that the conversion option was outstanding was 660,000 shares and 690,000 shares for the three and six months ended June 30, 2018 . The potential conversion impact was excluded from the computation of diluted net loss per common share for such periods because including it would have had an anti-dilutive effect.

Investments

Investments	6 Months Ended
Investments	Jun. 30, 2018
Investments, Debt and Equity Securities [Abstract]
Investments	Investments At June 30, 2018 and December 31, 2017 , the estimated fair value of short-term and long-term debt securities investments, all of which are classified as available-for-sale, was as follows (in thousands): June 30, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Short-term investments Corporate debt securities $ 39,103 $ 4 $ (59 ) $ 39,048 Agency securities 5,120 — (11 ) 5,109 Commercial paper 3,441 — — 3,441 U.S. government securities and other 6,300 — (8 ) 6,292 Total short-term investments $ 53,964 $ 4 $ (78 ) $ 53,890 Long-term investments Corporate debt securities $ 12,958 $ 1 $ (34 ) $ 12,925 Agency securities 5,694 — (29 ) 5,665 U.S. government securities 6,411 — (27 ) 6,384 Total long-term investments $ 25,063 $ 1 $ (90 ) $ 24,974 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Short-term investments Corporate debt securities $ 54,911 $ 3 $ (52 ) $ 54,862 Agency securities 10,781 — (14 ) 10,767 Commercial paper 101,546 — — 101,546 U.S. government securities 10,857 — (11 ) 10,846 Total short-term investments $ 178,095 $ 3 $ (77 ) $ 178,021 Long-term investments Corporate debt securities $ 6,287 $ — $ (25 ) $ 6,262 Agency securities 2,000 — (17 ) 1,983 U.S. government securities 998 — (1 ) 997 Total long-term investments $ 9,285 $ — $ (43 ) $ 9,242 The Company had no available-for-sale investments with a significant unrealized loss that have been in a continuous unrealized loss position for more than 12 months as of June 30, 2018 , and no impairments were recorded during the three and six months ended June 30, 2018 and 2017 . The Company had no material realized gains or losses during the three and six months ended June 30, 2018 and 2017 . The following table summarizes the contractual maturities of the Company's investments as of June 30, 2018 and December 31, 2017 (in thousands): June 30, 2018 December 31, 2017 One year or less $ 53,890 $ 178,021 One year through three years 24,974 9,242 $ 78,864 $ 187,263 Actual maturities may differ from the contractual maturities because borrowers may have certain prepayment conditions.

Fair Value Measurement

Fair Value Measurement	6 Months Ended
Fair Value Measurement	Jun. 30, 2018
Fair Value Disclosures [Abstract]
Fair Value Measurement	Fair Value Measurement Cash Equivalents and Investments The Company measures the fair value of money market funds and investments based on quoted prices in active markets for identical assets or liabilities. All other financial instruments were valued either based on recent trades of securities in inactive markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data. The Company did not hold any cash equivalents or investments categorized as Level 3 as of June 30, 2018 and December 31, 2017 . The following table summarizes, by major security type, the Company's cash equivalents and investments that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands): Total Estimated Fair Value as of June 30, 2018 December 31, 2017 Cash Equivalents Investments Cash Equivalents Investments Level 1 Securities: Money market funds $ 94,765 $ — $ 151,071 $ — Level 2 Securities: Corporate debt securities — 51,974 21,592 61,124 Agency securities — 10,773 6,444 12,750 Commercial paper — 3,441 85,599 101,546 U.S. government securities and other — 12,676 — 11,843 Total cash equivalents and investments $ 94,765 $ 78,864 $ 264,706 $ 187,263 Derivative Assets As of June 30, 2018 and December 31, 2017 , the fair value of certain of the Company's term loans interest-rate swap agreements, which were determined based on an income-based valuation model that takes into account the contract terms as well as multiple observable market inputs such as LIBOR-based yield curves, futures, volatilities and basis spreads (Level 2), were as follows (in thousands): Total Estimated Fair Value as of June 30, 2018 December 31, 2017 Derivative assets $ 6,749 $ 2,979 Borrowings As of June 30, 2018 and December 31, 2017 , the fair value of the Company's borrowings, which was determined based on inputs that are observable in the market or that could be derived from, or corroborated with, observable market data, including the Company's stock price, interest rates and credit spread (Level 2) were as follows (in thousands): Total Estimated Fair Value as of June 30, 2018 December 31, 2017 Convertible senior notes $ — $ 296,550 Term Loans $ 1,128,658 $ 300,000 As of June 30, 2018 and December 31, 2017 , the carrying value of other financial instruments, including accounts receivable, accounts payable and other payables, approximates fair value due to their short maturities.

Balance Sheet Components

Balance Sheet Components	6 Months Ended
Balance Sheet Components	Jun. 30, 2018
Balance Sheet Related Disclosures [Abstract]
Balance Sheet Components	Balance Sheet Components Prepaid Expenses and Other Current Assets June 30, 2018 December 31, 2017 (in thousands) Intra-period deferred tax asset $ 44,821 $ — Restricted investment 18,745 — Prepaid service contracts – current portion 15,597 12,861 Other prepaid expenses and current assets 33,033 28,522 $ 112,196 $ 41,383 Intra-period income tax asset represents the cumulative income tax benefit recorded as of the balance sheet date, which will offset against taxes payable or become a component of deferred taxes on a full year basis. The restricted investment relates to collateral required for insurance policies for Lifetouch. Property and Equipment, Net June 30, 2018 December 31, 2017 (in thousands) Manufacturing equipment $ 218,416 $ 192,494 Computer equipment and software 170,020 188,593 Capitalized software and website development costs 154,001 134,585 Buildings under build-to-suit leases 56,468 56,468 Photography equipment 53,375 — Owned buildings and building improvements 38,622 — Leasehold improvements 27,188 22,145 Rental equipment 18,628 19,208 Land 17,000 — Furniture and fixtures 12,529 8,255 766,247 621,748 Less: Accumulated depreciation and amortization (373,585 ) (354,888 ) Property and equipment, net $ 392,662 $ 266,860 Included within manufacturing equipment is approximately $92.9 million and $89.9 million of capital lease obligations for various manufacturing facility equipment as of June 30, 2018 and December 31, 2017 , respectively. Accumulated depreciation of assets under capital leases totaled $40.0 million and $32.4 million at June 30, 2018 and December 31, 2017 , respectively. Rental equipment includes camera lenses, camera bodies, video equipment and other camera peripherals which are rented through the BorrowLenses website. Depreciation and amortization expense totaled $27.5 million and $22.1 million for the three months ended June 30, 2018 and 2017 , respectively. Depreciation and amortization expense totaled $50.1 million and $45.1 million for the six months ended June 30, 2018 and 2017 , respectively. Included in property and equipment is approximately $27.7 million and $15.8 million of assets in construction as of June 30, 2018 and December 31, 2017 , respectively, the majority of which relates to capitalized software and website development costs. Intangible Assets Intangible assets are comprised of the following: Weighted Average Useful Life June 30, 2018 December 31, 2017 (in thousands) Purchased technology 8 years $ 173,469 $ 104,869 Less: accumulated amortization (81,742 ) (76,585 ) 91,727 28,284 Customer relationships 9 years 275,246 75,146 Less: accumulated amortization (80,310 ) (73,759 ) 194,936 1,387 Other (1) 5 years 65,202 7,202 Less: accumulated amortization (10,096 ) (7,202 ) 55,106 — Total $ 341,769 $ 29,671 (1) The unamortized balance for other intangible assets primarily relate to the trade name, trademarks and domain name assets acquired as part of the acquisition of Lifetouch during the second quarter of 2018. Intangible asset amortization expense for the three months ended June 30, 2018 and June 30, 2017 was $12.5 million and $3.6 million , respectively. Intangible asset amortization expense for the six months ended June 30, 2018 and June 30, 2017 was $14.6 million and $7.6 million , respectively. Amortization of existing intangible assets is estimated to be as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 24,691 2019 49,360 2020 49,134 2021 49,059 2022 48,553 Thereafter 120,972 $ 341,769 Goodwill The following table presents the goodwill allocated to the Company's reportable segments as of and during the six months ended June 30, 2018 (in thousands): December 31, 2017 Acquisitions June 30, 2018 Shutterfly Consumer $ 372,072 $ — $ 372,072 Lifetouch — 432,399 432,399 Shutterfly Business Solutions 36,903 — 36,903 $ 408,975 $ 432,399 $ 841,374 The allocation of goodwill from the acquisition of Lifetouch to the Company's reporting units has not been finalized and will be allocated based upon the finalization of the valuation. Accrued Liabilities June 30, 2018 December 31, 2017 (in thousands) Accrued compensation $ 52,614 $ 31,331 Capital lease obligations, current portion 16,865 16,859 Accrued marketing expenses 10,992 22,874 Accrued production costs 9,639 37,552 Accrued income, sales and other taxes 9,516 21,745 Accrued other 46,746 28,887 $ 146,372 $ 159,248 Other Liabilities June 30, 2018 December 31, 2017 (in thousands) Financing obligations $ 52,761 $ 53,682 Capital lease obligations, non-current portion 43,280 48,620 Other liabilities 52,105 16,893 $ 148,146 $ 119,195 Financing obligations relate to the Company's build-to-suit leases.

Debt

Debt	6 Months Ended
Debt	Jun. 30, 2018
Debt Disclosure [Abstract]
Debt	Debt 2017 Syndicated Credit Facility On August 17, 2017 (“Closing Date”), the Company entered into a credit agreement (“Credit Agreement”) with certain lenders and Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent. The Credit Agreement provides for (a) a secured revolving loan facility in an aggregate principal amount of up to $200.0 million (“Revolving Loan Facility”) and (b) a secured delayed draw term loan facility (“Initial Term Loan”) in an aggregate principal amount of up to $300.0 million . The Credit Agreement permits the Company to add one or more incremental term loan facilities and/or increase the commitments for revolving loans subject to certain conditions. In October 2017, the Company fully drew the $300.0 million Initial Term Loan under the Credit Agreement. The proceeds of the Initial Term Loan were used (1) to settle the Company's existing 0.25% Convertible Senior Notes due May 15, 2018 and (2) for working capital and general corporate purposes. On April 2, 2018 , the Company entered into an amendment under the Credit Agreement for an incremental term loan in an aggregate principal amount of $825.0 million ("Incremental Term Loan") to finance the acquisition of Lifetouch, Inc. The full amount of the $200.0 million Revolving Loan Facility remains undrawn as of June 30, 2018 . Upon funding of the Initial Term Loan, the Company elected to bear interest at a rate of one-month LIBOR, subject to a floor of 0.0% , plus an applicable margin of 2.50% per annum. Upon funding of the Incremental Term Loan, the Company elected to bear interest at a rate of one-month LIBOR, subject to a floor of 0.0% , plus an applicable margin of 2.75% per annum. The applicable margin of 2.75% for the Incremental Term Loan is determined based on a secured leverage ratio as defined by the Incremental Term Loan Amendment dated April 2, 2018. The effective interest rates for the unhedged portion of the Initial Term Loan for three and six months ended June 30, 2018 were 4.43% and 4.27% , respectively. The effective interest rate for the Incremental Term Loan, which was drawn during the current quarter, was 4.68% . The revolving loans under the Credit Agreement bear interest, at the election of the Company, at either (a) the base rate (the "Base Rate"), which is defined as a fluctuating rate per annum equal to the greatest of (1) the prime rate then in effect, (2) the federal funds rate then in effect, plus 0.50% , and (3) an adjusted LIBOR rate determined on the basis of a one-month interest period, plus 1.0% or (b) an adjusted LIBOR Rate, subject to a floor of 0.0% (the "LIBOR Rate"), in each case, plus an applicable margin of (1) initially, 0.75% per annum in the case of Base Rate loans and 1.75% per annum in the case of LIBOR Rate loans or (2) following the Company’s delivery of financial statements for the first full fiscal quarter following the Closing Date, 0.50% to 0.75% per annum in the case of Base Rate loans and 1.50% to 1.75% per annum in the case of LIBOR Rate loans, in each case based on the Company’s consolidated secured net leverage ratio, measured as of the end of the most recently ended fiscal quarter. In connection with the Credit Agreement, the Company is also required to pay commitment fees, closing fees, arrangement fees, ticking fees and administration fees, and other customary fees and costs. Both the Initial Term Loan and the Incremental Term Loan have a maturity date of August 17, 2024 . Commencing on the respective last day of the first full fiscal quarter following the Company's respective borrowings of the Initial Term Loan and the Incremental Term Loan, the respective Initial Term Loan and Incremental Term Loan amortize in equal quarterly installments of 0.25% of the outstanding principal balance for each loan, with the remaining respective principal balances payable on the maturity date. Amounts drawn on the Revolving Loan Facility, if any, mature on August 17, 2022. Further, the Company has the right to prepay its borrowings under the Credit Agreement in whole or in part at any time without a premium or penalty, subject to certain limitations and a 1.0% repricing premium applicable during the first six months for the Initial Term Loan and/or the Incremental Term Loan. The Credit Agreement also contains certain customary mandatory prepayments under certain conditions as set forth in the Credit Agreement. The Credit Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict the Company’s and its subsidiaries’ ability to, among other things, incur indebtedness, grant liens, undergo certain fundamental changes, dispose of assets, make investments, enter into transactions with affiliates, and make certain restricted payments (including declaration and payment of dividends), in each case subject to limitations and exceptions set forth in the Credit Agreement. The Company is also required to maintain compliance, measured as of the end of each fiscal quarter, with a consolidated secured net leverage ratio and a consolidated interest expense coverage ratio. As of June 30, 2018 , the Company is in compliance with these covenants. In August 2017, the Company entered into certain interest-rate swap agreements with an effective date of October 18, 2017 that have the economic effect of modifying a portion of the variable interest-rate obligations associated with the Initial Term Loan so that the interest payable on such portion become fixed (refer to Note 14 - Derivative Financial Instruments for further details regarding the interest-rate swap agreements). The Company incurred $5.6 million in credit facility origination costs during the year ended December 31, 2017 related to the Credit Agreement and $18.3 million in origination costs during the six months ended June 30, 2018 related to the Incremental Term Loan. The origination costs attributable to the Revolving Loan Facility were capitalized within prepaid expenses for the current portion and other assets for the non-current portion. The origination costs attributable to the Initial Term Loan and the Incremental Term Loan are presented as a reduction to the carrying value of the debt in the consolidated balance sheet. Fees attributable to the Revolving Loan Facility of $0.8 million are being amortized over five years as component of interest expense. The fees attributable to the Initial Term Loan of $4.8 million and the Incremental Term Loan of $18.3 million are being amortized over the term of the loans, both as a component of interest expense. The Initial Term Loan and Incremental Term Loan consist of the following (in thousands): June 30, 2018 December 31, 2017 Liability component: Principal borrowings $ 1,125,000 $ 300,000 Less: principal payments (1,500 ) — Less: debt issuance costs, net of amortization (21,827 ) (4,543 ) Net carrying amount $ 1,101,673 $ 295,457 Term loans, current $ 11,219 $ 3,000 Term loans, non-current $ 1,090,454 $ 292,457 The following table sets forth the total interest expense recognized related to the Initial Term Loan and the Incremental Term Loan for the three and six months ended June 30, 2018 (in thousands). The Initial Term Loan was drawn in October 2017 and the Incremental Term Loan was draw in April 2018. Therefore, there was no interest expense for the three and six months ended June 30, 2017 associated with these loans. Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Floating interest (including the effects of cash flow hedges) $ 12,849 $ — $ 16,100 $ — Amortization of debt issuance costs 891 — 1,063 — $ 13,740 $ — $ 17,163 $ — Assumed Notes Payable from the Acquisition of Lifetouch In connection with the acquisition of Lifetouch in the second quarter of 2018 (refer to Note 2 - Acquisition ), the Company assumed $9.1 million of legacy Lifetouch notes payable (of which $4.0 million was classified as current), which is payable in varying principal payments plus interest rates ranging from 0% to 2.2% with maturities at various dates through July 2022. These notes payable were issued by Lifetouch to finance various acquisitions and represents promissory notes issued to the owners of the acquired companies for an amount equal to the purchase consideration. Payments of principal for these notes payable during the three months ended June 30, 2018 were $1.1 million . As of June 30, 2018 , the estimated future principal and interest payments of these assumed notes payable is as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 1,429 2019 3,357 2020 2,082 2021 1,196 2022 740 Total principal and interest payments $ 8,804 0.25% Convertible Senior Notes Due May 15, 2018 In May 2013, the Company issued $300.0 million aggregate principal amount of 0.25% convertible senior notes (the "Notes") which were due and paid on May 15, 2018 . Upon maturity, the Company paid the aggregate principal amount of $300.0 million and delivered 1,108,000 shares of the Company's common stock. In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the face value of the Notes as a whole. The excess of the principal amount of the liability component over its carrying amount (“debt discount”) was amortized to interest expense over the term of the Notes. In accounting for the transaction costs related to the Note issuance, the Company allocated the total amount incurred to the liability and equity components based on their relative values. Issuance costs attributable to the liability component, totaling $6.4 million , were amortized to expense over the term of the Notes, and issuance costs attributable to the equity component, totaling $1.7 million , were netted with the equity component in stockholders' equity. Additionally, the Company recorded a deferred tax asset of $0.6 million on a portion of the equity component transaction costs which are deductible for tax purposes. Concurrently with the Note issuance, the Company repurchased 0.6 million shares of common stock for approximately $30.0 million . The Notes consist of the following (in thousands): June 30, 2018 December 31, 2017 Liability component: Principal $ — $ 300,000 Less: debt issuance costs, debt discount, net of amortization — (5,946 ) Net carrying amount (classified as current) $ — $ 294,054 Equity component (1) $ — $ 63,510 (1) Recorded in the consolidated balance sheets within additional paid-in capital, net of the $1.7 million of issuance costs in equity. The following table sets forth total interest expense recognized related to the Notes (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 0.25% coupon $ 94 $ 188 $ 281 $ 375 Amortization of debt issuance costs 182 347 543 688 Amortization of debt discount 1,814 3,442 5,403 6,836 $ 2,090 $ 3,977 $ 6,227 $ 7,899 Note Hedge To minimize the impact of potential economic dilution upon conversion of the Notes, the Company entered into convertible note hedge transactions with respect to its common stock (the “Note Hedge”). In May 2013, the Company paid an aggregate amount of $63.5 million for the Note Hedge. The Note Hedge expired upon maturity of the Notes in May 2018. The Note Hedge was intended to offset the potential dilution upon conversion of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount upon conversion of the Notes in the event that the market value per share of the Company's common stock, as measured under the Notes, is greater than the strike price of the Note Hedge, which initially corresponds to the conversion price of the Notes and is subject to anti-dilution adjustments substantially similar to those applicable to the conversion rate of the Notes. Upon expiration of the Note Hedge in May 2018, the Company received 1,108,000 shares of the Company's common stock from the Note Hedge counterparties. Warrant Separately, in May 2013, the Company entered into warrant transactions (the “Warrant”), whereby the Company sold warrants to acquire shares of the Company's common stock at a strike price of $83.18 per share. The Company received aggregate proceeds of $43.6 million from the sale of the Warrant. As of June 30, 2018 , there are 4,675,000 warrants that will settle ratably over an 80 -day period commencing on August 15, 2018. The Company intends to net share settle the warrants. If the average market value per share of the Company's common stock for the reporting period, as measured under the Warrant, exceeds the strike price of the Warrant, the Warrant will have a dilutive effect on the Company's earnings per share (refer to Note 5 - Net Loss per Share for dilution considerations). The Warrant is a separate transaction, entered into by the Company and is not part of the Notes or the Note Hedge, and has been accounted for as part of additional paid-in capital. Holders of the Notes and Note Hedge will not have any rights with respect to the Warrant.

Segment Reporting

Segment Reporting	6 Months Ended
Segment Reporting	Jun. 30, 2018
Segment Reporting [Abstract]
Segment Reporting	Segment Reporting The Company reports segment information based on its internal reporting used by management for making decisions and assessing performance as the source of its reportable segments. As a result of the acquisition of Lifetouch in the second quarter of 2018, the Company entered into a new business and as a result, the Company has a new reportable and operating segment described further below. The Chief Operating Decision Maker ("CODM") function uses segment margin to evaluate the performance of the segments and allocate resources. Management considers segment margin to be the appropriate metric to evaluate and compare the ongoing performance of each reportable segment as it is the level at which direct costs associated with the performance of the segment are monitored. During the second quarter of 2018, the Company expanded its segment reporting. As a result, the profitability metric by which the Company's CODM measures segment performance and allocates resources changed from segment gross profit to segment margin. Segment margin includes technology and development expenses, sales and marketing expenses, and credit card fees, arriving at a margin for the segment. Segment margin excludes corporate expenses, amortization of intangible assets, stock-based compensation expense, and other non-recurring items including restructuring charges and acquisition-related costs. Corporate expenses include activities that are not directly attributable or allocable to a specific segment. The Company’s segments are determined based on the products and services each segment provides and how the CODM evaluates the business. The Company has the following reportable segments: Shutterfly Consumer - Includes sales from the Company's brands and are derived from the sale of a variety of products, such as cards and stationery, professionally-bound photo books, home décor, personalized gifts, high quality prints, and other photo-based merchandise, and related shipping revenue, as well as rental revenue from its BorrowLenses brand. Revenue from advertising displayed on the Company's websites is also included in Shutterfly Consumer revenue. Lifetouch - Includes revenue from professional photography services provided at schools, preschools and churches, as well as retail studios operated by Lifetouch under the JCPenney Portrait brand. Shutterfly Business Solutions - Includes revenue from personalized direct marketing and other end-consumer communications as well as just-in-time, inventory-free printing for the Company's business customers. Segment assets are not reported to, or used by, the CODM to allocate resources or assess performance of the Company's segments. Accordingly, the Company has not disclosed asset information by segment. Substantially all of the Company's revenue is generated from sales originating in the United States. The Company’s segment results for the three and six months ended June 30, 2018 and 2017 were as follows (dollars in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Shutterfly Consumer: Net revenue $ 165,003 $ 179,090 $ 317,062 $ 339,735 Cost of net revenue 86,065 92,049 170,909 181,903 Technology and development 29,830 33,037 61,959 71,966 Sales and marketing 29,956 36,406 60,681 72,144 Credit card fees 4,349 4,654 8,548 8,943 Margin (1) $ 14,803 $ 12,944 $ 14,965 $ 4,779 Margin % 9 % 7 % 5 % 1 % Lifetouch (2) : Net revenue (3) $ 261,911 $ — $ 261,911 $ — Cost of net revenue (4) 91,148 — 91,148 — Technology and development 7,109 — 7,109 — Sales and marketing 86,960 — 86,960 — Credit card fees 1,165 — 1,165 — Margin (1) $ 75,529 $ — $ 75,529 $ — Margin % 29 % — % 29 % — % Shutterfly Business Solutions: Net revenue $ 49,809 $ 29,942 $ 97,475 $ 61,269 Cost of net revenue 41,610 23,900 81,519 47,738 Technology and development 3,049 4,182 6,994 8,511 Sales and marketing 1,619 931 3,069 1,839 Margin (1) $ 3,531 $ 929 $ 5,893 $ 3,181 Margin % 7 % 3 % 6 % 5 % Consolidated Segments: Net revenue (3) $ 476,723 $ 209,032 $ 676,448 $ 401,004 Cost of net revenue (4) 218,823 115,949 343,576 229,641 Technology and development 39,988 37,219 76,062 80,477 Sales and marketing 118,535 37,337 150,710 73,983 Credit card fees 5,514 4,654 9,713 8,943 Margin (1) $ 93,863 $ 13,873 $ 96,387 $ 7,960 Margin % 20 % 7 % 14 % 2 % (1) The margins reported reflect only costs that are directly attributable or allocable to a specific segment and exclude corporate expenses, amortization of intangible assets, stock-based compensation expense and other one-time charges. (2) The Company acquired Lifetouch on April 2, 2018. (3) Yearbook sales and collections for the Lifetouch segment are made throughout the school year, whereas yearbooks are typically delivered toward the end of the school year in the second quarter of the fiscal year. Business combination accounting principles require the Company to record the assumed deferred revenue at fair value on the acquisition date measured based on the cost to manufacture and deliver the yearbooks, plus a profit margin. Segment reporting includes this purchase accounting adjustment which primarily relates to yearbook sales in net revenue for the Lifetouch segment. (4) Business combination accounting principles require the Company to measure acquired inventory at fair value. The fair value of inventory reflects Lifetouch's cost of manufacturing plus a portion of the expected profit margin. Segment reporting excludes this purchase accounting adjustment from cost of net revenue for the Lifetouch segment. The following table reconciles operating segment margin to total operating income (loss) and loss before income taxes, operating segment net revenue to total net revenue, and operating segment cost of net revenue to total cost of net revenue (in thousands): Three Months Ended Six Months Ended 2018 2017 2018 2017 Total margin for operating segments $ 93,863 $ 13,873 $ 96,387 $ 7,960 Purchase accounting deferred revenue adjustment (1) (33,351 ) — (33,351 ) — Purchase accounting inventory adjustment (2) (10,931 ) — (10,931 ) — Corporate expenses (3) (37,012 ) (18,613 ) (55,036 ) (36,825 ) Amortization of intangible assets (12,831 ) (3,860 ) (15,164 ) (8,200 ) Stock-based compensation expense for operating segments (11,697 ) (10,469 ) (23,389 ) (22,788 ) Restructuring (2,952 ) (4,673 ) (2,952 ) (13,649 ) Acquisition-related costs (8,000 ) — (12,585 ) — Capital lease termination — (8,098 ) — (8,098 ) Loss from operations $ (22,911 ) $ (31,840 ) $ (57,021 ) $ (81,600 ) Loss from operations $ (22,911 ) $ (31,840 ) $ (57,021 ) $ (81,600 ) Interest expense (17,769 ) (5,955 ) (27,402 ) (11,919 ) Interest and other income, net 1,561 244 3,310 433 Loss before income taxes $ (39,119 ) $ (37,551 ) $ (81,113 ) $ (93,086 ) Total net revenue for all operating segments $ 476,723 $ 209,032 $ 676,448 $ 401,004 Purchase accounting deferred revenue adjustment (1) (33,351 ) — (33,351 ) — Total net revenue $ 443,372 $ 209,032 $ 643,097 $ 401,004 Total cost of net revenue for all operating segments $ 218,823 $ 115,949 $ 343,576 $ 229,641 Purchase accounting inventory adjustment (2) 10,931 — 10,931 — Stock-based compensation expense for cost of net revenue 943 1,074 1,942 2,243 Amortization of intangible assets for cost of net revenue 2,531 1,182 2,826 2,440 Total cost of net revenue $ 233,228 $ 118,205 $ 359,275 $ 234,324 (1) Yearbook sales and collections for the Lifetouch segment are made throughout the school year, whereas yearbooks are typically delivered toward the end of the school year in the second quarter of the fiscal year. Business combination accounting principles require the Company to record the assumed deferred revenue at fair value on the acquisition date measured based on the cost to manufacture and deliver the yearbooks, plus a profit margin. Segment reporting includes this purchase accounting adjustment which primarily relates to yearbook sales in net revenue for the Lifetouch segment. (2) Business combination accounting principles require the Company to measure acquired inventory at fair value. The fair value of inventory reflects the acquired company’s cost of manufacturing plus a portion of the expected profit margin. Management reporting excludes this purchase accounting adjustment from cost of net revenue for the Lifetouch segment. (3) Corporate expenses include activities that are not directly attributable or allocable to a specific segment. This category consists primarily of expenses related to certain functions performed at the corporate level such as non-manufacturing facilities, human resources, finance and accounting, legal, information technology, integration, etc.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
Commitments and Contingencies	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Leases Assumed from the Acquisition of Lifetouch There have been no significant changes to the minimum lease payments schedule disclosed in the Company's Form 10-K for the year ended December 31, 2017. However, the Company assumed leases in connection with the acquisition of Lifetouch. As part of this acquisition, the Company assumed leases for office facilities, production and warehouse facilities, several photographic studios, and a portion of office equipment under operating agreements, which expire beginning in 2018 through 2030. Rent expense in connection with these assumed leases was $4.8 million for the three months ended June 30, 2018 . At June 30, 2018 , the total future minimum payments under these assumed non-cancelable operating leases from the acquisition of Lifetouch are as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 8,149 2019 13,432 2020 8,662 2021 4,998 2022 2,612 2023 1,265 Thereafter 1,462 Total minimum lease payments $ 40,580 Total minimum lease payments for capital leases assumed as part of the acquisition of Lifetouch are not significant to the financial statements. Purchase Obligations Assumed from the Acquisition of Lifetouch There have been no significant changes to the non-cancelable purchase obligations disclosed in the Company's Form 10-K for the year ended December 31, 2017. However, the Company assumed certain non-cancelable purchase obligations in connection with the acquisition of Lifetouch primarily related to non-cancelable service agreements that expire through 2021. At June 30, 2018 , the assumed purchased obligations totaled $15.8 million . As of June 30, 2018 , the total future minimum payments under these purchase obligations are as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 6,874 2019 6,786 2020 2,057 2021 101 Total minimum purchase obligations $ 15,818 Indemnifications In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves future claims that may be made against the Company, but have not yet been made. To date, the Company has not paid any claims or been required to defend any action related to its indemnification obligations. However, the Company may record charges in the future as a result of these indemnification obligations. 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 contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. Legal Matters The Company is subject to the various legal proceedings and claims discussed below as well as certain other legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. Although adverse decisions (or settlements) may occur in one or more of these cases, it is not possible to estimate the possible loss or losses from each of these cases. The final resolution of these lawsuits, individually or in the aggregate, is not expected to have a material adverse effect on the Company's business, financial position or results of operations. Cases that previously were disclosed may no longer be described because of rulings in the case, settlements, changes in the Company's business or other developments rendering them, in the Company's judgment, no longer material to the Company's business, financial position or results of operations. No material legal proceeding was terminated during the second quarter of 2018. The State of Delaware v. Shutterfly, Inc. On May 1, 2014, the State of Delaware filed a complaint against Shutterfly for alleged violations of the Delaware False Claims and Reporting Act, 6 Del C. § 1203(b)(2). The complaint asserts that Shutterfly failed to report and remit to Delaware cash equal to the balances on unused gift cards under the Delaware Escheats Law, 12 Del. C. § 1101 et seq. The Company believes the suit is without merit. The Company has reached an agreement in principle to settle this matter. The settlement is in the process of being finalized, which the Company expects to happen during the third quarter of 2018. After the settlement is finalized, the case will be dismissed with prejudice. Monroy v. Shutterfly, Inc. On November 30, 2016, Alejandro Monroy on behalf of himself and all others similarly situated, filed a complaint against us in the U.S. District Court for the Northern District of Illinois. The complaint asserts that the Company violated the Illinois Biometric Information Privacy Act by extracting his and others’ biometric identifiers from photographs and seeks statutory damages and an injunction. The Company believes the suit is without merit and intends to vigorously defend against it. Taylor v. Shutterfly, Inc. On December 12, 2017, Megan Taylor filed a purported class action complaint on behalf of herself and other customers in the U.S. District Court for the Northern District of California. Taylor alleges that the Company misrepresents a deal it currently offers through Groupon because it does not allow purchasers of the Groupon offer to combine or “stack” it with other promotional codes offered by the Company. Taylor is seeking monetary damages and injunctive relief. The Company believes the suit is without merit and intends to vigorously defend against it. Vigeant v Meek et al. On March 1, 2018, a purported class action complaint was filed against several directors of Lifetouch, Inc. (which became a direct wholly-owned subsidiary of Shutterfly on April 2, 2018) and the trustee of the Lifetouch Employee Stock Ownership Plan (the “ESOP”) in the U.S. District Court for the District of Minnesota. On April 2, 2018, the complaint was amended to include the prior ESOP trustees and plan sponsor (Lifetouch) as additional named defendants. The complaint alleges violations of the Employee Retirement Income Security Act, including that the ESOP should not have been permitted to continue investing in Lifetouch stock during a period in which the Lifetouch stock price was declining. The plaintiffs seek recovery for damages arising from the alleged breaches of fiduciary duty. The Company believes this suit is without merit and intends to vigorously defend against it. In all cases, at each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. In such cases, the Company accrues for the amount, or if a range, the Company accrues the low end of the range as a component of legal expense. The Company monitors developments in these legal matters that could affect the estimate the Company had previously accrued. There are no amounts accrued which the Company believes would be material to its financial position and results of operations.

Share Repurchase Program

Share Repurchase Program	6 Months Ended
Share Repurchase Program	Jun. 30, 2018
Share Repurchase Program [Abstract]
Share Repurchase Program	Share Repurchase Program On October 24, 2012, the Company's Board of Directors (the "Board") conditionally authorized and the Audit Committee subsequently approved a share repurchase program for up to $60.0 million of the Company's common stock. As of June 30, 2018 , the Company's Board of Directors had approved increases to the program on the following dates: • On February 6, 2014, the Board approved an increase of $100.0 million in addition to any amounts repurchased as of that date. • On February 9, 2015, the Board approved an increase of $300.0 million in addition to any amounts repurchased as of that date. • On April 21, 2016, the Board approved an increase of $100.0 million in addition to any amounts repurchased as of that date. • On April 18, 2017, the Board approved an increase of $140.0 million in addition to any amounts repurchased as of that date. The Company suspended its share repurchase program as of December 31, 2017 and the Company has publicly committed to maintaining a BB rating profile, and repaying acquisition debt, accordingly. The share repurchase program is subject to prevailing market conditions and other considerations; does not require the Company to repurchase any dollar amount or number of shares; and may be suspended or discontinued at any time. The share repurchase authorization, which was effective immediately, permits the Company to effect repurchases for cash from time to time through the open market, privately negotiated or other transactions, including pursuant to trading plans established in accordance with Rules 10b5-1 and 10b-18 of the Securities Exchange Act of 1934, as amended, or by a combination of such methods. The following table provides information about our repurchase of shares of our common stock for fiscal years 2016 , 2017 , and 2018 : Period (1) Total Number of Shares Purchased Average Price Paid per Share Total Dollar Value Spent on Repurchases (in thousands) 2016 Repurchases 2,524,752 $44.55 $112,488 2017 Repurchases 2,325,825 $47.29 $110,000 2018 Repurchases — — — (1) All shares were purchased pursuant to the publicly announced share repurchase program described above. Shares are reported in a period based on the settlement date of the applicable repurchase. All repurchased shares of common stock have been retired.

Restructuring

Restructuring	6 Months Ended
Restructuring	Jun. 30, 2018
Restructuring and Related Activities [Abstract]
Restructuring	Restructuring iMemories Restructuring The Company completed the acquisition of Lifetouch on April 2, 2018. At the time the Company purchased Lifetouch, it anticipated that it would exit the iMemories business, as Shutterfly Photos was a more complete and advanced solution. The Company decided to accelerate the process of exiting iMemories, which was completed in the second quarter of 2018 and was divested for a nominal amount. The exit resulted in restructuring charges of $3.0 million consisted of lease termination costs of $1.0 million , employee-related costs of $0.8 million and other costs of $1.2 million . Payments of $2.2 million in connection with these charges were made during the second quarter of 2018. The remaining $0.8 million relates to non-cash restructuring charges primarily related to write-off of certain assets. The Company does not expect to incur any further charges in connection with this divestiture. Other Restructuring Activity The restructuring liability in connection with restructuring plans from previous years was $2.0 million and $3.2 million as of June 30, 2018 and December 31, 2017, respectively. Activity for these plans during the six months ended June 30, 2018 related to cash payments.

Derivative Financial Instrument

Derivative Financial Instruments	6 Months Ended
Derivative Financial Instruments	Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Financial Instruments	Derivative Financial Instruments In August 2017, the Company entered into certain interest-rate swap agreements (“Swap Agreements”) with an aggregate notional amount of $150.0 million and an effective date of October 18, 2017. The Swap Agreements have the economic effect of modifying a portion of the variable interest-rate obligations associated with the Company’s Initial Term Loan drawn in October 2017 so that the interest payable on such portion of the Initial Term Loan become fixed at a rate of 4.27% (refer to Note 9 - Debt for further details regarding the term loan facility). The Swap Agreements have a maturity date of August 17, 2023 as compared to August 17, 2024 for the Initial Term Loan. Further, the Initial Term Loan has an interest-rate floor, whereas the Swap Agreements do not include a floor. All other critical terms of the Swap Agreements correspond to the Initial Term Loan, including interest-rate reset dates and underlying market indices. The Company fully drew the Initial Term Loan on October 18, 2017 which is also the effective date of the Swap Agreements. The Company has asserted that it is probable that it will have sufficient outstanding debt throughout the life of the Swap Agreements. The Company has designated the aforementioned Swap Agreements as qualifying hedging instruments and is accounting for them as cash flow hedges pursuant to ASC 815 (as amended by ASU 2017-12). The fair value of the Swap Agreements were $6.7 million and $3.0 million as of June 30, 2018 and December 31, 2017 , respectively, and were classified as other assets in the balance sheet. The unrealized gains recognized in other comprehensive income (loss) were $1.0 million and $3.8 million for the three and six months ended June 30, 2018 , respectively. The amounts reclassified from other comprehensive income (loss) to interest expense during the three and six months ended June 30, 2018 were insignificant. Amounts expected to be reclassified from other comprehensive income into interest expense in the coming 12 months is $0.9 million . Interest expense (including the effects of the cash flow hedges) related to the portion of the Initial Term Loan subject to the aforementioned interest-rate swap agreements was $1.6 million and $3.3 million for the three and six months ended June 30, 2018 , respectively. The Company does not use derivative financial instruments for trading purposes.

The Company and Summary of Si21

The Company and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and, accordingly, do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements include the accounts of Shutterfly, Inc. and its wholly owned subsidiaries including the financial results of Lifetouch which are included prospectively from the acquisition date of April 2, 2018. In the opinion of management, all adjustments, consisting primarily of normal recurring accruals, considered necessary for a fair statement of the Company’s results of operations for the interim periods reported and of its financial condition as of the date of the interim balance sheet have been included. Operating results for the three and six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018 , or for any other period. The December 31, 2017 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes for the year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K.
Tax Cuts and Jobs Act	Tax Cuts and Jobs Act As of December 31, 2017, the Company recorded provisional estimates of the tax impacts of the enactment of the Tax Cuts and Jobs Act (the “Tax Act”). The Company provisionally recorded an income tax benefit related to the Tax Act primarily for the impact of the remeasurement of its deferred tax assets and liabilities at the newly enacted 21% tax rate, the enhanced accelerated depreciation deductions available on qualified property, and estimates of other elements of the Tax Act. The Company's accounting for the Tax Act as of December 31, 2017 was incomplete due to the complexity involved and the absence of regulatory guidance, and therefore its provisional accounting was based on reasonable estimates. In accordance with Staff Accounting Bulletin 118, the measurement period extends up to one year from the enactment date. As the Company completes its analysis of regulatory guidance, adjustments to its provisional amounts may have a material impact to the Company’s provision for income taxes in the period they are recognized. For the three and six months ended June 30, 2018 , the Company did not record any adjustments to its provisional amounts. The Company expects to complete its analysis by the fourth quarter of 2018.
Foreign Currency Translation Policy	Foreign Currency Translation Policy As a result of the acquisition of Lifetouch, the Company has subsidiaries in Canada for which the functional currency is the local currency. As such, exchange rate fluctuations for these subsidiaries are included in stockholders' equity as a component of accumulated other comprehensive income. Prior to the acquisition of Lifetouch, the Company only had one foreign subsidiary in Israel for which the functional currency is the U.S. Dollar and exchange rate fluctuations are recorded as part of earnings.
Recently Adopted and Pending Adoption Accounting Pronouncements	Recently Adopted Accounting Pronouncements In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606 ) (“ASC 606”). This new standard replaces all current GAAP guidance on this topic and eliminates all industry-specific guidance. The new revenue recognition guidance provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange of those goods or services. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective transition method. Refer to Note 2 - Revenue for further details. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments. The Company adopted ASU 2016-15 as of January 1, 2018 on a retrospective basis with no material impact to the consolidated statements of cash flows for the six months ended June 30, 2018 and 2017. Recent Accounting Pronouncements Pending Adoption In February 2018, the FASB issued ASU No. 2018-02, Income Statement, Reporting Comprehensive Income (Topic 220) : Reclassification of Certain Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”), which allows a reclassification of stranded tax effects from accumulated other comprehensive income to retained earnings, as a result of the Tax Act. ASU 2018-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018, with early adoption permitted and can be applied either in the period of adoption or retrospectively to all applicable periods. The Company does not expect that the pending adoption of ASU 2018-02 will have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The new guidance requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous guidance. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 on a modified retrospective basis, and earlier adoption is permitted. The Company anticipates that most of its operating lease commitments will be subject to the new standard and recognized as lease liabilities and right-of-use assets upon adoption, which will increase the total assets and total liabilities. The Company is currently evaluating the accounting transition and disclosure requirements of this standard, and due to the magnitude of leases assumed in the recent acquisition of Lifetouch, the Company cannot currently estimate the financial statement impact of adoption. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires measurement and recognition of expected credit losses for financial assets held. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Earlier adoption is permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is evaluating the impact of adopting this new accounting guidance on the consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) . The updated guidance simplifies the measurement of goodwill impairment by removing step two of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments should be applied on a prospective basis. The new standard is effective for annual or any interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019 with early adoption permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is evaluating the impact this new accounting guidance will have on the consolidated financial statements.
Revenue Recognition and Deferred Revenue	Revenue Recognition Policy The Company derives its revenue from Shutterfly Consumer, Lifetouch and SBS product sales, net of applicable sales tax and allowances for returns. Revenue is recognized when control of the promised products or services is transferred to its customers in an amount that reflects the consideration it expects to be entitled to in exchange for those products or services. Shipping charged to its customers is recognized upon shipment and the related shipping costs are recognized as cost of net revenue. Shutterfly Consumer and Lifetouch. The Company’s Shutterfly Consumer revenue is primarily derived from the sale of products such as, professionally-bound photo books, cards and stationery, custom home décor products and unique photo gifts, calendars and prints, etc. Customers place Shutterfly Consumer product orders through the Shutterfly website or mobile apps and pay primarily using credit cards. The Company’s Lifetouch revenue is primarily derived from the sale of photographic and publishing products. Customers place Lifetouch product orders through the Lifetouch website, via order forms or in person at the JCPenney photo studios and churches. Customers pay using credit cards, or fill out an order form and enclose exact payment. Revenue is recognized upon shipment of the fulfilled orders, which generally occurs upon delivering to the carrier. If multiple products are ordered together, each product is a separate performance obligation, and the transaction price is allocated to each performance obligation based upon standalone selling price as each performance obligation is satisfied. The Company generally determines the standalone selling prices based on the prices charged to its customers or using expected cost plus margin. For flash deal promotions through group buying websites, the Company recognizes revenue on a gross basis, as it is the primary obligor, when redeemed items are shipped. Revenue from sales of flash deal promotions are deferred until shipment of fulfilled orders or until unredeemed flash deal promotions are recognized as breakage revenue. The Company recognizes the expected breakage amounts as revenue in proportion to the pattern of rights exercised by the customer. The Company periodically provides incentive offers to its new customers in exchange for setting up an account as well as to its existing customers to encourage purchases. These incentive offers are readily available to all of its customers. Therefore, these do not represent a performance obligation as its customers are not required to enter into any enforceable commitment by receiving these incentive offers. The discounts are treated as a price reduction when accepted and used by customers. Production costs related to free products are included in cost of net revenue upon redemption. SBS. The Company’s SBS revenue is derived from personalized direct marketing and other end-consumer communications as well as just-in-time, inventory-free printing for its business customers. The services that the Company promises to its SBS customers are typically composed of a series of services that are performed over time. The Company accounts for these series of services as one performance obligation which represents a series of distinct services that are substantially the same and have the same pattern of transfer. The Company recognizes revenue from the satisfaction of performance obligations when it invoices its customers (that is, when it has the contractual right to bill under the contract). The Company has the contractual right to consideration from its customers in an amount that corresponds directly with the value to the customer of the services it has performed to date. For contracts that do not contain a significant non-refundable up-front fee, the Company applies the “right to invoice” practical expedient as it has the right to consideration from its customers in an amount that corresponds directly with the value to the customer of the services it has performed to date. For contracts that contain a significant non-refundable up-front fee, the Company considers whether these fees are related to the transfer of a promised good or service to the customer, and therefore represent a performance obligation. When the up-front fees do not represent a distinct performance obligation, the Company recognizes revenue ratably over the period for which there is a significant termination contractual penalty. The Company's incremental direct costs of obtaining a contract consist of Lifetouch and SBS sales commissions. The Company does not defer such incremental direct costs as the related performance obligations are satisfied within a short period of time and the Company elected to apply the practical expedient per ASC 340-40-25-4 related to expensing contract acquisition costs with the amortization period of less than one year. The Company does not provide any financing service to its customer as payment term. Deferred Revenue The Company records deferred revenue when cash payments are received in advance of our performance and primarily relate to flash deal promotions, gift cards, yearbooks and portrait proofs as well as up-front fees received from an SBS customer.
Business Combinations	In accordance with ASC 805, Business Combinations , the Company has recorded the acquired assets (including identifiable intangible assets) and liabilities assumed at the acquisition date fair values. The purchase price allocation for the Lifetouch acquisition is preliminary and subject to revision as additional information about fair value of assets acquired and liabilities assumed becomes available. Additional information that existed as of the acquisition date but at that time was unknown may become known during the remainder of the measurement period, a period not to exceed 12 months from the acquisition date.
Net Loss Per Share	Basic net loss per share attributed to common shares is computed by dividing the net loss attributable to common shares for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share attributed to common shares is computed by dividing the net loss attributable to common shares for the period by the weighted-average number of common and potential common shares outstanding during the period, if the effect of each class of potential common shares is dilutive. Potential common shares include RSUs and incremental shares of common stock issuable upon the exercise of stock options, and conversion of warrants.

Revenues (Tables)

Revenues (Tables)	6 Months Ended
Revenues (Tables)	Jun. 30, 2018
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue	The following table disaggregates the Company’s net revenue by brand for the three and six months ended June 30, 2018 and 2017 (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Shutterfly consumer net revenue: Shutterfly brand $ 154,181 $ 139,908 $ 296,845 $ 263,811 Tiny Prints Boutique (1) 1,397 — 3,500 — Tiny Prints (1) — 12,917 — 23,382 Wedding Paper Divas (2) — 11,365 — 25,655 MyPublisher (3) — 6,056 — 10,992 Other 9,425 8,844 16,717 15,895 Shutterfly consumer net revenue 165,003 179,090 317,062 339,735 Lifetouch net revenue (4) 228,560 — 228,560 — Shutterfly Business Solutions net revenue 49,809 29,942 97,475 61,269 Net revenue $ 443,372 $ 209,032 $ 643,097 $ 401,004 (1) On June 28, 2017, the Company created a Tiny Prints boutique on a dedicated tab on Shutterfly.com and shut down the legacy Tiny Prints website. (2) On September 13, 2017, the Company launched the new Shutterfly Wedding Shop and shut down the Wedding Paper Divas legacy website. (3) The MyPublisher brand was shut down on May 15, 2017. (4) On April 2, 2018, the Company acquired Lifetouch.

Acquisition (Tables)

Acquisition (Tables)	6 Months Ended
Acquisition (Tables)	Jun. 30, 2018
Business Combinations [Abstract]
Summary of Calculation of the Purchase Consideration	The following table shows the calculation of how the preliminary purchase consideration paid by the Company was determined in accordance with the Purchase Agreement (in thousands): Cash consideration at closing $ 825,000 Less: Closing Indebtedness (1) (27,742 ) Less: Net Working Capital Adjustment (1) (10,559 ) Less: Transaction Expenses (1)(2) (17,614 ) Add: Closing Cash and Investments (1) 212,872 Purchase price adjustments 156,957 Total preliminary purchase consideration $ 981,957 (1) As defined in the Purchase Agreement. (2) Transaction expenses incurred by Lifetouch in connection with the transaction as defined by the Purchase Agreement.
Summary of the Preliminary Allocation of the Total Purchase Price to Net Assets Acquired	The following table shows the preliminary allocation of the total purchase price to the net assets acquired based on their estimated fair values as of April 2, 2018 (in thousands): Cash and cash equivalents $ 91,905 Investments 101,269 Accounts receivable, net 7,029 Inventories 19,857 Property and equipment, net 135,968 Intangible assets, net 326,700 Goodwill 432,399 Prepaid expenses and other assets 32,281 Accounts payable (15,331 ) Deferred revenue, current portion (29,984 ) Notes payable (9,065 ) Accrued and other liabilities (111,071 ) Total $ 981,957
Schedule of Intangible Assets Acquired from Lifetouch	The following table shows the valuation of the intangible assets acquired from Lifetouch along with their estimated remaining useful lives: Approximate Fair Value (in thousands) Weighted Average Life (in years) Customer contracts and related relationships $ 200,100 10 Developed technology 68,600 5 Trade names / trademarks / domain name 57,600 5 Favorable/unfavorable leases 400 7 Total intangible assets $ 326,700
Schedule of Unaudited Pro Forma Financial Information	The unaudited pro forma financial information as presented below is for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal 2017. Three Months Ended Six Months Ended June 30, June 30, (in thousands, except per share data) 2018 2017 2018 2017 Total net revenue $ 476,723 $ 470,531 $ 810,917 $ 789,010 Net loss $ 14,791 $ (3,488 ) $ (69,359 ) $ (115,667 ) Basic earnings per share $ 0.45 $ (0.10 ) $ (2.10 ) $ (3.44 ) Diluted earnings per share $ 0.41 $ (0.10 ) $ (2.10 ) $ (3.44 )

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
Stock-Based Compensation (Tables)	Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Summary of the status of the company's stock option plan	A summary of the Company’s stock option activity for the six months ended June 30, 2018 is as follows (share numbers and aggregate intrinsic values in thousands): Number of Options Outstanding (in thousands) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Balance as of December 31, 2017 1,529 $ 46.77 Granted 228 $ 76.73 Exercised (361 ) $ 45.87 Forfeited, cancelled or expired (28 ) $ 45.49 Balance as of June 30, 2018 1,368 $ 52.03 5.5 $ 51,997 Options vested and expected to vest as of June 30, 2018 1,264 $ 51.48 5.4 $ 48,748 Options vested as of June 30, 2018 338 $ 47.12 5.0 $ 14,514
Summary of valuation assumptions for stock options	The assumptions used to value options granted during the three and six months ended June 30, 2018 and 2017 are as follows (there were no option awards granted during the three months ended June 30, 2018): Three Months Ended Six Months Ended June 30, June 30, 2017 2018 2017 Dividend yield — — — Annual risk-free rate of return 1.8 % 2.6 % 1.9 % Expected volatility 30.0 % 33.7 % 29.8 % Expected term (years) 4.1 4.1 4.1
Summary of company restricted stock unit activity	A summary of the Company’s RSU activity for the six months ended June 30, 2018 , is as follows (share numbers in thousands): Number of Units Outstanding Weighted Average Grant Date Fair Value Awarded and unvested as of December 31, 2017 2,293 $ 44.64 Granted 629 $ 76.93 Vested (720 ) $ 45.01 Forfeited (127 ) $ 45.45 Awarded and unvested as of June 30, 2018 2,075 $ 54.24 RSUs expected to vest as of June 30, 2018 1,746

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	6 Months Ended
Net Loss Per Share (Tables)	Jun. 30, 2018
Earnings Per Share [Abstract]
Summary of the net loss per share	A summary of the net loss per share for the three and six months ended June 30, 2018 and 2017 is as follows (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Net loss per share: Numerator Net loss $ (26,512 ) $ (22,838 ) $ (53,677 ) $ (56,032 ) Denominator for basic and diluted net loss per share Weighted-average common shares outstanding 33,234 33,579 32,970 33,646 Net loss per share - basic and diluted $ (0.80 ) $ (0.68 ) $ (1.63 ) $ (1.67 )
Schedule of antidilutive securities excluded from computation of earnings per share	The following weighted-average outstanding stock options and RSUs were excluded from the computation of diluted net loss per common share for the periods presented because including them would have had an anti-dilutive effect (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Stock options and RSUs 3,571 4,060 3,629 4,004

Investments (Tables)

Investments (Tables)	6 Months Ended
Investments (Tables)	Jun. 30, 2018
Investments, Debt and Equity Securities [Abstract]
Fair value of short and long-term investments classified as available for sale	At June 30, 2018 and December 31, 2017 , the estimated fair value of short-term and long-term debt securities investments, all of which are classified as available-for-sale, was as follows (in thousands): June 30, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Short-term investments Corporate debt securities $ 39,103 $ 4 $ (59 ) $ 39,048 Agency securities 5,120 — (11 ) 5,109 Commercial paper 3,441 — — 3,441 U.S. government securities and other 6,300 — (8 ) 6,292 Total short-term investments $ 53,964 $ 4 $ (78 ) $ 53,890 Long-term investments Corporate debt securities $ 12,958 $ 1 $ (34 ) $ 12,925 Agency securities 5,694 — (29 ) 5,665 U.S. government securities 6,411 — (27 ) 6,384 Total long-term investments $ 25,063 $ 1 $ (90 ) $ 24,974 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Short-term investments Corporate debt securities $ 54,911 $ 3 $ (52 ) $ 54,862 Agency securities 10,781 — (14 ) 10,767 Commercial paper 101,546 — — 101,546 U.S. government securities 10,857 — (11 ) 10,846 Total short-term investments $ 178,095 $ 3 $ (77 ) $ 178,021 Long-term investments Corporate debt securities $ 6,287 $ — $ (25 ) $ 6,262 Agency securities 2,000 — (17 ) 1,983 U.S. government securities 998 — (1 ) 997 Total long-term investments $ 9,285 $ — $ (43 ) $ 9,242
Estimated fair values of short and long-term investments classified by date of contractual maturity	The following table summarizes the contractual maturities of the Company's investments as of June 30, 2018 and December 31, 2017 (in thousands): June 30, 2018 December 31, 2017 One year or less $ 53,890 $ 178,021 One year through three years 24,974 9,242 $ 78,864 $ 187,263

Fair Value Measurement (Tables)

Fair Value Measurement (Tables)	6 Months Ended
Fair Value Measurement (Tables)	Jun. 30, 2018
Fair Value Disclosures [Abstract]
Fair value, assets measured on recurring basis	The following table summarizes, by major security type, the Company's cash equivalents and investments that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands): Total Estimated Fair Value as of June 30, 2018 December 31, 2017 Cash Equivalents Investments Cash Equivalents Investments Level 1 Securities: Money market funds $ 94,765 $ — $ 151,071 $ — Level 2 Securities: Corporate debt securities — 51,974 21,592 61,124 Agency securities — 10,773 6,444 12,750 Commercial paper — 3,441 85,599 101,546 U.S. government securities and other — 12,676 — 11,843 Total cash equivalents and investments $ 94,765 $ 78,864 $ 264,706 $ 187,263
Fair value, derivative assets	As of June 30, 2018 and December 31, 2017 , the fair value of certain of the Company's term loans interest-rate swap agreements, which were determined based on an income-based valuation model that takes into account the contract terms as well as multiple observable market inputs such as LIBOR-based yield curves, futures, volatilities and basis spreads (Level 2), were as follows (in thousands): Total Estimated Fair Value as of June 30, 2018 December 31, 2017 Derivative assets $ 6,749 $ 2,979
Fair value, liabilities measured on a recurring basis	As of June 30, 2018 and December 31, 2017 , the fair value of the Company's borrowings, which was determined based on inputs that are observable in the market or that could be derived from, or corroborated with, observable market data, including the Company's stock price, interest rates and credit spread (Level 2) were as follows (in thousands): Total Estimated Fair Value as of June 30, 2018 December 31, 2017 Convertible senior notes $ — $ 296,550 Term Loans $ 1,128,658 $ 300,000

Balance Sheet Components (Table

Balance Sheet Components (Tables)	6 Months Ended
Balance Sheet Components (Tables)	Jun. 30, 2018
Balance Sheet Related Disclosures [Abstract]
Schedule of prepaid expenses and other current assets	Prepaid Expenses and Other Current Assets June 30, 2018 December 31, 2017 (in thousands) Intra-period deferred tax asset $ 44,821 $ — Restricted investment 18,745 — Prepaid service contracts – current portion 15,597 12,861 Other prepaid expenses and current assets 33,033 28,522 $ 112,196 $ 41,383
Schedule of property and equipment	Property and Equipment, Net June 30, 2018 December 31, 2017 (in thousands) Manufacturing equipment $ 218,416 $ 192,494 Computer equipment and software 170,020 188,593 Capitalized software and website development costs 154,001 134,585 Buildings under build-to-suit leases 56,468 56,468 Photography equipment 53,375 — Owned buildings and building improvements 38,622 — Leasehold improvements 27,188 22,145 Rental equipment 18,628 19,208 Land 17,000 — Furniture and fixtures 12,529 8,255 766,247 621,748 Less: Accumulated depreciation and amortization (373,585 ) (354,888 ) Property and equipment, net $ 392,662 $ 266,860
Schedule of intangible assets	Intangible assets are comprised of the following: Weighted Average Useful Life June 30, 2018 December 31, 2017 (in thousands) Purchased technology 8 years $ 173,469 $ 104,869 Less: accumulated amortization (81,742 ) (76,585 ) 91,727 28,284 Customer relationships 9 years 275,246 75,146 Less: accumulated amortization (80,310 ) (73,759 ) 194,936 1,387 Other (1) 5 years 65,202 7,202 Less: accumulated amortization (10,096 ) (7,202 ) 55,106 — Total $ 341,769 $ 29,671 (1) The unamortized balance for other intangible assets primarily relate to the trade name, trademarks and domain name assets acquired as part of the acquisition of Lifetouch during the second quarter of 2018.
Schedule of amortization of intangible assets	Amortization of existing intangible assets is estimated to be as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 24,691 2019 49,360 2020 49,134 2021 49,059 2022 48,553 Thereafter 120,972 $ 341,769
Schedule of goodwill	The following table presents the goodwill allocated to the Company's reportable segments as of and during the six months ended June 30, 2018 (in thousands): December 31, 2017 Acquisitions June 30, 2018 Shutterfly Consumer $ 372,072 $ — $ 372,072 Lifetouch — 432,399 432,399 Shutterfly Business Solutions 36,903 — 36,903 $ 408,975 $ 432,399 $ 841,374
Schedule of accrued liabilities	Accrued Liabilities June 30, 2018 December 31, 2017 (in thousands) Accrued compensation $ 52,614 $ 31,331 Capital lease obligations, current portion 16,865 16,859 Accrued marketing expenses 10,992 22,874 Accrued production costs 9,639 37,552 Accrued income, sales and other taxes 9,516 21,745 Accrued other 46,746 28,887 $ 146,372 $ 159,248
Schedule of other liabilities	Other Liabilities June 30, 2018 December 31, 2017 (in thousands) Financing obligations $ 52,761 $ 53,682 Capital lease obligations, non-current portion 43,280 48,620 Other liabilities 52,105 16,893 $ 148,146 $ 119,195 Financing obligations relate to the Company's build-to-suit leases.

Debt (Tables)

Debt (Tables)	6 Months Ended
Debt (Tables)	Jun. 30, 2018
Debt Disclosure [Abstract]
Schedule of long-term debt instruments	The Notes consist of the following (in thousands): June 30, 2018 December 31, 2017 Liability component: Principal $ — $ 300,000 Less: debt issuance costs, debt discount, net of amortization — (5,946 ) Net carrying amount (classified as current) $ — $ 294,054 Equity component (1) $ — $ 63,510 (1) Recorded in the consolidated balance sheets within additional paid-in capital, net of the $1.7 million of issuance costs in equity. The Initial Term Loan and Incremental Term Loan consist of the following (in thousands): June 30, 2018 December 31, 2017 Liability component: Principal borrowings $ 1,125,000 $ 300,000 Less: principal payments (1,500 ) — Less: debt issuance costs, net of amortization (21,827 ) (4,543 ) Net carrying amount $ 1,101,673 $ 295,457 Term loans, current $ 11,219 $ 3,000 Term loans, non-current $ 1,090,454 $ 292,457
Interest expense related to convertible senior notes	The following table sets forth the total interest expense recognized related to the Initial Term Loan and the Incremental Term Loan for the three and six months ended June 30, 2018 (in thousands). The Initial Term Loan was drawn in October 2017 and the Incremental Term Loan was draw in April 2018. Therefore, there was no interest expense for the three and six months ended June 30, 2017 associated with these loans. Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Floating interest (including the effects of cash flow hedges) $ 12,849 $ — $ 16,100 $ — Amortization of debt issuance costs 891 — 1,063 — $ 13,740 $ — $ 17,163 $ — The following table sets forth total interest expense recognized related to the Notes (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 0.25% coupon $ 94 $ 188 $ 281 $ 375 Amortization of debt issuance costs 182 347 543 688 Amortization of debt discount 1,814 3,442 5,403 6,836 $ 2,090 $ 3,977 $ 6,227 $ 7,899
Schedule of maturities of assumed debt	As of June 30, 2018 , the estimated future principal and interest payments of these assumed notes payable is as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 1,429 2019 3,357 2020 2,082 2021 1,196 2022 740 Total principal and interest payments $ 8,804

Segment Reporting (Tables)

Segment Reporting (Tables)	6 Months Ended
Segment Reporting (Tables)	Jun. 30, 2018
Segment Reporting [Abstract]
Segment reporting information	The Company’s segment results for the three and six months ended June 30, 2018 and 2017 were as follows (dollars in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Shutterfly Consumer: Net revenue $ 165,003 $ 179,090 $ 317,062 $ 339,735 Cost of net revenue 86,065 92,049 170,909 181,903 Technology and development 29,830 33,037 61,959 71,966 Sales and marketing 29,956 36,406 60,681 72,144 Credit card fees 4,349 4,654 8,548 8,943 Margin (1) $ 14,803 $ 12,944 $ 14,965 $ 4,779 Margin % 9 % 7 % 5 % 1 % Lifetouch (2) : Net revenue (3) $ 261,911 $ — $ 261,911 $ — Cost of net revenue (4) 91,148 — 91,148 — Technology and development 7,109 — 7,109 — Sales and marketing 86,960 — 86,960 — Credit card fees 1,165 — 1,165 — Margin (1) $ 75,529 $ — $ 75,529 $ — Margin % 29 % — % 29 % — % Shutterfly Business Solutions: Net revenue $ 49,809 $ 29,942 $ 97,475 $ 61,269 Cost of net revenue 41,610 23,900 81,519 47,738 Technology and development 3,049 4,182 6,994 8,511 Sales and marketing 1,619 931 3,069 1,839 Margin (1) $ 3,531 $ 929 $ 5,893 $ 3,181 Margin % 7 % 3 % 6 % 5 % Consolidated Segments: Net revenue (3) $ 476,723 $ 209,032 $ 676,448 $ 401,004 Cost of net revenue (4) 218,823 115,949 343,576 229,641 Technology and development 39,988 37,219 76,062 80,477 Sales and marketing 118,535 37,337 150,710 73,983 Credit card fees 5,514 4,654 9,713 8,943 Margin (1) $ 93,863 $ 13,873 $ 96,387 $ 7,960 Margin % 20 % 7 % 14 % 2 % (1) The margins reported reflect only costs that are directly attributable or allocable to a specific segment and exclude corporate expenses, amortization of intangible assets, stock-based compensation expense and other one-time charges. (2) The Company acquired Lifetouch on April 2, 2018. (3) Yearbook sales and collections for the Lifetouch segment are made throughout the school year, whereas yearbooks are typically delivered toward the end of the school year in the second quarter of the fiscal year. Business combination accounting principles require the Company to record the assumed deferred revenue at fair value on the acquisition date measured based on the cost to manufacture and deliver the yearbooks, plus a profit margin. Segment reporting includes this purchase accounting adjustment which primarily relates to yearbook sales in net revenue for the Lifetouch segment. (4) Business combination accounting principles require the Company to measure acquired inventory at fair value. The fair value of inventory reflects Lifetouch's cost of manufacturing plus a portion of the expected profit margin. Segment reporting excludes this purchase accounting adjustment from cost of net revenue for the Lifetouch segment.
Reconciliation of operating segments to consolidated	The following table reconciles operating segment margin to total operating income (loss) and loss before income taxes, operating segment net revenue to total net revenue, and operating segment cost of net revenue to total cost of net revenue (in thousands): Three Months Ended Six Months Ended 2018 2017 2018 2017 Total margin for operating segments $ 93,863 $ 13,873 $ 96,387 $ 7,960 Purchase accounting deferred revenue adjustment (1) (33,351 ) — (33,351 ) — Purchase accounting inventory adjustment (2) (10,931 ) — (10,931 ) — Corporate expenses (3) (37,012 ) (18,613 ) (55,036 ) (36,825 ) Amortization of intangible assets (12,831 ) (3,860 ) (15,164 ) (8,200 ) Stock-based compensation expense for operating segments (11,697 ) (10,469 ) (23,389 ) (22,788 ) Restructuring (2,952 ) (4,673 ) (2,952 ) (13,649 ) Acquisition-related costs (8,000 ) — (12,585 ) — Capital lease termination — (8,098 ) — (8,098 ) Loss from operations $ (22,911 ) $ (31,840 ) $ (57,021 ) $ (81,600 ) Loss from operations $ (22,911 ) $ (31,840 ) $ (57,021 ) $ (81,600 ) Interest expense (17,769 ) (5,955 ) (27,402 ) (11,919 ) Interest and other income, net 1,561 244 3,310 433 Loss before income taxes $ (39,119 ) $ (37,551 ) $ (81,113 ) $ (93,086 ) Total net revenue for all operating segments $ 476,723 $ 209,032 $ 676,448 $ 401,004 Purchase accounting deferred revenue adjustment (1) (33,351 ) — (33,351 ) — Total net revenue $ 443,372 $ 209,032 $ 643,097 $ 401,004 Total cost of net revenue for all operating segments $ 218,823 $ 115,949 $ 343,576 $ 229,641 Purchase accounting inventory adjustment (2) 10,931 — 10,931 — Stock-based compensation expense for cost of net revenue 943 1,074 1,942 2,243 Amortization of intangible assets for cost of net revenue 2,531 1,182 2,826 2,440 Total cost of net revenue $ 233,228 $ 118,205 $ 359,275 $ 234,324 (1) Yearbook sales and collections for the Lifetouch segment are made throughout the school year, whereas yearbooks are typically delivered toward the end of the school year in the second quarter of the fiscal year. Business combination accounting principles require the Company to record the assumed deferred revenue at fair value on the acquisition date measured based on the cost to manufacture and deliver the yearbooks, plus a profit margin. Segment reporting includes this purchase accounting adjustment which primarily relates to yearbook sales in net revenue for the Lifetouch segment. (2) Business combination accounting principles require the Company to measure acquired inventory at fair value. The fair value of inventory reflects the acquired company’s cost of manufacturing plus a portion of the expected profit margin. Management reporting excludes this purchase accounting adjustment from cost of net revenue for the Lifetouch segment. (3) Corporate expenses include activities that are not directly attributable or allocable to a specific segment. This category consists primarily of expenses related to certain functions performed at the corporate level such as non-manufacturing facilities, human resources, finance and accounting, legal, information technology, integration, etc.

Commitments and Contingencies C

Commitments and Contingencies Commitment and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Future Minimum Payments	At June 30, 2018 , the total future minimum payments under these assumed non-cancelable operating leases from the acquisition of Lifetouch are as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 8,149 2019 13,432 2020 8,662 2021 4,998 2022 2,612 2023 1,265 Thereafter 1,462 Total minimum lease payments $ 40,580 As of June 30, 2018 , the total future minimum payments under these purchase obligations are as follows (in thousands): Year Ending December 31: Remainder of 2018 $ 6,874 2019 6,786 2020 2,057 2021 101 Total minimum purchase obligations $ 15,818

Share Repurchase Program (Table

Share Repurchase Program (Tables)	6 Months Ended
Share Repurchase Program (Tables)	Jun. 30, 2018
Share Repurchase Program [Abstract]
Schedule of share repurchase program	The following table provides information about our repurchase of shares of our common stock for fiscal years 2016 , 2017 , and 2018 : Period (1) Total Number of Shares Purchased Average Price Paid per Share Total Dollar Value Spent on Repurchases (in thousands) 2016 Repurchases 2,524,752 $44.55 $112,488 2017 Repurchases 2,325,825 $47.29 $110,000 2018 Repurchases — — — (1) All shares were purchased pursuant to the publicly announced share repurchase program described above. Shares are reported in a period based on the settlement date of the applicable repurchase. All repurchased shares of common stock have been retired.

The Company and Summary of Si33

The Company and Summary of Significant Accounting Policies - Narrative (Details)	Apr. 02, 2018retail_studio
Lifetouch
Business Acquisition [Line Items]
Number of retail studios (over)	400

Revenues - Impact of Adoption o

Revenues - Impact of Adoption of ASC 606 (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Jan. 01, 2018	Dec. 31, 2017
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Adjustment to accumulated deficit due to adoption of new accounting guidance	$ (496,833)		$ (496,833)			$ (447,358)
Adjustment to total liabilities due to adoption of new accounting guidance	(1,466,740)		(1,466,740)			(984,076)
Adjustment to total assets due to adoption of new accounting guidance	(2,011,036)		(2,011,036)			$ (1,534,800)
Adjustment to revenues due to adoption of new accounting guidance	443,372	$ 209,032	643,097	$ 401,004
Difference between Revenue Guidance in Effect before and after Topic 606 \| ASC 606
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Adjustment to accumulated deficit due to adoption of new accounting guidance					$ 4,200
Adjustment to total liabilities due to adoption of new accounting guidance					5,100
Adjustment to total assets due to adoption of new accounting guidance					$ 900
Adjustment to revenues due to adoption of new accounting guidance	700		1,200
Adjustment to deferred revenue due to adoption of new accounting guidance	$ 7,500		$ 7,500

Revenues - Deferred Revenues (D

Revenues - Deferred Revenues (Details) $ in Millions	6 Months Ended
Revenues - Deferred Revenues (Details) $ in Millions	Jun. 30, 2018USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Decrease in deferred revenue	$ 0.6
Revenues recognized that were included in deferred revenue	3.3
Lifetouch
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Increase in deferred revenue due to business acquisition	$ 8.5

Revenues - Consumer Revenues by

Revenues - Consumer Revenues by Brand (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Disaggregation of Revenue [Line Items]
Net revenue	$ 443,372	$ 209,032	$ 643,097	$ 401,004
Operating Segments
Disaggregation of Revenue [Line Items]
Net revenue	476,723	209,032	676,448	401,004
Operating Segments \| Shutterfly Consumer
Disaggregation of Revenue [Line Items]
Net revenue	165,003	179,090	317,062	339,735
Operating Segments \| Shutterfly Consumer \| Shutterfly brand
Disaggregation of Revenue [Line Items]
Net revenue	154,181	139,908	296,845	263,811
Operating Segments \| Shutterfly Consumer \| Tiny Prints Boutique
Disaggregation of Revenue [Line Items]
Net revenue	1,397	0	3,500	0
Operating Segments \| Shutterfly Consumer \| Tiny Prints
Disaggregation of Revenue [Line Items]
Net revenue	0	12,917	0	23,382
Operating Segments \| Shutterfly Consumer \| Wedding Paper Divas
Disaggregation of Revenue [Line Items]
Net revenue	0	11,365	0	25,655
Operating Segments \| Shutterfly Consumer \| MyPublisher
Disaggregation of Revenue [Line Items]
Net revenue	0	6,056	0	10,992
Operating Segments \| Shutterfly Consumer \| Other
Disaggregation of Revenue [Line Items]
Net revenue	9,425	8,844	16,717	15,895
Operating Segments \| Lifetouch
Disaggregation of Revenue [Line Items]
Net revenue	228,560	0	228,560	0
Operating Segments \| Shutterfly Business Solutions
Disaggregation of Revenue [Line Items]
Net revenue	$ 49,809	$ 29,942	$ 97,475	$ 61,269

Acquisition - Narrative (Detai

Acquisition - Narrative (Details) - Lifetouch - USD ($) $ in Thousands	Apr. 02, 2018	Jun. 30, 2018	Jun. 30, 2018
Business Acquisition [Line Items]
Percentage of issued and outstanding shares of common stock acquired	100.00%
All-cash purchase price, subject to certain adjustments	$ 825,000
Acquisition-related costs		$ 8,000	$ 12,600
Revenue since acquisition date		228,600	228,600
Gross profit since acquisition date		$ 124,200	$ 124,200
Preliminary purchase consideration	$ 981,957

Acquisition - Calculation of Pu

Acquisition - Calculation of Purchase Consideration (Details) - Lifetouch $ in Thousands	Apr. 02, 2018USD ($)
Business Acquisition [Line Items]
Cash consideration at closing	$ 825,000
Less: Closing Indebtedness	(27,742)
Less: Net Working Capital Adjustment	(10,559)
Less: Transaction Expenses	(17,614)
Add: Closing Cash and Investments	212,872
Purchase price adjustments	156,957
Total preliminary purchase consideration	$ 981,957

Acquisition - Purchase Price Al

Acquisition - Purchase Price Allocation (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Apr. 02, 2018	Dec. 31, 2017
Business Acquisition [Line Items]
Goodwill	$ 841,374		$ 408,975
Lifetouch
Business Acquisition [Line Items]
Cash and cash equivalents		$ 91,905
Investments		101,269
Accounts receivable, net		7,029
Inventories		19,857
Property and equipment, net		135,968
Intangible assets, net		326,700
Goodwill		432,399
Prepaid expenses and other assets		32,281
Accounts payable		(15,331)
Deferred revenue, current portion		(29,984)
Notes payable		(9,065)
Accrued and other liabilities		(111,071)
Total		$ 981,957

Acquisition - Valuation of the

Acquisition - Valuation of the intangible assets (Details) - Lifetouch $ in Thousands	Apr. 02, 2018USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 326,700
Customer contracts and related relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 200,100
Weighted Average Life (in years)	10 years
Developed technology
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 68,600
Weighted Average Life (in years)	5 years
Trade names / trademarks / domain name
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 57,600
Weighted Average Life (in years)	5 years
Favorable/unfavorable leases
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 400
Weighted Average Life (in years)	7 years
Minimum \| Customer contracts and related relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Life (in years)	2 years
Maximum \| Customer contracts and related relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Life (in years)	10 years

Acquisition - Unaudited Pro For

Acquisition - Unaudited Pro Forma Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Business Combinations [Abstract]
Total net revenue	$ 476,723	$ 470,531	$ 810,917	$ 789,010
Net loss	$ 14,791	$ (3,488)	$ (69,359)	$ (115,667)
Basic earnings per share (in dollars per share)	$ 0.45	$ (0.10)	$ (2.10)	$ (3.44)
Diluted earnings per share (in dollars per share)	$ 0.41	$ (0.10)	$ (2.10)	$ (3.44)

Stock-Based Compensation - Stoc

Stock-Based Compensation - Stock Option Activity (Details) - Employee Stock Option $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)$ / sharesshares
Number of Options Outstanding (in thousands)
Balances (in shares) \| shares	1,529
Granted (in shares) \| shares	228
Exercised (in shares) \| shares	(361)
Forfeited, cancelled or expired (in shares) \| shares	(28)
Balances (in shares) \| shares	1,368
Options vested and expected to vest (in shares) \| shares	1,264
Options vested (in shares) \| shares	338
Weighted Average Exercise Price
Balances (in dollars per share) \| $ / shares	$ 46.77
Granted (in dollars per share) \| $ / shares	76.73
Exercised (in dollars per share) \| $ / shares	45.87
Forfeited, cancelled or expired (in dollars per share) \| $ / shares	45.49
Balances (in dollars per share) \| $ / shares	52.03
Options vested and expected to vest (in dollars per share) \| $ / shares	51.48
Options vested (in dollars per share) \| $ / shares	$ 47.12
Weighted Average Remaining Contractual Term (years)
Term at end of period	5 years 6 months
Options vested and expected to vest	5 years 4 months 24 days
Options vested	5 years
Aggregate Intrinsic Value (in thousands)
Value at end of period \| $	$ 51,997
Options vested and expected to vest \| $	48,748
Options vested \| $	$ 14,514

Stock-Based Compensation - St43

Stock-Based Compensation - Stock-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Share-based Compensation
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value			$ 10,700	$ 700
Net cash proceeds from the exercise of stock options			16,577	$ 520
Unrecognized compensation expense	$ 87,800		$ 87,800
Weighted average period of unrecognized compensation expense (in years)			2 years
Employee Stock Option
Share-based Compensation
Options granted to purchase (in shares)			228
Estimated weighted-average grant-date fair value (usd per share)			$ 23.57
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value	2,800	$ 600
Net cash proceeds from the exercise of stock options	$ 2,800	$ 400
Restricted Stock Units (RSUs) \| 2015 Equity Incentive Plan
Share-based Compensation
Vesting period of restricted stock			4 years

Stock-Based Compensation - Valu

Stock-Based Compensation - Valuation of Stock Options (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Dividend yield	0.00%	0.00%	0.00%
Annual risk-free rate of return	1.80%	2.60%	1.90%
Expected volatility	30.00%	33.70%	29.80%
Expected term (years)	4 years 1 month 6 days	4 years 1 month 6 days	4 years 1 month 6 days

Stock-Based Compensation - Rest

Stock-Based Compensation - Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) shares in Thousands	6 Months Ended
	Jun. 30, 2018$ / sharesshares
Number of Units Outstanding
Awarded and unvested, beginning of period (in shares)	2,293
Granted (in shares)	629
Vested (in shares)	(720)
Forfeited (in shares)	(127)
Awarded and unvested, ending period (in shares)	2,075
Restricted stock units expected to vest, ending period (in shares)	1,746
Weighted Average Grant Date Fair Value
Awarded and unvested, beginning period (in dollars per share) \| $ / shares	$ 44.64
Granted (in dollars per share) \| $ / shares	76.93
Vested (in dollars per share) \| $ / shares	45.01
Forfeited (in dollars per share) \| $ / shares	45.45
Awarded and unvested, ending period (in dollars per share) \| $ / shares	$ 54.24

Net Loss Per Share (Details)

Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Numerator
Net loss	$ (26,512)	$ (22,838)	$ (53,677)	$ (56,032)
Denominator for basic and diluted net loss per share
Weighted-average shares outstanding - basic and diluted (in shares)	33,234,000	33,579,000	32,970,000	33,646,000
Net loss per share - basic and diluted (in dollars per share)	$ (0.80)	$ (0.68)	$ (1.63)	$ (1.67)
Dilutive effect of convertible debt (in shares)	660,000,000		690,000,000
Stock options and RSUs
Denominator for basic and diluted net loss per share
Antidilutive securities excluded from computation of earnings per share (in shares)	3,571,000	4,060,000	3,629,000	4,004,000
Warrant
Denominator for basic and diluted net loss per share
Antidilutive securities excluded from computation of earnings per share (in shares)	345,000

Investments - Schedule of Estim

Investments - Schedule of Estimated Fair Value (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Debt Securities, Available-for-sale [Line Items]
Impairments recorded on available-for-sale investments	$ 0	$ 0	$ 0	$ 0
Short-term investments
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	53,964,000		53,964,000		$ 178,095,000
Gross Unrealized Gains	4,000		4,000		3,000
Gross Unrealized Losses	(78,000)		(78,000)		(77,000)
Estimated Fair Value	53,890,000		53,890,000		178,021,000
Short-term investments \| Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	39,103,000		39,103,000		54,911,000
Gross Unrealized Gains	4,000		4,000		3,000
Gross Unrealized Losses	(59,000)		(59,000)		(52,000)
Estimated Fair Value	39,048,000		39,048,000		54,862,000
Short-term investments \| Agency securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	5,120,000		5,120,000		10,781,000
Gross Unrealized Gains	0		0		0
Gross Unrealized Losses	(11,000)		(11,000)		(14,000)
Estimated Fair Value	5,109,000		5,109,000		10,767,000
Short-term investments \| Commercial paper
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	3,441,000		3,441,000		101,546,000
Gross Unrealized Gains	0		0		0
Gross Unrealized Losses	0		0		0
Estimated Fair Value	3,441,000		3,441,000		101,546,000
Short-term investments \| U.S. government securities and other
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	6,300,000		6,300,000		10,857,000
Gross Unrealized Gains	0		0		0
Gross Unrealized Losses	(8,000)		(8,000)		(11,000)
Estimated Fair Value	6,292,000		6,292,000		10,846,000
Long-term investments
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	25,063,000		25,063,000		9,285,000
Gross Unrealized Gains	1,000		1,000		0
Gross Unrealized Losses	(90,000)		(90,000)		(43,000)
Estimated Fair Value	24,974,000		24,974,000		9,242,000
Long-term investments \| Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	12,958,000		12,958,000		6,287,000
Gross Unrealized Gains	1,000		1,000		0
Gross Unrealized Losses	(34,000)		(34,000)		(25,000)
Estimated Fair Value	12,925,000		12,925,000		6,262,000
Long-term investments \| Agency securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	5,694,000		5,694,000		2,000,000
Gross Unrealized Gains	0		0		0
Gross Unrealized Losses	(29,000)		(29,000)		(17,000)
Estimated Fair Value	5,665,000		5,665,000		1,983,000
Long-term investments \| U.S. government securities and other
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	6,411,000		6,411,000		998,000
Gross Unrealized Gains	0		0		0
Gross Unrealized Losses	(27,000)		(27,000)		(1,000)
Estimated Fair Value	$ 6,384,000		$ 6,384,000		$ 997,000

Investments - Summary of Contra

Investments - Summary of Contractual Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Investments, Debt and Equity Securities [Abstract]
One year or less	$ 53,890	$ 178,021
One year through three years	24,974	9,242
Available-for-sale securities	$ 78,864	$ 187,263

Fair Value Measurement - Cash E

Fair Value Measurement - Cash Equivalents and Investments (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	$ 94,765	$ 264,706
Investments	78,864	187,263
Money market funds \| Level 1 Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	94,765	151,071
Investments	0	0
Corporate debt securities \| Level 2 Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	0	21,592
Investments	51,974	61,124
Agency securities \| Level 2 Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	0	6,444
Investments	10,773	12,750
Commercial paper \| Level 2 Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	0	85,599
Investments	3,441	101,546
U.S. government securities and other \| Level 2 Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	0	0
Investments	$ 12,676	$ 11,843

Fair Value Measurement - Deriva

Fair Value Measurement - Derivative Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Fair Value, Inputs, Level 2 \| Estimate of Fair Value Measurement
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	$ 6,749	$ 2,979

Fair Value Measurement - Borrow

Fair Value Measurement - Borrowings (Details) - Fair Value, Inputs, Level 2 - Estimate of Fair Value Measurement - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Convertible senior notes	$ 0	$ 296,550
Term Loans	$ 1,128,658	$ 300,000

Balance Sheet Components - Prep

Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Prepaid Expense and Other Assets, Current [Abstract]
Intra-period deferred tax asset	$ 44,821	$ 0
Restricted investment	18,745	0
Prepaid service contracts – current portion	15,597	12,861
Other prepaid expenses and current assets	33,033	28,522
Total prepaid expenses and other current assets	$ 112,196	$ 41,383

Balance Sheet Components - Prop

Balance Sheet Components - Property and Equipment, Net (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Property and Equipment
Gross property and equipment	$ 766,247		$ 766,247		$ 621,748
Less: Accumulated depreciation and amortization	(373,585)		(373,585)		(354,888)
Property and equipment, net	392,662		392,662		266,860
Depreciation and amortization expense	27,500	$ 22,100	50,111	$ 45,121
Assets in construction	27,700		27,700		15,800
Manufacturing equipment
Property and Equipment
Gross property and equipment	218,416		218,416		192,494
Capital lease obligations	92,900		92,900		89,900
Accumulated depreciation of assets under capital leases	40,000		40,000		32,400
Computer equipment and software
Property and Equipment
Gross property and equipment	170,020		170,020		188,593
Capitalized software and website development costs
Property and Equipment
Gross property and equipment	154,001		154,001		134,585
Buildings under build-to-suit leases
Property and Equipment
Gross property and equipment	56,468		56,468		56,468
Photography equipment
Property and Equipment
Gross property and equipment	53,375		53,375		0
Owned buildings and building improvements
Property and Equipment
Gross property and equipment	38,622		38,622		0
Leasehold improvements
Property and Equipment
Gross property and equipment	27,188		27,188		22,145
Rental equipment
Property and Equipment
Gross property and equipment	18,628		18,628		19,208
Land
Property and Equipment
Gross property and equipment	17,000		17,000		0
Furniture and fixtures
Property and Equipment
Gross property and equipment	$ 12,529		$ 12,529		$ 8,255

Balance Sheet Components - Inta

Balance Sheet Components - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 341,769		$ 341,769		$ 29,671
Amortization expense	12,500	$ 3,600	14,600	$ 7,600
Remainder of 2018	24,691		24,691
2,019	49,360		49,360
2,020	49,134		49,134
2,021	49,059		49,059
2,022	48,553		48,553
Thereafter	120,972		120,972
Purchased technology
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	173,469		173,469		104,869
Less: accumulated amortization	(81,742)		(81,742)		(76,585)
Intangible assets, net	91,727		91,727		28,284
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	275,246		275,246		75,146
Less: accumulated amortization	(80,310)		(80,310)		(73,759)
Intangible assets, net	194,936		194,936		1,387
Other
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	65,202		65,202		7,202
Less: accumulated amortization	(10,096)		(10,096)		(7,202)
Intangible assets, net	$ 55,106		$ 55,106		$ 0
Weighted Average \| Purchased technology
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life			8 years
Weighted Average \| Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life			9 years
Weighted Average \| Other
Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life			5 years

Balance Sheet Components - Good

Balance Sheet Components - Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)
Goodwill [Roll Forward]
12/31/2017	$ 408,975
Acquisitions	432,399
6/30/2018	841,374
Shutterfly Consumer
Goodwill [Roll Forward]
12/31/2017	372,072
Acquisitions	0
6/30/2018	372,072
Lifetouch
Goodwill [Roll Forward]
12/31/2017	0
Acquisitions	432,399
6/30/2018	432,399
Shutterfly Business Solutions
Goodwill [Roll Forward]
12/31/2017	36,903
Acquisitions	0
6/30/2018	$ 36,903

Balance Sheet Components - Accr

Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Accrued Liabilities, Current [Abstract]
Accrued compensation	$ 52,614	$ 31,331
Capital lease obligations, current portion	16,865	16,859
Accrued marketing expenses	10,992	22,874
Accrued production costs	9,639	37,552
Accrued income, sales and other taxes	9,516	21,745
Accrued other	46,746	28,887
Total accrued liabilities	$ 146,372	$ 159,248

Balance Sheet Components - Othe

Balance Sheet Components - Other Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Other Liabilities, Noncurrent [Abstract]
Financing obligations	$ 52,761	$ 53,682
Capital lease obligations, non-current portion	43,280	48,620
Other liabilities	52,105	16,893
Other liabilities	$ 148,146	$ 119,195

Debt - Narrative (Details)

Debt - Narrative (Details) - USD ($)	May 15, 2018	Apr. 02, 2018	Oct. 18, 2017	Aug. 17, 2017	May 31, 2013	Jun. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Dec. 31, 2016	Oct. 31, 2017	Jun. 30, 2017
Debt Instrument [Line Items]
Number of shares issued in conversion of debt (in shares)	1,108,000
Total number of shares repurchased (in shares)					600,000		0	2,325,825	2,524,752
Total dollar value of shares repurchased					$ 30,000,000		$ 0	$ 110,000,000	$ 112,488,000
Strike price of warrants (usd per share)					$ 83.18
Proceeds from issuance of warrants					$ 43,600,000
Outstanding warrants (in shares)						4,675,000	4,675,000
Period warrants will settle						80 days	80 days
Designated as Hedging Instrument
Debt Instrument [Line Items]
Note hedge, aggregate amount					63,500,000
Incremental Term Loan
Debt Instrument [Line Items]
Credit facility origination costs						$ 18,300,000	$ 18,300,000
Line of credit
Debt Instrument [Line Items]
Credit facility origination costs								5,600,000
Line of credit \| Initial Term Loan
Debt Instrument [Line Items]
Credit facility origination costs								4,800,000
Line of credit \| Revolving credit facility
Debt Instrument [Line Items]
Amount of credit facility undrawn						$ 200,000,000	$ 200,000,000
Credit facility origination costs								800,000
Amortization period of credit facility origination fees							5 years
Line of credit \| Revolving credit facility \| LIBOR
Debt Instrument [Line Items]
Basis spread				1.75%
Line of credit \| Revolving credit facility \| LIBOR \| Minimum
Debt Instrument [Line Items]
Basis spread				1.50%
Line of credit \| Revolving credit facility \| LIBOR \| Maximum
Debt Instrument [Line Items]
Basis spread				1.75%
Line of credit \| Revolving credit facility \| Base rate
Debt Instrument [Line Items]
Basis spread				0.75%
Line of credit \| Revolving credit facility \| Base rate \| Minimum
Debt Instrument [Line Items]
Basis spread				0.50%
Line of credit \| Revolving credit facility \| Base rate \| Maximum
Debt Instrument [Line Items]
Basis spread				0.75%
Term Loan
Debt Instrument [Line Items]
Maximum borrowing capacity				$ 300,000,000
Amortization of principal, percentage of original principal				0.25%
Repricing premium				1.00%
Term Loan \| Incremental Term Loan
Debt Instrument [Line Items]
Amount of draw on term loan facility		$ 825,000,000
Term Loan \| Initial Term Loan
Debt Instrument [Line Items]
Amount of draw on term loan facility										$ 300,000,000
Effective interest rate for unhedged portion of Initial Term Loan						4.43%	4.27%
Fixed rate on Term Loan						4.68%	4.68%
Loan principal						$ 1,125,000,000	$ 1,125,000,000	300,000,000
Term Loan \| LIBOR \| Incremental Term Loan
Debt Instrument [Line Items]
Interest rate floor		0.00%
Basis spread		2.75%
Term Loan \| LIBOR \| Initial Term Loan
Debt Instrument [Line Items]
Interest rate floor			0.01%
Basis spread			2.50%
Term Loan \| Credit Agreement, Base Rate Option \| LIBOR
Debt Instrument [Line Items]
Basis spread				1.00%
Term Loan \| Credit Agreement, Base Rate Option \| Federal funds rate
Debt Instrument [Line Items]
Basis spread				0.50%
Term Loan \| LIBOR Rate option \| LIBOR
Debt Instrument [Line Items]
Interest rate floor				0.00%
Convertible Senior Notes
Debt Instrument [Line Items]
Loan principal						$ 0	$ 0	$ 300,000,000
Deferred tax assets					$ 600,000
Convertible Senior Notes \| Convertible Senior Notes 0.25% Due May 15, 2018
Debt Instrument [Line Items]
Contractual interest rate					0.25%	0.25%	0.25%				250.00%
Loan principal	$ 300,000,000
Number of shares issued in conversion of debt (in shares)	1,108,000
Debt issuance costs attributable to the liability component					$ 6,400,000
Debt issuance costs attributable to the equity component					$ 1,700,000
Lifetouch \| Notes Payable \| Legacy Lifetouch Notes Payable
Debt Instrument [Line Items]
Repayments of Notes Payable						$ 1,100,000
Debt assumed in a business combination		$ 9,100,000
Debt assumed in a business combination, current		$ 4,000,000
Lifetouch \| Notes Payable \| Minimum \| Legacy Lifetouch Notes Payable
Debt Instrument [Line Items]
Contractual interest rate		0.00%
Lifetouch \| Notes Payable \| Maximum \| Legacy Lifetouch Notes Payable
Debt Instrument [Line Items]
Contractual interest rate		2.20%

Debt - Schedule of Term Loan De

Debt - Schedule of Term Loan Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Debt Instrument [Line Items]
Current portion of long-term debt	$ 15,249	$ 297,054
Term loans, non-current	1,094,347	292,457
Term Loan \| Initial Term Loan
Debt Instrument [Line Items]
Principal	1,125,000	300,000
Less: principal payments	(1,500)	0
Less: debt issuance costs, debt discount, net of amortization	(21,827)	(4,543)
Net carrying amount	1,101,673	295,457
Current portion of long-term debt	11,219	3,000
Term loans, non-current	$ 1,090,454	$ 292,457

Debt - Schedule of Interest Exp

Debt - Schedule of Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	May 31, 2013
Term Loan \| Initial Term Loan
Debt Instrument [Line Items]
Floating interest (including the effects of cash flow hedges)	$ 12,849	$ 0	$ 16,100	$ 0
Amortization of debt issuance costs	891	0	1,063	0
Interest expense, convertible notes	13,740	0	17,163	0
Convertible Senior Notes \| Convertible Senior Notes 0.25% Due May 15, 2018
Debt Instrument [Line Items]
0.25% coupon	94	188	281	375
Amortization of debt issuance costs	182	347	543	688
Amortization of debt discount	1,814	3,442	5,403	6,836
Interest expense, convertible notes	$ 2,090	$ 3,977	$ 6,227	$ 7,899
Contractual interest rate	0.25%	250.00%	0.25%	250.00%	0.25%

Debt - Summary of Maturities of

Debt - Summary of Maturities of Assumed Debt (Details) - Lifetouch - Notes Payable - Legacy Lifetouch Notes Payable $ in Thousands	Jun. 30, 2018USD ($)
Debt Instrument [Line Items]
Remainder of 2018	$ 1,429
2,019	3,357
2,020	2,082
2,021	1,196
2,022	740
Net carrying amount	$ 8,804

Debt - Schedule of Convertible

Debt - Schedule of Convertible Note Debt (Details) - USD ($) $ in Thousands	1 Months Ended
	May 31, 2013	Jun. 30, 2018	May 15, 2018	Dec. 31, 2017
Short-term Debt [Line Items]
Net carrying amount (classified as current)		$ 15,249		$ 297,054
Convertible Senior Notes
Short-term Debt [Line Items]
Principal		0		300,000
Less: debt issuance costs, debt discount, net of amortization		0		(5,946)
Net carrying amount (classified as current)		0		294,054
Equity component		$ 0		$ 63,510
Convertible Senior Notes 0.25% Due May 15, 2018 \| Convertible Senior Notes
Short-term Debt [Line Items]
Principal			$ 300,000
Debt issuance costs attributable to the equity component	$ 1,700

Segment Reporting - Segment In

Segment Reporting - Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Segment Reporting Information
Net revenue	$ 443,372	$ 209,032	$ 643,097	$ 401,004
Cost of net revenue	233,228	118,205	359,275	234,324
Technology and development	44,420	39,398	82,924	85,353
Sales and marketing	130,643	42,987	168,363	85,874
Gross Profit	210,144	90,631	283,822	165,244
Operating Segments
Segment Reporting Information
Net revenue	476,723	209,032	676,448	401,004
Cost of net revenue	218,823	115,949	343,576	229,641
Technology and development	39,988	37,219	76,062	80,477
Sales and marketing	118,535	37,337	150,710	73,983
Credit card fees	5,514	4,654	9,713	8,943
Gross Profit	$ 93,863	$ 13,873	$ 96,387	$ 7,960
Gross Profit As Percentage Of Revenue	20.00%	7.00%	14.00%	2.00%
Operating Segments \| Shutterfly Consumer
Segment Reporting Information
Net revenue	$ 165,003	$ 179,090	$ 317,062	$ 339,735
Cost of net revenue	86,065	92,049	170,909	181,903
Technology and development	29,830	33,037	61,959	71,966
Sales and marketing	29,956	36,406	60,681	72,144
Credit card fees	4,349	4,654	8,548	8,943
Gross Profit	$ 14,803	$ 12,944	$ 14,965	$ 4,779
Gross Profit As Percentage Of Revenue	9.00%	7.00%	5.00%	1.00%
Operating Segments \| Lifetouch
Segment Reporting Information
Net revenue	$ 228,560	$ 0	$ 228,560	$ 0
Net revenue including purchase accounting adjustment	261,911	0	261,911	0
Cost of net revenue	91,148	0	91,148	0
Technology and development	7,109	0	7,109	0
Sales and marketing	86,960	0	86,960	0
Credit card fees	1,165	0	1,165	0
Gross Profit	$ 75,529	$ 0	$ 75,529	$ 0
Gross Profit As Percentage Of Revenue	29.00%	0.00%	29.00%	0.00%
Operating Segments \| Shutterfly Business Solutions
Segment Reporting Information
Net revenue	$ 49,809	$ 29,942	$ 97,475	$ 61,269
Cost of net revenue	41,610	23,900	81,519	47,738
Technology and development	3,049	4,182	6,994	8,511
Sales and marketing	1,619	931	3,069	1,839
Gross Profit	$ 3,531	$ 929	$ 5,893	$ 3,181
Gross Profit As Percentage Of Revenue	7.00%	3.00%	6.00%	5.00%

Segment Reporting - Reconciliat

Segment Reporting - Reconciliation of Operating Segments to Consolidated (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross Profit	$ 210,144	$ 90,631	$ 283,822	$ 165,244
Amortization of intangible assets			(15,164)	(8,200)
Restructuring	(2,952)	(4,477)	(2,952)	(12,213)
Capital lease termination	0	(8,098)	0	(8,098)
Loss from operations	(22,911)	(31,840)	(57,021)	(81,600)
Interest expense	(17,769)	(5,955)	(27,402)	(11,919)
Interest and other income, net	1,561	244	3,310	433
Loss before income taxes	(39,119)	(37,551)	(81,113)	(93,086)
Net revenue	443,372	209,032	643,097	401,004
Cost of net revenue	233,228	118,205	359,275	234,324
Cost of net revenue
Segment Reporting, Revenue Reconciling Item [Line Items]
Stock-based compensation expense for operating segments	(943)	(1,074)	(1,942)	(2,243)
Operating Segments
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross Profit	93,863	13,873	96,387	7,960
Net revenue	476,723	209,032	676,448	401,004
Cost of net revenue	218,823	115,949	343,576	229,641
Segment Reconciling Items
Segment Reporting, Revenue Reconciling Item [Line Items]
Purchase accounting deferred revenue adjustment	(33,351)	0	(33,351)	0
Purchase accounting inventory adjustment	(10,931)	0	(10,931)	0
Corporate expenses	(37,012)	(18,613)	(55,036)	(36,825)
Amortization of intangible assets	(12,831)	(3,860)	(15,164)	(8,200)
Stock-based compensation expense for operating segments	(11,697)	(10,469)	(23,389)	(22,788)
Restructuring	(2,952)	(4,673)	(2,952)	(13,649)
Acquisition-related costs	(8,000)	0	(12,585)	0
Capital lease termination	0	(8,098)	0	(8,098)
Segment Reconciling Items \| Cost of net revenue
Segment Reporting, Revenue Reconciling Item [Line Items]
Amortization of intangible assets	(2,531)	(1,182)	(2,826)	(2,440)
Stock-based compensation expense for operating segments	$ (943)	$ (1,074)	$ (1,942)	$ (2,243)

Commitments and Contingencies -

Commitments and Contingencies - Narrative (Details) - Lifetouch $ in Thousands	3 Months Ended
	Jun. 30, 2018USD ($)
Business Acquisition [Line Items]
Rent expense	$ 4,800
Total minimum purchase obligations	$ 15,818

Commitments and Contingencies66

Commitments and Contingencies - Future Minimum Payments of Leases (Details) - Lifetouch $ in Thousands	Jun. 30, 2018USD ($)
Loss Contingencies [Line Items]
Remainder of 2018	$ 8,149
2,019	13,432
2,020	8,662
2,021	4,998
2,022	2,612
2,023	1,265
Thereafter	1,462
Total minimum lease payments	$ 40,580

Commitments and Contingencies67

Commitments and Contingencies - Future Minimum Payments of Purchase Obligations (Details) - Lifetouch $ in Thousands	Jun. 30, 2018USD ($)
Loss Contingencies [Line Items]
Remainder of 2018	$ 6,874
2,019	6,786
2,020	2,057
2,021	101
Total minimum purchase obligations	$ 15,818

Share Repurchase Program - Narr

Share Repurchase Program - Narrative (Details) - USD ($)	Apr. 18, 2017	Apr. 21, 2016	Feb. 09, 2015	Feb. 06, 2014	Oct. 24, 2012
Share Repurchase Program [Abstract]
Stock repurchase program, authorized amount	$ 140,000,000	$ 100,000,000	$ 300,000,000	$ 100,000,000	$ 60,000,000

Share Repurchase Program - Sche

Share Repurchase Program - Schedule of Repurchases (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	6 Months Ended	12 Months Ended
	May 31, 2013	Jun. 30, 2018	Dec. 31, 2017	Dec. 31, 2016
Share Repurchase Program [Abstract]
Total Number of Shares Purchased	600,000	0	2,325,825	2,524,752
Average Price Paid per Share (usd per share)		$ 0	$ 47.29	$ 44.55
Total Dollar Value Spent on Repurchases	$ 30,000	$ 0	$ 110,000	$ 112,488

Restructuring - Narrative (Deta

Restructuring - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 2,952	$ 4,477	$ 2,952	$ 12,213
Restructuring reserve	2,000		2,000		$ 3,200
iMemories
Restructuring Cost and Reserve [Line Items]
Restructuring charges	3,000
Cash payments for restructuring	2,200
Restructuring costs settled without cash			$ 800
Lease termination costs \| iMemories
Restructuring Cost and Reserve [Line Items]
Restructuring charges	1,000
Employee-related costs \| iMemories
Restructuring Cost and Reserve [Line Items]
Restructuring charges	800
Other costs \| iMemories
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 1,200

Derivative Financial Instrume71

Derivative Financial Instruments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Aug. 31, 2017
Derivative [Line Items]
Unrealized gains recognized in other comprehensive income (loss)	$ 1,000	$ 0	$ 3,770	$ 0
Amounts expected to be reclassified from other comprehensive income into interest expense in coming 12 months	900		900
Interest expense	$ 17,769	$ 5,955	$ 27,402	$ 11,919
Term Loan facility
Derivative [Line Items]
Fixed rate on Term Loan	4.27%		4.27%
Interest rate swap agreement \| Designated as Hedging Instrument \| Cash flow hedge
Derivative [Line Items]
Aggregate notional amount						$ 150,000
Interest expense	$ 1,600		$ 3,300
Fair Value, Inputs, Level 2 \| Estimate of Fair Value Measurement
Derivative [Line Items]
Derivative assets	$ 6,749		$ 6,749		$ 2,979