Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Feb. 05, 2014 | Jun. 28, 2013 | |
Document And Entity Information [Abstract] | ' | ' | ' |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Trading Symbol | 'ATHN | ' | ' |
Entity Registrant Name | 'Athenahealth Inc | ' | ' |
Entity Central Index Key | '0001131096 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 37,381,347 | ' |
Entity Public Float | ' | ' | $3,086,579,443 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $65,002 | $154,988 |
Short-term investments | 0 | 38,092 |
Accounts receivable - net | 87,343 | 61,916 |
Current portion of restricted cash | 3,000 | 1,357 |
Deferred tax assets | 6,118 | 6,907 |
Prepaid expenses and other current assets | 17,194 | 10,924 |
Total current assets | 178,657 | 274,184 |
Property and equipment - net | 213,018 | 54,035 |
Capitalized software costs - net | 29,987 | 16,050 |
Purchased intangible assets - net | 168,364 | 21,561 |
Goodwill | 198,049 | 48,090 |
Deferred tax assets | 0 | 11,759 |
Investments and other assets | 8,321 | 2,773 |
Total assets | 796,396 | 428,452 |
Current liabilities: | ' | ' |
Accounts payable | 3,930 | 1,733 |
Accrued compensation | 44,444 | 36,393 |
Accrued expenses | 24,297 | 19,683 |
Line of credit | 35,000 | 0 |
Current portion of long-term debt | 15,000 | 0 |
Current portion of deferred revenue | 27,002 | 8,209 |
Current portion of deferred rent | 83 | 799 |
Total current liabilities | 149,756 | 66,817 |
Deferred rent, net of current portion | 1,478 | 2,854 |
Long-term debt, net of current portion | 173,750 | 0 |
Deferred revenue, net of current portion | 53,172 | 45,515 |
Long-term deferred tax liability - net | 21,421 | 0 |
Other long-term liabilities | 5,511 | 1,618 |
Total liabilities | 405,088 | 116,804 |
Commitments and contingencies (note 14) | ' | ' |
Stockholders’ equity: | ' | ' |
Preferred stock, $0.01 par value: 5,000 shares authorized; no shares issued and outstanding at December 31, 2013 and December 31, 2012, respectively | 0 | 0 |
Common stock, $0.01 par value: 125,000 shares authorized; 38,600 shares issued and 37,322 shares outstanding at December 31, 2013; 37,572 shares issued and 36,294 shares outstanding at December 31, 2012 | 387 | 376 |
Additional paid-in capital | 380,967 | 303,547 |
Treasury stock, at cost, 1,278 shares | -1,200 | -1,200 |
Accumulated other comprehensive loss | -446 | -81 |
Retained earnings | 11,600 | 9,006 |
Total stockholders’ equity | 391,308 | 311,648 |
Total liabilities and stockholders’ equity | $796,396 | $428,452 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Preferred stock, par value (dollars per share) | $0.01 | $0.01 |
Preferred stock, shares authorized (shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, par value (dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized (shares) | 125,000,000 | 125,000,000 |
Common stock, shares issued (shares) | 38,600,000 | 37,572,000 |
Common stock, shares outstanding (shares) | 37,322,000 | 36,294,000 |
Treasury stock, shares (shares) | 1,278,000 | 1,278,000 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue: | ' | ' | ' |
Business services | $563,237 | $408,496 | $312,768 |
Implementation and other | 31,766 | 13,775 | 11,299 |
Total revenue | 595,003 | 422,271 | 324,067 |
Expense: | ' | ' | ' |
Direct operating | 238,672 | 166,886 | 122,795 |
Selling and marketing | 149,488 | 104,300 | 79,775 |
Research and development | 57,639 | 33,792 | 23,343 |
General and administrative | 99,776 | 57,025 | 48,711 |
Depreciation and amortization | 43,575 | 25,641 | 16,710 |
Total expense | 589,150 | 387,644 | 291,334 |
Operating income | 5,853 | 34,627 | 32,733 |
Other (expense) income: | ' | ' | ' |
Interest expense | -3,905 | -407 | -314 |
Other income | 283 | 658 | 461 |
Total other (expense) income | -3,622 | 251 | 147 |
Income before income tax benefit (provision) | 2,231 | 34,878 | 32,880 |
Income tax benefit (provision) | 363 | -16,146 | -13,834 |
Net income | $2,594 | $18,732 | $19,046 |
Net income per share - Basic (in dollars per share) | $0.07 | $0.52 | $0.54 |
Net income per share - Diluted (in dollars per share) | $0.07 | $0.50 | $0.53 |
Weighted average shares used in computing net income per share: | ' | ' | ' |
Basic (shares) | 36,856 | 35,956 | 35,046 |
Diluted (shares) | 38,257 | 37,133 | 36,050 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Net income | $2,594 | $18,732 | $19,046 |
Other comprehensive income (loss) | ' | ' | ' |
Unrealized gain (loss) on securities, net of tax of $5, $3, and $1 for the years ended December 31, 2013, 2012, and 2011, respectively. | 13 | 32 | -6 |
Unrealized loss on interest rate derivative, net of tax of $101, $0, and $0 for the years ended December 31, 2013, 2012, and 2011, respectively. | -253 | 0 | 0 |
Foreign currency translation adjustment | -125 | -12 | -123 |
Total other comprehensive (loss) income | -365 | 20 | -129 |
Comprehensive income | $2,229 | $18,752 | $18,917 |
Consolidated_Statements_of_Com1
Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Unrealized gain (loss) on securities, tax | $5 | $3 | $1 |
Unrealized loss on interest rate derivative, tax | $101 | $0 | $0 |
Consolidated_Statement_of_Stoc
Consolidated Statement of Stockholders' Equity (USD $) | Total | Total Stockholders Equity | Common Stock | Additional Paid-In Capital | Treasury Stock | Accumulated Other Comprehensive (Loss) Income | Retained Earnings (Accumulated Deficit) |
In Thousands, unless otherwise specified | |||||||
Total stockholders' equity, Balance at Dec. 31, 2010 | ' | $170,753 | $358 | $200,339 | ($1,200) | $28 | ($28,772) |
Shares, Balance at Dec. 31, 2010 | ' | ' | 35,808 | ' | -1,278 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Stock compensation expense | ' | 18,901 | ' | 18,901 | ' | ' | ' |
Stock options exercised and restricted stock units vested, shares | ' | ' | 816 | ' | ' | ' | ' |
Stock options exercised and restricted stock units vested, amount | ' | 12,328 | 8 | 12,320 | ' | ' | ' |
Common stock issued under employee stock purchase plan, shares | ' | ' | 54 | ' | ' | ' | ' |
Common stock issued under employee stock purchase plan, amount | ' | 1,769 | 1 | 1,768 | ' | ' | ' |
Tax benefit realized from stock-based awards | 14,200 | 13,803 | ' | 13,803 | ' | ' | ' |
Net income | 19,046 | 19,046 | ' | ' | ' | ' | 19,046 |
Other comprehensive loss | -129 | -129 | ' | ' | ' | -129 | ' |
Total stockholders' equity, Balance at Dec. 31, 2011 | ' | 236,471 | 367 | 247,131 | -1,200 | -101 | -9,726 |
Shares, Balance at Dec. 31, 2011 | ' | ' | 36,678 | ' | -1,278 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Stock compensation expense | ' | 28,082 | ' | 28,082 | ' | ' | ' |
Stock options exercised and restricted stock units vested, shares | ' | ' | 849 | ' | ' | ' | ' |
Stock options exercised and restricted stock units vested, amount | ' | 11,767 | 9 | 11,758 | ' | ' | ' |
Common stock issued under employee stock purchase plan, shares | ' | ' | 45 | ' | ' | ' | ' |
Common stock issued under employee stock purchase plan, amount | ' | 2,426 | 0 | 2,426 | ' | ' | ' |
Tax benefit realized from stock-based awards | 14,100 | 14,150 | ' | 14,150 | ' | ' | ' |
Net income | 18,732 | 18,732 | ' | ' | ' | ' | 18,732 |
Other comprehensive loss | 20 | 20 | ' | ' | ' | 20 | ' |
Total stockholders' equity, Balance at Dec. 31, 2012 | 311,648 | 311,648 | 376 | 303,547 | -1,200 | -81 | 9,006 |
Shares, Balance at Dec. 31, 2012 | ' | ' | 37,572 | ' | -1,278 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Stock compensation expense | ' | 44,842 | ' | 44,842 | ' | ' | ' |
Stock options exercised and restricted stock units vested, shares | ' | ' | 983 | ' | ' | ' | ' |
Stock options exercised and restricted stock units vested, amount | ' | 15,816 | 11 | 15,805 | ' | ' | ' |
Common stock issued under employee stock purchase plan, shares | ' | ' | 45 | ' | ' | ' | ' |
Common stock issued under employee stock purchase plan, amount | ' | 3,500 | 0 | 3,500 | ' | ' | ' |
Tax benefit realized from stock-based awards | 6,900 | 6,051 | ' | 6,051 | ' | ' | ' |
Fair value of vested stock options and restricted stock units assumed | ' | 13,028 | ' | 13,028 | ' | ' | ' |
Net settlement of acquired company’s board of directors equity shares | ' | -5,806 | ' | -5,806 | ' | ' | ' |
Net income | 2,594 | 2,594 | ' | ' | ' | ' | 2,594 |
Other comprehensive loss | -365 | -365 | ' | ' | ' | -365 | ' |
Total stockholders' equity, Balance at Dec. 31, 2013 | $391,308 | $391,308 | $387 | $380,967 | ($1,200) | ($446) | $11,600 |
Shares, Balance at Dec. 31, 2013 | ' | ' | 38,600 | ' | -1,278 | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' | ' |
Net income | $2,594 | $18,732 | $19,046 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Depreciation and amortization | 61,853 | 29,144 | 19,030 |
Amortization of premium on investments | 84 | 1,270 | 1,579 |
Provision for uncollectible accounts | 791 | 153 | 1,122 |
Excess tax benefit from stock-based awards | -6,910 | -14,179 | -14,208 |
Deferred income tax | -7,044 | -890 | -2,962 |
Change in fair value of contingent considerations | 76 | -5,118 | 40 |
Stock-based compensation expense | 42,648 | 27,236 | 18,901 |
Other reconciling adjustments | -151 | -178 | 73 |
Changes in operating assets and liabilities: | ' | ' | ' |
Accounts receivable | -4,190 | -12,764 | -12,130 |
Prepaid expenses and other current assets | 3,283 | 12,096 | 11,787 |
Other long-term assets | -66 | 111 | 489 |
Accounts payable | -233 | 13 | 688 |
Accrued expenses | -21 | 3,898 | 2,832 |
Accrued compensation | 5,775 | 7,959 | 8,055 |
Deferred revenue | -3,090 | 2,969 | 9,987 |
Deferred rent | -2,091 | -239 | -3,565 |
Net cash provided by operating activities | 93,308 | 70,213 | 60,764 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' | ' |
Capitalized software development costs | -29,123 | -15,657 | -7,779 |
Purchases of property and equipment | -38,260 | -23,904 | -16,696 |
Proceeds from sales and disposals of property and equipment | 0 | 172 | 0 |
Proceeds from sales and maturities of investments | 56,245 | 160,340 | 168,083 |
Purchases of investments | -2,000 | -118,919 | -165,657 |
Payments on acquisitions, net of cash acquired | -410,161 | -5,798 | -34,882 |
Change in restricted cash | -1,643 | 3,650 | 3,684 |
Net cash used in investing activities | -424,942 | -116 | -53,247 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' | ' |
Proceeds from issuance of common stock under stock plans and warrants | 31,133 | 18,699 | 14,097 |
Taxes paid related to net share settlement of restricted stock awards | -12,075 | -4,248 | 0 |
Excess tax benefit from stock-based awards | 6,910 | 14,179 | 14,208 |
Proceeds from long-term debt | 200,000 | 0 | 0 |
Proceeds from line of credit | 155,000 | 0 | 0 |
Payments on line of credit | -120,000 | 0 | 0 |
Payments on long-term debt and capital lease obligations | -11,250 | 0 | -9,216 |
Net settlement of acquired company’s board of directors equity shares | -5,806 | 0 | 0 |
Debt issuance costs | -1,699 | 0 | -741 |
Payment of contingent consideration accrued at acquisition date | -525 | -1,550 | -3,355 |
Payment to terminate interest rate derivative contract | 0 | 0 | -563 |
Net cash provided by financing activities | 241,688 | 27,080 | 14,430 |
Effects of exchange rate changes on cash and cash equivalents | -40 | 30 | -110 |
Net (decrease) increase in cash and cash equivalents | -89,986 | 97,207 | 21,837 |
Cash and cash equivalents at beginning of period | 154,988 | 57,781 | 35,944 |
Cash and cash equivalents at end of period | 65,002 | 154,988 | 57,781 |
Non-cash transactions | ' | ' | ' |
Property, equipment and purchased software recorded in accounts payable and accrued expenses | 1,667 | 4,217 | 8,066 |
Taxes to be paid related to net share settlement of restricted stock units in accrued expenses | 0 | 258 | 0 |
Fair value of equity awards assumed | 13,028 | 0 | ' |
'Grant from government program to be used to reduce non-income taxes recorded in investments and other assets and other long-term liabilities | 936 | 0 | 0 |
Fair value of contingent consideration at acquisition date | 0 | 0 | 6,836 |
Tax benefit recorded in prepaid expenses and other current assets | 5,649 | 14,150 | 13,803 |
Additional disclosures | ' | ' | ' |
Cash received for interest | 451 | 1,960 | 1,900 |
Cash paid for interest | 3,328 | 0 | 183 |
Cash paid for taxes | $1,348 | $3,932 | $2,708 |
NATURE_OF_OPERATIONS_AND_SUMMA
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||||||||||||
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||
General – athenahealth, Inc. (the “Company”, “we”, “us”, or “our”) is a business services company that provides ongoing billing, clinical-related, and other related services to its customers. The Company provides these services with the use of a single instance of athenaNet, a proprietary Internet-based practice management application. The Company’s customers consist of medical group practices ranging in size throughout the United States of America. In March 2013, the Company acquired Epocrates, Inc. Epocrates is recognized for developing a leading medical application among U.S. physicians for clinical content, practice tools, and health industry engagement at the point of care. The features available through the Epocrates services are used by health care professionals to make more informed prescribing decisions, improve workflow, and enhance patient safety. | |||||||||||||
Principles of Consolidation – The accompanying consolidated financial statements include the results of operations of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. | |||||||||||||
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions are used for, but are not limited to: (1) revenue recognition; including the estimated expected customer life; (2) asset impairments; (3) depreciable lives of assets; (4) fair value of stock-based compensation; (5) allocation of direct and indirect cost of sales; (6) fair value of identifiable purchased tangible and intangible assets in a business combination; (7) fair value of reporting units for goodwill impairment test and (8) litigation reserves. Actual results could significantly differ from those estimates. | |||||||||||||
Revenue Recognition – The Company recognizes revenue when there is evidence of an arrangement, the service has been provided to the customer, the collection of the fees is reasonably assured, and the amount of fees to be paid by the customer are fixed or determinable. | |||||||||||||
The Company derives its revenue from business services associated with our four integrated services and from subscriptions to and sponsored clinical information and decision support services for our point of care medical application. Our four integrated services consist of athenaCollector for revenue cycle and practice management; athenaClinicals for electronic health records (“EHR”); athenaCommunicator for automated, live and online patient communications; and athenaCoordinator for care coordination. | |||||||||||||
athenahealth’s clients typically purchase one-year service contracts related to our integrated services that renew automatically upon completion. In most cases, the Company’s clients may terminate their agreements with 90 days notice without cause. The Company typically retains the right to terminate client agreements in a similar timeframe. The Company’s clients are billed monthly, in arrears, based either upon a percentage of collections posted to athenaNet, minimum fees, flat fees, or per-claim fees where applicable. The Company does not recognize revenue for business services fees until these collections are made, as the services fees are not fixed and determinable until such time. | |||||||||||||
Subscriptions to the Epocrates point of care medical application are entered into by a member via an internal or third-party digital distribution platform or through a redeemable license code which expires within six to 12 months of issuance. Basic subscriptions are free and do not expire. Premium subscription fees are assessed on the length of the subscription period, typically one year, and payment occurs at the time of order, which is in advance of the services being performed, and is recorded as deferred revenue. Premium subscriptions are recognized ratably over the contracted term of delivery, typically one year. If a license code expires before it is redeemed, revenue is recognized upon expiration. | |||||||||||||
Clients in the health care industry typically enter into sponsored clinical information and decision support service arrangements that contain various combinations of services that are generally fulfilled within one year. The clients are charged a fee for the entire group of services to be provided and are typically billed a portion of the contracted fee upon signing of the agreement with the balance billed upon one or more future milestones. Because billings typically occur in advance of services being performed, these amounts are recorded as deferred revenue when billed. Each deliverable within a multiple-deliverable revenue arrangement is accounted for as a separate unit if both of the following criteria are met: (1) the delivered item or items have value to the customer on a standalone basis and (2) for an arrangement that includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in our control. Further, the Company’s revenue arrangements do not include a general right of return, as we deliver services and not products. The Company considers a deliverable to have standalone value if it sells this item separately or if the item is sold by another vendor or could be resold by the customer. Each service deliverable within these multiple element arrangements is then accounted for as a separate unit; deliverables not meeting the criteria for being a separate unit of accounting are combined with a deliverable that does meet that criterion, and the Company allocates arrangement consideration to each deliverable using its best estimate of selling price (“BESP”) if it does not have vendor specific objective evidence of selling price (“VSOE”) of fair value or third-party evidence (“TPE”) of fair value. Any discount or premium inherent in the arrangement is allocated to each element in the arrangement based on the relative fair value of each element. | |||||||||||||
Multiple element arrangements require judgments as to how to allocate the arrangement consideration to each deliverable. We maintain a standard price list by service; however, certain incentives, such as discounts, may be offered to clients when they purchase multiple services. Such discounting is subject to various levels of management approval and any discount offered is based on the total contract value. Due to the specific nature of these agreements and the variability in the amount of discount offered for individual services across multiple contracts, we have not been able to conclude that a consistent number of standalone sales of a deliverable have been priced within a reasonably narrow range in order to assert that we have established VSOE. | |||||||||||||
When we cannot establish VSOE of fair value, we then determine if we can establish TPE of fair value. TPE is determined based on competitor prices for similar deliverables when sold separately. Our services differ significantly from that of our peers and our offerings contain a significant level of customization and differentiation such that the comparable pricing of products with similar functionality cannot be obtained. Furthermore, we are unable to reliably determine what similar competitor products’ selling prices are on a stand-alone basis. Therefore, we are typically unable to determine TPE. | |||||||||||||
If both VSOE and TPE do not exist, we use BESP to establish fair value and to allocate total consideration to each element in the arrangement. The objective of BESP is to determine the price at which we would transact a sale if the product or service were sold on a stand-alone basis. We determine BESP for a product or service by considering multiple factors including an analysis of recent stand-alone sales of that product, market conditions, competitive landscape, internal costs, gross margin objectives, and pricing practices. | |||||||||||||
Implementation revenue consists primarily of professional services fees related to assisting customers with the implementation of the Company’s services and are generally billed upfront and recorded as deferred revenue until the implementation is complete and then, as the service does not have stand-alone value, it is recognized ratably over the longer of the life of the agreement or the estimated expected customer life, which is currently estimated to be 12 years. The Company evaluates the length of the amortization period of the implementation fees based on its experience with customer contract renewals and consideration of the period over which those customers will receive benefits from the Company’s current portfolio of services. Certain expenses related to the implementation of a customer, such as out-of-pocket travel, are typically reimbursed by the customer. This is accounted for as both revenue and expense in the period the cost is incurred. Other services consist primarily of tenant revenue which is straight-lined over the term of the lease. | |||||||||||||
Direct Operating Expenses – Direct operating expenses consist primarily of salaries, benefits, claims processing costs, stock-based compensation related to personnel who provide services to clients, including staff who implement new clients, and other direct expenses. Costs associated with the implementation of new clients are expensed as incurred. Direct operating expenses include all service costs incurred to fulfill our revenue contracts. Direct operating expenses also include costs associated with third-party tenant revenue for the Arsenal on the Charles. The reported amounts of direct operating expenses do not include allocated amounts for rent expense, depreciation, and amortization, except for a portion of amortization related to certain purchased intangible assets. | |||||||||||||
Research and Development Expenses – Research and development expenses consist primarily of personnel-related costs and consulting fees for third-party developers. All such costs are expensed as incurred, except for certain internal use software development costs, which may be capitalized. | |||||||||||||
Advertising Expenses – Advertising expenses are expensed as incurred and are included in selling and marketing expense in the Consolidated Statements of Income. Advertising expense totaled $14.2 million, $12.3 million and $9.8 million for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||||||
Cash and Cash Equivalents – The Company considers all highly liquid investments with an original or remaining maturity from the Company’s date of purchase of 90 days or less to be cash equivalents. | |||||||||||||
Investments – Management determines the appropriate classification of investments at the time of purchase based upon management’s intent with regard to such investments. All investments, except for certain long-term investments in privately-held companies which are accounted for at cost, are held as available-for-sale investments. Scheduled maturity dates of U.S. government-backed securities, corporate bonds and commercial paper purchased that are within one year are classified as short-term. Scheduled maturity dates of U.S. government-backed securities, corporate bonds and commercial paper that are in excess of one year are classified as long-term. All investments are recorded at fair value with unrealized holding gains and losses included in accumulated other comprehensive (loss) income. There were no material realized gains and losses on sales of these investments for the periods presented. The Company determines realized gains and losses based on the specific identification method. | |||||||||||||
Accounts Receivable – Accounts receivable represents amounts due from customers for business services. Accounts receivable are stated net of an allowance for uncollectible accounts, which is determined by establishing reserves for specific accounts and consideration of historical and estimated probable losses. | |||||||||||||
Activity in the allowance for doubtful accounts is as follows: | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Beginning balance | $ | 1,771 | $ | 2,348 | $ | 1,945 | |||||||
Provision | 791 | 153 | 1,122 | ||||||||||
Write-offs and adjustments | (871 | ) | (730 | ) | (719 | ) | |||||||
Ending balance | $ | 1,691 | $ | 1,771 | $ | 2,348 | |||||||
Financial Instruments – Certain financial instruments are required to be recorded at fair value. The other financial instruments approximate their fair value, primarily because of their short-term nature. All highly-liquid debt instruments purchased with a maturity of three months or less at the date of acquisition are included in cash and cash equivalents. | |||||||||||||
Derivative financial instruments are used to manage certain of the Company’s interest rate exposures. The Company does not enter into derivatives for trading or speculative purposes. Derivatives are carried at fair value, as determined using standard valuation models, and adjusted when necessary for credit risk. Refer to Note 9 – Debt for additional information. | |||||||||||||
Property and Equipment – Property and equipment are stated at cost. Equipment, furniture, and fixtures are depreciated using the straight-line method over their estimated useful lives, generally ranging from three to five years. Leasehold improvements are depreciated using the straight-line method over the lesser of the useful life of the improvements or the applicable lease terms, excluding renewal periods. Buildings are depreciated using the straight-line method over 30 to 40 years. Building improvements are depreciated using the straight-line method over 10 years. Costs associated with maintenance and repairs are expensed as incurred. The airplane and land improvements are depreciated using the straight-line method over 20 years and 10 years, respectively. | |||||||||||||
Long-Lived Assets – Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability of long-lived assets is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition, as compared with the asset carrying value. Measurement of an impairment loss for long-lived assets that management expects to hold and use is based on the fair value of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value, less costs to sell. No impairment losses have been recognized in the years ended December 31, 2013, 2012, and 2011. | |||||||||||||
Capitalized Interest Cost – Interest costs related to major capital projects, specifically the Company’s corporate headquarters campus project and capitalized internal-use software development costs, are capitalized until the underlying asset is placed into service. Capitalized interest is calculated by multiplying the effective interest rate of the outstanding debt by the qualifying costs. As the qualifying asset is placed into service, the qualifying asset and the related capitalized interest are amortized over the useful life of the related asset. | |||||||||||||
Restricted Cash – As of December 31, 2013 and 2012, restricted cash balances totaled $3.0 million and $1.4 million, respectively. The December 31, 2013 balance of $3.0 million consists of escrowed funds held as a deposit associated with a possible pending lease. The amount was returned to Company when the lease was signed in January 2014. The December 31, 2012 balance consists of $0.9 million of escrowed funds held under a letter of credit as a condition of the Company’s previous operating lease for its corporate headquarters and $0.5 million consists of a deposit made relating to the purchase of the Company’s corporate headquarters. | |||||||||||||
Capitalized Software Costs – The Company capitalizes costs related to its athenaNet services and certain other projects for internal use incurred during the application development stage, including stock-based compensation expense for employees working on these projects. Costs related to the preliminary project stage and post implementation activities are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life. The estimated useful life of the software is two to three years. Amortization expense was $18.0 million, $9.0 million, and $4.4 million for the years ended December 31, 2013, 2012, and 2011, respectively. Future amortization expense for all software development costs capitalized as of December 31, 2013 is estimated to be $18.8 million, $9.2 million and $0.6 million for the years ending December 31, 2014, 2015, and 2016, respectively. In addition to the future amortization expenses, the Company has a $1.4 million balance in a capitalization in progress account related to software development costs. | |||||||||||||
Goodwill – Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the identifiable net tangible and intangible assets acquired. Goodwill is not amortized but is evaluated for impairment annually or more frequently if indicators of impairment are present or changes in circumstances suggest that impairment may exist. The Company evaluates the carrying value of its goodwill annually on November 30. The first step of the goodwill impairment test compares the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the Company’s reporting unit exceeds its carrying amount, the goodwill of the reporting unit is considered not impaired. If the carrying amount of the Company’s reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test, used to measure the amount of impairment loss, compares the implied fair value of the affected reporting unit’s goodwill with the carrying value of that goodwill. No impairment losses have been recognized in the years ended December 31, 2013, 2012, and 2011. | |||||||||||||
Purchased Intangible Assets – Purchased intangible assets consist of technology, a physician network, content, a trade name, customer backlog, non-compete agreements and customer relationships acquired in connection with business acquisitions and are amortized over their estimated useful lives based on the pattern of economic benefit expected from each asset. The Company concluded for certain purchased intangible assets that the pattern of economic benefit approximated straight-line method therefore the use of the straight-line method was appropriate as the majority of the cash flows will be recognized ratably over the estimated useful lives and there is no degradation of the cash flows over time. | |||||||||||||
Accrued expenses and accrued compensation – Accrued expenses consist of the following: | |||||||||||||
As of December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Accrued bonus | $ | 25,013 | $ | 17,192 | |||||||||
Accrued vacation | 5,107 | 4,109 | |||||||||||
Accrued payroll | 8,611 | 9,980 | |||||||||||
Accrued commissions | 5,713 | 5,112 | |||||||||||
Accrued compensation expenses | $ | 44,444 | $ | 36,393 | |||||||||
Accrued expenses | $ | 23,692 | $ | 15,214 | |||||||||
Accrued property and equipment additions | 605 | 4,021 | |||||||||||
Current portion of accrued contingent consideration | — | 448 | |||||||||||
Accrued expenses | $ | 24,297 | $ | 19,683 | |||||||||
Deferred Rent – Deferred rent consists of rent escalation payment terms, tenant improvement allowances and other incentives received from landlords related to the Company’s operating leases for its facilities. Rent escalation represents the difference between actual operating lease payments due and straight-line rent expense, which is recorded by the Company over the term of the lease, including any construction period. The excess is recorded as a deferred credit in the early periods of the lease, when cash payments are generally lower than straight-line rent expense, and is reduced in the later periods of the lease when payments begin to exceed the straight-line expense. Tenant allowances from landlords for tenant improvements are generally comprised of cash received from the landlord as part of the negotiated terms of the lease or reimbursements of moving costs. These cash payments are recorded as deferred rent from landlords and are amortized as a reduction of periodic rent expense, over the term of the applicable lease. | |||||||||||||
Deferred Revenue – Deferred revenue primarily consists of billings or payments received in advance of the revenue recognition criteria being met. Deferred revenue includes certain deferred revenue associated with multiple element arrangements associated with sponsored clinical information and decision support services which is recognized based upon contractual deliverables, and implementation services fees which are recognized as revenue ratably over the longer of the life of the agreement or the estimated expected customer life, which is currently estimated to be twelve years. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. | |||||||||||||
Business Combinations – The Company applies business combination accounting when they have acquired control over one or more businesses. Business Combinations are accounted for at fair value. The associated acquisition costs are generally expensed as incurred and recorded in general and administrative expenses; non-controlling interests, if any, are reflected at fair value at the acquisition date; in-process research and development (“IPR&D”), if any, is recorded at fair value as an intangible asset at the acquisition date; restructuring costs associated with a business combination, if any, are generally expensed rather than capitalized; contingent consideration is measured at fair value at the acquisition date, with changes in the fair value after the acquisition date affecting earnings; changes in deferred tax asset valuation allowances and income tax uncertainties after the measurement period will affect income tax expense; and goodwill is determined as the excess of the fair value of the consideration conveyed in the acquisition over the fair value of the net assets acquired. The accounting for business combinations requires estimates and judgments as to expectations for future cash flows of the acquired business, and the allocation of those cash flows to identifiable intangible assets, in determining the estimated fair value for assets and liabilities acquired. The fair values assigned to tangible and intangible assets acquired and liabilities assumed, including contingent consideration, are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. If the actual results differ from the estimates and judgments used in these estimates, the amounts recorded in the financial statements could result in a possible impairment of the intangible assets and goodwill, or require acceleration of the amortization expense of finite-lived intangible assets. The results of the newly acquired businesses’ operations are included in the Consolidated Statements of Income of the combined entity beginning on the date of acquisition. We have applied this acquisition method to the transactions described in Note 2. | |||||||||||||
Related Party Transaction – During the year ended December 31, 2013, we made a long-term investment in a vendor. The total expense for the year ended December 31, 2013 was $1.5 million and the total amount payable at December 31, 2013 was $0.4 million. | |||||||||||||
Concentrations of Credit Risk – Financial instruments that potentially subject the Company to concentrations of credit risk are cash equivalents, investments, derivatives, and accounts receivable. The Company attempts to limit its credit risk associated with cash equivalents and investments by investing in highly-rated corporate and financial institutions, and engaging with highly-rated financial institutions as counterparties to its derivative transactions. With respect to customer accounts receivable, the Company manages its credit risk by performing ongoing credit evaluations of its customers. No customers accounted for more than 10% of revenues for the years ended December 31, 2013, December 31, 2012 and December 31, 2011. No customer accounted for more than 10% of accounts receivable as of December 31, 2013. One customer accounted for 11% of accounts receivable as of the year ended December 31, 2012 due to the timing of receipt of payments. | |||||||||||||
Income Taxes – Deferred tax assets and liabilities relate to temporary differences between the financial reporting and income tax bases of assets and liabilities and are measured using enacted tax rates and laws expected to be in effect at the time of their reversal. A valuation allowance is established to reduce net deferred tax assets if, based on the available positive and negative evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In making such determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and recent financial results. | |||||||||||||
The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. Our income tax positions must meet a more-likely-than-not recognition threshold at the balance sheet date to be recognized in the related period. The Company’s policy is to record interest and penalties related to unrecognized tax benefits in income tax expense. | |||||||||||||
From time to time, the Company receives incentives from various government agencies and programs. The Company accounts for the portion of the credits that are expected to be used to reduce non-income taxes as a grant. Credits which are expected to be used to reduce non-income taxes are recognized when the requirements to earn the credits have been met. | |||||||||||||
Sales and Use Taxes – The Company’s services are subject to sales and use taxes in certain jurisdictions. The Company’s contractual agreements with its customers provide that payment of any sales or use tax assessments are the responsibility of the customer. In certain jurisdictions sales taxes are collected from the customer and remitted to the respective agencies. These taxes are recorded on a net basis and excluded from revenue and expense in our financial statements as presented. | |||||||||||||
Segment Reporting – Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision-maker (“CODM”), or decision-making group, in making decisions regarding resource allocation and assessing performance. The Company, which uses consolidated financial information in determining how to allocate resources and assess performance, has determined that it operates in one segment and the CODM uses non-GAAP operating income (defined as Operating Income as shown in the Consolidated Statements of Income less total stock-based compensation, amortization expense related to purchased intangible assets, integration costs, transaction costs, and gain on early termination of lease for the period) as the measure of the Company’s profit on a regular basis. During the year ended December 31, 2013, the Company acquired and integrated two significant businesses and re-evaluated its operating segments. As of December 31, 2013, the Company’s CODM determined that the newly-acquired businesses are so closely integrated, that he will continue to review and assess the business as one operating segment. | |||||||||||||
Stock-Based Compensation – The Company accounts for share-based awards, including shares issued under employee stock purchase plans, stock options, and share-based awards with compensation cost measured using the fair value of the awards issued. The Company uses the Black-Scholes option pricing model to value share-based awards and determine the related compensation expense. The assumptions used in calculating the fair value of share-based awards represent management’s best estimates. The Company generally issues previously unissued shares for the exercise of stock options; however, the Company may reissue previously acquired treasury shares to satisfy these issuances in the future. | |||||||||||||
Certain employees have received grants for which the ultimate number of shares that will be subject to vesting is dependent upon the achievement of certain financial targets for the year. Such determination is not made until the grant’s vesting determination date, which is the date the Company’s fiscal year financial statements are available. The grant is initially recorded at the maximum attainable number of shares that is most likely to be subject to vesting based on available financial forecasts as of the date of grant. This amount is adjusted on a quarterly basis as new financial forecasts become available. Stock‑based compensation expense for these grants is recorded over the requisite service period, generally four years. Such options generally vest ratably over four years from the vesting determination date. | |||||||||||||
Foreign Currency Translation – The financial position and results of operations of the Company’s foreign subsidiary are measured using local currency as the functional currency. Assets and liabilities are translated at the rate of exchange in effect at the end of each reporting period. Revenues and expenses are translated at the average exchange rate for the period. Foreign currency translation gains and losses are recorded within other comprehensive (loss) income. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Business Combinations [Abstract] | ' | |||||||||||
ACQUISITIONS | ' | |||||||||||
ACQUISITIONS | ||||||||||||
Watertown, MA Corporate Headquarters - Arsenal on the Charles | ||||||||||||
On May 10, 2013, athenahealth, through its wholly-owned subsidiary Athena Arsenal, LLC, completed the acquisition of the real estate commonly known as the Arsenal on the Charles, located in Watertown, Massachusetts. The Arsenal on the Charles is an expansive 29-acre, multi-building, commercial property where the Company was leasing space for its headquarters and related operating activities prior to the transaction. The purpose of this acquisition is to allow for future expansion of the corporate headquarters to accommodate anticipated headcount growth. The purchase price was $168.5 million, subject to working capital adjustments. The fair value of the consideration paid was $167.3 million, all of which was paid in cash. | ||||||||||||
The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of acquisition: | ||||||||||||
Prepaid expenses and other current assets | $ | 685 | ||||||||||
Property, equipment and buildings | 144,071 | |||||||||||
Purchased intangible assets | 25,545 | |||||||||||
Accrued expenses | (271 | ) | ||||||||||
Deferred revenue | (789 | ) | ||||||||||
Other long-term liabilities | (1,916 | ) | ||||||||||
Total identifiable net assets | $ | 167,325 | ||||||||||
The fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions and are based on the information that was available as of the date of the acquisition. The Company believes that the information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but certain items such as the working capital adjustments to the purchase price may be subject to change as additional information is received about facts and circumstances that existed at the date of acquisition. Thus, the provisional measurements of fair value set forth above are subject to change. We expect to finalize the valuation as soon as practicable, but not later than one year from the acquisition date. | ||||||||||||
The following table sets forth the fair value of the preliminary components of the identifiable intangible assets acquired by asset class: | ||||||||||||
Above market leases | $ | 3,298 | ||||||||||
In-place leases | 22,247 | |||||||||||
Total intangible assets subject to amortization | $ | 25,545 | ||||||||||
The value of any in-place lease is estimated to be equal to the property owners’ avoidance of costs necessary to re-lease the property for a lease term equal to the remaining primary in-place lease term and the value of investment grade tenancy. The cost avoidance to the property owners of vacancy/leasing costs necessary to lease the property for a lease term equal to the remaining in-place lease term is derived first by determining the in-place lease term on the subject lease. Then, based on the Company’s review of the market, the cost to be borne by a property owner to replicate a market lease to the remaining in-place term was estimated. These costs consist of: (i) rent lost during downtime (e.g., assumed periods of vacancy), (ii) estimated expenses that would be incurred by the property owner during periods of vacancy, (iii) rent concessions (e.g., free rent), (iv) leasing commissions, and (v) tenant improvement allowances. The Company determine these values using its own estimates along with third-party appraisals. We amortize the capitalized value of in-place lease intangible assets to expense over the remaining initial term of each lease. We amortize the capitalized value of above market leases to expense over the initial and expected renewal terms of the leases. No amortization period for intangible assets will exceed the remaining depreciable life of the building. | ||||||||||||
The amounts of third-party tenant revenue (included in the line item “Implementation and other”) and net loss from the Arsenal on the Charles included in our Consolidated Statements of Income from the acquisition date of May 10, 2013, through the period ended December 31, 2013, are $9.7 million and $4.8 million, respectively. Direct operating expense from the acquisition date of May 10, 2013, through the period ended December 31, 2013, includes $9.1 million of costs associated with third-party tenant revenue for the Arsenal on the Charles. | ||||||||||||
We incurred transaction costs in connection with the acquisition of $2.4 million during the year ended December 31, 2013, respectively, and $3.1 million in total. These costs are included in general and administrative expenses. | ||||||||||||
Epocrates, Inc. | ||||||||||||
On March 12, 2013, we acquired Epocrates, a leading provider of essential clinical content, practice tools, and health industry engagement via mobile devices at the point of care. We acquired Epocrates for the assembled workforce, expected synergies, and accelerated awareness of athenahealth’s services across the physician market and to deliver high-value information to the clinical community. The acquisition date fair value of the consideration transferred for Epocrates, less cash and short-term investments acquired, was approximately $237.6 million, which consisted of the following: | ||||||||||||
Cash payments | $ | 294,632 | ||||||||||
Fair value of vested stock options and restricted stock units assumed | 13,028 | |||||||||||
Fair value of total consideration | 307,660 | |||||||||||
Less cash acquired | (51,796 | ) | ||||||||||
Less short-term investments acquired | (18,250 | ) | ||||||||||
Total | $ | 237,614 | ||||||||||
The value of the share consideration for Epocrates’ common stock was based on the average closing sales prices per share of athenahealth common stock for the ten trading days ending on the second trading day prior to the closing of the acquisition. The fair value of the stock options and restricted stock units assumed by us was determined using the Black-Scholes option pricing model. The share conversion ratio of 0.1239 was applied to convert Epocrates stock options and restricted stock units to athenahealth stock options and restricted stock units. | ||||||||||||
We assumed stock options and restricted stock units with a fair value of $22.6 million. Of the total consideration, $13.0 million was allocated to the purchase consideration and $9.6 million was allocated to future services and will be expensed on a straight-line basis over the remaining service periods. In the year ended December 31, 2013, stock-based compensation expense recognized for stock options and restricted stock units assumed was $7.4 million. | ||||||||||||
The following table summarizes the preliminary and final fair values of assets acquired and liabilities assumed as of the date of acquisition, March 12, 2013, and upon completion of the valuation at December 31, 2013: | ||||||||||||
12-Mar-13 | Adjustments | 31-Dec-13 | ||||||||||
Accounts receivable | $ | 23,144 | $ | (1,116 | ) | $ | 22,028 | |||||
Other current and long-term assets | 3,833 | 650 | 4,483 | |||||||||
Property, equipment and capitalized software costs | 4,168 | 20 | 4,188 | |||||||||
Purchased intangible assets | 139,900 | (500 | ) | 139,400 | ||||||||
Current liabilities | (11,054 | ) | (282 | ) | (11,336 | ) | ||||||
Deferred tax liabilities, net | (39,811 | ) | (1,340 | ) | (41,151 | ) | ||||||
Deferred revenue | (29,400 | ) | 648 | (28,752 | ) | |||||||
Other long-term liabilities | (1,259 | ) | 53 | (1,206 | ) | |||||||
Total identifiable net assets | 89,521 | (1,867 | ) | 87,654 | ||||||||
Goodwill | 148,093 | 1,867 | 149,960 | |||||||||
$ | 237,614 | $ | — | $ | 237,614 | |||||||
The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed were based on management’s estimates and assumptions based on the information that was available as of the date of the acquisition. The fair values of certain items, such as accounts receivable, purchased intangible assets, current and non-current income taxes payable, deferred taxes, deferred revenue and uncertain tax benefits, were subject to change as additional information was received about facts and circumstances that existed at the date of acquisition and as certain tax returns were finalized. The fair values were finalized during the quarter ended December 31, 2013. | ||||||||||||
The following table sets forth the components of the identifiable intangible assets acquired by asset class and their estimated useful lives as of the date of acquisition: | ||||||||||||
Fair Value | Useful Life | |||||||||||
Physician network | 104,000 | 14 years | ||||||||||
Drug information content | 10,000 | 5 years | ||||||||||
Trade name | 11,500 | 10 years | ||||||||||
Customer backlog | 2,900 | 1.5 years | ||||||||||
Developed technology | 6,500 | 3 years | ||||||||||
Epocrates non-compete agreement | 4,500 | 1.5 years | ||||||||||
Total intangible assets subject to amortization | $ | 139,400 | ||||||||||
The physician network represents the fair values of the underlying relationships and agreements with Epocrates customers and the fair values of the savings associated with future marketing spend for the athenahealth services to the acquired physician network. Drug information content represents the fair value of the cost to replace the drug information and interaction content used by the physician network. The trade name represents the fair value of the brand and name recognition associated with the marketing of Epocrates’ service offerings. Customer backlog represents the estimated fair value of existing contractual backlog orders as of the acquisition date. Epocrates non-compete agreement represents the estimated fair value of the contract between athenahealth and a former member of Epocrates management. Developed technology represents the estimated fair value of Epocrates’ mobile device platform. All of the purchased intangible assets related to the Epocrates transaction have finite lives. For those purchased intangible assets where an income approach was used, we considered the projected undiscounted cash flows as the best indication of the pattern of economic benefit expected from each asset. | ||||||||||||
The goodwill balance is primarily attributed to the assembled workforce and expanded market opportunities when integrating Epocrates’ mobile device platform with the athenahealth service offerings. The goodwill balance is not deductible for U.S. income tax purposes. | ||||||||||||
The amounts of revenue and net loss of Epocrates included in our Consolidated Statements of Income from the acquisition date of March 12, 2013, through the period ended December 31, 2013, are $52.4 million and $14.4 million, respectively. The net loss includes $7.9 million in stock-based compensation expense primarily related to the acceleration of certain individuals’ stock awards upon termination. | ||||||||||||
We incurred transaction costs in connection with the acquisition of $2.7 million during the year ended December 31, 2013, and $3.2 million in total. These costs are included in general and administrative expenses. | ||||||||||||
As part of the integration of Epocrates, we communicated to certain employees severance and retention bonuses which total $4.2 million and were expensed through the end of 2013. If the employee did not fulfill the required employment period for the retention bonus, the amount was not paid and the expense was reversed. The following table summarizes these amounts on the Consolidated Statements of Income for the year ended December 31, 2013: | ||||||||||||
Rollforward of integration costs | ||||||||||||
Beginning balance, January 1, 2013 | $ | — | ||||||||||
Addition to provision | 3,909 | |||||||||||
Cash payments | (3,574 | ) | ||||||||||
Ending balance, December 31, 2013 | $ | 335 | ||||||||||
Pro Forma Presentation | ||||||||||||
The following pro forma financial information summarizes the combined results of operations for athenahealth as though the acquisitions of Epocrates and the Arsenal on the Charles occurred on January 1, 2012. The unaudited pro forma financial information is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Revenue | $ | 614,775 | $ | 538,030 | ||||||||
Net income (loss) | $ | (1,808 | ) | $ | (4,700 | ) | ||||||
Net income (loss) per share – Basic | $ | (0.05 | ) | $ | (0.13 | ) | ||||||
Net income (loss) per share – Diluted | $ | (0.05 | ) | $ | (0.13 | ) | ||||||
The pro forma financial information for all periods presented has been calculated after adjusting the results of Epocrates and the Arsenal on the Charles to reflect the business combination accounting effects resulting from these acquisitions including the amortization expenses from acquired intangible assets, the deprecation expenses from acquired tangible assets, the stock-based compensation expense for unvested stock options and restricted stock units assumed and the related tax effects as though the acquisition occurred as of January 1, 2012. The pro forma financial information is for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of our 2012 fiscal year. | ||||||||||||
Healthcare Data Services | ||||||||||||
On October 10, 2012, the Company acquired Healthcare Data Services LLC (“HDS”) for a purchase price of $6.0 million, which was adjusted for certain working capital adjustments to arrive at a total cash consideration of $5.8 million net of cash acquired. The valuation of the intangible assets was finalized during the quarter ended December 31, 2012. The identifiable assets acquired and liabilities assumed included $0.3 million in accounts receivable, prepaid and other current assets, $4.8 million of intangible assets and $0.1 million in accrued expenses and deferred revenue. The goodwill recorded as a result of this transaction was $0.8 million and is deductible for tax purposes. The Company incurred legal and professional fees in connection with the acquisition of $0.2 million, which are included in general and administrative expenses. | ||||||||||||
The fair values of the purchased intangible assets acquired as part of the purchase of Healthcare Data Services are allocated as development technology of $3.2 million, customer relationships of $0.4 million and non-compete agreement of $1.2 million. The intangible assets are being amortized between 3 and 5 years, with customer lists being amortized over 5 years. The goodwill resulting from the acquisition arises largely from the synergies expected from combining the operations of the acquisition with our existing service operations, as well as from the benefits derived from the assembled workforce of the acquisition. The goodwill recognized is deductible for tax purposes. |
NET_INCOME_PER_SHARE
NET INCOME PER SHARE | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
NET INCOME PER SHARE | ' | ||||||||||||
NET INCOME PER SHARE | |||||||||||||
Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period under the treasury stock method. Potentially dilutive securities include stock options, restricted stock units, and shares to be purchased under the employee stock purchase plan. Under the treasury stock method, dilutive securities are assumed to be exercised at the beginning of the periods and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Securities are excluded from the computations of diluted net income per share if their effect would be anti-dilutive to earnings per share. | |||||||||||||
The following table reconciles the weighted average shares outstanding for basic and diluted net income per share for the periods indicated: | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Net income | $ | 2,594 | $ | 18,732 | $ | 19,046 | |||||||
Weighted average shares used in computing basic net income per share | 36,856 | 35,956 | 35,046 | ||||||||||
Net income per share – basic | $ | 0.07 | $ | 0.52 | $ | 0.54 | |||||||
Net income | $ | 2,594 | $ | 18,732 | $ | 19,046 | |||||||
Weighted average shares used in computing basic net income per share | 36,856 | 35,956 | 35,046 | ||||||||||
Effect of dilutive securities | 1,401 | 1,177 | 1,004 | ||||||||||
Weighted average shares used in computing diluted net income per share | 38,257 | 37,133 | 36,050 | ||||||||||
Net income per share – diluted | $ | 0.07 | $ | 0.5 | $ | 0.53 | |||||||
The computation of diluted net income per share does not include 0.4 million, 0.4 million, and 0.8 million of stock options and restricted stock units for the years ended December 31, 2013, 2012, and 2011, respectively, because their inclusion would have an anti-dilutive effect on net income per share. |
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ' | ||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||||||
As of December 31, 2013 and 2012, the carrying amounts of cash and cash equivalents, restricted cash, receivables, accounts payable and accrued expenses approximated their estimated fair values because of their short term nature of these financial instruments. Included in cash and cash equivalents as of December 31, 2013 and 2012, are money market fund investments of $0.0 million and $59.4 million, respectively, which are reported at fair value. As of December 31, 2013, the Company had $188.8 million outstanding on its term loan facility and $35.0 million outstanding on its revolving credit facility (see Note 9 – Debt), which approximate their fair values due to their variable rate nature at current market rates. As of December 31, 2012, the Company had no outstanding debt. | |||||||||||||||||
The following table presents information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2013 and December 31, 2012, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities and fair values determined by Level 2 inputs utilize quoted prices (unadjusted) in inactive markets for identical assets or liabilities obtained from readily available pricing sources for similar instruments. The fair values determined by Level 3 inputs are unobservable values which are supported by little or no market activity. | |||||||||||||||||
Fair Value Measurements At December 31, 2013, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market | $ | 26 | $ | — | $ | — | $ | 26 | |||||||||
Total assets | $ | 26 | $ | — | $ | — | $ | 26 | |||||||||
Interest rate swap liability | $ | — | $ | (354 | ) | $ | — | $ | (354 | ) | |||||||
Total liabilities | $ | — | $ | (354 | ) | $ | — | $ | (354 | ) | |||||||
Fair Value Measurements as of December 31, 2012, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market | $ | 89,480 | $ | — | $ | — | $ | 89,480 | |||||||||
Available-for-sale investments: | — | ||||||||||||||||
Commercial paper | — | 11,748 | — | 11,748 | |||||||||||||
Corporate bonds | — | 20,334 | — | 20,334 | |||||||||||||
Certificate of deposit | — | 6,010 | — | 6,010 | |||||||||||||
Total assets | $ | 89,480 | $ | 38,092 | $ | — | $ | 127,572 | |||||||||
Accrued contingent consideration | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Total liabilities | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Money markets, certificates of deposit, U.S. government-backed securities, corporate bonds and commercial paper are valued using a market approach based upon the quoted market prices of identical instruments when available or other observable inputs such as trading prices of identical instruments in inactive markets or similar securities. It is the Company’s policy to recognize transfers between levels of the fair value hierarchy, if any, at the end of the reporting period; however, there have been no such transfers during any periods presented. | |||||||||||||||||
The estimated fair value of our interest rate swap agreement with a certain financial institution at December 31, 2013, was $0.4 million, based on inputs other than quoted prices that are observable for the interest rate swap (Level 2). Inputs include preset value of fixed and projected floating rate cash flows over term of the swap contract. There was no interest rate swap agreement at December 31, 2012. Refer to Note 9 – Debt for further information. | |||||||||||||||||
Contingent consideration is recorded at fair value as an element of consideration paid with subsequent adjustments recognized in the Consolidated Statements of Income. At the acquisition date and reporting date, the fair value of the accrued contingent consideration was determined using a probability-weighted income approach based on upside, downside and base case scenarios. This approach is based on significant inputs that are not observable in the market, which are referred to as Level 3 inputs. As of December 31, 2012, the Company had accrued a liability $0.4 million for the estimated fair value of contingent considerations estimated to be payable upon the acquired companies reaching specific performance metrics over a specified period of operations or time after acquisition. There was no contingent consideration as of December 31, 2013. | |||||||||||||||||
Anodyne | |||||||||||||||||
The first potential contingent consideration related to our acquisition of Anodyne Health Partners, Inc. (“Anodyne”) in 2009 ranged from zero to $4.8 million and was payable in one installment based upon operational performance for the year ended December 31, 2010. Based on the actual operational performance for the year ended December 31, 2010, the Company paid $2.4 million relating to the first potential contingent consideration in March of 2011. | |||||||||||||||||
The second potential contingent consideration related to our acquisition of Anodyne in 2009 ranged from zero to $2.9 million and was payable in quarterly installments based upon the cross selling of the Company’s services for the years ended December 31, 2010 and 2011, and the six-month period ended June 30, 2012. Any amounts not earned in the first potential contingent consideration could be earned under the second potential contingent consideration in excess of the initial $2.9 million bringing the total second potential contingent consideration to $5.3 million. On December 31, 2011, the Company estimated the fair value of the second contingent consideration at $1.4 million based on key assumptions including a probability adjusted level of 50% for the base case scenario and 25% for the upside and downside scenarios. The significant judgment related to the estimated earn-out payments by scenario was primarily based on the Company’s i) past experience of our cross selling, ii) past experience of the timeline for converting pipeline opportunities into customers and iii) the remaining time period of this contingent consideration. At December 31, 2011, a large cross sell customer opportunity was included in the upside scenario which had a 25% probability. On March 31, 2012, the Company estimated the fair value of the second contingent consideration at $3.4 million based on key assumptions including a 20% for the base case scenario, 70% for the upside scenario and 10% for the downside scenario. At March 31, 2012, this large cross sell opportunity was in final contract negotiations with the Company and therefore a higher probability was assigned to the upside scenario. The time period through which the contingent consideration could be earned elapsed on June 30, 2012. The Company accrued $1.8 million as of June 30, 2012, for the final payment based on the final cross selling results which was paid during the three months ended September 30, 2012. The change in fair value of $1.3 million for the year ended December 31, 2012, was an increase in the general and administrative line item in the Consolidated Statements of Income. The Company paid $2.6 million during the year ended December 31, 2012, and $3.9 million over the entire term of the second contingent consideration. | |||||||||||||||||
Proxsys | |||||||||||||||||
The first potential contingent consideration related to our acquisition of Proxsys LLC (“Proxsys”) in 2011 ranges from zero to $3.0 million and is payable in one installment in the first quarter of 2013 based upon revenue and new sales performance for the fiscal year ended December 31, 2012. In order to qualify for the earnout payment, the acquired subsidiary must have achieved a minimum revenue threshold which was derived from both recurring revenue and revenue generated from new customers brought onto the service after the acquisition. Once that minimum revenue threshold is met, the amount of the payment is then determined by new sales of the Company’s athenaCoordinator service offering since date of acquisition. At acquisition date and on December 31, 2011, the Company estimated the fair value of the first potential contingent consideration at $2.4 million, the key assumptions relating to this potential contingent consideration included the athenaCoordinator revenue budget for the 2012 fiscal year, which included recurring revenue and estimates related to new revenue generated from new customers based upon the existing sales pipeline and historical implementation timeline and a probability adjusted level of 60% for the base case and 25% and 15% for the upside and downside scenarios, respectively. The athenaCoordinator revenue budget for the 2012 fiscal year exceeded the minimum revenue threshold. The downside scenarios included a worse case scenario where the acquired subsidiary did not achieve the minimum revenue target. Certain contracts that were in an advanced negotiation stage at December 31, 2011, and estimated to close in the first quarter of 2012, did not close during the three months ended March 31, 2012; therefore as of March 31, 2012, the Company determined that it is more likely than not that the minimum revenue threshold for athenaCoordinator will not be achieved by a margin of 5-10%. On March 31, 2012, the Company determined that based on the reforecasted amounts and the pass fail structure of this contingent payment, the probability percentages have been adjusted to 90% for the worse case scenario and 10% for the upside scenario. On March 31, 2012, the Company estimated the fair value of the first potential contingent consideration at $0.3 million. On June 30, 2012, the Company estimated the fair value of the first potential contingent consideration to have no value. For the year ended December 31, 2012, the Company did not meet the minimum revenue threshold and therefore zero consideration was earned related to the first contingent consideration. The change in fair value of $2.4 million is a decrease in the general and administrative expense line item in the Consolidated Statements of Income for the year ended December 31, 2012. | |||||||||||||||||
The second potential contingent consideration related to our acquisition of Proxsys in 2011 ranges from zero to $5.0 million and is payable in quarterly installments based upon the cross selling of the Company’s athenaCollector services into Proxsys’ new and acquired customer and physician sender base, from acquisition to the second year anniversary of the acquisition in the third quarter of 2013. On December 31, 2011, and through June 30, 2012, the key assumptions relating to this potential contingent consideration included scenarios primarily based on the Company’s (i) past experience of our cross selling related to the Anodyne acquisition, (ii) past experience of the timeline for converting pipeline opportunities into customers and (iii) the remaining time period of this contingent consideration and a probability adjusted level of 65% for the base case and 25% and 10% for the upside and downside scenarios, respectively. As of September 30, 2012, over one year after the acquisition, the Company determined that it now had sufficient information into the actual cross sell opportunity base to adjust the scenarios. The Company lowered its expectations of achievable cross sells within the earn out period for all scenarios and has a probability adjusted level of 60% for the base case and 20% for the upside and downside scenarios. The Company estimated the fair value of the contingent consideration at December 31, 2012, to be $0.4 million, primarily related to the amount of time left to earn the additional consideration. The change in fair value of $4.0 million is a decrease in the general and administrative expense line item in the Consolidated Statements of Income for the year ended December 31, 2012. Minimal cross-sells were earned and minimal payments were made as of December 31, 2012. The second contingent consideration related to the Proxsys acquisition ended on August 31, 2013 and a final payment of $0.5 million was made during the period ending December 31, 2013. The total expense for the period ended December 31, 2013 was $0.1 million. | |||||||||||||||||
The reconciliations for the fair values of financial instruments determined by Level 3 for the periods presented, are as follows: | |||||||||||||||||
Year Ended December 31, 2013 | Year Ended December 31, 2012 | ||||||||||||||||
Balance beginning of period | $ | 448 | $ | 8,176 | |||||||||||||
Payments | (524 | ) | (2,610 | ) | |||||||||||||
Additions | — | — | |||||||||||||||
Change in fair value (included in G&A expenses) | 76 | (5,118 | ) | ||||||||||||||
Balance end of period | $ | — | $ | 448 | |||||||||||||
INVESTMENTS
INVESTMENTS | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Investments [Abstract] | ' | ||||||||||||
INVESTMENTS | ' | ||||||||||||
INVESTMENTS | |||||||||||||
As of December 31, 2013, the Company has no available-for-sale securities. The summary of available-for-sale securities at December 31, 2012, is as follows: | |||||||||||||
Amortized Cost | Gross Unrealized | Fair Value | |||||||||||
Gains | |||||||||||||
Commercial paper | $ | 11,740 | $ | 8 | $ | 11,748 | |||||||
Corporate bonds | 20,331 | 3 | 20,334 | ||||||||||
Certificate of deposit | 6,008 | 2 | 6,010 | ||||||||||
Total | $ | 38,079 | $ | 13 | $ | 38,092 | |||||||
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
PROPERTY AND EQUIPMENT | ' | ||||||||
PROPERTY AND EQUIPMENT | |||||||||
The Company has no capital leases for the years ended December 31, 2013 and December 31, 2012. | |||||||||
The fair values of the property and equipment acquired as part of the purchase of the Arsenal on the Charles are allocated to buildings, land, and land improvements in the amounts of $121.3 million, $21.0 million, and $1.8 million, respectively. | |||||||||
Property and equipment consist of the following: | |||||||||
Years Ended December 31, | |||||||||
2013 | 2012 | ||||||||
Equipment | $ | 78,616 | $ | 56,078 | |||||
Furniture and fixtures | 8,822 | 5,297 | |||||||
Leasehold improvements | 3,104 | 15,518 | |||||||
Airplane | 3,156 | 3,156 | |||||||
Building | 136,368 | 14,644 | |||||||
Building improvements | 24,441 | 3,500 | |||||||
Land | 23,059 | 2,035 | |||||||
Land improvements | 2,980 | 915 | |||||||
Total property and equipment, at cost | 280,546 | 101,143 | |||||||
Accumulated depreciation and amortization | (72,777 | ) | (49,902 | ) | |||||
Construction in progress | 5,249 | 2,794 | |||||||
Property and equipment, net | $ | 213,018 | $ | 54,035 | |||||
Depreciation expense on property and equipment was $25.5 million, $16.6 million, and $12.2 million for the years ended December 31, 2013, 2012, and 2011, respectively. |
GOODWILL_AND_PURCHASED_INTANGI
GOODWILL AND PURCHASED INTANGIBLE ASSETS | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||
GOODWILL AND PURCHASED INTANGIBLE ASSETS | ' | ||||||||||||||
GOODWILL AND PURCHASED INTANGIBLE ASSETS | |||||||||||||||
Goodwill | |||||||||||||||
The following table summarizes the activity related to the carrying value of the Company’s goodwill during the years ended December 31, 2013 and 2012: | |||||||||||||||
Gross balance as of January 1, 2012 | $ | 47,307 | |||||||||||||
Goodwill recorded in connection with the acquisition of Healthcare Data Services LLC | 783 | ||||||||||||||
Gross balance as of December 31, 2012 | $ | 48,090 | |||||||||||||
Goodwill recorded in connection with the acquisition of Epocrates, Inc. | 149,959 | ||||||||||||||
Gross balance as of December 31, 2013 | $ | 198,049 | |||||||||||||
Purchased Intangible Assets | |||||||||||||||
Intangible assets acquired as of December 31, 2013 and 2012, are as follows: | |||||||||||||||
December 31, 2013 | |||||||||||||||
Gross | Accumulated | Net | Weighted Average Remaining | ||||||||||||
Amortization | Useful Life (years) | ||||||||||||||
Developed technology | $ | 11,721 | $ | (4,737 | ) | $ | 6,984 | 2 | |||||||
Customer relationships | 21,434 | (7,365 | ) | 14,069 | 6.6 | ||||||||||
Doctor network | 104,000 | (682 | ) | 103,318 | 13.2 | ||||||||||
Drug information content | 10,000 | (1,608 | ) | 8,392 | 4.2 | ||||||||||
Trade name | 11,500 | (924 | ) | 10,576 | 9.2 | ||||||||||
Customer backlog | 2,900 | (1,554 | ) | 1,346 | 0.7 | ||||||||||
Non-compete agreement | 6,178 | (3,280 | ) | 2,898 | 1 | ||||||||||
Above market leases | 3,123 | (357 | ) | 2,766 | 5.9 | ||||||||||
Leases in place | 21,578 | (3,563 | ) | 18,015 | 5.3 | ||||||||||
Total | $ | 192,434 | $ | (24,070 | ) | $ | 168,364 | ||||||||
31-Dec-12 | |||||||||||||||
Gross | Accumulated | Net | Weighted Average Remaining | ||||||||||||
Amortization | Useful Life (years) | ||||||||||||||
Developed technology | $ | 6,612 | $ | (2,678 | ) | $ | 3,934 | 2.5 | |||||||
Customer relationships | 21,434 | (5,175 | ) | 16,259 | 7.6 | ||||||||||
Non-compete agreement | 1,678 | (310 | ) | 1,368 | 2.6 | ||||||||||
Total | $ | 29,724 | $ | (8,163 | ) | $ | 21,561 | ||||||||
Amortization expense for the years ended December 31, 2013, 2012, and 2011, was $17.9 million, $3.4 million, and $2.2 million, respectively, and is included in direct operating expenses. Estimated amortization expense, based upon the Company’s intangible assets at December 31, 2013, is as follows: | |||||||||||||||
Year ending December 31, | Amount | ||||||||||||||
2014 | $ | 27,670 | |||||||||||||
2015 | 22,528 | ||||||||||||||
2016 | 18,560 | ||||||||||||||
2017 | 17,803 | ||||||||||||||
2018 | 15,441 | ||||||||||||||
Thereafter | 66,362 | ||||||||||||||
Total | $ | 168,364 | |||||||||||||
OPERATING_LEASES_AND_OTHER_COM
OPERATING LEASES AND OTHER COMMITMENTS | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Leases [Abstract] | ' | |||
OPERATING LEASES AND OTHER COMMITMENTS | ' | |||
OPERATING LEASES AND OTHER COMMITMENTS | ||||
The Company maintains operating leases for facilities and certain office equipment. The facility leases contain renewal options and require payments of certain utilities, taxes, and shared operating costs of each leased facility. The rental agreements expire at various dates from 2014 to 2029. | ||||
The Company entered into a lease agreement with a landlord in connection with the relocation of its corporate offices in June 2005 to the Arsenal on the Charles. Under the terms of such lease agreement, the landlord provided approximately $11.5 million in allowances to the Company for the leasehold improvements for the office space, reimbursement of moving costs and all payments under the Company’s lease agreement relating to its previous office space. Prior to May 2011, the incentive payments received from the new landlord were being recognized over the lease term and accounted for as a component of deferred rent on the Company’s Consolidated Balance Sheets. In May 2011, the Company paid $2.1 million to settle the remaining amounts of these rental incentive loans. In May 2013, this lease was effectively terminated when the Company purchased the Arsenal on the Charles from the landlord (see Note 2). During the year ended December 31, 2013, the Company recognized a $2.5 million net gain due to the early termination of our lease and the realization of the remaining balance in deferred rent at the time of acquisition. This gain was recorded in general and administrative expense during the three months ended June 30, 2013. | ||||
Rent expense for the Company totaled $5.5 million, $4.9 million, and $3.5 million for the years ended December 31, 2013, 2012, and 2011, respectively. | ||||
Future minimum lease payments under non-cancelable operating leases as of December 31, 2013, are as follows: | ||||
Year ending December 31, | Future Rent | |||
Payments | ||||
2014 | $ | 5,658 | ||
2015 | 7,645 | |||
2016 | 7,984 | |||
2017 | 8,093 | |||
2018 | 8,295 | |||
Thereafter | 50,253 | |||
Total minimum lease payments | $ | 87,928 | ||
DEBT
DEBT | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
DEBT | ' | ||||||||||||||||
DEBT | |||||||||||||||||
2011 Line of Credit – On October 20, 2011, the Company entered into a five-year, $100.0 million revolving credit agreement (“Revolving Credit Agreement”). The Revolving Credit Agreement contained certain covenants, including consolidated leverage and minimum fixed charge coverage ratios. The interest rates applicable to revolving loans under the Revolving Credit Agreement were at either (i) the British Bankers Association London Interbank Offered Rate (“LIBOR”) plus an interest margin based on our consolidated leverage ratio, or (ii) the base rate (which is the highest of (a) the bank’s prime rate, (b) the Federal Funds rate plus 0.50%, and (c) one month LIBOR plus 1.00%) plus an interest margin based on our consolidated leverage ratio. | |||||||||||||||||
There was no balance outstanding on the revolving credit facility as of December 31, 2012. In connection with the planned acquisition of Epocrates, on January 3, 2013, the Company borrowed $100.0 million from the revolving credit facility and, on January 9, 2013, repaid the borrowed amount in full. | |||||||||||||||||
2013 Commitment Letter – On January 7, 2013, the Company entered into a commitment letter, pursuant to which Bank of America, N.A. committed to increase its commitment to provide revolving loans under the Revolving Credit Agreement by an amount up to $55.0 million as a source of funding for the Epocrates transaction (see Note 2 – Acquisitions). The Company was required to pay financing fees of $0.3 million for this commitment. | |||||||||||||||||
On March 11, 2013, the Company borrowed $155.0 million under the Revolving Credit Agreement as a source of funding for the Epocrates transaction, and repaid $50.0 million of the $155.0 million as of March 31, 2013. All amounts outstanding under the Revolving Credit Agreement were repaid on May 10, 2013. | |||||||||||||||||
2013 Credit Agreement – On May 10, 2013, the Company entered into a $325.0 million senior credit facility consisting of a $200.0 million unsecured term loan facility and a $125.0 million unsecured revolving credit facility (the “Senior Credit Facility”). The Senior Credit Facility replaced the Revolving Credit Agreement. The Senior Credit Facility contains terms and conditions that are customary to facilities of this nature and certain covenants, including consolidated leverage ratio and capital expenditures limitations. The Senior Credit Facility may be used to refinance existing indebtedness, to finance the acquisition of the real estate known as the Arsenal on the Charles, and for working capital and other general corporate purposes. The Company may increase the Senior Credit Facility up to an additional $100.0 million, subject to certain terms, including obtaining lender commitments. The Senior Credit Facility expires on May 10, 2018, although the Company may prepay the Senior Credit Facility in whole or in part at any time without premium or penalty, and the unutilized portion of the commitments may be irrevocably reduced or terminated by athenahealth in whole or in part without penalty or premium. | |||||||||||||||||
On May 10, 2013, the Company borrowed $200.0 million under the unsecured term loan facility and $50.0 million under the unsecured revolving credit facility of the Senior Credit Facility to refinance existing indebtedness described above, to finance the Arsenal on the Charles acquisition as described in Note 2 – Acquisitions, and for working capital and other general corporate purposes. The unsecured term loan facility was payable quarterly starting in June 30, 2013, in the amount of $3.8 million each quarter. As of December 31, 2013, $188.8 million was outstanding on the unsecured term loan facility and $35.0 million was outstanding on the unsecured revolving credit facility. As of December 31, 2013, there was $90.0 million available on the unsecured revolving credit facility. | |||||||||||||||||
Any loan under the Senior Credit Facility bears interest at the same rates as in the Revolving Credit Agreement. The interest rate for the Senior Credit Facility as of December 31, 2013 was 1.67%. | |||||||||||||||||
The Company was required to pay financing fees of $1.4 million for the Senior Credit Facility, which are being amortized as interest expense in the Consolidated Statements of Income over the five-year term of the agreement. | |||||||||||||||||
Future principal payments of the unsecured term loan facility at December 31, 2013 are as follows: | |||||||||||||||||
Amount | |||||||||||||||||
2014 | $ | 15,000 | |||||||||||||||
2015 | 15,000 | ||||||||||||||||
2016 | 15,000 | ||||||||||||||||
2017 | 15,000 | ||||||||||||||||
Thereafter | 128,750 | ||||||||||||||||
Total | $ | 188,750 | |||||||||||||||
Less current portion | 15,000 | ||||||||||||||||
Long-term portion | $ | 173,750 | |||||||||||||||
During the quarter ended September 30, 2013, the Company entered into an interest rate swap agreement designed to fix the variable interest rate payable on $120.0 million of its outstanding borrowings under the Senior Credit Facility at 0.8396% exclusive of the credit spread under the Senior Credit Facility. | |||||||||||||||||
The interest rate swap agreement was designed to manage exposure to interest rates on the Company’s variable rate indebtedness. The Company recognizes all derivatives on the Consolidated Balance Sheet at fair value. The Company has designated the interest rate swap agreement as a cash flow hedge. Changes in the fair value of the interest rate swap are recognized in other comprehensive income (loss) (“OCI”) until the hedged items are recognized in earnings. Hedge ineffectiveness, if any, associated with the interest rate swap will be reported in interest expense. There was no ineffectiveness associated with the interest rate swap during the quarter ended December 31, 2013, nor was any amount excluded from ineffectiveness testing. The Company is exposed to credit loss in the event of non-performance by the swap counter party. | |||||||||||||||||
The fair value of the interest rate swap recognized in other long-term liabilities and in OCI was as follows: | |||||||||||||||||
Fair Value | |||||||||||||||||
Effective Date | Notional Amount | Fixed Rate | Maturity | December 31, 2013 | 31-Dec-12 | ||||||||||||
August 31, 2013 | 120,000 | 0.8396 | % | August 31, 2016 | $ | (354 | ) | $ | — | ||||||||
Refer to Note 4 – Fair Value of Financial Instruments for further information. |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2013 | |
Stockholders' Equity Note [Abstract] | ' |
STOCKHOLDERS' EQUITY | ' |
STOCKHOLDERS’ EQUITY | |
Preferred Stock – The Company’s Board of Directors has the authority, without further action by stockholders, to issue up to 5,000 shares of preferred stock in one or more series. The Company’s Board of Directors may designate the rights, preferences, privileges, and restrictions of the preferred stock, including dividend rights, conversion rights, voting rights, terms of redemption, liquidation preference, and number of shares constituting any series or the designation of any series. The issuance of preferred stock could have the effect of restricting dividends on the Company’s common stock, diluting the voting power of its common stock, impairing the liquidation rights of its common stock, or delaying or preventing a change in control. The ability to issue preferred stock could delay or impede a change in control. As of December 31, 2013 and 2012, no shares of preferred stock were outstanding. | |
Common Stock – Common stockholders are entitled to one vote per share and dividends when declared by the Board of Directors, subject to any preferential rights of preferred stockholders. | |
Warrants – In connection with equipment financing with a finance company and a bank in May 2001, the Company issued warrants to purchase shares of the Company’s stock at an exercise price of $3.08 per share. As of December 31, 2011, 32 warrants remained outstanding. The 32 warrants were exercised during the year ended December 31, 2012. As of December 31, 2013 and 2012, no warrants remain outstanding. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
STOCK-BASED COMPENSATION | ' | |||||||||||||
STOCK-BASED COMPENSATION | ||||||||||||||
Total stock-based compensation expense for the years ended December 31, 2013, 2012, and 2011, is as follows: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Stock-based compensation charged to: | ||||||||||||||
Direct operating | $ | 7,778 | $ | 5,619 | $ | 3,173 | ||||||||
Selling and marketing | 12,057 | 7,717 | 5,645 | |||||||||||
Research and development | 4,238 | 3,213 | 2,311 | |||||||||||
General and administrative | 18,575 | 10,687 | 7,772 | |||||||||||
Total | $ | 42,648 | $ | 27,236 | $ | 18,901 | ||||||||
Amortization of capitalized stock-based compensation related to software development | 1,027 | 257 | — | |||||||||||
Total | $ | 43,675 | $ | 27,493 | $ | 18,901 | ||||||||
In addition, for the years ended December 31, 2013 and 2012, $2.2 million and $0.8 million of stock-based compensation was capitalized in the line item Software Development Costs in the Consolidated Balance Sheets for which $1.0 million and $0.3 million was included in the line item Depreciation and Amortization Expense in the Consolidated Statements of Income. The amount of stock-based compensation related to capitalized software development costs in prior periods was not significant. | ||||||||||||||
In 2007, the board of directors and the Company’s stockholders approved the Company’s 2007 Stock Option and Incentive Plan. The 2007 Stock Option and Incentive Plan was amended and restated in 2011 to: (i) remove an evergreen provision; (ii) increase the number of shares reserved for issuance by 1.3 million shares; (iii) set a multiplier for full value awards of 1.3 shares of stock for each share of stock subject to that award; (iv) set minimum restriction periods for stock awards; (v) set maximum awards payable for performance-based awards; (vi) add performance criteria; and (vii) make other administrative changes; and in 2012 to: (i) increase the number of shares reserved for issuance by 1.85 million shares; (ii) set a multiplier for full value awards of 1.66 shares of stock for each share of stock subject to that award; (iii) set a new minimum period for a performance cycle for cash-based awards; (iv) add performance criteria; (v) revise the share counting provision so that shares underlying awards other than stock options and stock appreciation rights may be withheld to satisfy tax withholding obligations; and (vi) extend its term through April 23, 2022 (as amended and restated, the “2007 Plan”); and in 2013 to: (i) increase the number of shares reserved for issuance by 1.66 million shares. As part of the Epocrates acquisition, we assumed 0.4 million shares available for issuance under the Epocrates stock plan. As of December 31, 2013 and 2012, there were approximately 4,609 and 3,303 shares, respectively, available for grant under the Company’s stock award plans. | ||||||||||||||
Stock Options | ||||||||||||||
Options granted under the 2007 Plan may be incentive stock options or non-qualified stock options under the applicable provisions of the Internal Revenue Code. Incentive stock options are granted with exercise prices at or above the fair value of the Company’s common stock at the grant date as determined by the Board of Directors. Incentive stock options granted to employees who own more than 10% of the voting power of all classes of stock are granted with exercise prices at 110% of the fair value of the Company’s common stock at the date of the grant. Non-qualified stock options may be granted with exercise prices up to the fair value of the Company’s common stock on the date of the grant, as determined by the Board of Directors. All options granted vest over a range of one to four years and have contractual terms of between five and ten years. Options granted typically vest 25% per year over a total of four years at each anniversary, with the exception of options granted to members of the board of directors, which vest on a quarterly basis. | ||||||||||||||
The following table presents the stock option activity for the year ended December 31, 2013: | ||||||||||||||
Shares | Weighted- | Weighted- | Aggregate | |||||||||||
Average | Average | Intrinsic | ||||||||||||
Exercise | Remaining | Value | ||||||||||||
Price | Contractual Term | |||||||||||||
(in years) | ||||||||||||||
Outstanding – January 1, 2013 | 2,503 | $ | 37.93 | |||||||||||
Granted | 241 | 96.09 | ||||||||||||
Options assumed | 251 | 83.91 | ||||||||||||
Exercised | (749 | ) | 36.86 | |||||||||||
Forfeited | (79 | ) | 75.22 | |||||||||||
Outstanding – as of December 31, 2013 | 2,167 | $ | 48.69 | 6.3 | $ | 186,093 | ||||||||
Exercisable – as of December 31, 2013 | 1,354 | $ | 37.11 | 5.3 | $ | 131,950 | ||||||||
Vested and expected to vest as of December 31, 2013 | 2,040 | $ | 47.03 | 6.2 | $ | 178,634 | ||||||||
Weighted-average fair value of options granted for the year ended December 31, 2013 | $ | 38.09 | ||||||||||||
The Company assumed stock options related to the acquisition of Epocrates based on a conversion ratio of 0.1239. The Company recorded compensation expense in relation to stock options of $14.0 million, $9.8 million, and $10.6 million, for the years ended December 31, 2013, 2012, and 2011, respectively. | ||||||||||||||
The following table illustrates the weighted average assumptions used to compute stock-based compensation expense for awards granted: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Risk-free interest rate | .35% - .75% | 1% | 1% - 2.2% | |||||||||||
Expected dividend yield | —% | —% | —% | |||||||||||
Expected option term (years) | 3.0 - 5.0 | 3.0 - 5.0 | 5 | |||||||||||
Expected stock volatility | 41% - 45% | 43% - 52% | 51% - 54% | |||||||||||
The risk-free interest rate estimate was based on the U.S. Treasury rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. The expected dividend yield was based on the Company’s expectation of not paying dividends in the foreseeable future. | ||||||||||||||
Since the Company completed its initial public offering in September 2007, it did not have sufficient history as a publicly-traded company to evaluate its volatility factor for grants prior to 2011. As such, the Company analyzed the volatilities of a group of peer companies, including company-specific historical information to date, to support the assumptions used in its calculations. The Company averaged the volatilities of the peer companies with in-the-money options, sufficient trading history and similar vesting terms to generate the assumptions. In 2012, the Company began using only company-specific historical and implied volatility information to generate the volatility assumptions. | ||||||||||||||
As of December 31, 2013 and 2012, there was $17.4 million and $19.2 million, respectively, of unrecognized stock-based compensation expense related to unvested stock option share-based compensation arrangements granted under the Company’s stock award plans. This expense is expected to be recognized over a weighted-average period of approximately 1.4 years. The weighted average fair value of stock options granted during fiscal 2013, 2012, and 2011, was $38.09, $31.71, and $21.01, respectively. The intrinsic value of options exercised during fiscal 2013, 2012, and 2011, was $53.2 million, $36.1 million, and $26.1 million, respectively. The intrinsic value is calculated as the difference between the market value on the date of purchase and the exercise price of the options. | ||||||||||||||
Restricted Stock Units | ||||||||||||||
The 2007 Plan also allows for granting of restricted stock unit awards under the terms of the plan. The majority of the restricted units vest in four equal, annual installments on the anniversaries of the vesting start date or in four equal, quarterly installments on anniversaries of the vesting date. The Company estimated the fair value of the restricted stock units using the market price of its common stock on the date of the grant. The fair value of restricted stock units is amortized on a straight-line basis over the vesting period. The following table presents the restricted stock unit activity for the year ended December 31, 2013. | ||||||||||||||
Shares | Weighted- | |||||||||||||
Average | ||||||||||||||
Grant | ||||||||||||||
Date | ||||||||||||||
Fair Value | ||||||||||||||
Outstanding – January 1, 2013 | 1,084 | $ | 58.07 | |||||||||||
Granted | 504 | 98.34 | ||||||||||||
RSUs assumed | 29 | 71.22 | ||||||||||||
Vested | (365 | ) | 56.28 | |||||||||||
Forfeited | (59 | ) | 70.78 | |||||||||||
Outstanding – as of December 31, 2013 | 1,193 | $ | 75.2 | |||||||||||
The Company assumed restricted stock units related to the acquisition of Epocrates based on a conversion ratio of 0.1239. As of December 31, 2013, $68.7 million of total unrecognized compensation costs related to restricted stock units is expected to be recognized over a weighted average period of 2.0 years. Stock-based compensation expense of $27.4 million, $17.3 million, and $7.3 million was recorded for restricted stock units during the years ended December 31, 2013, 2012, and 2011, respectively. The weighted average fair value of restricted stock units granted during the years ended December 31, 2013, 2012, and 2011, was $98.34, $71.15, and $47.02, respectively. The intrinsic value of vested restricted stock units during the years ended December 31, 2013, 2012, and 2011, was $35.2 million, $15.1 million, and $3.8 million, respectively. | ||||||||||||||
Employee Stock Purchase Plan | ||||||||||||||
The Company’s 2007 Employee Stock Purchase Plan (“2007 ESPP”) allows employees of the Company and its subsidiaries as designated by the Company’s board of directors to purchase shares of the Company’s common stock. The purchase price is equal to 85% of the lower of the closing price of the Company’s common stock on (1) the first day of the purchase period or (2) the last day of the purchase period. The expense for the years ended December 31, 2013, 2012, and 2011, was $1.2 million, $1.0 million, and $1.0 million, respectively. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
INCOME TAXES | ' | ||||||||||||
INCOME TAXES | |||||||||||||
The components of the Company’s income tax (benefit) provision for the years ended December 31, 2013, 2012, and 2011 are as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current Provision: | |||||||||||||
Federal | $ | 4,225 | $ | 13,089 | $ | 12,264 | |||||||
State | 1,495 | 3,575 | 4,397 | ||||||||||
Foreign | 961 | 372 | 135 | ||||||||||
6,681 | 17,036 | 16,796 | |||||||||||
Deferred (Benefit) Provision : | |||||||||||||
Federal | (5,291 | ) | 26 | (1,804 | ) | ||||||||
Foreign | — | (114 | ) | — | |||||||||
State | (1,753 | ) | (802 | ) | (1,158 | ) | |||||||
(7,044 | ) | (890 | ) | (2,962 | ) | ||||||||
Total income tax (benefit) provision | $ | (363 | ) | $ | 16,146 | $ | 13,834 | ||||||
The components of the Company’s deferred income taxes as of December 31, 2013 and 2012 are as follows: | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred tax assets: | |||||||||||||
Federal net operating loss carryforward | $ | 187 | $ | — | |||||||||
State net operating loss carryforward | 1,476 | 25 | |||||||||||
Research and development tax credits | 3,244 | — | |||||||||||
Allowances for accounts receivable | 2,773 | 1,005 | |||||||||||
Deferred rent obligation | 328 | 1,593 | |||||||||||
Stock compensation | 18,270 | 13,800 | |||||||||||
Other accrued liabilities | 2,171 | 1,743 | |||||||||||
Deferred revenue | 17,754 | 16,594 | |||||||||||
Other | 3,101 | 2,251 | |||||||||||
Total gross deferred tax assets | 49,304 | 37,011 | |||||||||||
Valuation allowance | (2,627 | ) | (25 | ) | |||||||||
Total deferred tax assets | 46,677 | 36,986 | |||||||||||
Deferred tax liabilities: | |||||||||||||
Intangible assets | (49,555 | ) | (6,605 | ) | |||||||||
Capitalized software development | (8,641 | ) | (5,420 | ) | |||||||||
Property and equipment | (3,784 | ) | (6,290 | ) | |||||||||
Investments | — | (5 | ) | ||||||||||
Total deferred tax liabilities | (61,980 | ) | (18,320 | ) | |||||||||
Net deferred tax (liabilities) assets | $ | (15,303 | ) | $ | 18,666 | ||||||||
The Company classifies its deferred tax assets and liabilities as current or noncurrent based on the classification of the related asset or liability for financial reporting giving rise to the temporary difference. A deferred tax asset that is not related to an asset or liability for financial reporting, including deferred tax assets related to net operating loss (“NOL”) carryforwards, is classified according to the expected reversal date. The Company recorded a valuation allowance against certain deferred tax assets related to state NOL carryforwards and research and development tax credits. The Company evaluated the ability to utilize the losses and credits and determined they could not meet the more likely than not standard. | |||||||||||||
As of December 31, 2013, the Company had federal and state NOL carryforwards of approximately $28.0 million (which includes $27.5 million of NOL carryforwards from stock-based compensation) and $26.0 million (which includes $1.6 million of NOL carryforwards from stock-based compensation), respectively, to offset future federal and state taxable income. The state NOL carryforwards begin to expire in 2018 and the federal NOL carryforwards expire at various times from 2025 through 2033. As of December 31, 2012, the Company had federal and state NOL carryforwards of approximately $6.1 million (which includes $6.1 million of NOL carryforwards from stock-based compensation) and $2.2 million (which includes $0.4 million of NOL carryforwards from stock-based compensation), respectively, to offset future federal and state taxable income. | |||||||||||||
The Company has generated NOL carryforwards from stock-based compensation deductions in excess of expenses recognized for financial reporting purposes (“excess tax benefits”). Excess tax benefits are realized when they reduce taxes payable, as determined using a “with and without” method, and are credited to additional paid-in capital rather than as a reduction of income tax provision. During the years ended December 31, 2013, 2012, and 2011, the Company realized excess tax benefits from federal and state tax deductions of $6.9 million, $14.1 million and $14.2 million, respectively, which was credited to additional paid-in capital. As of December 31, 2013, the amount of unrecognized federal and state excess tax benefits is $9.6 million and $0.1 million, respectively, which will be credited to additional paid-in capital when realized. | |||||||||||||
During the year ended December 31, 2013, the Company utilized tax federal and state NOL carryforwards to reduce the current tax provision by $7.0 million and zero, respectively. During the year ended December 31, 2012, the Company utilized federal NOL carryforwards to reduce the current tax provision by $2.8 million. During the year ended December 31, 2011, the Company utilized federal NOL carryforwards to reduce the current tax provision by $0.3 million. | |||||||||||||
The Company’s federal research and development tax credits carryforward is available to offset future federal and state taxes and the credits expire at various times through 2033. The Company has federal and state R&D credits of $7.6 million (which includes $5.2 million from the utilization of credits under the without method of accounting related to stock-based compensation) and $3.0 million (which includes $1.7 million from the utilization of credits under the without method of accounting related to stock-based compensation), respectively. These benefits, when utilized to reduce taxes payable, will be credited to additional paid-in capital. | |||||||||||||
A reconciliation of the federal statutory income tax rate to the Company’s effective income tax rate is as follows for the years ended December 31, 2013, 2012, and 2011: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Income tax computed at federal statutory tax rate | 35 | % | 35 | % | 35 | % | |||||||
State taxes, net of federal benefit | (6 | )% | 5 | % | 6 | % | |||||||
Research and development credits | (98 | )% | — | % | (1 | )% | |||||||
Permanent differences | 20 | % | 6 | % | 2 | % | |||||||
Valuation allowance | 33 | % | — | % | — | % | |||||||
Total | (16 | )% | 46 | % | 42 | % | |||||||
A reconciliation of the beginning and ending amount of uncertain tax benefits is as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Beginning uncertain tax benefits | $ | 1,761 | $ | 1,685 | $ | 1,610 | |||||||
Prior year – decreases | (537 | ) | (140 | ) | (23 | ) | |||||||
Prior year – increases | 501 | 177 | 22 | ||||||||||
Acquired balances | 2,339 | — | — | ||||||||||
Current year – increases | 787 | 39 | 76 | ||||||||||
Ending uncertain tax benefits | $ | 4,851 | $ | 1,761 | $ | 1,685 | |||||||
Included in the balance of unrecognized tax benefits at December 31, 2013, are $4.3 million of tax benefits that, if recognized, would affect the effective tax rate. The Company anticipates that no material amounts of unrecognized tax benefits will either expire or be settled in the next 12 months of the reporting date. | |||||||||||||
On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law reinstating the federal research and development credit for the 2012 and 2013 years. Under the accounting guidance on this topic, the effects are recognized as a component of income tax expense or benefit from continuing operations in the financial statements for the interim or annual period that includes the enactment date. The deferred benefit recorded in 2013 related to the 2012 federal research and development credit was $0.9 million. | |||||||||||||
The Company is subject to taxation in the United States, various states and India. As of December 31, 2013, tax years 1997 through 2012 – except for 2006 through 2008 for federal purposes – remain open to examination by major taxing jurisdictions to which the Company is subject, which years primarily resulted in carryforward attributes that may still be adjusted upon examination by the Internal Revenue Service or other tax authorities if they have been used or will be used in a future period. |
EMPLOYEE_BENEFIT_PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Dec. 31, 2013 | |
Compensation and Retirement Disclosure [Abstract] | ' |
EMPLOYEE BENEFIT PLAN | ' |
EMPLOYEE BENEFIT PLAN | |
The Company sponsors a 401(k) retirement savings plan (the “401(k) Plan”), under which eligible employees may contribute, on a pre-tax basis, specified percentages of their compensation, subject to maximum aggregate annual contributions imposed by the Internal Revenue Code of 1986. All employee contributions are allocated to the employee’s individual account and are invested in various investment options as directed by the employee. Employees’ cash contributions are fully vested and non-forfeitable. The Company may make a discretionary contribution in any year, subject to authorization by the Company’s Board of Directors. During the years ended December 31, 2013, 2012, and 2011, the Company’s contributions to the 401(k)Plan were $3.2 million, $2.4 million, and $1.7 million, respectively. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies Disclosure | ' |
COMMITMENTS AND CONTINGENCIES | |
On January 11, 2013, a complaint captioned Bushansky v. Epocrates, Inc., et al., Case No. 519078, was filed in San Mateo County Superior Court (the “Court”) on behalf of a putative class of Epocrates’ shareholders against Epocrates and each member of the Epocrates board of directors. This complaint challenged the proposed merger between Epocrates and one of our wholly owned subsidiaries. On January 25, 2013, a similar complaint was filed in the Court captioned DeJoice v. Epocrates, et al., Case No. 519461. This second complaint made similar allegations against Epocrates and each member of the Epocrates board of directors and included a claim against us for aiding and abetting a breach of fiduciary duty. On January 31, 2013, the Bushansky complaint was amended to include additional allegations. Plaintiffs allege, among other things, that the Epocrates directors breached their fiduciary duties by allegedly agreeing to sell Epocrates at an unfair and inadequate price, failing to take steps to maximize the sale price of Epocrates, and making material omissions to the preliminary proxy statement dated January 25, 2013. The complaints sought to enjoin the merger, other equitable relief, and monetary damages. On March 5, 2013, Epocrates and the plaintiffs signed a memorandum of understanding in which the parties agreed to enter into a stipulation of settlement whereby the plaintiffs and all class members would release all claims related to the merger in exchange for Epocrates filing a supplement to its definitive proxy statement regarding the merger with the SEC, which would include additional disclosures regarding the merger agreement, and an agreement to negotiate in good faith regarding the amount of attorneys’ fees and expenses for which plaintiffs may seek approval from the Court. On October 4, 2013, the Court granted final settlement approval including a grant of fees and expenses in the amount of $0.3 million to plaintiffs’ counsel. The settlement has no material impact on our consolidated financial statements. | |
In addition, we are engaged from time to time in certain legal disputes arising in the ordinary course of business, including employment discrimination claims and challenges to our intellectual property. We believe that we have adequate legal defenses and that the likelihood of a loss contingency relating to the ultimate dispositions of any of these disputes is remote. When the likelihood of a loss contingency becomes at least reasonably possible with respect to any of these disputes, or, as applicable in the future, if there is at least a reasonable possibility that a loss exceeding amounts already recognized may have been incurred, we will revise our disclosures in accordance with the relevant authoritative guidance. | |
Additionally, we will accrue liability for loss contingencies when we believe that it is both probable that a liability has been incurred and that we can reasonably estimate the amount of the loss. We will review these accruals and adjust them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel, and other relevant information. To the extent new information is obtained, and our views on the probable outcomes of claims, suits, assessments, investigations, or legal proceedings change, changes in our accrued liabilities would be recorded in the period in which such determination is made. |
QUARTERLY_FINANCIAL_INFORMATIO
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | ' | ||||||||||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | |||||||||||||||||||||
Selected quarterly financial information follows for the year ended December 31, 2013: | |||||||||||||||||||||
First | Second | Third | Fourth | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
Revenue: | |||||||||||||||||||||
Business services | $ | 121,463 | $ | 137,919 | $ | 141,326 | $ | 162,529 | $ | 563,237 | |||||||||||
Implementation and other | 4,133 | 8,382 | 10,201 | 9,050 | 31,766 | ||||||||||||||||
Total revenue | 125,596 | 146,301 | 151,527 | 171,579 | 595,003 | ||||||||||||||||
Expenses: | |||||||||||||||||||||
Direct operating | 53,185 | 59,390 | 63,245 | 62,852 | 238,672 | ||||||||||||||||
Selling and marketing | 32,922 | 41,035 | 37,584 | 37,947 | 149,488 | ||||||||||||||||
Research and development | 11,944 | 14,269 | 15,104 | 16,322 | 57,639 | ||||||||||||||||
General and administrative | 31,077 | 24,670 | 21,690 | 22,339 | 99,776 | ||||||||||||||||
Depreciation and amortization | 8,341 | 11,107 | 11,263 | 12,864 | 43,575 | ||||||||||||||||
Total expenses | 137,469 | 150,471 | 148,886 | 152,324 | 589,150 | ||||||||||||||||
Operating (loss) income | (11,873 | ) | (4,170 | ) | 2,641 | 19,255 | 5,853 | ||||||||||||||
Other (expense) income: | |||||||||||||||||||||
Interest expense | (164 | ) | (1,001 | ) | (1,421 | ) | (1,319 | ) | (3,905 | ) | |||||||||||
Other (expense) income | 54 | 63 | 30 | 136 | 283 | ||||||||||||||||
Total other expense | (110 | ) | (938 | ) | (1,391 | ) | (1,183 | ) | (3,622 | ) | |||||||||||
(Loss) income before income tax benefit (provision) | (11,983 | ) | (5,108 | ) | 1,250 | 18,072 | 2,231 | ||||||||||||||
Income tax benefit (provision) | 12,683 | (7,313 | ) | (80 | ) | (4,927 | ) | 363 | |||||||||||||
Net income (loss) | $ | 700 | $ | (12,421 | ) | $ | 1,170 | $ | 13,145 | $ | 2,594 | ||||||||||
Net income (loss) per share – Basic | $ | 0.02 | $ | (0.34 | ) | $ | 0.03 | $ | 0.35 | $ | 0.07 | ||||||||||
Net income (loss) per share – Diluted | $ | 0.02 | $ | (0.34 | ) | $ | 0.03 | $ | 0.34 | $ | 0.07 | ||||||||||
Weighted average shares used in computing net income (loss) per share: | |||||||||||||||||||||
Basic | 36,409 | 36,760 | 36,970 | 37,262 | 36,856 | ||||||||||||||||
Diluted | 37,744 | 36,760 | 38,343 | 38,645 | 38,257 | ||||||||||||||||
Selected quarterly financial information follows for the year ended December 31, 2012: | |||||||||||||||||||||
First | Second | Third | Fourth | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
Revenue: | |||||||||||||||||||||
Business services | $ | 93,549 | $ | 100,110 | $ | 102,256 | $ | 112,581 | $ | 408,496 | |||||||||||
Implementation and other | 3,017 | 3,405 | 3,630 | 3,723 | 13,775 | ||||||||||||||||
Total revenue | 96,566 | 103,515 | 105,886 | 116,304 | 422,271 | ||||||||||||||||
Expenses: | |||||||||||||||||||||
Direct operating | 38,798 | 41,014 | 41,866 | 45,208 | 166,886 | ||||||||||||||||
Selling and marketing | 23,728 | 27,389 | 25,603 | 27,580 | 104,300 | ||||||||||||||||
Research and development | 7,168 | 8,615 | 8,746 | 9,263 | 33,792 | ||||||||||||||||
General and administrative | 16,199 | 13,961 | 11,913 | 14,952 | 57,025 | ||||||||||||||||
Depreciation and amortization | 5,486 | 5,795 | 6,683 | 7,677 | 25,641 | ||||||||||||||||
Total expenses | 91,379 | 96,774 | 94,811 | 104,680 | 387,644 | ||||||||||||||||
Operating income | 5,187 | 6,741 | 11,075 | 11,624 | 34,627 | ||||||||||||||||
Other income | 134 | 12 | 88 | 17 | 251 | ||||||||||||||||
Income before income tax provision | 5,321 | 6,753 | 11,163 | 11,641 | 34,878 | ||||||||||||||||
Income tax provision | (2,893 | ) | (2,599 | ) | (4,953 | ) | (5,701 | ) | (16,146 | ) | |||||||||||
Net income | $ | 2,428 | 4,154 | 6,210 | 5,940 | $ | 18,732 | ||||||||||||||
Net income per share – Basic | $ | 0.07 | $ | 0.12 | $ | 0.17 | $ | 0.16 | $ | 0.52 | |||||||||||
Net income per share – Diluted | $ | 0.07 | $ | 0.11 | $ | 0.17 | $ | 0.16 | $ | 0.5 | |||||||||||
Weighted average shares used in computing net income per share: | |||||||||||||||||||||
Basic | 35,535 | 35,685 | 35,832 | 36,264 | 35,956 | ||||||||||||||||
Diluted | 36,996 | 36,906 | 37,212 | 37,420 | 37,133 | ||||||||||||||||
Net income (loss) per share for the four quarters of each fiscal year may not sum to the total for the fiscal year due to the different number of shares outstanding during each period. |
NATURE_OF_OPERATIONS_AND_SUMMA1
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
General | ' |
General – athenahealth, Inc. (the “Company”, “we”, “us”, or “our”) is a business services company that provides ongoing billing, clinical-related, and other related services to its customers. The Company provides these services with the use of a single instance of athenaNet, a proprietary Internet-based practice management application. The Company’s customers consist of medical group practices ranging in size throughout the United States of America. In March 2013, the Company acquired Epocrates, Inc. Epocrates is recognized for developing a leading medical application among U.S. physicians for clinical content, practice tools, and health industry engagement at the point of care. The features available through the Epocrates services are used by health care professionals to make more informed prescribing decisions, improve workflow, and enhance patient safety. | |
Principles of Consolidation | ' |
Principles of Consolidation – The accompanying consolidated financial statements include the results of operations of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. | |
Use of Estimates | ' |
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions are used for, but are not limited to: (1) revenue recognition; including the estimated expected customer life; (2) asset impairments; (3) depreciable lives of assets; (4) fair value of stock-based compensation; (5) allocation of direct and indirect cost of sales; (6) fair value of identifiable purchased tangible and intangible assets in a business combination; (7) fair value of reporting units for goodwill impairment test and (8) litigation reserves. Actual results could significantly differ from those estimates. | |
Revenue Recognition | ' |
Revenue Recognition – The Company recognizes revenue when there is evidence of an arrangement, the service has been provided to the customer, the collection of the fees is reasonably assured, and the amount of fees to be paid by the customer are fixed or determinable. | |
The Company derives its revenue from business services associated with our four integrated services and from subscriptions to and sponsored clinical information and decision support services for our point of care medical application. Our four integrated services consist of athenaCollector for revenue cycle and practice management; athenaClinicals for electronic health records (“EHR”); athenaCommunicator for automated, live and online patient communications; and athenaCoordinator for care coordination. | |
athenahealth’s clients typically purchase one-year service contracts related to our integrated services that renew automatically upon completion. In most cases, the Company’s clients may terminate their agreements with 90 days notice without cause. The Company typically retains the right to terminate client agreements in a similar timeframe. The Company’s clients are billed monthly, in arrears, based either upon a percentage of collections posted to athenaNet, minimum fees, flat fees, or per-claim fees where applicable. The Company does not recognize revenue for business services fees until these collections are made, as the services fees are not fixed and determinable until such time. | |
Subscriptions to the Epocrates point of care medical application are entered into by a member via an internal or third-party digital distribution platform or through a redeemable license code which expires within six to 12 months of issuance. Basic subscriptions are free and do not expire. Premium subscription fees are assessed on the length of the subscription period, typically one year, and payment occurs at the time of order, which is in advance of the services being performed, and is recorded as deferred revenue. Premium subscriptions are recognized ratably over the contracted term of delivery, typically one year. If a license code expires before it is redeemed, revenue is recognized upon expiration. | |
Clients in the health care industry typically enter into sponsored clinical information and decision support service arrangements that contain various combinations of services that are generally fulfilled within one year. The clients are charged a fee for the entire group of services to be provided and are typically billed a portion of the contracted fee upon signing of the agreement with the balance billed upon one or more future milestones. Because billings typically occur in advance of services being performed, these amounts are recorded as deferred revenue when billed. Each deliverable within a multiple-deliverable revenue arrangement is accounted for as a separate unit if both of the following criteria are met: (1) the delivered item or items have value to the customer on a standalone basis and (2) for an arrangement that includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in our control. Further, the Company’s revenue arrangements do not include a general right of return, as we deliver services and not products. The Company considers a deliverable to have standalone value if it sells this item separately or if the item is sold by another vendor or could be resold by the customer. Each service deliverable within these multiple element arrangements is then accounted for as a separate unit; deliverables not meeting the criteria for being a separate unit of accounting are combined with a deliverable that does meet that criterion, and the Company allocates arrangement consideration to each deliverable using its best estimate of selling price (“BESP”) if it does not have vendor specific objective evidence of selling price (“VSOE”) of fair value or third-party evidence (“TPE”) of fair value. Any discount or premium inherent in the arrangement is allocated to each element in the arrangement based on the relative fair value of each element. | |
Multiple element arrangements require judgments as to how to allocate the arrangement consideration to each deliverable. We maintain a standard price list by service; however, certain incentives, such as discounts, may be offered to clients when they purchase multiple services. Such discounting is subject to various levels of management approval and any discount offered is based on the total contract value. Due to the specific nature of these agreements and the variability in the amount of discount offered for individual services across multiple contracts, we have not been able to conclude that a consistent number of standalone sales of a deliverable have been priced within a reasonably narrow range in order to assert that we have established VSOE. | |
When we cannot establish VSOE of fair value, we then determine if we can establish TPE of fair value. TPE is determined based on competitor prices for similar deliverables when sold separately. Our services differ significantly from that of our peers and our offerings contain a significant level of customization and differentiation such that the comparable pricing of products with similar functionality cannot be obtained. Furthermore, we are unable to reliably determine what similar competitor products’ selling prices are on a stand-alone basis. Therefore, we are typically unable to determine TPE. | |
If both VSOE and TPE do not exist, we use BESP to establish fair value and to allocate total consideration to each element in the arrangement. The objective of BESP is to determine the price at which we would transact a sale if the product or service were sold on a stand-alone basis. We determine BESP for a product or service by considering multiple factors including an analysis of recent stand-alone sales of that product, market conditions, competitive landscape, internal costs, gross margin objectives, and pricing practices. | |
Implementation revenue consists primarily of professional services fees related to assisting customers with the implementation of the Company’s services and are generally billed upfront and recorded as deferred revenue until the implementation is complete and then, as the service does not have stand-alone value, it is recognized ratably over the longer of the life of the agreement or the estimated expected customer life, which is currently estimated to be 12 years. The Company evaluates the length of the amortization period of the implementation fees based on its experience with customer contract renewals and consideration of the period over which those customers will receive benefits from the Company’s current portfolio of services. Certain expenses related to the implementation of a customer, such as out-of-pocket travel, are typically reimbursed by the customer. This is accounted for as both revenue and expense in the period the cost is incurred. Other services consist primarily of tenant revenue which is straight-lined over the term of the lease. | |
Direct Operating Expenses | ' |
Direct Operating Expenses – Direct operating expenses consist primarily of salaries, benefits, claims processing costs, stock-based compensation related to personnel who provide services to clients, including staff who implement new clients, and other direct expenses. Costs associated with the implementation of new clients are expensed as incurred. Direct operating expenses include all service costs incurred to fulfill our revenue contracts. Direct operating expenses also include costs associated with third-party tenant revenue for the Arsenal on the Charles. The reported amounts of direct operating expenses do not include allocated amounts for rent expense, depreciation, and amortization, except for a portion of amortization related to certain purchased intangible assets. | |
Research and Development Expenses | ' |
Research and Development Expenses – Research and development expenses consist primarily of personnel-related costs and consulting fees for third-party developers. All such costs are expensed as incurred, except for certain internal use software development costs, which may be capitalized. | |
Advertising Expenses | ' |
Advertising Expenses – Advertising expenses are expensed as incurred and are included in selling and marketing expense in the Consolidated Statements of Income. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents – The Company considers all highly liquid investments with an original or remaining maturity from the Company’s date of purchase of 90 days or less to be cash equivalents. | |
Investments | ' |
Investments – Management determines the appropriate classification of investments at the time of purchase based upon management’s intent with regard to such investments. All investments, except for certain long-term investments in privately-held companies which are accounted for at cost, are held as available-for-sale investments. Scheduled maturity dates of U.S. government-backed securities, corporate bonds and commercial paper purchased that are within one year are classified as short-term. Scheduled maturity dates of U.S. government-backed securities, corporate bonds and commercial paper that are in excess of one year are classified as long-term. All investments are recorded at fair value with unrealized holding gains and losses included in accumulated other comprehensive (loss) income. There were no material realized gains and losses on sales of these investments for the periods presented. The Company determines realized gains and losses based on the specific identification method. | |
Accounts Receivable | ' |
Accounts Receivable – Accounts receivable represents amounts due from customers for business services. Accounts receivable are stated net of an allowance for uncollectible accounts, which is determined by establishing reserves for specific accounts and consideration of historical and estimated probable losses. | |
Financial Instruments | ' |
Financial Instruments – Certain financial instruments are required to be recorded at fair value. The other financial instruments approximate their fair value, primarily because of their short-term nature. All highly-liquid debt instruments purchased with a maturity of three months or less at the date of acquisition are included in cash and cash equivalents. | |
Derivative financial instruments are used to manage certain of the Company’s interest rate exposures. The Company does not enter into derivatives for trading or speculative purposes. Derivatives are carried at fair value, as determined using standard valuation models, and adjusted when necessary for credit risk. Refer to Note 9 – Debt for additional information. | |
Property and Equipment | ' |
Property and Equipment – Property and equipment are stated at cost. Equipment, furniture, and fixtures are depreciated using the straight-line method over their estimated useful lives, generally ranging from three to five years. Leasehold improvements are depreciated using the straight-line method over the lesser of the useful life of the improvements or the applicable lease terms, excluding renewal periods. Buildings are depreciated using the straight-line method over 30 to 40 years. Building improvements are depreciated using the straight-line method over 10 years. Costs associated with maintenance and repairs are expensed as incurred. The airplane and land improvements are depreciated using the straight-line method over 20 years and 10 years, respectively. | |
Long-Lived Assets | ' |
Long-Lived Assets – Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability of long-lived assets is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition, as compared with the asset carrying value. Measurement of an impairment loss for long-lived assets that management expects to hold and use is based on the fair value of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value, less costs to sell. No impairment losses have been recognized in the years ended December 31, 2013, 2012, and 2011. | |
Capitalized Interest Cost | ' |
Capitalized Interest Cost – Interest costs related to major capital projects, specifically the Company’s corporate headquarters campus project and capitalized internal-use software development costs, are capitalized until the underlying asset is placed into service. Capitalized interest is calculated by multiplying the effective interest rate of the outstanding debt by the qualifying costs. As the qualifying asset is placed into service, the qualifying asset and the related capitalized interest are amortized over the useful life of the related asset. | |
Restricted Cash | ' |
Restricted Cash – As of December 31, 2013 and 2012, restricted cash balances totaled $3.0 million and $1.4 million, respectively. The December 31, 2013 balance of $3.0 million consists of escrowed funds held as a deposit associated with a possible pending lease. The amount was returned to Company when the lease was signed in January 2014. The December 31, 2012 balance consists of $0.9 million of escrowed funds held under a letter of credit as a condition of the Company’s previous operating lease for its corporate headquarters and $0.5 million consists of a deposit made relating to the purchase of the Company’s corporate headquarters. | |
Capitalized Software Costs | ' |
Capitalized Software Costs – The Company capitalizes costs related to its athenaNet services and certain other projects for internal use incurred during the application development stage, including stock-based compensation expense for employees working on these projects. Costs related to the preliminary project stage and post implementation activities are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life. The estimated useful life of the software is two to three years. | |
Goodwill | ' |
Goodwill – Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the identifiable net tangible and intangible assets acquired. Goodwill is not amortized but is evaluated for impairment annually or more frequently if indicators of impairment are present or changes in circumstances suggest that impairment may exist. The Company evaluates the carrying value of its goodwill annually on November 30. The first step of the goodwill impairment test compares the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the Company’s reporting unit exceeds its carrying amount, the goodwill of the reporting unit is considered not impaired. If the carrying amount of the Company’s reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test, used to measure the amount of impairment loss, compares the implied fair value of the affected reporting unit’s goodwill with the carrying value of that goodwill. | |
Purchased Intangibles Assets | ' |
Purchased Intangible Assets – Purchased intangible assets consist of technology, a physician network, content, a trade name, customer backlog, non-compete agreements and customer relationships acquired in connection with business acquisitions and are amortized over their estimated useful lives based on the pattern of economic benefit expected from each asset. The Company concluded for certain purchased intangible assets that the pattern of economic benefit approximated straight-line method therefore the use of the straight-line method was appropriate as the majority of the cash flows will be recognized ratably over the estimated useful lives and there is no degradation of the cash flows over time. | |
Deferred Rent | ' |
Deferred Rent – Deferred rent consists of rent escalation payment terms, tenant improvement allowances and other incentives received from landlords related to the Company’s operating leases for its facilities. Rent escalation represents the difference between actual operating lease payments due and straight-line rent expense, which is recorded by the Company over the term of the lease, including any construction period. The excess is recorded as a deferred credit in the early periods of the lease, when cash payments are generally lower than straight-line rent expense, and is reduced in the later periods of the lease when payments begin to exceed the straight-line expense. Tenant allowances from landlords for tenant improvements are generally comprised of cash received from the landlord as part of the negotiated terms of the lease or reimbursements of moving costs. These cash payments are recorded as deferred rent from landlords and are amortized as a reduction of periodic rent expense, over the term of the applicable lease. | |
Deferred Revenue | ' |
Deferred Revenue – Deferred revenue primarily consists of billings or payments received in advance of the revenue recognition criteria being met. Deferred revenue includes certain deferred revenue associated with multiple element arrangements associated with sponsored clinical information and decision support services which is recognized based upon contractual deliverables, and implementation services fees which are recognized as revenue ratably over the longer of the life of the agreement or the estimated expected customer life, which is currently estimated to be twelve years. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. | |
Business Combinations | ' |
Business Combinations – The Company applies business combination accounting when they have acquired control over one or more businesses. Business Combinations are accounted for at fair value. The associated acquisition costs are generally expensed as incurred and recorded in general and administrative expenses; non-controlling interests, if any, are reflected at fair value at the acquisition date; in-process research and development (“IPR&D”), if any, is recorded at fair value as an intangible asset at the acquisition date; restructuring costs associated with a business combination, if any, are generally expensed rather than capitalized; contingent consideration is measured at fair value at the acquisition date, with changes in the fair value after the acquisition date affecting earnings; changes in deferred tax asset valuation allowances and income tax uncertainties after the measurement period will affect income tax expense; and goodwill is determined as the excess of the fair value of the consideration conveyed in the acquisition over the fair value of the net assets acquired. The accounting for business combinations requires estimates and judgments as to expectations for future cash flows of the acquired business, and the allocation of those cash flows to identifiable intangible assets, in determining the estimated fair value for assets and liabilities acquired. The fair values assigned to tangible and intangible assets acquired and liabilities assumed, including contingent consideration, are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. If the actual results differ from the estimates and judgments used in these estimates, the amounts recorded in the financial statements could result in a possible impairment of the intangible assets and goodwill, or require acceleration of the amortization expense of finite-lived intangible assets. The results of the newly acquired businesses’ operations are included in the Consolidated Statements of Income of the combined entity beginning on the date of acquisition. We have applied this acquisition method to the transactions described in Note 2. | |
Concentrations of Credit Risk | ' |
Concentrations of Credit Risk – Financial instruments that potentially subject the Company to concentrations of credit risk are cash equivalents, investments, derivatives, and accounts receivable. The Company attempts to limit its credit risk associated with cash equivalents and investments by investing in highly-rated corporate and financial institutions, and engaging with highly-rated financial institutions as counterparties to its derivative transactions. With respect to customer accounts receivable, the Company manages its credit risk by performing ongoing credit evaluations of its customers. | |
Income Taxes | ' |
Income Taxes – Deferred tax assets and liabilities relate to temporary differences between the financial reporting and income tax bases of assets and liabilities and are measured using enacted tax rates and laws expected to be in effect at the time of their reversal. A valuation allowance is established to reduce net deferred tax assets if, based on the available positive and negative evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In making such determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and recent financial results. | |
The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. Our income tax positions must meet a more-likely-than-not recognition threshold at the balance sheet date to be recognized in the related period. The Company’s policy is to record interest and penalties related to unrecognized tax benefits in income tax expense. | |
From time to time, the Company receives incentives from various government agencies and programs. The Company accounts for the portion of the credits that are expected to be used to reduce non-income taxes as a grant. Credits which are expected to be used to reduce non-income taxes are recognized when the requirements to earn the credits have been met. | |
Sales and Use Taxes | ' |
Sales and Use Taxes – The Company’s services are subject to sales and use taxes in certain jurisdictions. The Company’s contractual agreements with its customers provide that payment of any sales or use tax assessments are the responsibility of the customer. In certain jurisdictions sales taxes are collected from the customer and remitted to the respective agencies. These taxes are recorded on a net basis and excluded from revenue and expense in our financial statements as presented. | |
Segment Reporting | ' |
Segment Reporting – Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision-maker (“CODM”), or decision-making group, in making decisions regarding resource allocation and assessing performance. The Company, which uses consolidated financial information in determining how to allocate resources and assess performance, has determined that it operates in one segment and the CODM uses non-GAAP operating income (defined as Operating Income as shown in the Consolidated Statements of Income less total stock-based compensation, amortization expense related to purchased intangible assets, integration costs, transaction costs, and gain on early termination of lease for the period) as the measure of the Company’s profit on a regular basis. During the year ended December 31, 2013, the Company acquired and integrated two significant businesses and re-evaluated its operating segments. As of December 31, 2013, the Company’s CODM determined that the newly-acquired businesses are so closely integrated, that he will continue to review and assess the business as one operating segment. | |
Stock-Based Compensation | ' |
Stock-Based Compensation – The Company accounts for share-based awards, including shares issued under employee stock purchase plans, stock options, and share-based awards with compensation cost measured using the fair value of the awards issued. The Company uses the Black-Scholes option pricing model to value share-based awards and determine the related compensation expense. The assumptions used in calculating the fair value of share-based awards represent management’s best estimates. The Company generally issues previously unissued shares for the exercise of stock options; however, the Company may reissue previously acquired treasury shares to satisfy these issuances in the future. | |
Certain employees have received grants for which the ultimate number of shares that will be subject to vesting is dependent upon the achievement of certain financial targets for the year. Such determination is not made until the grant’s vesting determination date, which is the date the Company’s fiscal year financial statements are available. The grant is initially recorded at the maximum attainable number of shares that is most likely to be subject to vesting based on available financial forecasts as of the date of grant. This amount is adjusted on a quarterly basis as new financial forecasts become available. Stock‑based compensation expense for these grants is recorded over the requisite service period, generally four years. Such options generally vest ratably over four years from the vesting determination date. | |
Foreign Currency Translation | ' |
Foreign Currency Translation – The financial position and results of operations of the Company’s foreign subsidiary are measured using local currency as the functional currency. Assets and liabilities are translated at the rate of exchange in effect at the end of each reporting period. Revenues and expenses are translated at the average exchange rate for the period. Foreign currency translation gains and losses are recorded within other comprehensive (loss) income. |
NATURE_OF_OPERATIONS_AND_SUMMA2
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||||||||||||
Activity in the Allowance for Doubtful Accounts | ' | ||||||||||||
Activity in the allowance for doubtful accounts is as follows: | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Beginning balance | $ | 1,771 | $ | 2,348 | $ | 1,945 | |||||||
Provision | 791 | 153 | 1,122 | ||||||||||
Write-offs and adjustments | (871 | ) | (730 | ) | (719 | ) | |||||||
Ending balance | $ | 1,691 | $ | 1,771 | $ | 2,348 | |||||||
Accrued Expenses | ' | ||||||||||||
Accrued expenses consist of the following: | |||||||||||||
As of December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Accrued bonus | $ | 25,013 | $ | 17,192 | |||||||||
Accrued vacation | 5,107 | 4,109 | |||||||||||
Accrued payroll | 8,611 | 9,980 | |||||||||||
Accrued commissions | 5,713 | 5,112 | |||||||||||
Accrued compensation expenses | $ | 44,444 | $ | 36,393 | |||||||||
Accrued expenses | $ | 23,692 | $ | 15,214 | |||||||||
Accrued property and equipment additions | 605 | 4,021 | |||||||||||
Current portion of accrued contingent consideration | — | 448 | |||||||||||
Accrued expenses | $ | 24,297 | $ | 19,683 | |||||||||
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Business Acquisition [Line Items] | ' | |||||||||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustments | ' | |||||||||||
The unaudited pro forma financial information is as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Revenue | $ | 614,775 | $ | 538,030 | ||||||||
Net income (loss) | $ | (1,808 | ) | $ | (4,700 | ) | ||||||
Net income (loss) per share – Basic | $ | (0.05 | ) | $ | (0.13 | ) | ||||||
Net income (loss) per share – Diluted | $ | (0.05 | ) | $ | (0.13 | ) | ||||||
Arsenal on the Charles | ' | |||||||||||
Business Acquisition [Line Items] | ' | |||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | ' | |||||||||||
The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of acquisition: | ||||||||||||
Prepaid expenses and other current assets | $ | 685 | ||||||||||
Property, equipment and buildings | 144,071 | |||||||||||
Purchased intangible assets | 25,545 | |||||||||||
Accrued expenses | (271 | ) | ||||||||||
Deferred revenue | (789 | ) | ||||||||||
Other long-term liabilities | (1,916 | ) | ||||||||||
Total identifiable net assets | $ | 167,325 | ||||||||||
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | ' | |||||||||||
The following table sets forth the fair value of the preliminary components of the identifiable intangible assets acquired by asset class: | ||||||||||||
Above market leases | $ | 3,298 | ||||||||||
In-place leases | 22,247 | |||||||||||
Total intangible assets subject to amortization | $ | 25,545 | ||||||||||
Epocrates Inc | ' | |||||||||||
Business Acquisition [Line Items] | ' | |||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | ' | |||||||||||
The following table summarizes the preliminary and final fair values of assets acquired and liabilities assumed as of the date of acquisition, March 12, 2013, and upon completion of the valuation at December 31, 2013: | ||||||||||||
12-Mar-13 | Adjustments | 31-Dec-13 | ||||||||||
Accounts receivable | $ | 23,144 | $ | (1,116 | ) | $ | 22,028 | |||||
Other current and long-term assets | 3,833 | 650 | 4,483 | |||||||||
Property, equipment and capitalized software costs | 4,168 | 20 | 4,188 | |||||||||
Purchased intangible assets | 139,900 | (500 | ) | 139,400 | ||||||||
Current liabilities | (11,054 | ) | (282 | ) | (11,336 | ) | ||||||
Deferred tax liabilities, net | (39,811 | ) | (1,340 | ) | (41,151 | ) | ||||||
Deferred revenue | (29,400 | ) | 648 | (28,752 | ) | |||||||
Other long-term liabilities | (1,259 | ) | 53 | (1,206 | ) | |||||||
Total identifiable net assets | 89,521 | (1,867 | ) | 87,654 | ||||||||
Goodwill | 148,093 | 1,867 | 149,960 | |||||||||
$ | 237,614 | $ | — | $ | 237,614 | |||||||
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | ' | |||||||||||
The following table sets forth the components of the identifiable intangible assets acquired by asset class and their estimated useful lives as of the date of acquisition: | ||||||||||||
Fair Value | Useful Life | |||||||||||
Physician network | 104,000 | 14 years | ||||||||||
Drug information content | 10,000 | 5 years | ||||||||||
Trade name | 11,500 | 10 years | ||||||||||
Customer backlog | 2,900 | 1.5 years | ||||||||||
Developed technology | 6,500 | 3 years | ||||||||||
Epocrates non-compete agreement | 4,500 | 1.5 years | ||||||||||
Total intangible assets subject to amortization | $ | 139,400 | ||||||||||
Schedule of Business Acquisitions, by Acquisition | ' | |||||||||||
The acquisition date fair value of the consideration transferred for Epocrates, less cash and short-term investments acquired, was approximately $237.6 million, which consisted of the following: | ||||||||||||
Cash payments | $ | 294,632 | ||||||||||
Fair value of vested stock options and restricted stock units assumed | 13,028 | |||||||||||
Fair value of total consideration | 307,660 | |||||||||||
Less cash acquired | (51,796 | ) | ||||||||||
Less short-term investments acquired | (18,250 | ) | ||||||||||
Total | $ | 237,614 | ||||||||||
Business Acquisition, Schedule Of Integration Costs | ' | |||||||||||
The following table summarizes these amounts on the Consolidated Statements of Income for the year ended December 31, 2013: | ||||||||||||
Rollforward of integration costs | ||||||||||||
Beginning balance, January 1, 2013 | $ | — | ||||||||||
Addition to provision | 3,909 | |||||||||||
Cash payments | (3,574 | ) | ||||||||||
Ending balance, December 31, 2013 | $ | 335 | ||||||||||
NET_INCOME_PER_SHARE_Tables
NET INCOME PER SHARE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | ' | ||||||||||||
The following table reconciles the weighted average shares outstanding for basic and diluted net income per share for the periods indicated: | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Net income | $ | 2,594 | $ | 18,732 | $ | 19,046 | |||||||
Weighted average shares used in computing basic net income per share | 36,856 | 35,956 | 35,046 | ||||||||||
Net income per share – basic | $ | 0.07 | $ | 0.52 | $ | 0.54 | |||||||
Net income | $ | 2,594 | $ | 18,732 | $ | 19,046 | |||||||
Weighted average shares used in computing basic net income per share | 36,856 | 35,956 | 35,046 | ||||||||||
Effect of dilutive securities | 1,401 | 1,177 | 1,004 | ||||||||||
Weighted average shares used in computing diluted net income per share | 38,257 | 37,133 | 36,050 | ||||||||||
Net income per share – diluted | $ | 0.07 | $ | 0.5 | $ | 0.53 | |||||||
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | ' | ||||||||||||||||
The following table presents information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2013 and December 31, 2012, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities and fair values determined by Level 2 inputs utilize quoted prices (unadjusted) in inactive markets for identical assets or liabilities obtained from readily available pricing sources for similar instruments. The fair values determined by Level 3 inputs are unobservable values which are supported by little or no market activity. | |||||||||||||||||
Fair Value Measurements At December 31, 2013, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market | $ | 26 | $ | — | $ | — | $ | 26 | |||||||||
Total assets | $ | 26 | $ | — | $ | — | $ | 26 | |||||||||
Interest rate swap liability | $ | — | $ | (354 | ) | $ | — | $ | (354 | ) | |||||||
Total liabilities | $ | — | $ | (354 | ) | $ | — | $ | (354 | ) | |||||||
Fair Value Measurements as of December 31, 2012, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market | $ | 89,480 | $ | — | $ | — | $ | 89,480 | |||||||||
Available-for-sale investments: | — | ||||||||||||||||
Commercial paper | — | 11,748 | — | 11,748 | |||||||||||||
Corporate bonds | — | 20,334 | — | 20,334 | |||||||||||||
Certificate of deposit | — | 6,010 | — | 6,010 | |||||||||||||
Total assets | $ | 89,480 | $ | 38,092 | $ | — | $ | 127,572 | |||||||||
Accrued contingent consideration | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Total liabilities | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Reconciliations for Fair Values of Financial Instruments Determined by Level 3 | ' | ||||||||||||||||
The reconciliations for the fair values of financial instruments determined by Level 3 for the periods presented, are as follows: | |||||||||||||||||
Year Ended December 31, 2013 | Year Ended December 31, 2012 | ||||||||||||||||
Balance beginning of period | $ | 448 | $ | 8,176 | |||||||||||||
Payments | (524 | ) | (2,610 | ) | |||||||||||||
Additions | — | — | |||||||||||||||
Change in fair value (included in G&A expenses) | 76 | (5,118 | ) | ||||||||||||||
Balance end of period | $ | — | $ | 448 | |||||||||||||
INVESTMENTS_Tables
INVESTMENTS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Investments [Abstract] | ' | ||||||||||||
Schedule of Available-for-sale Securities Reconciliation | ' | ||||||||||||
As of December 31, 2013, the Company has no available-for-sale securities. The summary of available-for-sale securities at December 31, 2012, is as follows: | |||||||||||||
Amortized Cost | Gross Unrealized | Fair Value | |||||||||||
Gains | |||||||||||||
Commercial paper | $ | 11,740 | $ | 8 | $ | 11,748 | |||||||
Corporate bonds | 20,331 | 3 | 20,334 | ||||||||||
Certificate of deposit | 6,008 | 2 | 6,010 | ||||||||||
Total | $ | 38,079 | $ | 13 | $ | 38,092 | |||||||
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property and equipment | ' | ||||||||
Property and equipment consist of the following: | |||||||||
Years Ended December 31, | |||||||||
2013 | 2012 | ||||||||
Equipment | $ | 78,616 | $ | 56,078 | |||||
Furniture and fixtures | 8,822 | 5,297 | |||||||
Leasehold improvements | 3,104 | 15,518 | |||||||
Airplane | 3,156 | 3,156 | |||||||
Building | 136,368 | 14,644 | |||||||
Building improvements | 24,441 | 3,500 | |||||||
Land | 23,059 | 2,035 | |||||||
Land improvements | 2,980 | 915 | |||||||
Total property and equipment, at cost | 280,546 | 101,143 | |||||||
Accumulated depreciation and amortization | (72,777 | ) | (49,902 | ) | |||||
Construction in progress | 5,249 | 2,794 | |||||||
Property and equipment, net | $ | 213,018 | $ | 54,035 | |||||
GOODWILL_AND_PURCHASED_INTANGI1
GOODWILL AND PURCHASED INTANGIBLE ASSETS (Tables) | 12 Months Ended | ||||||||||||||
Dec. 31, 2013 | |||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||
Activity Relating to Carrying Values of Goodwill | ' | ||||||||||||||
The following table summarizes the activity related to the carrying value of the Company’s goodwill during the years ended December 31, 2013 and 2012: | |||||||||||||||
Gross balance as of January 1, 2012 | $ | 47,307 | |||||||||||||
Goodwill recorded in connection with the acquisition of Healthcare Data Services LLC | 783 | ||||||||||||||
Gross balance as of December 31, 2012 | $ | 48,090 | |||||||||||||
Goodwill recorded in connection with the acquisition of Epocrates, Inc. | 149,959 | ||||||||||||||
Gross balance as of December 31, 2013 | $ | 198,049 | |||||||||||||
Intangible Assets Acquired | ' | ||||||||||||||
Intangible assets acquired as of December 31, 2013 and 2012, are as follows: | |||||||||||||||
December 31, 2013 | |||||||||||||||
Gross | Accumulated | Net | Weighted Average Remaining | ||||||||||||
Amortization | Useful Life (years) | ||||||||||||||
Developed technology | $ | 11,721 | $ | (4,737 | ) | $ | 6,984 | 2 | |||||||
Customer relationships | 21,434 | (7,365 | ) | 14,069 | 6.6 | ||||||||||
Doctor network | 104,000 | (682 | ) | 103,318 | 13.2 | ||||||||||
Drug information content | 10,000 | (1,608 | ) | 8,392 | 4.2 | ||||||||||
Trade name | 11,500 | (924 | ) | 10,576 | 9.2 | ||||||||||
Customer backlog | 2,900 | (1,554 | ) | 1,346 | 0.7 | ||||||||||
Non-compete agreement | 6,178 | (3,280 | ) | 2,898 | 1 | ||||||||||
Above market leases | 3,123 | (357 | ) | 2,766 | 5.9 | ||||||||||
Leases in place | 21,578 | (3,563 | ) | 18,015 | 5.3 | ||||||||||
Total | $ | 192,434 | $ | (24,070 | ) | $ | 168,364 | ||||||||
31-Dec-12 | |||||||||||||||
Gross | Accumulated | Net | Weighted Average Remaining | ||||||||||||
Amortization | Useful Life (years) | ||||||||||||||
Developed technology | $ | 6,612 | $ | (2,678 | ) | $ | 3,934 | 2.5 | |||||||
Customer relationships | 21,434 | (5,175 | ) | 16,259 | 7.6 | ||||||||||
Non-compete agreement | 1,678 | (310 | ) | 1,368 | 2.6 | ||||||||||
Total | $ | 29,724 | $ | (8,163 | ) | $ | 21,561 | ||||||||
Estimated Amortization Expense | ' | ||||||||||||||
Estimated amortization expense, based upon the Company’s intangible assets at December 31, 2013, is as follows: | |||||||||||||||
Year ending December 31, | Amount | ||||||||||||||
2014 | $ | 27,670 | |||||||||||||
2015 | 22,528 | ||||||||||||||
2016 | 18,560 | ||||||||||||||
2017 | 17,803 | ||||||||||||||
2018 | 15,441 | ||||||||||||||
Thereafter | 66,362 | ||||||||||||||
Total | $ | 168,364 | |||||||||||||
OPERATING_LEASES_AND_OTHER_COM1
OPERATING LEASES AND OTHER COMMITMENTS (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Leases [Abstract] | ' | |||
Future Minimum Lease Payments Under Non-cancelable Operating Leases | ' | |||
Future minimum lease payments under non-cancelable operating leases as of December 31, 2013, are as follows: | ||||
Year ending December 31, | Future Rent | |||
Payments | ||||
2014 | $ | 5,658 | ||
2015 | 7,645 | |||
2016 | 7,984 | |||
2017 | 8,093 | |||
2018 | 8,295 | |||
Thereafter | 50,253 | |||
Total minimum lease payments | $ | 87,928 | ||
DEBT_Tables
DEBT (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of Maturities of Long-term Debt | ' | ||||||||||||||||
Future principal payments of the unsecured term loan facility at December 31, 2013 are as follows: | |||||||||||||||||
Amount | |||||||||||||||||
2014 | $ | 15,000 | |||||||||||||||
2015 | 15,000 | ||||||||||||||||
2016 | 15,000 | ||||||||||||||||
2017 | 15,000 | ||||||||||||||||
Thereafter | 128,750 | ||||||||||||||||
Total | $ | 188,750 | |||||||||||||||
Less current portion | 15,000 | ||||||||||||||||
Long-term portion | $ | 173,750 | |||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | ' | ||||||||||||||||
The fair value of the interest rate swap recognized in other long-term liabilities and in OCI was as follows: | |||||||||||||||||
Fair Value | |||||||||||||||||
Effective Date | Notional Amount | Fixed Rate | Maturity | December 31, 2013 | 31-Dec-12 | ||||||||||||
August 31, 2013 | 120,000 | 0.8396 | % | August 31, 2016 | $ | (354 | ) | $ | — | ||||||||
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Total Stock-Based Compensation Expense | ' | |||||||||||||
Total stock-based compensation expense for the years ended December 31, 2013, 2012, and 2011, is as follows: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Stock-based compensation charged to: | ||||||||||||||
Direct operating | $ | 7,778 | $ | 5,619 | $ | 3,173 | ||||||||
Selling and marketing | 12,057 | 7,717 | 5,645 | |||||||||||
Research and development | 4,238 | 3,213 | 2,311 | |||||||||||
General and administrative | 18,575 | 10,687 | 7,772 | |||||||||||
Total | $ | 42,648 | $ | 27,236 | $ | 18,901 | ||||||||
Amortization of capitalized stock-based compensation related to software development | 1,027 | 257 | — | |||||||||||
Total | $ | 43,675 | $ | 27,493 | $ | 18,901 | ||||||||
Stock Option Activity | ' | |||||||||||||
The following table presents the stock option activity for the year ended December 31, 2013: | ||||||||||||||
Shares | Weighted- | Weighted- | Aggregate | |||||||||||
Average | Average | Intrinsic | ||||||||||||
Exercise | Remaining | Value | ||||||||||||
Price | Contractual Term | |||||||||||||
(in years) | ||||||||||||||
Outstanding – January 1, 2013 | 2,503 | $ | 37.93 | |||||||||||
Granted | 241 | 96.09 | ||||||||||||
Options assumed | 251 | 83.91 | ||||||||||||
Exercised | (749 | ) | 36.86 | |||||||||||
Forfeited | (79 | ) | 75.22 | |||||||||||
Outstanding – as of December 31, 2013 | 2,167 | $ | 48.69 | 6.3 | $ | 186,093 | ||||||||
Exercisable – as of December 31, 2013 | 1,354 | $ | 37.11 | 5.3 | $ | 131,950 | ||||||||
Vested and expected to vest as of December 31, 2013 | 2,040 | $ | 47.03 | 6.2 | $ | 178,634 | ||||||||
Weighted-average fair value of options granted for the year ended December 31, 2013 | $ | 38.09 | ||||||||||||
Weighted Average Assumptions Used to Compute Stock-based Compensation Expense for Awards Granted | ' | |||||||||||||
The following table illustrates the weighted average assumptions used to compute stock-based compensation expense for awards granted: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Risk-free interest rate | .35% - .75% | 1% | 1% - 2.2% | |||||||||||
Expected dividend yield | —% | —% | —% | |||||||||||
Expected option term (years) | 3.0 - 5.0 | 3.0 - 5.0 | 5 | |||||||||||
Expected stock volatility | 41% - 45% | 43% - 52% | 51% - 54% | |||||||||||
Restricted Stock Unit Activity | ' | |||||||||||||
The following table presents the restricted stock unit activity for the year ended December 31, 2013. | ||||||||||||||
Shares | Weighted- | |||||||||||||
Average | ||||||||||||||
Grant | ||||||||||||||
Date | ||||||||||||||
Fair Value | ||||||||||||||
Outstanding – January 1, 2013 | 1,084 | $ | 58.07 | |||||||||||
Granted | 504 | 98.34 | ||||||||||||
RSUs assumed | 29 | 71.22 | ||||||||||||
Vested | (365 | ) | 56.28 | |||||||||||
Forfeited | (59 | ) | 70.78 | |||||||||||
Outstanding – as of December 31, 2013 | 1,193 | $ | 75.2 | |||||||||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Components of Income Tax Provision | ' | ||||||||||||
The components of the Company’s income tax (benefit) provision for the years ended December 31, 2013, 2012, and 2011 are as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current Provision: | |||||||||||||
Federal | $ | 4,225 | $ | 13,089 | $ | 12,264 | |||||||
State | 1,495 | 3,575 | 4,397 | ||||||||||
Foreign | 961 | 372 | 135 | ||||||||||
6,681 | 17,036 | 16,796 | |||||||||||
Deferred (Benefit) Provision : | |||||||||||||
Federal | (5,291 | ) | 26 | (1,804 | ) | ||||||||
Foreign | — | (114 | ) | — | |||||||||
State | (1,753 | ) | (802 | ) | (1,158 | ) | |||||||
(7,044 | ) | (890 | ) | (2,962 | ) | ||||||||
Total income tax (benefit) provision | $ | (363 | ) | $ | 16,146 | $ | 13,834 | ||||||
Components of Deferred Income Taxes | ' | ||||||||||||
The components of the Company’s deferred income taxes as of December 31, 2013 and 2012 are as follows: | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred tax assets: | |||||||||||||
Federal net operating loss carryforward | $ | 187 | $ | — | |||||||||
State net operating loss carryforward | 1,476 | 25 | |||||||||||
Research and development tax credits | 3,244 | — | |||||||||||
Allowances for accounts receivable | 2,773 | 1,005 | |||||||||||
Deferred rent obligation | 328 | 1,593 | |||||||||||
Stock compensation | 18,270 | 13,800 | |||||||||||
Other accrued liabilities | 2,171 | 1,743 | |||||||||||
Deferred revenue | 17,754 | 16,594 | |||||||||||
Other | 3,101 | 2,251 | |||||||||||
Total gross deferred tax assets | 49,304 | 37,011 | |||||||||||
Valuation allowance | (2,627 | ) | (25 | ) | |||||||||
Total deferred tax assets | 46,677 | 36,986 | |||||||||||
Deferred tax liabilities: | |||||||||||||
Intangible assets | (49,555 | ) | (6,605 | ) | |||||||||
Capitalized software development | (8,641 | ) | (5,420 | ) | |||||||||
Property and equipment | (3,784 | ) | (6,290 | ) | |||||||||
Investments | — | (5 | ) | ||||||||||
Total deferred tax liabilities | (61,980 | ) | (18,320 | ) | |||||||||
Net deferred tax (liabilities) assets | $ | (15,303 | ) | $ | 18,666 | ||||||||
Reconciliation of the Federal Statutory Income Tax Rate to Effective Income Tax Rate | ' | ||||||||||||
A reconciliation of the federal statutory income tax rate to the Company’s effective income tax rate is as follows for the years ended December 31, 2013, 2012, and 2011: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Income tax computed at federal statutory tax rate | 35 | % | 35 | % | 35 | % | |||||||
State taxes, net of federal benefit | (6 | )% | 5 | % | 6 | % | |||||||
Research and development credits | (98 | )% | — | % | (1 | )% | |||||||
Permanent differences | 20 | % | 6 | % | 2 | % | |||||||
Valuation allowance | 33 | % | — | % | — | % | |||||||
Total | (16 | )% | 46 | % | 42 | % | |||||||
Reconciliation of the Beginning and Ending Amount of Uncertain Tax Benefits | ' | ||||||||||||
A reconciliation of the beginning and ending amount of uncertain tax benefits is as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Beginning uncertain tax benefits | $ | 1,761 | $ | 1,685 | $ | 1,610 | |||||||
Prior year – decreases | (537 | ) | (140 | ) | (23 | ) | |||||||
Prior year – increases | 501 | 177 | 22 | ||||||||||
Acquired balances | 2,339 | — | — | ||||||||||
Current year – increases | 787 | 39 | 76 | ||||||||||
Ending uncertain tax benefits | $ | 4,851 | $ | 1,761 | $ | 1,685 | |||||||
QUARTERLY_FINANCIAL_INFORMATIO1
QUARTERLY FINANCIAL INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | ' | ||||||||||||||||||||
Selected quarterly financial information follows for the year ended December 31, 2013: | |||||||||||||||||||||
First | Second | Third | Fourth | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
Revenue: | |||||||||||||||||||||
Business services | $ | 121,463 | $ | 137,919 | $ | 141,326 | $ | 162,529 | $ | 563,237 | |||||||||||
Implementation and other | 4,133 | 8,382 | 10,201 | 9,050 | 31,766 | ||||||||||||||||
Total revenue | 125,596 | 146,301 | 151,527 | 171,579 | 595,003 | ||||||||||||||||
Expenses: | |||||||||||||||||||||
Direct operating | 53,185 | 59,390 | 63,245 | 62,852 | 238,672 | ||||||||||||||||
Selling and marketing | 32,922 | 41,035 | 37,584 | 37,947 | 149,488 | ||||||||||||||||
Research and development | 11,944 | 14,269 | 15,104 | 16,322 | 57,639 | ||||||||||||||||
General and administrative | 31,077 | 24,670 | 21,690 | 22,339 | 99,776 | ||||||||||||||||
Depreciation and amortization | 8,341 | 11,107 | 11,263 | 12,864 | 43,575 | ||||||||||||||||
Total expenses | 137,469 | 150,471 | 148,886 | 152,324 | 589,150 | ||||||||||||||||
Operating (loss) income | (11,873 | ) | (4,170 | ) | 2,641 | 19,255 | 5,853 | ||||||||||||||
Other (expense) income: | |||||||||||||||||||||
Interest expense | (164 | ) | (1,001 | ) | (1,421 | ) | (1,319 | ) | (3,905 | ) | |||||||||||
Other (expense) income | 54 | 63 | 30 | 136 | 283 | ||||||||||||||||
Total other expense | (110 | ) | (938 | ) | (1,391 | ) | (1,183 | ) | (3,622 | ) | |||||||||||
(Loss) income before income tax benefit (provision) | (11,983 | ) | (5,108 | ) | 1,250 | 18,072 | 2,231 | ||||||||||||||
Income tax benefit (provision) | 12,683 | (7,313 | ) | (80 | ) | (4,927 | ) | 363 | |||||||||||||
Net income (loss) | $ | 700 | $ | (12,421 | ) | $ | 1,170 | $ | 13,145 | $ | 2,594 | ||||||||||
Net income (loss) per share – Basic | $ | 0.02 | $ | (0.34 | ) | $ | 0.03 | $ | 0.35 | $ | 0.07 | ||||||||||
Net income (loss) per share – Diluted | $ | 0.02 | $ | (0.34 | ) | $ | 0.03 | $ | 0.34 | $ | 0.07 | ||||||||||
Weighted average shares used in computing net income (loss) per share: | |||||||||||||||||||||
Basic | 36,409 | 36,760 | 36,970 | 37,262 | 36,856 | ||||||||||||||||
Diluted | 37,744 | 36,760 | 38,343 | 38,645 | 38,257 | ||||||||||||||||
Selected quarterly financial information follows for the year ended December 31, 2012: | |||||||||||||||||||||
First | Second | Third | Fourth | Year | |||||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
Revenue: | |||||||||||||||||||||
Business services | $ | 93,549 | $ | 100,110 | $ | 102,256 | $ | 112,581 | $ | 408,496 | |||||||||||
Implementation and other | 3,017 | 3,405 | 3,630 | 3,723 | 13,775 | ||||||||||||||||
Total revenue | 96,566 | 103,515 | 105,886 | 116,304 | 422,271 | ||||||||||||||||
Expenses: | |||||||||||||||||||||
Direct operating | 38,798 | 41,014 | 41,866 | 45,208 | 166,886 | ||||||||||||||||
Selling and marketing | 23,728 | 27,389 | 25,603 | 27,580 | 104,300 | ||||||||||||||||
Research and development | 7,168 | 8,615 | 8,746 | 9,263 | 33,792 | ||||||||||||||||
General and administrative | 16,199 | 13,961 | 11,913 | 14,952 | 57,025 | ||||||||||||||||
Depreciation and amortization | 5,486 | 5,795 | 6,683 | 7,677 | 25,641 | ||||||||||||||||
Total expenses | 91,379 | 96,774 | 94,811 | 104,680 | 387,644 | ||||||||||||||||
Operating income | 5,187 | 6,741 | 11,075 | 11,624 | 34,627 | ||||||||||||||||
Other income | 134 | 12 | 88 | 17 | 251 | ||||||||||||||||
Income before income tax provision | 5,321 | 6,753 | 11,163 | 11,641 | 34,878 | ||||||||||||||||
Income tax provision | (2,893 | ) | (2,599 | ) | (4,953 | ) | (5,701 | ) | (16,146 | ) | |||||||||||
Net income | $ | 2,428 | 4,154 | 6,210 | 5,940 | $ | 18,732 | ||||||||||||||
Net income per share – Basic | $ | 0.07 | $ | 0.12 | $ | 0.17 | $ | 0.16 | $ | 0.52 | |||||||||||
Net income per share – Diluted | $ | 0.07 | $ | 0.11 | $ | 0.17 | $ | 0.16 | $ | 0.5 | |||||||||||
Weighted average shares used in computing net income per share: | |||||||||||||||||||||
Basic | 35,535 | 35,685 | 35,832 | 36,264 | 35,956 | ||||||||||||||||
Diluted | 36,996 | 36,906 | 37,212 | 37,420 | 37,133 | ||||||||||||||||
NATURE_OF_OPERATIONS_AND_SUMMA3
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Additional Information) (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Segment | |||
Business | |||
Significant Accounting Policies [Line Items] | ' | ' | ' |
Term of service contracts | '1 year | ' | ' |
Period for notice of termination of agreement without cause | '90 days | ' | ' |
Deferred Revenue, estimated period of recognition (in years) | '12 years | ' | ' |
Advertising expense | $14,200,000 | $12,300,000 | $9,800,000 |
Restricted cash | 3,000,000 | 1,400,000 | ' |
Deposit | 500,000 | ' | ' |
Software amortization expense | 17,900,000 | 3,400,000 | 2,200,000 |
Future amortization expense for software development, year one | 27,670,000 | ' | ' |
Future amortization expense for software development, year two | 22,528,000 | ' | ' |
Future amortization expense for software, year three | 18,560,000 | ' | ' |
Impairment losses recognized | 0 | 0 | 0 |
Related party transaction, total expense | 1,500,000 | ' | ' |
Related party transaction, total payable | 400,000 | ' | ' |
Number of acquired and integrated businesses | 2 | ' | ' |
Number of operating segments | 1 | ' | ' |
Requisite service period | '4 years | ' | ' |
Options granted vesting period | '4 years | ' | ' |
Customer Concentration Risk | Accounts Receivable | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Number of customers | 1 | ' | ' |
Percentage of accounts receivable | 11.00% | ' | ' |
Developed technology | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Software amortization expense | 18,000,000 | 9,000,000 | 4,400,000 |
Future amortization expense for software development, year one | 18,800,000 | ' | ' |
Future amortization expense for software development, year two | 9,200,000 | ' | ' |
Future amortization expense for software, year three | 600,000 | ' | ' |
Balance in capitalization in progress account related to software development costs | 1,400,000 | ' | ' |
Letter of Credit | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Escrowed funds | ' | $900,000 | ' |
Building improvements | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '10 years | ' | ' |
Airplane | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '20 years | ' | ' |
Land improvements | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '10 years | ' | ' |
Minimum | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Estimated useful life of the software (in years) | '3 years | ' | ' |
Minimum | Developed technology | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Estimated useful life of the software (in years) | '2 years | ' | ' |
Minimum | Furniture Fixtures And Equipment | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '3 years | ' | ' |
Minimum | Building | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '30 years | ' | ' |
Maximum | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Estimated useful life of the software (in years) | '5 years | ' | ' |
Maximum | Developed technology | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Estimated useful life of the software (in years) | '3 years | ' | ' |
Maximum | Furniture Fixtures And Equipment | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '5 years | ' | ' |
Maximum | Building | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property and Equipment, useful life (in years) | '40 years | ' | ' |
Epocrates | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Term of service contracts | '1 year | ' | ' |
Epocrates | Minimum | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Period for redeemable license code subscription | '6 months | ' | ' |
Epocrates | Maximum | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Period for redeemable license code subscription | '12 months | ' | ' |
NATURE_OF_OPERATIONS_AND_SUMMA4
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Activity in Allowance for Doubtful Accounts) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ' | ' | ' |
Beginning balance | $1,771 | $2,348 | $1,945 |
Provision | 791 | 153 | 1,122 |
Write-offs and adjustments | -871 | -730 | -719 |
Ending balance | $1,691 | $1,771 | $2,348 |
NATURE_OF_OPERATIONS_AND_SUMMA5
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Accrued Expenses) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' |
Accrued bonus | $25,013 | $17,192 |
Accrued vacation | 5,107 | 4,109 |
Accrued payroll | 8,611 | 9,980 |
Accrued commissions | 5,713 | 5,112 |
Accrued compensation expenses | 44,444 | 36,393 |
Accrued expenses | 23,692 | 15,214 |
Accrued property and equipment additions | 605 | 4,021 |
Current portion of accrued contingent consideration | 0 | 448 |
Accrued expenses | $24,297 | $19,683 |
ACQUISITIONS_Additional_Inform
ACQUISITIONS (Additional Information) (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 8 Months Ended | 12 Months Ended | 36 Months Ended | 0 Months Ended | 10 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 36 Months Ended | 0 Months Ended | ||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | 10-May-13 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Mar. 12, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Oct. 10, 2010 | Oct. 10, 2012 | Oct. 10, 2012 | |
Minimum | Maximum | Development Technology | Customer relationships | Noncompete Agreements | Customer backlog | General and administrative | General and administrative | General and administrative | Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Healthcare Data Services | Healthcare Data Services | Healthcare Data Services | ||||
acre | Direct operating expense | General and administrative | General and administrative | Development Technology | Noncompete Agreements | Customer backlog | General and administrative | General and administrative | General and administrative | |||||||||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of acres | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 29 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $168,500,000 | ' | ' | ' | ' | $237,614,000 | ' | ' | ' | ' | ' | ' | ' | $6,000,000 | ' | ' |
Cash payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 167,300,000 | ' | ' | ' | ' | 294,632,000 | ' | ' | ' | ' | ' | ' | ' | 5,800,000 | ' | ' |
Third party tenant revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,700,000 | ' | ' | ' | ' | 52,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net loss | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,800,000 | ' | ' | ' | ' | 14,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Costs associated with third-party tenant revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transactions costs incurred in connection with acquisition | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,400,000 | 3,100,000 | ' | ' | ' | ' | ' | ' | 2,700,000 | 3,200,000 | ' | ' | ' |
Share conversion ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.1239 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of assumed stock options and restricted stock units | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount allocated to purchase consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13,028,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of fair value of stock options and restricted stock units allocated to future services | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | 42,648,000 | 27,236,000 | 18,901,000 | ' | ' | ' | ' | ' | ' | 18,575,000 | 10,687,000 | 7,772,000 | ' | ' | ' | ' | ' | ' | ' | 7,400,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock based compensation expense primarily related to acceleration of certain stock awards | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Severance and retention bonuses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts receivable, prepaid and other current assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | ' |
Purchased intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,545,000 | ' | ' | ' | ' | 139,900,000 | 139,400,000 | 139,400,000 | ' | ' | ' | ' | ' | ' | 4,800,000 | ' |
Accrued expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 271,000 | ' | ' | ' | ' | 11,054,000 | 11,336,000 | 11,336,000 | ' | ' | ' | ' | ' | ' | 100,000 | ' |
Goodwill | 198,049,000 | 48,090,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 148,093,000 | 149,960,000 | 149,960,000 | ' | ' | ' | ' | ' | ' | 800,000 | ' |
Legal and professional fees in connection with the acquisition | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 |
Purchased intangibles | ' | ' | ' | ' | ' | $3,200,000 | $400,000 | $1,200,000 | ' | ' | ' | ' | $25,545,000 | ' | ' | ' | ' | $139,400,000 | ' | ' | $6,500,000 | $4,500,000 | $2,900,000 | ' | ' | ' | ' | ' |
Estimated useful life of the software (in years) | ' | ' | ' | '3 years | '5 years | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
ACQUISITIONS_Schedule_of_Recog
ACQUISITIONS (Schedule of Recognized Assets Acquired and Liabilities Assumed) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | 10-May-13 | Dec. 31, 2013 | Mar. 12, 2013 |
In Thousands, unless otherwise specified | Arsenal on the Charles | Epocrates Inc | Epocrates Inc | ||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' |
Prepaid expenses and other current assets | ' | ' | $685 | ' | ' |
Accounts receivable | ' | ' | ' | 22,028 | 23,144 |
Other current and long-term assets | ' | ' | ' | 4,483 | 3,833 |
Property, equipment and buildings | ' | ' | 144,071 | 4,188 | 4,168 |
Purchased intangible assets | ' | ' | 25,545 | 139,400 | 139,900 |
Accrued expenses | ' | ' | -271 | -11,336 | -11,054 |
Deferred tax liabilities, net | ' | ' | ' | -41,151 | -39,811 |
Deferred revenue | ' | ' | -789 | -28,752 | -29,400 |
Other long-term liabilities | ' | ' | -1,916 | -1,206 | -1,259 |
Total identifiable net assets | ' | ' | 167,325 | 87,654 | 89,521 |
Goodwill | 198,049 | 48,090 | ' | 149,960 | 148,093 |
Fair value of assets acquired and liabilities assumed | ' | ' | ' | 237,614 | 237,614 |
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | ' | ' | ' | ' | ' |
Accounts receivable, Adjustments | ' | ' | ' | -1,116 | ' |
Other current and long-term assets, Adjustments | ' | ' | ' | 650 | ' |
Property, equipment and capitalized software, Adjustments | ' | ' | ' | 20 | ' |
Purchased intangible assets, Adjustments | ' | ' | ' | -500 | ' |
Current liabilities, Adjustments | ' | ' | ' | -282 | ' |
Deferred tax liabilities, net, Adjustments | ' | ' | ' | -1,340 | ' |
Deferred revenue, Adjustments | ' | ' | ' | 648 | ' |
Other long-term liabilities, Adjustments | ' | ' | ' | 53 | ' |
Total identifiable net assets, Adjustments | ' | ' | ' | -1,867 | ' |
Goodwill, Adjustments | ' | ' | ' | 1,867 | ' |
Fair value of assets acquired and liabilities assumed, Adjustments | ' | ' | ' | $0 | ' |
ACQUISITIONS_Schedule_of_Ident
ACQUISITIONS (Schedule of Identifiable Intangible Assets Acquired) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 10 Months Ended | 0 Months Ended | 10 Months Ended | 0 Months Ended | 10 Months Ended | 0 Months Ended | 10 Months Ended | 0 Months Ended | 10 Months Ended | 0 Months Ended | 10 Months Ended | |||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | 10-May-13 | 10-May-13 | 10-May-13 | Mar. 12, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Dec. 31, 2013 | Mar. 12, 2013 | Dec. 31, 2013 |
Above market leases | In-place leases | Doctor network | Drug information content | Trade name | Developed technology | Epocrates non-compete agreement | Epocrates non-compete agreement | Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | |
Above market leases | In-place leases | Doctor network | Doctor network | Drug information content | Drug information content | Trade name | Trade name | Customer backlog | Customer backlog | Developed technology | Developed technology | Epocrates non-compete agreement | Epocrates non-compete agreement | |||||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total intangible assets subject to amortization | ' | ' | ' | ' | ' | $3,200 | $1,200 | ' | $25,545 | $3,298 | $22,247 | $139,400 | $104,000 | ' | $10,000 | ' | $11,500 | ' | $2,900 | ' | $6,500 | ' | $4,500 | ' |
Useful Life | '5 years 10 months 24 days | '5 years 3 months 18 days | '13 years 2 months 12 days | '4 years 2 months 12 days | '9 years 2 months 12 days | ' | '1 year | '2 years 7 months 6 days | ' | ' | ' | ' | ' | '14 years | ' | '5 years | ' | '10 years | ' | '1 year 6 months | ' | '3 years | ' | '1 year 6 months |
ACQUISITIONS_Total_Considerati
ACQUISITIONS (Total Consideration as of Acquisition Date) (Details) (Epocrates Inc, USD $) | 0 Months Ended |
In Thousands, unless otherwise specified | Mar. 12, 2013 |
Epocrates Inc | ' |
Business Acquisition [Line Items] | ' |
Cash payments | $294,632 |
Fair value of vested stock options and restricted stock units assumed | 13,028 |
Fair value of total consideration | 307,660 |
Less cash acquired | -51,796 |
Less short-term investments acquired | -18,250 |
Total | $237,614 |
ACQUISITIONS_Schedule_of_Integ
ACQUISITIONS (Schedule of Integration Costs) (Details) (Epocrates Inc, USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Epocrates Inc | ' |
Integration Costs [Roll Forward] | ' |
Beginning Balance | $0 |
Addition to provision | 3,909 |
Cash payments | -3,574 |
Ending Balance | $335 |
ACQUISITIONS_Schedule_of_Pro_F
ACQUISITIONS (Schedule of Pro Forma Information) (Details) (Epocrates Inc and the Arsenal on the Charles, USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Epocrates Inc and the Arsenal on the Charles | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Revenue | $614,775 | $538,030 |
Net income (loss) | ($1,808) | ($4,700) |
Net income (loss) per share – Basic | ($0.05) | ($0.13) |
Net income (loss) per share – Diluted | ($0.05) | ($0.13) |
NET_INCOME_PER_SHARE_Reconcili
NET INCOME PER SHARE (Reconciliation of Weighted Average Shares Outstanding for Basic and Diluted Net Income Per Share) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Earnings Per Share [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | $13,145 | $1,170 | ($12,421) | $700 | $5,940 | $6,210 | $4,154 | $2,428 | $2,594 | $18,732 | $19,046 |
Weighted average shares used in computing basic net income per share (shares) | 37,262 | 36,970 | 36,760 | 36,409 | 36,264 | 35,832 | 35,685 | 35,535 | 36,856 | 35,956 | 35,046 |
Net income per share - basic (in dollars per share) | $0.35 | $0.03 | ($0.34) | $0.02 | $0.16 | $0.17 | $0.12 | $0.07 | $0.07 | $0.52 | $0.54 |
Effect of dilutive securities (shares) | ' | ' | ' | ' | ' | ' | ' | ' | 1,401 | 1,177 | 1,004 |
Weighted average shares used in computing diluted net income per share (shares) | 38,645 | 38,343 | 36,760 | 37,744 | 37,420 | 37,212 | 36,906 | 36,996 | 38,257 | 37,133 | 36,050 |
Net income per share - diluted (in dollars per share) | $0.34 | $0.03 | ($0.34) | $0.02 | $0.16 | $0.17 | $0.11 | $0.07 | $0.07 | $0.50 | $0.53 |
NET_INCOME_PER_SHARE_Net_Incom
NET INCOME PER SHARE (Net Income Per Share - Additional Information) (Detail) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Earnings Per Share [Abstract] | ' | ' | ' |
Options and restricted stock units which have an antidilutive effect (shares) | 0.4 | 0.4 | 0.8 |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Fair Value of Financial Instruments - Additional Information) (Detail) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | 6 Months Ended | 12 Months Ended | 45 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Mar. 31, 2011 | Dec. 31, 2011 | Jun. 30, 2012 | Dec. 31, 2013 | Sep. 30, 2012 | Dec. 31, 2013 | Mar. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2012 | Mar. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Mar. 31, 2012 | Dec. 31, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Mar. 31, 2012 | Dec. 31, 2011 | Aug. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | 10-May-13 | Dec. 31, 2013 | 10-May-13 | |
Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Contingent Consideration | Money market | Money market | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | |||||
First Potential Contingent Consideration | First Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Anodyne Health Partners Inc | Anodyne Health Partners Inc | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 3 | Interest Rate Swap | Interest Rate Swap | Unsecured Debt | Unsecured Debt | Revolving Credit Facility | Revolving Credit Facility | ||||||||||
Installment | Maximum | Base Case Scenario | Base Case Scenario | Upside Scenario | Upside Scenario | Downside Scenario | Upside and Downside Senario | Installment | Minimum | Maximum | Base Case Scenario | Upside Scenario | Upside Scenario | Downside Scenario | Worse Case Scenario | Base Case Scenario | Base Case Scenario | Base Case Scenario | Upside Scenario | Upside Scenario | Downside Scenario | Downside Scenario | Upside and Downside Senario | Second Potential Contingent Consideration | Second Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | First Potential Contingent Consideration | Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | |||||||||||||||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $65,002,000 | $154,988,000 | $57,781,000 | $35,944,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $59,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding on facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 188,800,000 | 200,000,000 | 35,000,000 | 50,000,000 |
Outstanding debt | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term U.S. government backed securities | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of swap recognized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | 0 | ' | ' | ' | ' |
Accrued liability for the estimated fair value of contingent considerations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,400,000 | 1,400,000 | 300,000 | 300,000 | 2,400,000 | 2,400,000 | ' | 400,000 | ' | ' | 354,000 | 354,000 | 0 | ' | ' | ' | ' | ' | ' |
Contingent consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, lower range | ' | ' | ' | ' | ' | 0 | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, higher range | ' | ' | ' | ' | ' | 4,800,000 | ' | 2,900,000 | ' | 5,300,000 | ' | ' | ' | ' | ' | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, number of payment installments | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, amount paid | ' | ' | ' | ' | 2,400,000 | ' | ' | 2,600,000 | 3,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, payment date | ' | ' | ' | ' | ' | 'March of 2011 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'First quarter of 2013 | ' | ' | ' | ' | ' | ' | ' | ' | 'Third quarter of 2013 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, assumptions, probability adjusted level | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.00% | 50.00% | 70.00% | 25.00% | 10.00% | 25.00% | ' | ' | ' | ' | 60.00% | 25.00% | 10.00% | 15.00% | 90.00% | ' | ' | 65.00% | 65.00% | 60.00% | 25.00% | 25.00% | 10.00% | 10.00% | 20.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, assumptions | ' | ' | ' | ' | ' | ' | ' | 'Key assumptions including a probability adjusted level of 50% for the base case scenario and 25% for the upside and downside scenarios | ' | ' | ' | ' | ' | ' | ' | ' | 'The Company determined that based on the reforecasted amounts and the pass fail structure of this contingent payment, the probability percentages have been adjusted to 90% for the worse case scenario and 10% for the upside scenario. | 'The key assumptions relating to this potential contingent consideration included the athenaCoordinator revenue budget for the 2012 fiscal year, which included recurring revenue and estimates related new revenue generated from new customers based upon the existing sales pipeline and historical implementation timeline and a probability adjusted level of 60% for the base case and 25% and 15% for the upside and downside scenarios, respectively. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Change in fair value of contingent considerations | 76,000 | -5,118,000 | 40,000 | ' | ' | ' | 1,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent consideration, change in fair value | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,400,000 | ' | ' | ' | ' | ' | ' | ' | 4,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of minimum revenue threshold estimated to be missed by Coordinator | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $76,000 | ($5,118,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FAIR_VALUE_OF_FINANCIAL_INSTRU3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Financial Assets and Liabilities that Are Measured at Fair Value on Recurring Basis) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | $0 | $38,092,000 |
Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Total assets | 26,000 | 127,572,000 |
Interest rate swap liability | -354,000 | ' |
Total liabilities | -354,000 | -448,000 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Total assets | 26,000 | 89,480,000 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Total assets | 0 | 38,092,000 |
Interest rate swap liability | -354,000 | ' |
Total liabilities | -354,000 | ' |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Interest rate swap liability | 0 | ' |
Total liabilities | 0 | -448,000 |
Money market | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash and cash equivalents: | 26,000 | 89,480,000 |
Money market | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash and cash equivalents: | 26,000 | 89,480,000 |
Commercial paper | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 11,748,000 |
Commercial paper | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 11,748,000 |
Commercial paper | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 11,748,000 |
Corporate bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 20,334,000 |
Corporate bonds | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 20,334,000 |
Corporate bonds | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 20,334,000 |
Certificate of deposit | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 6,010,000 |
Certificate of deposit | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available-for-sale investments: | ' | 6,010,000 |
Contingent Consideration | Fair Value, Measurements, Recurring | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Interest rate swap liability | ' | -448,000 |
Contingent Consideration | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Interest rate swap liability | ' | ($448,000) |
FAIR_VALUE_OF_FINANCIAL_INSTRU4
FAIR VALUE OF FINANCIAL INSTRUMENTS (Reconciliations for Fair Values of Financial Instruments Determined by Level 3) (Detail) (Contingent Consideration, USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Contingent Consideration | ' | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' |
Balance beginning of period | $448 | $8,176 |
Payments | -524 | -2,610 |
Additions | 0 | 0 |
Change in fair value (included in G&A expenses) | 76 | -5,118 |
Balance end of period | $0 | $448 |
INVESTMENTS_Summary_of_Availab
INVESTMENTS (Summary of Available-For-Sale Securities) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | ' | $38,079,000 |
Gross Unrealized Gains | ' | 13,000 |
Fair Value | 0 | 38,092,000 |
Commercial paper | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | ' | 11,740,000 |
Gross Unrealized Gains | ' | 8,000 |
Fair Value | ' | 11,748,000 |
Corporate bonds | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | ' | 20,331,000 |
Gross Unrealized Gains | ' | 3,000 |
Fair Value | ' | 20,334,000 |
Certificate of deposit | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | ' | 6,008,000 |
Gross Unrealized Gains | ' | 2,000 |
Fair Value | ' | $6,010,000 |
PROPERTY_AND_EQUIPMENT_Additio
PROPERTY AND EQUIPMENT (Additional Information) (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Capital leases | $0 | $0 | ' |
Property and equipment, depreciation expense | 25,500,000 | 16,600,000 | 12,200,000 |
Arsenal on the Charles | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Fair value of buildings acquired | 121,300,000 | ' | ' |
Fair value of land and land improvements acquired | 21,000,000 | ' | ' |
Fair value of land improvements | $1,800,000 | ' | ' |
PROPERTY_AND_EQUIPMENT_Schedul
PROPERTY AND EQUIPMENT (Schedule of Property and Equipment) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | $280,546 | $101,143 |
Total property and equipment, at cost | -72,777 | -49,902 |
Accumulated depreciation and amortization | 5,249 | 2,794 |
Construction in progress | 213,018 | 54,035 |
Equipment | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 78,616 | 56,078 |
Furniture and fixtures | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 8,822 | 5,297 |
Leasehold improvements | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 3,104 | 15,518 |
Airplane | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 3,156 | 3,156 |
Building | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 136,368 | 14,644 |
Building improvements | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 24,441 | 3,500 |
Land | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | 23,059 | 2,035 |
Land improvements | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Land improvements | $2,980 | $915 |
GOODWILL_AND_PURCHASED_INTANGI2
GOODWILL AND PURCHASED INTANGIBLE ASSETS (Additional Information) (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ' | ' |
Amortization of purchased intangible assets | $17.90 | $3.40 | $2.20 |
GOODWILL_AND_PURCHASED_INTANGI3
GOODWILL AND PURCHASED INTANGIBLE ASSETS (Activity Relating to Carrying Values of Goodwill) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Healthcare Data Services | Epocrates Inc | |||
Goodwill [Roll Forward] | ' | ' | ' | ' | ' |
Beginning gross balance | $198,049 | $48,090 | $47,307 | ' | ' |
Goodwill recorded during the period | ' | ' | ' | 783 | 149,959 |
Ending gross balance | $198,049 | $48,090 | $47,307 | ' | ' |
GOODWILL_AND_PURCHASED_INTANGI4
GOODWILL AND PURCHASED INTANGIBLE ASSETS (Intangible Assets Acquired) (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | $192,434 | $29,724 |
Accumulated Amortization | -24,070 | -8,163 |
Net | 168,364 | 21,561 |
Developed technology | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 11,721 | 6,612 |
Accumulated Amortization | -4,737 | -2,678 |
Net | 6,984 | 3,934 |
Weighted Average Remaining Useful Life (years) | '2 years | '2 years 6 months |
Customer relationships | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 21,434 | 21,434 |
Accumulated Amortization | -7,365 | -5,175 |
Net | 14,069 | 16,259 |
Weighted Average Remaining Useful Life (years) | '6 years 7 months 6 days | '7 years 7 months 6 days |
Doctor network | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 104,000 | ' |
Accumulated Amortization | -682 | ' |
Net | 103,318 | ' |
Weighted Average Remaining Useful Life (years) | '13 years 2 months 12 days | ' |
Drug information content | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 10,000 | ' |
Accumulated Amortization | -1,608 | ' |
Net | 8,392 | ' |
Weighted Average Remaining Useful Life (years) | '4 years 2 months 12 days | ' |
Trade name | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 11,500 | ' |
Accumulated Amortization | -924 | ' |
Net | 10,576 | ' |
Weighted Average Remaining Useful Life (years) | '9 years 2 months 12 days | ' |
Customer backlog | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 2,900 | ' |
Accumulated Amortization | -1,554 | ' |
Net | 1,346 | ' |
Weighted Average Remaining Useful Life (years) | '8 months 12 days | ' |
Noncompete Agreements | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 6,178 | 1,678 |
Accumulated Amortization | -3,280 | -310 |
Net | 2,898 | 1,368 |
Weighted Average Remaining Useful Life (years) | '1 year | '2 years 7 months 6 days |
Above market leases | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 3,123 | ' |
Accumulated Amortization | -357 | ' |
Net | 2,766 | ' |
Weighted Average Remaining Useful Life (years) | '5 years 10 months 24 days | ' |
Leases in place | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross | 21,578 | ' |
Accumulated Amortization | -3,563 | ' |
Net | $18,015 | ' |
Weighted Average Remaining Useful Life (years) | '5 years 3 months 18 days | ' |
GOODWILL_AND_PURCHASED_INTANGI5
GOODWILL AND PURCHASED INTANGIBLE ASSETS (Estimated Amortization Expense) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ' |
2014 | $27,670 | ' |
2015 | 22,528 | ' |
2016 | 18,560 | ' |
2017 | 17,803 | ' |
2018 | 15,441 | ' |
Thereafter | 66,362 | ' |
Net | $168,364 | $21,561 |
OPERATING_LEASES_AND_OTHER_COM2
OPERATING LEASES AND OTHER COMMITMENTS (Additional Information) (Detail) (USD $) | 1 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | 31-May-11 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating Leased Assets [Line Items] | ' | ' | ' | ' |
Allowances for the leasehold improvements for the office space and reimbursement of moving costs | ' | $11.50 | ' | ' |
Repayment of incentive allowance | 2.1 | ' | ' | ' |
Operating Leases, rent expense net | ' | 5.5 | 4.9 | 3.5 |
General and administrative | ' | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' | ' |
Net gain due to early termination of lease | ' | $2.50 | ' | ' |
OPERATING_LEASES_AND_OTHER_COM3
OPERATING LEASES AND OTHER COMMITMENTS (Future Minimum Lease Payments Under Non-cancelable Operating Leases) (Detail) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Leases [Abstract] | ' |
2014 | $5,658 |
2015 | 7,645 |
2016 | 7,984 |
2017 | 8,093 |
2018 | 8,295 |
Thereafter | 50,253 |
Total minimum lease payments | $87,928 |
DEBT_Additional_Information_De
DEBT (Additional Information) (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 07, 2013 | Oct. 20, 2011 | Mar. 31, 2013 | Mar. 10, 2013 | 10-May-13 | Jan. 03, 2013 | Dec. 31, 2013 | 10-May-13 | 10-May-13 | Dec. 31, 2013 | Dec. 31, 2013 | |
Revolving Credit Agreement | Revolving Credit Agreement | Revolving Credit Agreement | Revolving Credit Agreement | Senior Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Unsecured Debt | Unsecured Debt | Senior Notes | ||||
Revolving Credit Agreement | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | |||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit, term | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | '5 years |
Line of Credit | ' | ' | ' | ' | $100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate for revolving loans, Federal Funds rate | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate for revolving loans, LIBOR rate | ' | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amounts borrowed and repaid from revolving credit facility | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' |
Additional borrowing capacity for Senior Credit Facility | ' | ' | ' | 55,000,000 | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' |
Financing Fees | ' | ' | ' | 300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,400,000 |
Amount issued under agreement | ' | ' | ' | ' | ' | ' | 155,000,000 | ' | ' | 35,000,000 | 50,000,000 | 200,000,000 | 188,800,000 | ' |
Amount repaid under Revolving Credit Agreement | 120,000,000 | 0 | 0 | ' | ' | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Credit Agreement, amount | ' | ' | ' | ' | ' | ' | ' | 325,000,000 | ' | ' | 125,000,000 | 200,000,000 | ' | ' |
Quarterly payment amount under agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,800,000 | ' | ' |
Amount available under credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $90,000,000 | ' |
Interest rate for facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.67% |
DEBT_Schedule_of_Future_Paymen
DEBT (Schedule of Future Payments of Long Term Debt) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Line of Credit Facility [Line Items] | ' | ' |
Current portion of long-term debt | $15,000 | $0 |
Long-term debt, net of current portion | 173,750 | 0 |
Unsecured Debt | Senior Credit Facility | ' | ' |
Line of Credit Facility [Line Items] | ' | ' |
2014 | 15,000 | ' |
2015 | 15,000 | ' |
2016 | 15,000 | ' |
2017 | 15,000 | ' |
Thereafter | 128,750 | ' |
Total | 188,750 | ' |
Current portion of long-term debt | 15,000 | ' |
Long-term debt, net of current portion | $173,750 | ' |
DEBT_Interest_Rate_Swap_Agreem
DEBT (Interest Rate Swap Agreement) (Details) (Interest Rate Swap, Designated as Hedging Instrument, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Derivatives, Fair Value [Line Items] | ' | ' |
Notional Amount | $120,000,000 | ' |
Fixed Rate | 0.84% | ' |
Other Long Term Liabilities | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Fair value of swap recognized | ($354,000) | $0 |
STOCKHOLDERS_EQUITY_Additional
STOCKHOLDERS' EQUITY (Additional Information) (Detail) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | 31-May-01 | Dec. 31, 2013 | Dec. 31, 2013 |
Vote | Minimum | Warrant | ||||
Series | ||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' |
Preferred Stock, shares authorized | 5,000,000 | 5,000,000 | ' | ' | ' | ' |
Number of series | ' | ' | ' | ' | 1 | ' |
Preferred stock, shares outstanding | 0 | 0 | ' | ' | ' | ' |
Votes per share entitled to common stockholders | 1 | ' | ' | ' | ' | ' |
Warrants issued, exercise price per share | ' | ' | ' | 3.08 | ' | ' |
Number of warrants outstanding and exercisable | 0 | 0 | 32 | ' | ' | ' |
Number of warrants exercised | ' | ' | ' | ' | ' | 32 |
STOCKBASED_COMPENSATION_Additi
STOCK-BASED COMPENSATION (Additional Information) (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 12, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | |
Epocrates Inc | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Epocrates Stock Plan | Employee Stock Purchase Plan (''2007 ESPP'') | Employee Stock Purchase Plan (''2007 ESPP'') | Employee Stock Purchase Plan (''2007 ESPP'') | Stock options | Stock options | Stock options | Restricted stock units | Restricted stock units | Restricted stock units | Restricted stock units | Restricted stock units | Software Development Costs | Software Development Costs | ||||
Management | Minimum | Maximum | Incentive Stock Plans | Epocrates Inc | Installment | Scenario 1 | Scenario 2 | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation capitalized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,200,000 | $800,000 |
Amortization of capitalized stock-based compensation related to software development | 1,027,000 | 257,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in number of shares reserved for issuance (shares) | ' | ' | ' | ' | 1,660,000 | 1,850,000 | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Multiplier of full value of awards (shares) | ' | ' | ' | ' | 1.66 | 1.3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options assumed | 251,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation arrangement by share-based payment award, number of shares available for grant | ' | ' | ' | ' | 4,609,000 | 3,303,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of employees who has voting power of all classes of stock granted incentive stock option | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of exercise price of the fair value of the Company's common stock at the date of the grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 110.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options granted vesting period | '4 years | ' | ' | ' | ' | ' | ' | '4 years | '1 year | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options granted contractual term (in years) | '5 years 3 months 18 days | ' | ' | ' | ' | ' | ' | ' | '5 years | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options granted vesting percentage per year | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of annual anniversary installments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' |
Number of quarterly anniversary installments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' |
Share conversion ratio | ' | ' | ' | 0.1239 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation expense | 42,648,000 | 27,236,000 | 18,901,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | 1,000,000 | 1,000,000 | 14,000,000 | 9,800,000 | 10,600,000 | ' | ' | ' | ' | ' | ' | ' |
Amount of fair value of stock options and restricted stock units allocated to future services | ' | ' | ' | 9,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,400,000 | 19,200,000 | ' | 68,700,000 | ' | ' | ' | ' | ' | ' |
Unrecognized stock-based compensation expense, expected weighted-average period for recognition (in years) | '1 year 4 months 24 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | ' |
Weighted average fair value of stock options granted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $38.09 | $31.71 | $21.01 | ' | ' | ' | ' | ' | ' | ' |
Intrinsic value of shares purchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 53,200,000 | 36,100,000 | 26,100,000 | ' | ' | ' | ' | ' | ' | ' |
Compensation expense, restricted stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 27,400,000 | 17,300,000 | 7,300,000 | ' | ' | ' | ' |
Weighted average fair value of restricted units granted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $98.34 | $71.15 | $47.02 | ' | ' | ' | ' |
Intrinsic value of vested restricted stock units | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $35,200,000 | $15,100,000 | $3,800,000 | ' | ' | ' | ' |
Restricted stock units, vesting term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'four equal, annual installments on the anniversaries of the vesting start date | 'four equal, quarterly installments on anniversaries of the vesting date | ' | ' |
Employee stock purchase price, percentage of the closing price of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
STOCKBASED_COMPENSATION_Total_
STOCK-BASED COMPENSATION (Total Stock-Based Compensation Expense) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | $42,648 | $27,236 | $18,901 |
Amortization of capitalized stock-based compensation related to software development | 1,027 | 257 | 0 |
Total | 43,675 | 27,493 | 18,901 |
Direct operating | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 7,778 | 5,619 | 3,173 |
Selling and marketing | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 12,057 | 7,717 | 5,645 |
Research and development | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | 4,238 | 3,213 | 2,311 |
General and administrative | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' |
Stock-based compensation expense | $18,575 | $10,687 | $7,772 |
STOCKBASED_COMPENSATION_Stock_
STOCK-BASED COMPENSATION (Stock Option Activity) (Detail) (USD $) | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 |
Shares | ' |
Beginning balance | 2,503 |
Granted | 241 |
Options assumed | 251 |
Exercised | -749 |
Forfeited | -79 |
Ending balance | 2,167 |
Exercisable – as of December 31, 2013 | 1,354 |
Vested and expected to vest as of December 31, 2013 | 2,040 |
Weighted- Average Exercise Price | ' |
Beginning balance | $37.93 |
Granted | $96.09 |
Options assumed | $83.91 |
Exercised | $36.86 |
Forfeited | $75.22 |
Ending balance | $48.69 |
Exercisable – as of December 31, 2013 | $37.11 |
Vested and expected to vest as of December 31, 2013 | $47.03 |
Weighted-average fair value of options granted for the year ended December 31, 2013 | $38.09 |
Weighted- Average Remaining Contractual Term (in years) | ' |
Outstanding – as of December 31, 2013 | '6 years 3 months 18 days |
Exercisable – as of December 31, 2013 | '5 years 3 months 18 days |
Vested and expected to vest as of December 31, 2013 | '6 years 2 months 12 days |
Aggregate Intrinsic Value | ' |
Outstanding – as of December 31, 2013 | $186,093 |
Exercisable – as of December 31, 2013 | 131,950 |
Vested and expected to vest as of December 31, 2013 | $178,634 |
STOCKBASED_COMPENSATION_Weight
STOCK-BASED COMPENSATION (Weighted Average Assumptions Used to Compute Stock-based Compensation Expense for Awards Granted) (Detail) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Risk-free interest rate, minimum | 0.35% | 1.00% | 1.00% |
Risk-free interest rate, maximum | 0.75% | 1.00% | 2.20% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Expected option term (years) | ' | ' | '5 years |
Expected stock volatility, minimum | 41.00% | 43.00% | 51.00% |
Expected stock volatility, maximum | 45.00% | 52.00% | 54.00% |
Minimum | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected option term (years) | '3 years | '3 years | ' |
Maximum | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Expected option term (years) | '5 years | '5 years | ' |
STOCKBASED_COMPENSATION_Restri
STOCK-BASED COMPENSATION (Restricted Stock Unit Activity) (Detail) (Restricted stock units, USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Restricted stock units | ' | ' | ' |
Restricted stock units - Shares | ' | ' | ' |
Beginning Balance | 1,084 | ' | ' |
Granted | 504 | ' | ' |
RSUs assumed | 29 | ' | ' |
Vested | -365 | ' | ' |
Forfeited | -59 | ' | ' |
Ending Balance | 1,193 | 1,084 | ' |
Restricted stock units - Weighted-Average Grant Date Fair Value | ' | ' | ' |
Beginning Balance | $58.07 | ' | ' |
Granted | $98.34 | $71.15 | $47.02 |
RSUs assumed | $71.22 | ' | ' |
Vested | $56.28 | ' | ' |
Forfeited | $70.78 | ' | ' |
Ending Balance | $75.20 | $58.07 | ' |
INCOME_TAXES_Additional_Inform
INCOME TAXES (Additional Information) (Detail) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Jan. 03, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | |
Research Tax Credit Carryforward | Federal | Federal | Federal | Federal | Federal | Federal | Federal | State | State | State | State | State | |||||
Minimum | Maximum | Stock Based Compensation Expense | Stock Based Compensation Expense | Minimum | Stock Based Compensation Expense | Stock Based Compensation Expense | |||||||||||
Income Taxes [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating loss carryforwards | ' | ' | ' | ' | ' | $28,000,000 | $6,100,000 | ' | ' | ' | $27,500,000 | $6,100,000 | $26,000,000 | $2,200,000 | ' | $1,600,000 | $400,000 |
Operating loss carryforwards, expiration year | ' | ' | ' | ' | ' | ' | ' | ' | '2025 | '2033 | ' | ' | ' | ' | '2018 | ' | ' |
Tax benefit realized from stock-based awards | 6,900,000 | 14,100,000 | 14,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized tax benefits | 4,851,000 | 1,761,000 | 1,685,000 | 1,610,000 | ' | 9,600,000 | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' |
Decrease in current tax provision by utilizing operating loss carryforwards | ' | ' | ' | ' | ' | 7,000,000 | 2,800,000 | 300,000 | ' | ' | ' | ' | 0 | ' | ' | ' | ' |
R&D credits | ' | ' | ' | ' | ' | 7,600,000 | ' | ' | ' | ' | ' | ' | 3,000,000 | ' | ' | ' | ' |
Utilization of credits under the without method of accounting related to stock-based compensation | ' | ' | ' | ' | ' | 5,200,000 | ' | ' | ' | ' | ' | ' | 1,700,000 | ' | ' | ' | ' |
Unrecognized tax benefits, if recognized, would impact effective tax rate | 4,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tax credit amount | ' | ' | ' | ' | $900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
INCOME_TAXES_Components_of_Inc
INCOME TAXES (Components of Income Tax Provision) (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Current Provision: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Federal | ' | ' | ' | ' | ' | ' | ' | ' | $4,225 | $13,089 | $12,264 |
State | ' | ' | ' | ' | ' | ' | ' | ' | 1,495 | 3,575 | 4,397 |
Foreign | ' | ' | ' | ' | ' | ' | ' | ' | 961 | 372 | 135 |
Current Income Tax Expense (Benefit), Total | ' | ' | ' | ' | ' | ' | ' | ' | 6,681 | 17,036 | 16,796 |
Deferred (Benefit) Provision : | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Federal | ' | ' | ' | ' | ' | ' | ' | ' | -5,291 | 26 | -1,804 |
Foreign | ' | ' | ' | ' | ' | ' | ' | ' | 0 | -114 | 0 |
State | ' | ' | ' | ' | ' | ' | ' | ' | -1,753 | -802 | -1,158 |
Deferred income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -7,044 | -890 | -2,962 |
Total income tax (benefit) provision | $4,927 | $80 | $7,313 | ($12,683) | $5,701 | $4,953 | $2,599 | $2,893 | ($363) | $16,146 | $13,834 |
INCOME_TAXES_Components_of_Def
INCOME TAXES (Components of Deferred Income Taxes) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Deferred tax assets: | ' | ' |
Federal net operating loss carryforward | $187 | $0 |
State net operating loss carryforward | 1,476 | 25 |
Research and development tax credits | 3,244 | 0 |
Allowances for accounts receivable | 2,773 | 1,005 |
Deferred rent obligation | 328 | 1,593 |
Stock compensation | 18,270 | 13,800 |
Other accrued liabilities | 2,171 | 1,743 |
Deferred revenue | 17,754 | 16,594 |
Other | 3,101 | 2,251 |
Total gross deferred tax assets | 49,304 | 37,011 |
Valuation allowance | -2,627 | -25 |
Total deferred tax assets | 46,677 | 36,986 |
Deferred tax liabilities: | ' | ' |
Intangible assets | -49,555 | -6,605 |
Capitalized software development | -8,641 | -5,420 |
Property and equipment | -3,784 | -6,290 |
Investments | 0 | -5 |
Total deferred tax liabilities | -61,980 | -18,320 |
Net deferred tax (liabilities) assets | ($15,303) | $18,666 |
INCOME_TAXES_Reconciliation_of
INCOME TAXES (Reconciliation of the Federal Statutory Income Tax Rate to Effective Income Tax Rate) (Detail) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Income tax computed at federal statutory tax rate | 35.00% | 35.00% | 35.00% |
State taxes, net of federal benefit | -6.00% | 5.00% | 6.00% |
Research and development credits | -98.00% | 0.00% | -1.00% |
Permanent differences | 20.00% | 6.00% | 2.00% |
Valuation allowance | 33.00% | 0.00% | 0.00% |
Total | -16.00% | 46.00% | 42.00% |
INCOME_TAXES_Reconciliation_of1
INCOME TAXES (Reconciliation of Beginning and Ending Amount of Uncertain Tax Benefits) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ' | ' | ' |
Beginning uncertain tax benefits | $1,761 | $1,685 | $1,610 |
Prior year – decreases | -537 | -140 | -23 |
Prior year – increases | 501 | 177 | 22 |
Acquired balances | 2,339 | 0 | 0 |
Current year – increases | 787 | 39 | 76 |
Ending uncertain tax benefits | $4,851 | $1,761 | $1,685 |
EMPLOYEE_BENEFIT_PLAN_Addition
EMPLOYEE BENEFIT PLAN (Additional Information) (Detail) (Defined Contribution Pension Plan 401k, USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Defined Contribution Pension Plan 401k | ' | ' | ' |
Employee Benefits Disclosure [Line Items] | ' | ' | ' |
Defined contribution plan, cost recognized | $3.20 | $2.40 | $1.70 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Additional Information) (Detail) (Bushansky v Epocrates Inc, et al, USD $) | 0 Months Ended |
In Millions, unless otherwise specified | Oct. 04, 2013 |
Bushansky v Epocrates Inc, et al | ' |
Commitments and Contingencies Disclosure [Line Items] | ' |
Amount of final settlement approval | $0.30 |
QUARTERLY_FINANCIAL_INFORMATIO2
QUARTERLY FINANCIAL INFORMATION (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business services | $162,529 | $141,326 | $137,919 | $121,463 | $112,581 | $102,256 | $100,110 | $93,549 | $563,237 | $408,496 | $312,768 |
Implementation and other | 9,050 | 10,201 | 8,382 | 4,133 | 3,723 | 3,630 | 3,405 | 3,017 | 31,766 | 13,775 | 11,299 |
Total revenue | 171,579 | 151,527 | 146,301 | 125,596 | 116,304 | 105,886 | 103,515 | 96,566 | 595,003 | 422,271 | 324,067 |
Expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Direct operating | 62,852 | 63,245 | 59,390 | 53,185 | 45,208 | 41,866 | 41,014 | 38,798 | 238,672 | 166,886 | 122,795 |
Selling and marketing | 37,947 | 37,584 | 41,035 | 32,922 | 27,580 | 25,603 | 27,389 | 23,728 | 149,488 | 104,300 | 79,775 |
Research and development | 16,322 | 15,104 | 14,269 | 11,944 | 9,263 | 8,746 | 8,615 | 7,168 | 57,639 | 33,792 | 23,343 |
General and administrative | 22,339 | 21,690 | 24,670 | 31,077 | 14,952 | 11,913 | 13,961 | 16,199 | 99,776 | 57,025 | 48,711 |
Depreciation and amortization | 12,864 | 11,263 | 11,107 | 8,341 | 7,677 | 6,683 | 5,795 | 5,486 | 43,575 | 25,641 | 16,710 |
Total expense | 152,324 | 148,886 | 150,471 | 137,469 | 104,680 | 94,811 | 96,774 | 91,379 | 589,150 | 387,644 | 291,334 |
Operating income | 19,255 | 2,641 | -4,170 | -11,873 | 11,624 | 11,075 | 6,741 | 5,187 | 5,853 | 34,627 | 32,733 |
Other (expense) income: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense | -1,319 | -1,421 | -1,001 | -164 | ' | ' | ' | ' | -3,905 | -407 | -314 |
Other (expense) income | 136 | 30 | 63 | 54 | ' | ' | ' | ' | 283 | ' | ' |
Total other (expense) income | -1,183 | -1,391 | -938 | -110 | 17 | 88 | 12 | 134 | -3,622 | 251 | 147 |
Income before income tax benefit (provision) | 18,072 | 1,250 | -5,108 | -11,983 | 11,641 | 11,163 | 6,753 | 5,321 | 2,231 | 34,878 | 32,880 |
Income tax benefit (provision) | -4,927 | -80 | -7,313 | 12,683 | -5,701 | -4,953 | -2,599 | -2,893 | 363 | -16,146 | -13,834 |
Net income | $13,145 | $1,170 | ($12,421) | $700 | $5,940 | $6,210 | $4,154 | $2,428 | $2,594 | $18,732 | $19,046 |
Net income per share - Basic (in dollars per share) | $0.35 | $0.03 | ($0.34) | $0.02 | $0.16 | $0.17 | $0.12 | $0.07 | $0.07 | $0.52 | $0.54 |
Net income per share - Diluted (in dollars per share) | $0.34 | $0.03 | ($0.34) | $0.02 | $0.16 | $0.17 | $0.11 | $0.07 | $0.07 | $0.50 | $0.53 |
Weighted average shares used in computing net income (loss) per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (shares) | 37,262 | 36,970 | 36,760 | 36,409 | 36,264 | 35,832 | 35,685 | 35,535 | 36,856 | 35,956 | 35,046 |
Diluted (shares) | 38,645 | 38,343 | 36,760 | 37,744 | 37,420 | 37,212 | 36,906 | 36,996 | 38,257 | 37,133 | 36,050 |