Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 18, 2016 | Jun. 30, 2015 | |
Document and Entity Information | |||
Entity Registrant Name | SYNCHRONOSS TECHNOLOGIES INC | ||
Entity Central Index Key | 1,131,554 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1.2 | ||
Entity Common Stock, Shares Outstanding | 44,594,635 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 147,634 | $ 235,967 |
Marketable securities | 66,357 | 51,097 |
Accounts receivable, net of allowance for doubtful accounts of $3,029 and $88 at December 31, 2015 and 2014, respectively | 143,692 | 118,371 |
Prepaid expenses and other assets | 49,262 | 35,023 |
Deferred tax assets | 1,475 | |
Total current assets | 406,945 | 441,933 |
Marketable securities | 19,635 | 3,313 |
Property and equipment, net | 168,280 | 151,171 |
Goodwill | 221,271 | 147,135 |
Intangible assets, net | 174,322 | 99,489 |
Deferred tax assets | 3,560 | 1,232 |
Other assets | 21,337 | 18,549 |
Total assets | 1,015,350 | 862,822 |
Current liabilities: | ||
Accounts payable | 26,038 | 25,059 |
Accrued expenses | 45,819 | 42,679 |
Deferred revenues | 8,323 | 11,897 |
Contingent consideration obligation | 8,000 | |
Total current liabilities | 80,180 | 87,635 |
Lease financing obligation - long-term | 13,343 | 9,204 |
Contingent consideration obligation - long-term | 930 | |
Convertible debt | 230,000 | 230,000 |
Deferred Tax Liabilities, Net, Noncurrent | 16,404 | 3,698 |
Other liabilities | 3,227 | $ 3,178 |
Redeemable noncontrolling interest | $ 61,452 | |
Stockholders' equity: | ||
Preferred stock, $0.0001 par value; 10,000 shares authorized, 0 shares issued and outstanding at December 31, 2015 and 2014 | ||
Common stock, $0.0001 par value; 100,000 shares authorized, 48,084 and 46,444 shares issued; 44,405 and 42,711 outstanding at December 31, 2015 and December 31, 2014, respectively | $ 4 | $ 4 |
Treasury stock, at cost (3,679 and 3,733 shares at December 31, 2015 and 2014, respectively) | (65,651) | (66,336) |
Additional paid-in capital | 512,802 | 454,740 |
Accumulated other comprehensive loss | (38,684) | (20,014) |
Retained earnings | 201,343 | 160,713 |
Total stockholders' equity | 609,814 | 529,107 |
Total liabilities and stockholders' equity | $ 1,015,350 | $ 862,822 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 3,029 | $ 88 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 48,084,000 | 46,444,000 |
Common stock, shares outstanding | 44,405,000 | 42,711,000 |
Treasury stock, shares | 3,679,000 | 3,733,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||||
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||||||
Net revenues | $ 578,831 | $ 457,314 | $ 349,047 | |||
Costs and expenses: | ||||||
Cost of services | 239,074 | [1] | 184,414 | [2] | 146,238 | [3] |
Research and development | 91,430 | 73,620 | 64,845 | |||
Selling, general and administrative | 90,735 | 79,227 | 62,096 | |||
Net change in contingent consideration obligation | 760 | 1,799 | (5,324) | |||
Restructuring charges | 5,090 | 5,172 | ||||
Depreciation and amortization | 72,152 | 55,956 | 41,126 | |||
Total costs and expenses | 499,241 | 395,016 | 314,153 | |||
Income from operations | 79,590 | 62,298 | 34,894 | |||
Interest income | 2,047 | 1,265 | 2,646 | |||
Interest expense | (5,711) | (3,430) | (3,178) | |||
Other income | 372 | 441 | 217 | |||
Income before income tax expense | 76,298 | 60,574 | 34,579 | |||
Income tax expense | (29,616) | (21,679) | (11,228) | |||
Net Income | 46,682 | 38,895 | 23,351 | |||
Net income attributable to noncontrolling interests | 6,052 | |||||
Net income attributable to Synchronoss | $ 40,630 | $ 38,895 | $ 23,351 | |||
Net income per common share: | ||||||
Basic (in dollars per share) | $ 0.96 | [4] | $ 0.96 | [5] | $ 0.60 | [6] |
Diluted (in dollars per share) | $ 0.89 | [7] | $ 0.92 | [8] | $ 0.58 | [9] |
Weighted-average common shares outstanding: | ||||||
Basic (in shares) | 42,284 | [10] | 40,418 | [11] | 38,891 | [12] |
Diluted (in shares) | 47,653 | [13] | 43,297 | [14] | 40,009 | [15] |
[1] | Cost of services excludes depreciation and amortization which is shown separately | |||||
[2] | Cost of services excludes depreciation and amortization which is shown separately | |||||
[3] | Cost of services excludes depreciation and amortization which is shown separately | |||||
[4] | See notes to financial statement footnote 2 | |||||
[5] | See notes to financial statement footnote 2 | |||||
[6] | See notes to financial statement footnote 2 | |||||
[7] | See notes to financial statement footnote 2 | |||||
[8] | See notes to financial statement footnote 2 | |||||
[9] | See notes to financial statement footnote 2 | |||||
[10] | See notes to financial statement footnote 2 | |||||
[11] | See notes to financial statement footnote 2 | |||||
[12] | See notes to financial statement footnote 2 | |||||
[13] | See notes to financial statement footnote 2 | |||||
[14] | See notes to financial statement footnote 2 | |||||
[15] | See notes to financial statement footnote 2 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income attributable to Synchronoss | $ 40,630 | $ 38,895 | $ 23,351 |
Other comprehensive loss, net of tax: | |||
Foreign currency translation adjustments | (17,281) | (12,739) | (3,779) |
Unrealized (loss) gain on securities | (54) | (176) | 2 |
Net (loss) gain on intra-entity foreign currency transactions | (1,335) | (6,376) | 3,419 |
Total other comprehensive loss | (18,670) | (19,291) | (358) |
Total comprehensive income attributable to Synchronoss | $ 21,960 | $ 19,604 | $ 22,993 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total |
Balance at Dec. 31, 2012 | $ 4 | $ (67,918) | $ 344,469 | $ (365) | $ 98,467 | $ 374,657 |
Balance (in shares) at Dec. 31, 2012 | 42,533 | (3,859) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock based compensation | 10,035 | 10,035 | ||||
Issuance of restricted stock | 14,539 | 14,539 | ||||
Issuance of restricted stock (in shares) | 734 | |||||
Issuance of common stock on exercise of options | 19,196 | 19,196 | ||||
Issuance of common stock on exercise of options (in shares) | 1,156 | |||||
Issuance of common stock related to acquisition | 1,144 | 1,144 | ||||
Issuance of common stock related to acquisition (in shares) | 33 | |||||
ESPP compensation | 640 | 640 | ||||
Sale of Treasury Stock in connection with an employee stock purchase plan | $ 814 | 660 | 1,474 | |||
Sale of Treasury Stock in connection with an employee stock purchase plan (in shares) | 66 | |||||
Net income attributable to Synchronoss | 23,351 | 23,351 | ||||
Total other comprehensive loss | (358) | (358) | ||||
Tax benefit from stock option exercise | 2,961 | 2,961 | ||||
Balance at Dec. 31, 2013 | $ 4 | $ (67,104) | 393,644 | (723) | 121,818 | 447,639 |
Balance (in shares) at Dec. 31, 2013 | 44,456 | (3,793) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock based compensation | 9,992 | 9,992 | ||||
Issuance of restricted stock | 18,353 | 18,353 | ||||
Issuance of restricted stock (in shares) | 765 | |||||
Issuance of common stock on exercise of options | 30,003 | 30,003 | ||||
Issuance of common stock on exercise of options (in shares) | 1,223 | |||||
ESPP compensation | 642 | 642 | ||||
Sale of Treasury Stock in connection with an employee stock purchase plan | $ 768 | 909 | 1,677 | |||
Sale of Treasury Stock in connection with an employee stock purchase plan (in shares) | 60 | |||||
Net income attributable to Synchronoss | 38,895 | 38,895 | ||||
Total other comprehensive loss | (19,291) | (19,291) | ||||
Tax benefit from stock option exercise | 1,197 | 1,197 | ||||
Balance at Dec. 31, 2014 | $ 4 | $ (66,336) | 454,740 | (20,014) | 160,713 | $ 529,107 |
Balance (in shares) at Dec. 31, 2014 | 46,444 | (3,733) | 46,444 | |||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock based compensation | 8,495 | $ 8,495 | ||||
Issuance of restricted stock | 22,592 | 22,592 | ||||
Issuance of restricted stock (in shares) | 761 | |||||
Issuance of common stock on exercise of options | 19,936 | $ 19,936 | ||||
Issuance of common stock on exercise of options (in shares) | 879 | 879 | ||||
ESPP compensation | 624 | $ 624 | ||||
Sale of Treasury Stock in connection with an employee stock purchase plan | $ 685 | 1,217 | 1,902 | |||
Sale of Treasury Stock in connection with an employee stock purchase plan (in shares) | 54 | |||||
Net income attributable to Synchronoss | 40,630 | 40,630 | ||||
Total other comprehensive loss | (18,670) | (18,670) | ||||
Tax benefit from stock option exercise | 5,198 | 5,198 | ||||
Balance at Dec. 31, 2015 | $ 4 | $ (65,651) | $ 512,802 | $ (38,684) | $ 201,343 | $ 609,814 |
Balance (in shares) at Dec. 31, 2015 | 48,084 | (3,679) | 48,084 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities: | |||
Net income | $ 46,682 | $ 38,895 | $ 23,351 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization expense | 72,152 | 55,956 | 41,126 |
Amortization of debt issuance costs | 1,501 | 618 | |
Loss on disposal of asset | 16 | 33 | |
Amortization of bond premium | 1,705 | 384 | 294 |
Deferred income taxes | 8,319 | 3,207 | 1,575 |
Non-cash interest on leased facility | 924 | 946 | 921 |
Stock-based compensation | 31,711 | 28,987 | 25,214 |
Changes in operating assets and liabilities: | |||
Accounts receivable, net of allowance for doubtful accounts | (27,577) | (50,924) | 10,167 |
Prepaid expenses and other current assets | (8,543) | (14,660) | 8,022 |
Other assets | (4,282) | (1,930) | (7,376) |
Accounts payable | 6,185 | 4,169 | 348 |
Accrued expenses | (710) | 1,263 | (7,155) |
Contingent consideration obligation | (772) | 3,532 | (6,214) |
Excess tax benefit from the exercise of stock options | (5,198) | (1,203) | (2,961) |
Other liabilities | (402) | 5,825 | (320) |
Deferred revenues | (4,130) | (4,119) | (5,900) |
Net cash provided by operating activities | 117,581 | 70,979 | 81,092 |
Investing activities: | |||
Purchases of fixed assets | (59,960) | (73,885) | (73,434) |
Purchases of intangibles | (1,200) | ||
Purchases of marketable securities available-for-sale | (139,569) | (50,275) | (8,366) |
Sales and maturities of marketable securities available-for-sale | 106,210 | 9,265 | 14,825 |
Business acquired, net of cash | (131,592) | (38,085) | (6,677) |
Net cash used in investing activities | (226,111) | (152,980) | (73,652) |
Financing activities: | |||
Proceeds from the exercise of stock options | 19,936 | 30,003 | 19,196 |
Payments on contingent consideration obligation | (4,468) | (1,926) | |
Debt issuance costs related to convertible notes | (7,065) | ||
Proceeds from issuance of convertible notes | 230,000 | ||
Borrowings on revolving line of credit | 40,000 | ||
Repayment of revolving line of credit | (40,000) | ||
Excess tax benefit from the exercise of stock options | 5,198 | 1,203 | 2,961 |
Proceeds from the sale of treasury stock in connection with an employee stock purchase plan | 1,902 | 1,677 | 1,474 |
Repayments of capital obligations | (2,021) | (1,515) | (1,597) |
Net cash provided by financing activities | 20,547 | 254,303 | 20,108 |
Effect of exchange rate changes on cash | (350) | 153 | (64) |
Net (decrease) increase in cash and cash equivalents | (88,333) | 172,455 | 27,484 |
Cash and cash equivalents at beginning of period | 235,967 | 63,512 | 36,028 |
Cash and cash equivalents at end of period | 147,634 | 235,967 | 63,512 |
Supplemental disclosures of cash flow information: | |||
Cash paid for interest | 5,791 | 2,290 | 168 |
Cash paid for income taxes | $ 29,868 | $ 19,342 | 1,773 |
Supplemental disclosures of non-cash investing and financing activities: | |||
Issuance of common stock in connection with the acquisition | $ 1,144 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2015 | |
Description of Business | |
Description of Business | 1. Description of Business S ynchronoss is a leading innovator of cloud solutions and software-based activation for mobile carriers, enterprises, retailers and OEMs across the globe. Synchronoss’ software provides innovative consumer and enterprise solutions that drive billions of transactions on a wide range of connected devices across the world’s leading networks. The Company’s solutions include: activation and provisioning software for devices and services, cloud-based sync, backup, storage and content engagement capabilities, broadband connectivity solutions, analytics, identity/access management and secure mobility management that enable communications service providers (CSPs), cable operators/multi-services operators (MSOs) and original equipment manufacturers (OEMs) with embedded connectivity (e.g. smartphones, laptops, tablets and mobile Internet devices (MIDs), such as automobiles, wearables for personal health and wellness, and connected homes), multi-channel retailers, medium and large enterprises and their consumers as well as other customers to accelerate and monetize value-add services for secure and broadband networks and connected devices. Synchronoss’ Activation Software, Synchronoss Personal Cloud™ and Enterprise products and platforms provide end-to-end seamless integration between customer-facing channels/applications, communication services, or devices and “back-office” infrastructure-related systems and processes. The Company’s customers rely on the Company’s solutions and technology to automate the process of activation and content and settings management for their subscribers’ devices while delivering additional communication services. The Synchronoss Activation solution orchestrates the complex and different back-end systems of communication service providers to provide a best-in-class ordering system by orchestrating the workflow and consolidated automated customer care services. This allows CSPs using the Company’s platforms to realize the full benefits of their offerings. The platforms also support, among other automated transaction areas, credit card billing, inventory management, and trouble ticketing. In addition to this, the platform supports the physical transactions involved in customer activation and service such as managing access service requests, local service requests, local number portability, and directory listings. The Synchronoss Personal Cloud™ solution seamlessly transfers content from an old device to a new device, syncs, backs up and connects consumer’s content from multiple smart devices to the Company’s cloud platform. This allows carrier customers to protect and manage their growing cache of personally generated, mobile content over long periods of time. The Synchronoss Enterprise solutions support an advanced mobility digital experience for businesses and consumers for accessing and protecting their information. The Company’s identity and access management platform helps consumers and business users to securely authenticate access to online websites to conduct ecommerce transactions or access important data. The secure mobility platforms help users safely and securely store and share important data. The solutions are based on understanding assumptions on the behaviors of individuals through the capture of who they are, what they are doing and how, where and when they are doing it. This allows the Company’s platforms to help reduce fraud, improve cybersecurity detection/prevention and overall productivity. The identity and access solution supports both consumers by allowing them to self-register and verify their identity, while providing non-intrusive multi-factor authentication and businesses the ability to be sure the correct person is doing the transaction. The secure mobility solution combines the identity platform with a “bring your own device” (BYOD) platform that is based on a secure container for accessing data, applications, content and personal information management tools like email, calendar, messaging and notes. The Company’s Integrated Life™ platform brings together select capabilities of the Company’s device/service Activation software and services with the Company’s Synchronoss Personal Cloud™ and analytics solutions to give carrier subscribers innovative digital experiences that work across new and emerging consumer devices (e.g. connected cars, wearables, connected homes, smart TV’s, etc.) in carrier and the Internet of Things (IoT) markets. Synchronoss’ products and platforms are designed to be carrier-grade, highly available, flexible and scalable to enable multiple converged communication services to be managed across multiple distribution channels including e-commerce, m-commerce, telesales, customer stores, indirect and other retail outlets allowing Synchronoss to meet the rapidly changing and converging services and connected devices offered by the Company’s customers. The Company’s products, platforms and solutions enable its Enterprise customers to acquire, retain and service subscribers quickly, reliably and cost-effectively with white label and custom-branded solutions. Customers can simplify the processes associated with managing the customer experience for procuring, activating, connecting, backing-up, synchronizing and enterprise-wide sharing/collaboration with connected devices and contents from these devices and associated services. The extensibility, scalability, reliability and relevance of the Company’s platforms enable new revenue streams and retention opportunities for the Company’s customers through new subscriber acquisitions, sale of new devices, accessories and new value-added service offerings in the Cloud, while optimizing their cost of operations and enhancing customer experience. Synchronoss currently operates in and markets its solutions and services directly through its sales organizations in North America, Europe and Asia-Pacific. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation The consolidated financial statements include the accounts of the Company, its wholly ‑owned subsidiaries, variable interest entities (VIE) in which the Company is the primary beneficiary and entities in which the Company has a controlling interest. All material intercompany transactions and accounts are eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year's presentation. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Revenue Recognition and Deferred Revenue The Company provides services principally on a transactional or subscription basis or, at times, on a fixed fee basis and recognizes the revenues as the services are performed or delivered as described below: Transactional and Subscription Service Arrangements: Transaction and subscription revenues consist of revenues derived from the processing of transactions through the Company’s service platforms, providing enterprise portal management services on a subscription basis and maintenance agreements on software licenses. Transaction service arrangements include services such as processing equipment orders, new account set ‑up and activation, number port requests, credit checks and inventory management. Subscription services include monthly active user fees, software as a service (“SaaS”) fees, hosting and storage and the related maintenance support for those services. Transaction revenues are principally based on a contractual price per transaction and are recognized based on the number of transactions processed during each reporting period. Revenues are recorded based on the total number of transactions processed at the applicable price established in the relevant contract. The total amount of revenues recognized is based primarily on the volume of transactions. Subscription revenues are recorded one of two ways: on a straight ‑line basis over the life of the contract or on a fixed monthly fee based on a set contracted amount. Many of the Company’s contracts guarantee minimum volume transactions from the customer. In these instances, if the customer’s total transaction volume for the period is less than the contractual amount, the Company records revenues at the minimum guaranteed amount. At times, transaction revenues may also include billings to customers that reimburse the Company based on the number of individuals dedicated to processing transactions. Set ‑up fees for transactional service arrangements are deferred and recognized on a straight ‑line basis over the life of the contract since these amounts would not have been paid by the customer without the related transactional service arrangement. Revenues are presented net of discounts, which are volume level driven, or credits, which are performance driven, and are determined in the period in which the volume thresholds are met or the services are provided. Professional Service and Software License Arrangements: Professional services include process and workflow consulting services and development services. Professional services when sold with transactional or subscription service arrangements are accounted for separately when the professional services have value to the customer on a standalone basis and there is objective and reliable evidence of fair value of the professional services. When accounted for separately, professional service revenues are recognized as services are performed and all other elements of revenue recognition have been satisfied. In determining whether professional service revenues can be accounted for separately from transaction or subscription service revenues, the Company considers the following factors for each professional services agreement: availability of the professional services from other vendors, whether objective and reliable evidence of fair value exists of the undelivered elements, the nature of the professional services, the timing of when the professional services contract was signed in comparison to the transaction or subscription service start date and the contractual independence of the transactional or subscription service from the professional services. If a professional service arrangement were not to qualify for separate accounting, the Company would recognize the professional service revenues ratably over the remaining term of the transaction or subscription agreement. Revenue from software license arrangements is recognized when the license is delivered to its customers and all of the software revenue recognition criteria are met. When software arrangements include multiple elements, the arrangement consideration is allocated at the inception to all deliverables using the residual method providing the Company has vendor specific objective evidence (VSOE) on all undelivered elements. The Company determines VSOE for each element based on historical stand ‑alone sales to third parties. When transaction or subscription service arrangements, include multiple elements, the arrangement consideration is allocated at the inception of an arrangement to all deliverables using the relative selling price method. The relative selling price method allocates any discount in the arrangement proportionally to each deliverable on the basis of each deliverable’s selling price. The selling price used for each deliverable will be based on VSOE if available, third ‑party evidence (TPE) if vendor ‑specific objective evidence is not available, or estimated selling price (ESP) if neither vendor ‑specific objective evidence nor third ‑party evidence is available. The objective of ESP is to determine the price at which the Company would transact a sale if the product or service were sold on a stand ‑alone basis. The Company determines ESP by considering multiple factors including, but not limited to, geographies, market conditions, competitive landscape, internal costs, gross margin objectives, and pricing practices. ESP is generally used for offerings that are not typically sold on a stand ‑alone basis or for new or highly customized offerings. While the Company follows specific and detailed rules and guidelines related to revenue recognition, it makes and uses management judgments and estimates in connection with the revenue recognized in any reporting period, particularly in the areas described above, as well as collectability. If management made different estimates or judgments, differences in the timing of the recognition of revenue could occur. Deferred Revenue: Deferred revenues primarily represent billings to customers for services in advance of the performance of services, with revenues recognized as the services are rendered, and also includes the fair value of deferred revenues recorded as a result of acquisitions. Service Level Standards Pursuant to certain contracts, the Company is subject to service level standards and to corresponding penalties for failure to meet those standards. All performance ‑related penalties are reflected as a corresponding reduction of the Company’s revenues. These penalties, if applicable, are recorded in the month incurred and were insignificant for the years ended December 31, 2015 , 2014 and 2013 , respectively. Cost of Services Cost of services includes all direct materials, direct labor and those indirect costs related to revenues such as indirect labor, materials and supplies and facilities cost, exclusive of depreciation expense. Research and Development Research and development costs are expensed as incurred, unless they meet U.S. GAAP criteria for deferral and amortization. Software development costs incurred prior to the establishment of technological feasibility do not meet these criteria, and are expensed as incurred. Amortization of software development costs is computed using the straight ‑line method over the estimated useful lives of the assets, 3 and 5 years. As of December 31, 2015 , the Company had $6.1 million of unamortized software development costs and $2.0 million of amortization expense which was recognized during 2015 . As of December 31, 2014 , the Company had $6.1 million of unamortized software development costs and $837 thousand of amortization expense which was recognized during 2014 . As of December 31, 2013 , the Company had $1.8 million of unamortized software development costs and $1.2 million of amortization expense which was recognized during 2013 . Research and development expense consists primarily of costs related to personnel, including salaries and other personnel ‑related expenses, consulting fees and the cost of facilities, computer and support services used in service technology development. The Company also expenses costs relating to developing modifications and minor enhancements of its existing technology and services. Concentration of Credit Risk The Company’s financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents, marketable securities and accounts receivable. The Company maintains its cash and cash equivalents at several major financial institutions. The Company has not experienced any realized losses in such accounts and believes it is not exposed to any significant credit risk related to cash, cash equivalents and securities. The Company’s cash equivalents and short ‑term marketable securities consist primarily of money market funds, certificates of deposit, commercial paper, and municipal and corporate bonds. The Company believes that concentration of credit risk with respect to accounts receivable is limited because of the creditworthiness of the Company’s major customers. AT&T and Verizon Wireless in the aggregate accounted for 75% , 73% and 66% of net revenues for 2015 , 2014 and 2013 , respectively. AT&T and Verizon accounted for 72% and 68% of accounts receivable at December 31, 2015 and 2014 , respectively. The loss of either AT&T or Verizon as a customer would have a material negative impact on the Company. The Company believes that if either AT&T or Verizon terminated their relationships with Synchronoss, they would encounter substantial costs in replacing Synchronoss’ solutions. Fair Value of Financial Instruments and Liabilities The Company includes disclosures of fair value information about financial instruments and liabilities, whether or not recognized on the balance sheet, for which it is practicable to estimate that value. Due to their short ‑term nature, the carrying amounts reported in the financial statements approximate the fair value for cash and cash equivalents, marketable securities, accounts receivable and accounts payable. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less at the date of acquisition to be cash equivalents. Marketable Securities Marketable securities consist of fixed income investments with a maturity of greater than three months and enhanced money market funds. These investments are classified as available ‑for ‑sale and are reported at fair value on the Company’s balance sheet. The Company classifies its securities with maturity dates of 12 months or more as long term. Unrealized holding gains and losses are reported within accumulated other comprehensive loss as a separate component of stockholders’ equity. If a decline in the fair value of a marketable security below the Company’s cost basis is determined to be other than temporary, such marketable security is written down to its estimated fair value as a new cost basis and the amount of the write ‑down is included in earnings as an impairment charge. The Company has recorded temporary changes in fair value of the marketable securities but has not recorded other ‑than ‑temporary charges for the periods presented herein. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consist of amounts due to the Company from normal business activities. The Company maintains an allowance for estimated losses resulting from the inability of its customers to make required payments. The Company estimates uncollectible amounts based upon historical bad debts, current customer receivable balances, the age of customer receivable balances, the customer’s financial condition and current economic trends. Property and Equipment Property and equipment and leasehold improvements are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight ‑line method over the estimated useful lives of the assets, which range from 3 to 5 years, or the lesser of the related initial term of the lease or useful life for leasehold improvements. Amortization of property and equipment recorded under a capital lease is included with depreciation expense. Expenditures for routine maintenance and repairs are charged against operations. Major replacements, improvements and additions are capitalized. Noncontrolling Interest Noncontrolling interests ("NCI") are evaluated by the Company and are shown as either a liability, temporary equity (shown between liabilities and equity) or as permanent equity depending on the nature of the redeemable features at amounts based on formulas specific to each entity. Generally, mandatorily redeemable NCI's are classified as liabilities and non-mandatorily redeemable NCI's are classified outside of stockholders' equity in the Consolidated Balance Sheets as temporary equity under the caption, redeemable noncontrolling interests, and are measured at their redemption values at the end of each period. If the redemption value is greater than the carrying value, an adjustment is recorded in retained earnings to record the NCI at its redemption value. Redeemable NCI’s that are mandatorily redeemable are classified as a liability in the Consolidated Balance Sheets under either other current liabilities or other long-term liabilities, depending on the remaining duration until settlement, and are measured at the amount of cash that would be paid if settlement occurred at the balance sheet date with any change from the prior period recognized as interest expense. If the noncontrolling interest is not currently redeemable yet probable of becoming redeemable, the Company is required to either (1) accrete changes in the redemption value over the period from the date of issuance to the earliest redemption date of the instrument using an appropriate methodology, usually the interest method, or (2) recognize changes in the redemption value immediately as they occur and adjust the carrying value of the security to equal the redemption value at the end of each reporting period. The Company has elected to recognize changes in the redemption value immediately as they occur and adjust the carrying value of the noncontrolling interest to the greater of the estimated redemption value, which approximates fair value, at the end of each reporting period or the initial carrying amount. Net income attributable to NCI’s reflects the portion of the net income (loss) of consolidated entities applicable to the NCI stockholders in the accompanying Consolidated Statements of Income. The net income attributable to NCI is classified in the Consolidated Statements of Income as part of consolidated net income and deducted from total consolidated net income to arrive at the net income attributable to the Company. Business Combinations The Company accounts for business combinations in accordance with the acquisition method. The acquisition method of accounting requires that assets acquired, liabilities assumed and any noncontrolling interest in the aquiree (if any) be recorded at their fair values on the date of a business acquisition. The Company’s consolidated financial statements and results of operations reflect an acquired business from the completion date of an acquisition. The judgments that the Company makes in determining the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact net income in periods following a business combination. The Company generally uses either the income, cost or market approach to aid in its conclusions of such fair values and asset lives. The income approach presumes that the value of an asset can be estimated by the net economic benefit to be received over the life of the asset, discounted to present value. The cost approach presumes that an investor would pay no more for an asset than its replacement or reproduction cost. The market approach estimates value based on what other participants in the market have paid for reasonably similar assets. Although each valuation approach is considered in valuing the assets acquired, the approach ultimately selected is based on the characteristics of the asset and the availability of information. The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date. Each reporting period thereafter, the Company revalues these obligations and records increases or decreases in their fair value as an adjustment to net change in contingent consideration obligation within the consolidated statement of income. Changes in the fair value of the contingent consideration obligation can result from updates in the achievement of financial targets and changes to the weighted probability of achieving those future financial targets. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, any change in the assumptions described above, could have a material impact on the amount of the net change in contingent consideration obligation that the Company records in any given period. Investments in Affiliates and Other Entities In the normal course of business, Synchronoss enters into various types of investment arrangements, each having unique terms and conditions. These investments may include equity interests held by Synchronoss in business entities, including general or limited partnerships, contractual joint ventures, or other forms of equity participation. Synchronoss determines whether such investments involve a VIE based on the characteristics of the subject entity. If the entity is determined to be a VIE, then management determines if Synchronoss is the primary beneficiary of the entity and whether or not consolidation of the VIE is required. The primary beneficiary consolidating the VIE must normally have both (i) the power to direct the activities of a VIE that most significantly affect the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE, in either case that could potentially be significant to the VIE. When Synchronoss is deemed to be the primary beneficiary, the VIE is consolidated and the other party’s equity interest in the VIE is accounted for as a noncontrolling interest. In cases where Synchronoss determines that it has an undivided interest in the assets, liabilities, revenues and profits of an unincorporated VIE (e.g., a general partnership interest), such amounts are consolidated on a basis proportional to Synchronoss’ ownership interest in the unincorporated entity. If an entity fails to meet the characteristics of a VIE, the Company then evaluates such entity under the voting model. Under the voting model, the Company consolidates the entity if they determine that they, directly or indirectly, have greater than 50% of the voting shares, and determine that other equity holders do not have substantive participating rights. During the year ended December 31, 2015, the Company formed a venture with MCI Communications and Verizon Patent and Licensing Inc. (collectively, “Verizon”), referred to as Zentry, LLC (“Zentry”). The Company determined that Zentry was a voting interest entity, because the entity has sufficient equity at risk to enable it to finance its activities independently. As the Company holds a majority ownership in Zentry, the Company consolidates Zentry under the voting model. During the year ended December 31, 2015, the Company formed a venture with Goldman Sachs (“Goldman”), referred to as SNCR, LLC which was determined to be a VIE. The Company concluded that the entity does not have enough equity to finance its activities without additional subordinated financial support, which was provided by the Company via a $20 million line of credit. The Company consolidates the entity under the VIE model. SNCR, LLC is the primary beneficiary and has the power to direct activities that most significantly impact the ventures’ economic performance. In particular, the Company directs the day to day operations, sales, marketing, distribution and R&D efforts of SNCR, LLC . Goodwill Goodwill represents the excess of the purchase price over the fair value of assets acquired, including other definite ‑lived intangible assets. Goodwill is not amortized, but reviewed annually for impairment or upon the occurrence of events or changes in circumstances that would more likely than not reduce the fair value of the reporting unit below its carrying amount. There were no impairment charges recognized during the years ended December 31, 2015 , 2014 and 2013 . Impairment of Long ‑Lived Assets A review of long ‑lived assets for impairment is performed when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. If an indication of impairment is present, the Company compares the estimated undiscounted future cash flows to be generated by the asset to the asset’s carrying amount. If the undiscounted future cash flows are less than the carrying amount of the asset, the Company records an impairment loss equal to the amount by which the asset’s carrying amount exceeds its fair value. The fair value is determined based on valuation techniques such as a comparison to fair values of similar assets or using a discounted cash flow analysis. There were no impairment charges recognized during the years ended December 31, 2015 , 2014 and 2013 . Long lived assets that do not have indefinite lives are amortized/depreciated over their useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The Company reevaluates the useful life determinations each year to determine whether events and circumstances warrant a revision to the remaining useful lives. Income Taxes Since the Company conducts operations on a global basis, its effective tax rate has and will depend upon the geographic distribution of its pre ‑tax earnings among locations with varying tax rates. The Company accounts for the effects of income taxes that result from its activities during the current and preceding years. Under this method, deferred income tax liabilities and assets are based on the difference between the financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse or be utilized. The realization of deferred tax assets is contingent upon the generation of future taxable income. A valuation allowance is recorded if it is “more likely than not” that a portion or all of a deferred tax asset will not be realized. In evaluating the Company’s ability to recover their deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations. In projecting future taxable income, the Company begins with historical results adjusted for the results of discontinued operations and incorporates assumptions about the amount of future state, federal, and foreign pretax operating income adjusted for items that do not have tax consequences. The assumptions about future taxable income require significant judgment and are consistent with the plans and estimates the Company is using to manage the underlying businesses. In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income (loss). The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not to be sustained upon examination based on the technical merits of the position. The amount of the accrual for which an exposure exists is measured by determining the amount that has a greater than 50 percent likelihood of being realized upon the settlement of the position. Components of the reserve are classified as a current or a long ‑term liability in the consolidated balance sheets based on when the Company expects each of the items to be settled. The Company records interest and penalties accrued in relation to uncertain tax benefits as a component of interest expense. The Company expects that the amount of unrecognized tax benefits will change during 2016 , however, the Company does not expect the change to have a significant impact on its results of operations or financial position. While the Company believes it has identified all reasonably identifiable exposures and that the reserve that the Company has established for identifiable exposures is appropriate under the circumstances, it is possible that additional exposures exist and that exposures may be settled at amounts different than the amounts reserved. It is also possible that changes in facts and circumstances could cause the Company to either materially increase or reduce the carrying amount of its tax reserves. In general, tax returns for the year 2011 and thereafter are subject to future examination by tax authorities. The Company’s policy has been to leave its cumulative unremitted foreign earnings invested indefinitely outside the United States, and the Company intends to continue this policy. As such, taxes have not been provided on any of the remaining accumulated foreign unremitted earnings. Due to the timing and circumstances of repatriation of such earnings, if any, it is not practicable to determine the unrecognized deferred tax liability relating to such amounts. If the cumulative unremitted foreign earnings exceed the amount the Company intends to reinvest in foreign countries in the future, the Company would provide for taxes on such excess amount. Foreign Currency The functional currency is translated into U.S. dollars for balance sheet accounts using the month end rates in effect as of the balance sheet date and average exchange rate for revenue and expense accounts for each respective period. The translation adjustments are deferred as a separate component of stockholders’ equity within accumulated other comprehensive income. Gains or losses resulting from transactions denominated in foreign currencies are included in other income or expense, within the consolidated statements of income. Comprehensive Income Reporting on comprehensive income requires components of other comprehensive income, including unrealized gains or losses on available ‑for ‑sale securities, to be included as part of total comprehensive income. Comprehensive income is comprised of net income, translation adjustments and unrealized gains and losses on available ‑for ‑sale securities. The components of comprehensive income are included in the statements of comprehensive income. Basic and Diluted Net Income Attributable to Common Stockholders per Common Share Basic earnings per share is calculated by using the weighted-average number of common shares outstanding during the period, excluding amounts associated with restricted shares. The diluted earnings per share calculation is based on the weighted-average number of shares of common stock outstanding adjusted for the number of additional shares that would have been outstanding had all potentially dilutive common shares been issued. Potentially dilutive shares of common stock include stock options, convertible debt and unvested restricted stock. The dilutive effects of stock options and restricted stock awards are based on the treasury stock method. The dilutive effect of the assumed conversion of convertible debt is determined using the if-converted method. The after-tax effect of interest expense related to the convertible securities is added back to net income, and the convertible debt is assumed to have been converted into common shares at the beginning of the period. The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share. Stock options that are anti ‑dilutive and excluded from the following table totaled 553 thousand , 1.1 million and 1.4 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. Year Ended December 31, 2015 2014 2013 Numerator: Net income attributable to Synchronoss $ $ $ Income effect for interest on convertible debt, net of tax — Net income applicable to shares of common stock for earnings per share $ $ $ Denominator: Weighted-average common shares outstanding — basic Dilutive effect of: Shares from assumed conversion of convertible debt — Options and unvested restricted shares Weighted-average common shares outstanding — diluted Stock ‑Based Compensation The Company utilizes the Black ‑Scholes pricing model to determine the fair value of stock options on the dates of grant. Restricted stock awards are measured based on the fair market values of the underlying stock on the dates of grant, unless the awards are subject to market conditions, in which case the Company uses a binomial ‑lattice model (e.g., Monte Carlo simulation model). The Monte Carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved. The Company recognizes stock ‑based compensation over the requisite service period with an offsetting credit to additional paid ‑in capital. For the Company’s performance restricted stock awards the Company estimates the number of shares the recipient is to receive by applying a probability of achieving the performance goals. The actual number of shares the recipient receives is determined at the end of the performance period based on the results achieved versus goals based on the performance targets, such as revenues and operating income. Once the number of awards is determined, the compensation cost is fixed and continues to be recognized using the accelerated attribution recognition over the requisite service period for each vesting tranche. The Company classifies benefits of tax deductions in excess of the compensation cost recognized (excess tax benefits) as a financing cash inflow with a corresponding operating cash outflow. Impact of Recently Issued Accounting Standards In January 2016, Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 requires equity investments to be measured at fair value with changes in fair value recognized in net income; simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; requires separate presentation of financial assets and financial liabilities by measurement category and form of f |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2015 | |
Acquisition | |
Acquisition | 3. Acquisition Zentry, LLC On December 31, 2015, the Company formed a venture with MCI Communication Services and Verizon Patent and Licensing Inc. (collectively, “Verizon”), referred to as Zentry, LLC (Zentry) with the goal of accelerating the Company’s entrance into the enterprise market by adding identity management capabilities to the Synchronoss Secure Mobility Suite. The Company obtained a 67% interest in Zentry in exchange for $48 million. The Company and Verizon agreed to certain put and call options with regard to Verizon’s interest in Zentry. Verizon wi ll have the right to exercise a put option (the "Put Option") any time on or after December 31, 2018, to sell their interest in Zentry at a value which approximates fair value to the Company. Under the Put Option, the Company will be obligated to purchase Verizon’s interest. In addition, the Company has a call option (the "Call Option") to purchase Verizon’s interest in Zentry at any time on or after December 31, 2018 at a value which approximates fair value. Although the Company has the option to settle any amount in excess of $200 million in shares of the Company’s publicly traded common stock equal to the purchase price to be paid divided by the volume weighted average trading price per share during the thirty days prior to the date of such settlement, the Company’s intention is to settle the entire amount in cash. The Company determined that the Put Option is embedded within the noncontrolling interest shares that are subject to the Put Option. The redemption feature requires the classification of Verizon’s minority interest in the consolidated Balance Sheets outside of equity under the caption “redeemable noncontrolling interest.” The fair value of the net assets acquired approximated the purchase price. The venture was deemed not to be a VIE, as a result, the Company consolidated the venture in the consolidated financial statements according to the voting model. See Note 4. On December 31, 2015, concurrently with the formation of the venture, Zentry, LLC entered into a non-exclusive perpetual license agreement with Verizon Sourcing, LLC, in the amount of $23 million, for the use of software for the UIS platform. As part of the business combination accounting rules, the Company calculated the fair value of the license using an income approach, which incorporates significant estimates and assumptions made by management, which by their nature are characterized by uncertainty. Inputs used to value the license are considered Level 3 inputs. The Company determined the preliminary fair value of the net assets as follows: Preliminary Purchase Price Allocation Property, plant and equipment $ Intangible assets: Wtd. Avg. Technology 5 years Customer relationships 5 years Goodwill Total assets acquired Redeemable noncontrolling interest Net assets acquired $ The goodwill recorded in connection with this venture was based on operating synergies and other benefits expected to result from the combined operations. The goodwill acquired is not deductible for tax purposes. SNCR, LLC On November 16, 2015, the Company formed a venture with Goldman Sachs (Goldman), referred to as SNCR, LLC in order to develop and deploy the Synchronoss Secure Mobility Suite. The Company will be integrating their Synchronoss Workspace™ platform with Goldman's internally developed mobile security intellectual property to help provide a safe, secure mobile device environment that also effectively supports BYOD. The Company obtained a 67% interest in SNCR, LLC in exchange for a perpetual license for the use of Workspace. The Company and Goldman agreed to certain put and call options with regard to Goldman’s interest in SNCR, LLC. Goldman will have the right to exercise a put option (the "Put Option") in each of 2019 and 2020, from January 1 of the applicable year until April 30 of such year to sell their interest in SNCR, LLC to the Company under the Put Option at a value which approximates fair value. Under the Put Option the Company will be obligated to purchase Goldman’s interest. In addition, the Company has a call option (the "Call Option") to purchase Goldman’s interest in SNCR, LLC during the same period, at a value which approximates fair value. If , as of December 31, 2020 , neither the Put Option or Call Option have been exercised and Goldman remains a holder of any Interest , from January 1, 2021, Goldman shall have the right (the “Special Put Right”) to cause the Company to purchase all of Goldman’s interest in SNCR, LLC, at a value which approximates fair value. The Company, at its sole discretion, may settle the option in cash or in shares of its publicly traded common stock equal to the purchase price to be paid divided by the volume weighted average trading price per share during the thirty days immediately up to the day of such purchase. The Company’s intention is to settle the entire amount in cash. The Company determined that the Put Option is embedded within the noncontrolling interest shares that are subject to the Put Option. The redemption feature requires the classification of Goldman’s minority interest in the consolidated Balance Sheets outside of equity under the caption “Redeemable noncontrolling interest.” The fair value of the net assets acquired approximated the purchase price. SNCR, LLC has been determined to be a VIE of which the Company is the primary beneficiary. See Note 4. The Company determined the preliminary fair value of the net assets as follows: Preliminary Purchase Price Allocation Intangible assets: Wtd. Avg. Technology $ 4 years Customer relationships 7 years Goodwill Total assets acquired Redeemable noncontrolling interest Net assets acquired — The goodwill recorded in connection with this venture was based on operating synergies and other benefits expected to result from the combined operations. The goodwill acquired is not deductible for tax purposes. Razorsight Corporation (“Razorsight”) On August 4, 2015, the Company acquired all outstanding shares of Razorsight for $25.3 million, net of liabilities assumed. In addition, the Company potentially may make payments ("Razorsight Earn-out") totaling up to approximately $15 million based on the ability to achieve a range of business objectives for the period from the acquisition date through December 31, 2016. Razorsight offers cloud-based analytics solutions for communications service providers. Their cloud-based products embed advanced statistical analysis and predictive analytics to proactively pinpoint customer attrition risk, revenue opportunities, and better customer experiences. Synchronoss believes that this acquisition will strategically enhance the Company’s product portfolio allowing the Company to reach a broader client base and by expanding their value proposition and more deeply embedding their platform. The Company determined the preliminary fair value of the net assets acquired as follows: Purchase Price Allocation Cash $ Prepaid expenses and other assets Accounts receivable Equipment Other assets - long term Intangible assets: Wtd. Avg. Technology 4 years Customer relationships 10 years Goodwill Total assets acquired Accounts payable and accrued liabilities Lease obligation Deferred revenues Contingent consideration Deferred taxes Net assets acquired $ The goodwill recorded in connection with this acquisition was based on operating synergies and other benefits expected to result from the combined operations and the assembled workforce acquired. The goodwill acquired is not deductible for tax purposes. F-Secure Corporation (“F-Secure”) On February 23, 2015, the Company acquired certain cloud assets from F-Secure, an online security and privacy company headquartered in Finland, for cash consideration of $59.5 million, net of liabilities assumed. The Company believes that the purchase will expand the Company’s cloud services customer base. On February 18, 2015, the Company entered into a patent license and settlement agreement whereby the Company granted F-Secure a limited license to the Company's patents. As part of the business combination accounting rules, the Company calculated the fair value of the license using an income approach, specifically a relief from royalty method, which incorporates significant estimates and assumptions made by management, which by their nature are characterized by uncertainty. Inputs used to value the license are considered Level 3 inputs. The Company determined the preliminary fair value of the net assets acquired as follows: Preliminary Purchase Price Allocation Intangible assets: Wtd. Avg. Technology $ 1 year Customer relationships 5 years Goodwill Total assets acquired Accrued expenses Net assets acquired $ The goodwill recorded in connection with this acquisition is based on operating synergies and other benefits expected to result from the combined operations and the assembled workforce acquired. The goodwill acquired will n o t be deductible for tax purposes. Acquisition ‑Related Costs Acquisition related costs recognized during the years ended December 31, 2015, 2014 and 2013 including transaction costs such as employee retention, legal, accounting, valuation and other professional services, were $1.8 million , $2.5 million , and $1.7 million respectively. |
Fair Value Measurements of Asse
Fair Value Measurements of Assets and Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Measurements of Assets and Liabilities | |
Fair Value Measurements of Assets and Liabilities | 4. Fair Value Measurements The Company classifies marketable securities as available ‑for ‑sale. The fair value hierarchy established in the guidance adopted by the Company prioritizes the inputs used in valuation techniques into three levels as follows: · Level 1—Observable inputs—quoted prices in active markets for identical assets and liabilities; · Level 2—Observable inputs other than the quoted prices in active markets for identical assets and liabilities—includes quoted prices for similar instruments, quoted prices for identical or similar instruments in inactive markets, and amounts derived from valuation models where all significant inputs are observable in active markets; and · Level 3—Unobservable inputs—includes amounts derived from valuation models where one or more significant inputs are unobservable and require the Company to develop relevant assumptions. The following is a summary of assets and liabilities held by the Company and their related classifications under the fair value hierarchy at December 31, 2015 and 2014 : December 31, 2015 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents (A) $ $ $ — $ — Securities available-for-sale (B) — — Total assets $ $ $ $ — Liabilities Contingent consideration obligation $ $ — $ — $ Total liabilities $ $ — $ — $ Temporary Equity Redeemable noncontrolling interest $ $ — $ — $ Total temporary equity $ $ — $ — $ December 31, 2014 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents (A) $ $ $ — $ — Securities available-for-sale (B) — — Total assets $ $ $ $ — Liabilities Contingent consideration obligation $ $ — $ — $ Total liabilities $ $ — $ — $ (A) Cash and cash equivalents includes money market funds. (B) Securities available-for-sale include municipal bonds, commercial papers, certificates of deposit, enhanced income money market fund and corporate bonds which are classified as marketable securities. The Company utilizes the market approach to measure fair value for its financial assets. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets. The Company’s marketable securities investments classified as Level 2 primarily utilize broker quotes in a non ‑active market for valuation of these securities. No transfers of assets between Level 1 , Level 2 and Level 3 of the fair value measurement hierarchy occurred during the year ended December 31, 2015 . Available- for-Sale Securities At December 31, 2015 and 2014 , the estimated fair value of investments classified as available for sale, are as follows: December 31, 2015 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Available-for-sale securities: Certificates of deposit $ $ — $ $ Corporate bonds — Municipal bonds Total available-for-sale securities $ $ $ $ December 31, 2014 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Available-for-sale securities: Commercial papers $ $ $ — $ Corporate bonds — Municipal bonds Total available-for-sale securities $ $ $ $ Unrealized gains and losses are reported as a component of accumulated other comprehensive loss in stockholders’ equity. The net unrealized (loss) gain net of tax was ($54) thousand and ($176) thousand as of December 31, 2015 and 2014 , respectively. There were no sales of marketable securities during the years ended December 31, 2015 and 2014 . The cost of securities sold is based on the specific identification method. The Company evaluates investments with unrealized losses to determine if the losses are other than temporary. The Company has determined that the gross unrealized losses at December 31, 2015 and 2014 are temporary. In making this determination, the Company considered the financial condition, credit ratings and near ‑term prospects of the issuers, the underlying collateral of the investments, and the magnitude of the losses as compared to the cost and the length of time the investments have been in an unrealized loss position. Additionally, while the Company classifies the securities as available for sale, the Company does not currently intend to sell such investments and it is more likely than not to recover the carrying value prior to being required to sell such investments. The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of December 31, 2015 , are as follows: December 31, 2015 Securities in unrealized loss position Securities in unrealized loss position less than 12 months greater than 12 months Total Gross Unrealized Fair Unrealized Fair unrealized Fair Losses Value Losses Value losses Value Certificates of deposit $ $ $ — $ — $ $ Corporate bonds — — Municipal bonds $ $ $ $ $ $ The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of December 31, 2014 , are as follows: December 31, 2014 Securities in unrealized loss position Securities in unrealized loss position less than 12 months greater than 12 months Total Gross Unrealized Fair Unrealized Fair unrealized Fair Losses Value Losses Value losses Value Corporate bonds $ $ $ — $ — $ $ Municipal bonds — — $ $ $ — $ — $ $ Expected maturities of available-for-sale securities are as follows: December 31, 2015 Amortized Fair Cost Value Due within one year $ $ Due after 1 year through 5 years Total available-for-sale securities $ $ Contingent Consideration The Company determined the fair value of the contingent consideration related to Razorsight using a real options approach which uses a risk-adjusted expected growth rate based on assessments of expected growth in revenue, adjusted by an appropriate factor. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement. The significant unobservable inputs used in the fair value measurement of the Company’s contingent consideration obligation are the probabilities of achieving certain financial targets and contractual milestones. Significant increases (decreases) in any of those probabilities in isolation may result in a higher (lower) fair value measurement. The Company determined the fair value of the contingent consideration obligation related to Strumsoft using the probability ‑weighted income approach derived from quarterly revenue estimates and a probability assessment with respect to the likelihood of achieving the various performance criteria. The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement. The significant unobservable inputs used in the fair value measurement of the Company’s contingent consideration obligation are the probabilities of achieving certain financial targets and contractual milestones. Significant increases (decreases) in any of those probabilities in isolation may result in a higher (lower) fair value measurement. As of December 31, 2014, all of the financial targets and contractual milestones were met and on February 20, 2015 the Company paid out $8 million related to the Strumsoft Earn-out. No changes in valuation techniques occurred during the year ended December 31, 2015 . During the year ended December 31, 2015 , the Company recognized a $760 thousand increase of the contingent consideration obligation driven by the addition of the Razorsight Earn-out. The changes in fair value of the Company’s Level 3 contingent consideration obligation during the year ended December 31, 2015 were as follows: Balance at December 31, 2014 $ Fair value adjustment to contingent consideration obligation included in net income Earn-out compensation paid Strumsoft employees Razorsight Earn-out Balance at December 31, 2015 $ Redeemable Noncontrolling Interests The Company recorded the noncontrolling interest at its acquisition-date fair value as temporary equity, due to the redemption option existing outside the control of the Company. The noncontrolling shareholders have the option, which is embedded in the noncontrolling interest, to require the Company to purchase the remaining noncontrolling share at a formula price designed to approximate fair value based on operating results of the entity. The fair value of the redeemable noncontrolling interest was estimated by applying an income approach using a discounted cash flow analysis. This fair value measurement is based on significant inputs that are not observable in the market and thus represents a Level 3 measurement. Significant increases or decreases in the underlying assumptions used to value the redeemable noncontrolling interest could significantly increase or decrease the fair value estimates recorded in the consolidated balance sheets. The changes in fair value of the Company’s Level 3 redeemable noncontrolling interests during the year ended December 31, 2015 were as follows: Balance at December 31, 2014 $ — Issuance of redeemable noncontrolling interests Net income attributable to redeemable noncontrolling interests Balance at December 31, 2015 $ |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment | |
Property and Equipment | 5. Property and Equipment Property and equipment consist of the following: December 31, 2015 2014 Computer hardware $ $ Computer software Construction in-progress Furniture and fixtures Building Leasehold improvements Less: Accumulated depreciation $ $ Depreciation expense was approximately $43.5 million , $36.1 million , and $24.6 million for 2015 , 2014 , and 2013 , respectively. Amortization of property and equipment recorded under capital leases are included with depreciation expense. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2015 | |
Accrued Expenses | |
Accrued Expenses | 6. Accrued Expenses Accrued expenses consist of the following: December 31, 2015 2014 Accrued compensation and benefits $ $ Accrued accounting fees Accrued consulting fees Accrued other Accrued income tax payable $ $ |
Capital Structure
Capital Structure | 12 Months Ended |
Dec. 31, 2015 | |
Capital Structure | |
Capital Structure | 7. Capital Structure As of December 31, 2015 , the Company’s authorized capital stock was 110 million shares of stock with a par value of $0.0001 , of which 100 million shares were designated as common stock and 10 million shares were designated as preferred stock. Common Stock Each holder of common stock is entitled to vote on all matters and is entitled to one vote for each share held. Dividends on common stock will be paid when, and if, declared by the Company’s Board of Directors. No dividends have ever been declared or paid by the Company. Preferred Stock There are no shares of preferred stock outstanding as of December 31, 2015 or 2014 . The Board of Directors is authorized to issue preferred shares and has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences of preferred stock. Treasury Stock On May 8, 2012, the Company’s Board of Directors authorized a stock repurchase program to purchase up to $25 million of the Company’s outstanding Common Stock. The duration of the repurchase program was twelve months. Under the program, the Company was able to purchase shares of its Common Stock in the open market, through block trades or otherwise at prices deemed appropriate by the Company. The timing and amount of repurchase transactions under the program depended on available working capital. The Company classifies Common Stock repurchased as Treasury Stock on its balance sheet. The Company repurchased all eligible shares to be repurchased under the stock repurchase plan in 2012. There were no repurchases of Common Stock under the stock repurchase program for the year ended December 31, 2013. Registration Rights Holders of shares of common stock which were issued upon conversion of the Company’s Series A preferred stock are entitled to have their shares registered under the Securities Act of 1933, as amended (the “Securities Act”). Under the terms of an agreement between the Company and the holders of these securities which include registration rights, if the Company proposes to register any of its securities under the Securities Act, either for its own account or for the account of others, these stockholders are entitled to notice of such registration and are entitled to include their shares in such registration. |
Stock Plans
Stock Plans | 12 Months Ended |
Dec. 31, 2015 | |
Stock Plans | |
Stock Plans | 8. Stock Plans In March 2015, the Company adopted the 2015 Equity Incentive Plan (the “2015 Plan”). The 2015 Plan replaces the Company’s prior 2000 Equity Incentive Plan (the “2000 Plan”), the 2006 Equity Incentive Plan (the “2006 Plan”) and the 2010 New Hire Equity Incentive Plan (the “2010 Plan”), (collectively, the “Plans”). Beginning March 2015, all awards were granted under the 2015 Plan. In addition, any awards that were previously granted under any prior Plans that terminate without issuance of shares, shall be eligible for issuance under the 2015 Plan. Under the 2015 Plan, the Company may grant to its employees, outside directors and consultants awards in the form of non-qualified stock options, shares of restricted stock, stock units, or stock appreciation rights and performance shares. The Company’s Board of Directors administers the Plan and is responsible for determining the individuals to be granted options or shares, the number of options or shares each individual will receive, the price per share and the exercise period of each option. As of December 31, 2015 , there were 3.8 million shares available for grant or award under the Company’s 2015 Plan. Stock-Based Compensation The following table summarizes stock-based compensation expense: December 31, 2015 2014 2013 Stock options $ $ $ Restricted stock awards ESPP Plan Total stock-based compensation before taxes $ $ $ Tax benefit $ $ $ The total stock ‑based compensation cost related to unvested equity awards not yet recognized as an expense as of December 31, 2015 was approximately $52.0 million . That cost is expected to be recognized over a weighted ‑average period of approximately 2.71 years. Stock Options Options that were granted under the Company’s 2000 , 2006 and 2015 Plans generally vest 25% on the first year anniversary of the date of grant plus an additional 1/48th for each month of continuous service thereafter. Options that were granted under the Company’s 2010 Plan generally vest 50% on the second year anniversary and an additional 1/48th for each month of continuous service thereafter. Incentive options that were granted under the 2000 and 2006 Plans generally vest 25% on the 1st year anniversary on the date of grant and an additional 1/48th for each month of continuous service thereafter. The Company utilizes the Black ‑Scholes option pricing model for determining the estimated fair value for stock option awards. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. Expected volatility was calculated based on a weighted ‑average of the Company’s historical stock information. The average expected life was determined using the Company’s historical data. The risk ‑free interest rate is based on U.S. Treasury zero ‑coupon issues with a remaining term equal to the expected life assumed at the date of grant. The Company has never declared or paid cash dividends on its common or preferred equity and does not anticipate paying any cash dividends in the foreseeable future. Forfeitures are estimated based on voluntary termination behavior, as well as a historical analysis of actual option forfeitures. The weighted ‑average assumptions used in the Black ‑Scholes option pricing model are as follows: December 31, 2015 2014 2013 Expected stock price volatility % % % Risk-free interest rate % % % Expected life of options (in years) Expected dividend yield % % % The weighted-average fair value (as of the date of grant) of the options granted $ $ $ The following table summarizes information about stock options outstanding. Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Options Options Exercise Price Term (Years) Value Outstanding at December 31, 2014 Options Granted Options Exercised Options Cancelled Outstanding at December 31, 2015 $ $ Vested or expected to vest at December 31, 2015 $ $ Exercisable at December 31, 2015 $ $ The below table summarizes additional information related to stock options: December 31, 2015 2014 2013 Total intrinsic value for stock options exercised Fair value of vested options Awards of Restricted Stock and Performance Stock Restricted stock awards (“restricted stock”) granted under the Company’s Plans generally vest 25% of the applicable shares on the first anniversary of the date of grant and thereafter an additional 1/16th for each three months of continuous service. Performance stock awards granted under the Company’s 2006 Plan generally vest with respect to one -third of the applicable shares on the date that the performance objectives under the performance stock awards are achieved and thereafter an additional one -third for each year of continuous service. Generally, performance stock awards granted under the Company’s 2015 Plan vest at the end of a three -year period based on service and achievement of certain performance objectives determined by the Company’s Board. A summary of the Company’s unvested restricted stock activity and the balance at December 31, 2015 , is presented below: Non-Vested Restricted Stock Number of Awards Weighted-Average Grant Date Fair Value Non-vested at December 31, 2014 $ Granted $ Vested $ Forfeited $ Non-vested at December 31, 2015 $ Restricted stock awards are granted subject to other service conditions or service and performance conditions (“performance-based awards”). Restricted stock and performance-based awards are measured at the closing stock price at the date of grant and are recognized straight line over the requisite service period. During 2015 , the Company issued approximately 195 thousand shares of restricted stock related to the 2014 performance share objectives. For certain executives, the 2013 and 2012 performance share grants also contained a market condition that adjusted the number of performance shares otherwise earned based on relative performance of the Company’s common stock. Employee Stock Purchase Plan On February 1, 2012, the Company established a ten year Employee Stock Purchase Plan (“ESPP” or “the Plan”) for certain eligible employees. The Plan is to be administered by the Company’s Board of Directors. The total number of shares available for purchase under the Plan is 500 thousand shares of the Company’s Common Stock. Employees participate over a six month period through payroll withholdings and may purchase, at the end of the six month period, the Company’s Common Stock at the lower of 85% of the fair market value on the first day of the offering period or the fair market value on the purchase date. No participant will be granted a right to purchase Common Stock under the Plan if such participant would own more than 5% of the total combined voting power of the Company. In addition, no participant may purchase more than a thousand shares of Common Stock within any purchase period. The Company utilizes the Black Scholes pricing model for determining the estimated fair value for ESPP shares. The expected life of ESPP shares is the average of the remaining purchase period under each offering period. The weighted ‑average assumptions used to value employee stock purchase rights during December 31, 2015 were as follows: December 31, 2015 2014 2013 Expected stock price volatility % % % Risk-free interest rate % % % Expected life of ESPP shares (in years) Expected dividend yield % % % The weighted-average fair value (as of the date of grant) of the ESPP shares $ $ $ |
401(k) Plan
401(k) Plan | 12 Months Ended |
Dec. 31, 2015 | |
401(k) Plan | |
401(k) Plan | 9. 401(k) Plan The Company has a 401(k) plan (the “Plan”) covering all eligible employees. The Plan allows for a discretionary employer match. The Company incurred and expensed $2.3 million , $2.0 million , and $1.5 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, in Plan match contributions. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes | |
Income Taxes | 10. Income Taxes The components of income before income taxes are as follows: Year Ended December 31, 2015 2014 2013 Domestic $ $ $ Foreign Total $ $ $ The components of income tax (expense) benefit are as follows: Year Ended December 31, 2015 2014 2013 Current: Federal $ $ $ State Foreign Deferred: Federal State Foreign Income tax expense $ $ $ Reconciliations of the statutory tax rates and the effective tax rates for the years ended December 31, 2015 , 2014 and 2013 are as follows: Year Ended December 31, 2015 2014 2013 Statutory rate % % % State taxes, net of federal benefit % % % Effect of rates different than statutory % % — % Minority interest % — % — % Non-deductible stock based compensation — % — % % Other permanent adjustments % % % Fair market value adjustment on Earn-out — % % % Research and development credit % % % Subpart F income — % % — % Change in valuation allowance % — % % Ireland deferred tax liability - migration % — % — % Customer relationship adjustment - Australia % — % — % Other — % % % Net % % % Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows: December 31, 2015 2014 Deferred tax assets: Accrued liabilities $ $ Deferred revenue Bad debts reserve Deferred compensation Federal net operating loss carry forwards State net operating loss carry forwards Foreign net operating loss carry forwards Deferred rent Capital loss carry forward Other Total deferred tax assets $ $ Deferred tax liabilities: Intangible assets $ $ Fixed assets Total deferred tax liabilities Less: valuation allowance Net deferred income tax (liabilities) assets $ $ As of December 31, 2015 , the Company has federal and state income tax net operating loss (NOL) carryforwards of $53.2 million and $37.3 million , respectively, which will expire at various dates from 2016 through 2035. The Company also has foreign NOL carryforwards in various jurisdictions of $47.3 million that have indefinite carryforward periods. Such NOL carryforwards expire as follows: 2016-2020 $ 2021-2025 2026-2035 Indefinite $ In evaluating the Company’s ability to recover its deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations. In projecting future taxable income, the Company begins with historical results and incorporates assumptions including the amount of future state, federal and foreign pretax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax-planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates the Company is using to manage the underlying businesses. The foreign NOL carryforwards in the income tax returns filed included unrecognized tax benefits taken in prior years. The NOLs for which a deferred tax asset is recognized for financial statement purposes in accordance with ASC 740 are presented net of these unrecognized tax benefits. As of December 31, 2014, a valuation allowance of $2.5 million was recorded to place a full valuation allowance on all deferred tax assets within Spatial U.S. In 2015, a valuation allowance of $249 thousand was released for the utilization of NOL for the current year income. However, the company still believes that there is no positive evidence with regards to the projections for the future income. As such, a valuation allowance of $2.3 million has been recorded to place a full valuation allowance on all the deferred tax assets within Spatial U.S. The Company continues to evaluate the ability to realize all of its net deferred tax assets at each reporting date and records a benefit for deferred tax assets to the extent it has deferred tax liabilities that provide a source of income to benefit the deferred tax asset. As a result of this analysis, the Company recorded a valuation allowance against the net deferred tax assets of certain foreign jurisdictions as the realization of these assets is not more likely than not, given uncertainty of future earnings in these jurisdictions. The Company is subject to taxation in the United States and various states and foreign jurisdictions. As of December 31, 2015, the Company’s tax years for 2012, 2013 and 2014 are subject to examination by the tax authorities. With few exceptions, as of December 31, 2015, the Company is no longer subject to U.S. federal, state, local, or foreign examinations by tax authorities for years before 2011. The Company finalized the New Jersey State Sales and Use Tax and Gross Income Tax audits for the tax years 2011 through 2013 in 2015 with no material changes. In addition, the Company is currently under sales and use tax examinations in New York and Pennsylvania for the tax years 2009 through 2015 and 2012 through 2015, respectively, but does not believe that the results of these audits will have a material effect on its financial position or results of operations. The Company has provided taxes for $3.3 million of royalty fees paid to its Ireland subsidiary as Subpart F income subject to US tax in 2014. The Company has not provided taxes for the remaining $30.8 million of undistributed earnings of its foreign subsidiaries which the Company plans to reinvest indefinitely outside of the United States. Should the Company decide to repatriate the foreign earnings, it would need to adjust its income tax provision in the period it determined that the earnings will no longer be indefinitely invested outside the United States. Due to the timing and circumstances of repatriation of such earnings, if any, it is not practicable to determine the unrecognized deferred tax liability relating to such amounts A reconciliation of the amounts of unrecognized tax benefits excluding interest are as follows: Unrecognized tax benefit at December 31, 2012 $ Decreases for tax positions taken during prior year Reduction due to lapse of applicable statute of limitations Increases for tax positions of current period Unrecognized tax benefit at December 31, 2013 Decreases for tax positions taken during prior year Reduction due to lapse of applicable statute of limitations Increases for tax positions of current period Unrecognized tax benefit at December 31, 2014 Increases for tax positions taken during prior year Reduction due to lapse of applicable statute of limitations Increases for tax positions of current period Unrecognized tax benefit at December 31, 2015 $ Included in the balance of unrecognized tax benefits as of the years ended December 31, 2015, 2014 and 2013 , are $1.5 million, $1.1 million and $700 thousand, respectively, of tax benefits that, if recognized, would affect the effective tax rate. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in interest expense. The liability for unrecognized tax benefits excludes accrued interest of $38 thousand , $24 thousand and $25 thousand as of the years ended December 31, 2015, 2014 and 2013 , respectively. The Company believes that it is reasonably possible that approximately $44 thousand of its currently unrecognized tax benefits related to research and development credits, which are individually insignificant, may be recognized by the end of 2016 as a result of a lapse of the statute of limitations. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | 11. Commitments and Contingencies The Company leases office space, automobiles, office equipment and colocation services under non ‑cancellable capital leases, operating leases or long-term agreements, which expire through December 2029. Aggregate annual future minimum payments under these non ‑cancellable agreements are as follows: Year Ending December 31: Colocation Operating Leases Capital Leases 2016 $ $ $ 2017 2018 2019 2020 and thereafter $ $ $ Rent expense for the years ended December 31, 2015 , 2014 and 2013 was $9.0 million , $8.0 million and $6.7 million respectively . |
Goodwill and Intangibles
Goodwill and Intangibles | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangibles | |
Goodwill and Intangibles | 12. Goodwill and Intangibles Goodwill The Company records goodwill which represents the excess of the purchase price over the fair value of assets acquired, including other definite-lived intangible assets. Goodwill is reviewed annually for impairment or upon the occurrence of events or changes in circumstances that would more likely than not reduce the fair value of the reporting unit below its carrying amount. The following table shows the adjustments to goodwill during 2015 and 2014 : Balance at December 31, 2013 $ Acquisitions Reclassifications, adjustments and other Translation adjustments Balance at December 31, 2014 $ Acquisitions Reclassifications, adjustments and other Translation adjustments Balance at December 31, 2015 $ The reclassification, adjustments and other of $30 thousand for the year 2015 is primarily related to a change in the Company’s deferred tax asset in connection with a pre-acquisition tax loss. The reclassifications, adjustment and other of $1.3 million for the year 2014 is primarily related to an increase in the Company’s deferred taxes in connection with a foreign tax election. Other Intangible Assets The Company’s intangible assets with definite lives consist primarily of trade names, technology, and customer lists and relationships. These intangible assets are being amortized on the straight ‑line method over the estimated useful lives of the assets. Amortization expense related to currently existing intangible assets for the years ended December 31, 2015 , 2014 and 2013 was $28.6 million , $19.8 million and $16.1 million , respectively. The Company’s intangible assets consist of the following: December 31, 2015 Accumulated Cost Amortization Net Trade name $ $ $ Technology Customer lists and relationships Capitalized software and patents Order Backlog — $ $ $ December 31, 2014 Accumulated Cost Amortization Net Trade name $ $ $ Technology Customer lists and relationships Capitalized software and patents Order Backlog — $ $ $ Estimated annual amortization expense of its intangible assets for the next five years is as follows: Year ended December 31: 2016 $ 2017 2018 2019 2020 |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Dec. 31, 2015 | |
Restructuring Charges | |
Restructuring Charges | 13. Restructuring Charges In January 2015, the Company initiated the preliminary phase of a work-force reduction as part of a corporate restructuring, with reductions occurring across all levels and departments within the Company. This measure was intended to reduce costs and to align the Company’s resources with its key strategic priorities. As of December 31, 2015 , there were $54 thousand of unpaid restructuring charges classified under accrued expenses on the balance sheet. A summary of the Company’s restructuring accrual at December 31, 2015 , and changes during the year ended December 31, 2015 , are presented below: Balance at Balance at December 31, 2014 Charges Payments December 31, 2015 Employment termination costs $ — $ $ $ — Facilities consolidation — Total $ — $ $ $ |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss). | |
Accumulated Other Comprehensive Income (Loss) | 14. Accumulated Other Comprehensive Income The changes in accumulated other comprehensive income during the year ended December 31, 2015 , are as follows, net of tax: Unrealized Net Gain (Loss) Holding Gains on on Intra-Entity Foreign Available-for-Sale Foreign Currency Currency Securities Transactions Total Balance at December 31, 2014 $ $ $ $ Other comprehensive loss before reclassifications Tax effect — Total other comprehensive loss Balance at December 31, 2015 $ $ $ $ The changes in accumulated other comprehensive income during the year ended December 31, 2014 , are as follows, net of tax: Unrealized Net Gain (Loss) Holding Gains on on Intra-Entity Foreign Available-for-Sale Foreign Currency Currency Securities Transactions Total Balance at December 31, 2013 $ $ $ $ Other comprehensive loss before reclassifications Tax effect — — Amounts reclassified from accumulated other comprehensive loss — — Total other comprehensive loss Balance at December 31, 2014 $ $ $ $ |
Debt
Debt | 12 Months Ended |
Dec. 31, 2015 | |
Debt | |
Credit Facility | 15. Debt Credit Facility In September 2013, the Company entered into a Credit Agreement (the “Credit Facility”) with JP Morgan Chase Bank, N.A., as the administrative agent, Wells Fargo Bank, National Association, as the syndication agent and Capital One, National Association and KeyBank National Association, as co-documentation agents. The Credit Facility, which can be used for general corporate purposes, is a $100 million unsecured revolving line of credit that matures on September 27, 2018. The Company pays a commitment fee in the range of 25 to 35 basis points on the unused balance of the revolving credit facility. Commitment fees totaled approximately $332 thousand and $215 thousand during the years ended December 31, 2015 and 2014 , respectively. Synchronoss has the right to request an increase in the aggregate principal amount of the Credit Facility to $150 million . The Credit Facility is subject to certain financial covenants. As of December 31, 2015 , the Company was in compliance with all required covenants and there were no outstanding balances on the Credit Facility. Convertible Senior Notes On August 12, 2014, the Company issued $230.0 million aggregate principal amount of its 0.75% Convertible Senior Notes due in 2019 (the “2019 Notes”). The 2019 Notes mature on August 15, 2019, and bear interest at a rate of 0.75% per annum payable semi-annually in arrears on February 15 and August 15 of each year. The Company accounted for the $230 million face value of the debt as a liability and capitalized approximately $7.1 million of financing fees, related to the issuance. The 2019 Notes are senior, unsecured obligations of the Company, and are convertible into shares of its common stock based on a conversion rate of 18.8072 shares per $1,000 principal amount of 2019 Notes which is equivalent to an initial conversion price of approximately $53.17 per share. The Company will satisfy any conversion of the 2019 Notes with shares of the Company’s common stock. The 2019 Notes are convertible at the note holders’ option prior to their maturity and if specified corporate transactions occur. The issue price of the 2019 Notes was equal to their face amount. Holders of the 2019 Notes, who convert their notes in connection with a qualifying fundamental change, as defined in the related indenture, may be entitled to a make-whole premium in the form of an increase in the conversion rate. Additionally, following the occurrence of a fundamental change, holders may require that the Company repurchase some or all of the 2019 Notes for cash at a repurchase price equal to 100% of the principal amount of the 2019 Notes being repurchased, plus accrued and unpaid interest, if any. As of December 31, 2015 , none of these conditions existed with respect to the 2019 Notes and as a result, the 2019 Notes are classified as long term. The 2019 Notes are the Company’s direct senior unsecured obligations and rank equal in right of payment to all of the Company’s existing and future unsecured and unsubordinated indebtedness. At December 31, 2015 , the carrying amount of the liability and the outstanding principal of the 2019 Notes was $230.0 million , with an effective interest rate of approximately 1.36% . The fair value of the 2019 Notes was $ 229.6 million at December 31, 2015 . The fair value of the liability of the 2019 Notes was determined using a discounted cash flow model based on current market interest rates available to the Company. These inputs are corroborated by observable market data for similar liabilities and therefore classified within Level 2 of the fair-value hierarchy. The interest expense of the Company’s 2019 Notes related to the contractual interest coupon was $1.7 million and $647 thousand for the years ended December 31, 2015 and 2014 , respectively. |
Legal Matters
Legal Matters | 12 Months Ended |
Dec. 31, 2015 | |
Legal Matters | |
Legal Matters | 16. Legal Matters On October 7, 2014, the Company filed an amended complaint in the United States District Court for the District of New Jersey (Civ Act. No. 3:14-cv-06220) against F-Secure Corporation and F-Secure, Inc. (collectively, “F-Secure"), claiming that F-Secure has infringed, and continues to infringe, several of the Company’s patents. In February 2015, Synchronoss entered into a patent license and settlement agreement with F-Secure Corporation and F-Secure, Inc. whereby the Company granted each of these companies (but not their subsidiaries or affiliates) a limited license to Synchronoss’ patents. As a result of entering into the patent license and settlement agreement, the parties filed a joint stipulation to dismiss the above complaint. The Company’s 2011 acquisition agreement with Miyowa SA provided that former shareholders of Miyowa SA would be eligible for earn-out payments, to the extent specified business milestones were achieved following the acquisition. In December 2013, Eurowebfund and Bakamar, two former shareholders of Miyowa SA, filed a complaint against the Company in the Commercial Court of Paris, France claiming that they are entitled to certain earn-out payments under the acquisition agreement. The Company was served with a copy of this complaint in January 2014. On December 3, 2015, the Court dismissed all claims in the complaint against the Company. The Company is not currently subject to any legal proceedings that could have a material adverse effect on its operations; however, it may from time to time become a party to various legal proceedings arising in the ordinary course of its business. The Company is currently the plaintiff in several patent infringement cases. The defendants in several of these cases have filed counterclaims. Although the Company cannot predict the outcome of the cases at this time due to the inherent uncertainties of litigation, the Company continues to pursue its claims and believes that the counterclaims are without merit, and the Company intends to defend all of such counterclaims. |
Subsequent Events Review
Subsequent Events Review | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Events Review | |
Subsequent Events Review | 17. Subsequent Events Review On February 4, 2016 the Company announced that its Board of Directors has approved a share repurchase program under which the Company may repurchase up to $100 million of its outstanding common stock. Synchronoss plans to make such purchases at prevailing prices over the next 12 to 18 months . The Company anticipates that the timing and amount of any share repurchases will be determined by Synchronoss’ management based on market conditions and in accordance with the requirements of the Securities and Exchange Commission. Once adopted, the repurchase program does not obligate Synchronoss to acquire any particular amount of common stock, and repurchases may be commenced, suspended or discontinued at any time without prior notice. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The consolidated financial statements include the accounts of the Company, its wholly ‑owned subsidiaries, variable interest entities (VIE) in which the Company is the primary beneficiary and entities in which the Company has a controlling interest. All material intercompany transactions and accounts are eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year's presentation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Revenue Recognition and Deferred Revenue | Revenue Recognition and Deferred Revenue The Company provides services principally on a transactional or subscription basis or, at times, on a fixed fee basis and recognizes the revenues as the services are performed or delivered as described below: Transactional and Subscription Service Arrangements: Transaction and subscription revenues consist of revenues derived from the processing of transactions through the Company’s service platforms, providing enterprise portal management services on a subscription basis and maintenance agreements on software licenses. Transaction service arrangements include services such as processing equipment orders, new account set ‑up and activation, number port requests, credit checks and inventory management. Subscription services include monthly active user fees, software as a service (“SaaS”) fees, hosting and storage and the related maintenance support for those services. Transaction revenues are principally based on a contractual price per transaction and are recognized based on the number of transactions processed during each reporting period. Revenues are recorded based on the total number of transactions processed at the applicable price established in the relevant contract. The total amount of revenues recognized is based primarily on the volume of transactions. Subscription revenues are recorded one of two ways: on a straight ‑line basis over the life of the contract or on a fixed monthly fee based on a set contracted amount. Many of the Company’s contracts guarantee minimum volume transactions from the customer. In these instances, if the customer’s total transaction volume for the period is less than the contractual amount, the Company records revenues at the minimum guaranteed amount. At times, transaction revenues may also include billings to customers that reimburse the Company based on the number of individuals dedicated to processing transactions. Set ‑up fees for transactional service arrangements are deferred and recognized on a straight ‑line basis over the life of the contract since these amounts would not have been paid by the customer without the related transactional service arrangement. Revenues are presented net of discounts, which are volume level driven, or credits, which are performance driven, and are determined in the period in which the volume thresholds are met or the services are provided. Professional Service and Software License Arrangements: Professional services include process and workflow consulting services and development services. Professional services when sold with transactional or subscription service arrangements are accounted for separately when the professional services have value to the customer on a standalone basis and there is objective and reliable evidence of fair value of the professional services. When accounted for separately, professional service revenues are recognized as services are performed and all other elements of revenue recognition have been satisfied. In determining whether professional service revenues can be accounted for separately from transaction or subscription service revenues, the Company considers the following factors for each professional services agreement: availability of the professional services from other vendors, whether objective and reliable evidence of fair value exists of the undelivered elements, the nature of the professional services, the timing of when the professional services contract was signed in comparison to the transaction or subscription service start date and the contractual independence of the transactional or subscription service from the professional services. If a professional service arrangement were not to qualify for separate accounting, the Company would recognize the professional service revenues ratably over the remaining term of the transaction or subscription agreement. Revenue from software license arrangements is recognized when the license is delivered to its customers and all of the software revenue recognition criteria are met. When software arrangements include multiple elements, the arrangement consideration is allocated at the inception to all deliverables using the residual method providing the Company has vendor specific objective evidence (VSOE) on all undelivered elements. The Company determines VSOE for each element based on historical stand ‑alone sales to third parties. When transaction or subscription service arrangements, include multiple elements, the arrangement consideration is allocated at the inception of an arrangement to all deliverables using the relative selling price method. The relative selling price method allocates any discount in the arrangement proportionally to each deliverable on the basis of each deliverable’s selling price. The selling price used for each deliverable will be based on VSOE if available, third ‑party evidence (TPE) if vendor ‑specific objective evidence is not available, or estimated selling price (ESP) if neither vendor ‑specific objective evidence nor third ‑party evidence is available. The objective of ESP is to determine the price at which the Company would transact a sale if the product or service were sold on a stand ‑alone basis. The Company determines ESP by considering multiple factors including, but not limited to, geographies, market conditions, competitive landscape, internal costs, gross margin objectives, and pricing practices. ESP is generally used for offerings that are not typically sold on a stand ‑alone basis or for new or highly customized offerings. While the Company follows specific and detailed rules and guidelines related to revenue recognition, it makes and uses management judgments and estimates in connection with the revenue recognized in any reporting period, particularly in the areas described above, as well as collectability. If management made different estimates or judgments, differences in the timing of the recognition of revenue could occur. Deferred Revenue: Deferred revenues primarily represent billings to customers for services in advance of the performance of services, with revenues recognized as the services are rendered, and also includes the fair value of deferred revenues recorded as a result of acquisitions. |
Service Level Standards | Service Level Standards Pursuant to certain contracts, the Company is subject to service level standards and to corresponding penalties for failure to meet those standards. All performance ‑related penalties are reflected as a corresponding reduction of the Company’s revenues. These penalties, if applicable, are recorded in the month incurred and were insignificant for the years ended December 31, 2015 , 2014 and 2013 , respectively. |
Cost of Services | Cost of Services Cost of services includes all direct materials, direct labor and those indirect costs related to revenues such as indirect labor, materials and supplies and facilities cost, exclusive of depreciation expense. |
Research and Development | Research and Development Research and development costs are expensed as incurred, unless they meet U.S. GAAP criteria for deferral and amortization. Software development costs incurred prior to the establishment of technological feasibility do not meet these criteria, and are expensed as incurred. Amortization of software development costs is computed using the straight ‑line method over the estimated useful lives of the assets, 3 and 5 years. As of December 31, 2015 , the Company had $6.1 million of unamortized software development costs and $2.0 million of amortization expense which was recognized during 2015 . As of December 31, 2014 , the Company had $6.1 million of unamortized software development costs and $837 thousand of amortization expense which was recognized during 2014 . As of December 31, 2013 , the Company had $1.8 million of unamortized software development costs and $1.2 million of amortization expense which was recognized during 2013 . Research and development expense consists primarily of costs related to personnel, including salaries and other personnel ‑related expenses, consulting fees and the cost of facilities, computer and support services used in service technology development. The Company also expenses costs relating to developing modifications and minor enhancements of its existing technology and services. |
Concentration of Credit Risk | Concentration of Credit Risk The Company’s financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents, marketable securities and accounts receivable. The Company maintains its cash and cash equivalents at several major financial institutions. The Company has not experienced any realized losses in such accounts and believes it is not exposed to any significant credit risk related to cash, cash equivalents and securities. The Company’s cash equivalents and short ‑term marketable securities consist primarily of money market funds, certificates of deposit, commercial paper, and municipal and corporate bonds. The Company believes that concentration of credit risk with respect to accounts receivable is limited because of the creditworthiness of the Company’s major customers. AT&T and Verizon Wireless in the aggregate accounted for 75% , 73% and 66% of net revenues for 2015 , 2014 and 2013 , respectively. AT&T and Verizon accounted for 72% and 68% of accounts receivable at December 31, 2015 and 2014 , respectively. The loss of either AT&T or Verizon as a customer would have a material negative impact on the Company. The Company believes that if either AT&T or Verizon terminated their relationships with Synchronoss, they would encounter substantial costs in replacing Synchronoss’ solutions. |
Fair Value of Financial Instruments and Liabilities | Fair Value of Financial Instruments and Liabilities The Company includes disclosures of fair value information about financial instruments and liabilities, whether or not recognized on the balance sheet, for which it is practicable to estimate that value. Due to their short ‑term nature, the carrying amounts reported in the financial statements approximate the fair value for cash and cash equivalents, marketable securities, accounts receivable and accounts payable. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less at the date of acquisition to be cash equivalents. |
Marketable Securities | Marketable Securities Marketable securities consist of fixed income investments with a maturity of greater than three months and enhanced money market funds. These investments are classified as available ‑for ‑sale and are reported at fair value on the Company’s balance sheet. The Company classifies its securities with maturity dates of 12 months or more as long term. Unrealized holding gains and losses are reported within accumulated other comprehensive loss as a separate component of stockholders’ equity. If a decline in the fair value of a marketable security below the Company’s cost basis is determined to be other than temporary, such marketable security is written down to its estimated fair value as a new cost basis and the amount of the write ‑down is included in earnings as an impairment charge. The Company has recorded temporary changes in fair value of the marketable securities but has not recorded other ‑than ‑temporary charges for the periods presented herein. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consist of amounts due to the Company from normal business activities. The Company maintains an allowance for estimated losses resulting from the inability of its customers to make required payments. The Company estimates uncollectible amounts based upon historical bad debts, current customer receivable balances, the age of customer receivable balances, the customer’s financial condition and current economic trends. |
Property and Equipment | Property and Equipment Property and equipment and leasehold improvements are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight ‑line method over the estimated useful lives of the assets, which range from 3 to 5 years, or the lesser of the related initial term of the lease or useful life for leasehold improvements. Amortization of property and equipment recorded under a capital lease is included with depreciation expense. Expenditures for routine maintenance and repairs are charged against operations. Major replacements, improvements and additions are capitalized. |
Noncontrolling interest | Noncontrolling Interest Noncontrolling interests ("NCI") are evaluated by the Company and are shown as either a liability, temporary equity (shown between liabilities and equity) or as permanent equity depending on the nature of the redeemable features at amounts based on formulas specific to each entity. Generally, mandatorily redeemable NCI's are classified as liabilities and non-mandatorily redeemable NCI's are classified outside of stockholders' equity in the Consolidated Balance Sheets as temporary equity under the caption, redeemable noncontrolling interests, and are measured at their redemption values at the end of each period. If the redemption value is greater than the carrying value, an adjustment is recorded in retained earnings to record the NCI at its redemption value. Redeemable NCI’s that are mandatorily redeemable are classified as a liability in the Consolidated Balance Sheets under either other current liabilities or other long-term liabilities, depending on the remaining duration until settlement, and are measured at the amount of cash that would be paid if settlement occurred at the balance sheet date with any change from the prior period recognized as interest expense. If the noncontrolling interest is not currently redeemable yet probable of becoming redeemable, the Company is required to either (1) accrete changes in the redemption value over the period from the date of issuance to the earliest redemption date of the instrument using an appropriate methodology, usually the interest method, or (2) recognize changes in the redemption value immediately as they occur and adjust the carrying value of the security to equal the redemption value at the end of each reporting period. The Company has elected to recognize changes in the redemption value immediately as they occur and adjust the carrying value of the noncontrolling interest to the greater of the estimated redemption value, which approximates fair value, at the end of each reporting period or the initial carrying amount. Net income attributable to NCI’s reflects the portion of the net income (loss) of consolidated entities applicable to the NCI stockholders in the accompanying Consolidated Statements of Income. The net income attributable to NCI is classified in the Consolidated Statements of Income as part of consolidated net income and deducted from total consolidated net income to arrive at the net income attributable to the Company. |
Business Combinations | Business Combinations The Company accounts for business combinations in accordance with the acquisition method. The acquisition method of accounting requires that assets acquired, liabilities assumed and any noncontrolling interest in the aquiree (if any) be recorded at their fair values on the date of a business acquisition. The Company’s consolidated financial statements and results of operations reflect an acquired business from the completion date of an acquisition. The judgments that the Company makes in determining the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact net income in periods following a business combination. The Company generally uses either the income, cost or market approach to aid in its conclusions of such fair values and asset lives. The income approach presumes that the value of an asset can be estimated by the net economic benefit to be received over the life of the asset, discounted to present value. The cost approach presumes that an investor would pay no more for an asset than its replacement or reproduction cost. The market approach estimates value based on what other participants in the market have paid for reasonably similar assets. Although each valuation approach is considered in valuing the assets acquired, the approach ultimately selected is based on the characteristics of the asset and the availability of information. The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date. Each reporting period thereafter, the Company revalues these obligations and records increases or decreases in their fair value as an adjustment to net change in contingent consideration obligation within the consolidated statement of income. Changes in the fair value of the contingent consideration obligation can result from updates in the achievement of financial targets and changes to the weighted probability of achieving those future financial targets. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, any change in the assumptions described above, could have a material impact on the amount of the net change in contingent consideration obligation that the Company records in any given period. |
Investments in Affiliates and Other Entities | Investments in Affiliates and Other Entities In the normal course of business, Synchronoss enters into various types of investment arrangements, each having unique terms and conditions. These investments may include equity interests held by Synchronoss in business entities, including general or limited partnerships, contractual joint ventures, or other forms of equity participation. Synchronoss determines whether such investments involve a VIE based on the characteristics of the subject entity. If the entity is determined to be a VIE, then management determines if Synchronoss is the primary beneficiary of the entity and whether or not consolidation of the VIE is required. The primary beneficiary consolidating the VIE must normally have both (i) the power to direct the activities of a VIE that most significantly affect the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE, in either case that could potentially be significant to the VIE. When Synchronoss is deemed to be the primary beneficiary, the VIE is consolidated and the other party’s equity interest in the VIE is accounted for as a noncontrolling interest. In cases where Synchronoss determines that it has an undivided interest in the assets, liabilities, revenues and profits of an unincorporated VIE (e.g., a general partnership interest), such amounts are consolidated on a basis proportional to Synchronoss’ ownership interest in the unincorporated entity. If an entity fails to meet the characteristics of a VIE, the Company then evaluates such entity under the voting model. Under the voting model, the Company consolidates the entity if they determine that they, directly or indirectly, have greater than 50% of the voting shares, and determine that other equity holders do not have substantive participating rights. During the year ended December 31, 2015, the Company formed a venture with MCI Communications and Verizon Patent and Licensing Inc. (collectively, “Verizon”), referred to as Zentry, LLC (“Zentry”). The Company determined that Zentry was a voting interest entity, because the entity has sufficient equity at risk to enable it to finance its activities independently. As the Company holds a majority ownership in Zentry, the Company consolidates Zentry under the voting model. During the year ended December 31, 2015, the Company formed a venture with Goldman Sachs (“Goldman”), referred to as SNCR, LLC which was determined to be a VIE. The Company concluded that the entity does not have enough equity to finance its activities without additional subordinated financial support, which was provided by the Company via a $20 million line of credit. The Company consolidates the entity under the VIE model. SNCR, LLC is the primary beneficiary and has the power to direct activities that most significantly impact the ventures’ economic performance. In particular, the Company directs the day to day operations, sales, marketing, distribution and R&D efforts of SNCR, LLC . |
Goodwill | . Goodwill Goodwill represents the excess of the purchase price over the fair value of assets acquired, including other definite ‑lived intangible assets. Goodwill is not amortized, but reviewed annually for impairment or upon the occurrence of events or changes in circumstances that would more likely than not reduce the fair value of the reporting unit below its carrying amount. There were no impairment charges recognized during the years ended December 31, 2015 , 2014 and 2013 . |
Impairment of Long-Lived Assets | Impairment of Long ‑Lived Assets A review of long ‑lived assets for impairment is performed when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. If an indication of impairment is present, the Company compares the estimated undiscounted future cash flows to be generated by the asset to the asset’s carrying amount. If the undiscounted future cash flows are less than the carrying amount of the asset, the Company records an impairment loss equal to the amount by which the asset’s carrying amount exceeds its fair value. The fair value is determined based on valuation techniques such as a comparison to fair values of similar assets or using a discounted cash flow analysis. There were no impairment charges recognized during the years ended December 31, 2015 , 2014 and 2013 . Long lived assets that do not have indefinite lives are amortized/depreciated over their useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The Company reevaluates the useful life determinations each year to determine whether events and circumstances warrant a revision to the remaining useful lives. |
Income Taxes | Income Taxes Since the Company conducts operations on a global basis, its effective tax rate has and will depend upon the geographic distribution of its pre ‑tax earnings among locations with varying tax rates. The Company accounts for the effects of income taxes that result from its activities during the current and preceding years. Under this method, deferred income tax liabilities and assets are based on the difference between the financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse or be utilized. The realization of deferred tax assets is contingent upon the generation of future taxable income. A valuation allowance is recorded if it is “more likely than not” that a portion or all of a deferred tax asset will not be realized. In evaluating the Company’s ability to recover their deferred tax assets within the jurisdiction from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations. In projecting future taxable income, the Company begins with historical results adjusted for the results of discontinued operations and incorporates assumptions about the amount of future state, federal, and foreign pretax operating income adjusted for items that do not have tax consequences. The assumptions about future taxable income require significant judgment and are consistent with the plans and estimates the Company is using to manage the underlying businesses. In evaluating the objective evidence that historical results provide, the Company considers three years of cumulative operating income (loss). The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not to be sustained upon examination based on the technical merits of the position. The amount of the accrual for which an exposure exists is measured by determining the amount that has a greater than 50 percent likelihood of being realized upon the settlement of the position. Components of the reserve are classified as a current or a long ‑term liability in the consolidated balance sheets based on when the Company expects each of the items to be settled. The Company records interest and penalties accrued in relation to uncertain tax benefits as a component of interest expense. The Company expects that the amount of unrecognized tax benefits will change during 2016 , however, the Company does not expect the change to have a significant impact on its results of operations or financial position. While the Company believes it has identified all reasonably identifiable exposures and that the reserve that the Company has established for identifiable exposures is appropriate under the circumstances, it is possible that additional exposures exist and that exposures may be settled at amounts different than the amounts reserved. It is also possible that changes in facts and circumstances could cause the Company to either materially increase or reduce the carrying amount of its tax reserves. In general, tax returns for the year 2011 and thereafter are subject to future examination by tax authorities. The Company’s policy has been to leave its cumulative unremitted foreign earnings invested indefinitely outside the United States, and the Company intends to continue this policy. As such, taxes have not been provided on any of the remaining accumulated foreign unremitted earnings. Due to the timing and circumstances of repatriation of such earnings, if any, it is not practicable to determine the unrecognized deferred tax liability relating to such amounts. If the cumulative unremitted foreign earnings exceed the amount the Company intends to reinvest in foreign countries in the future, the Company would provide for taxes on such excess amount. |
Foreign Currency | Foreign Currency The functional currency is translated into U.S. dollars for balance sheet accounts using the month end rates in effect as of the balance sheet date and average exchange rate for revenue and expense accounts for each respective period. The translation adjustments are deferred as a separate component of stockholders’ equity within accumulated other comprehensive income. Gains or losses resulting from transactions denominated in foreign currencies are included in other income or expense, within the consolidated statements of income. |
Comprehensive Income | Comprehensive Income Reporting on comprehensive income requires components of other comprehensive income, including unrealized gains or losses on available ‑for ‑sale securities, to be included as part of total comprehensive income. Comprehensive income is comprised of net income, translation adjustments and unrealized gains and losses on available ‑for ‑sale securities. The components of comprehensive income are included in the statements of comprehensive income. |
Basic and Diluted Net Income Attributable to Common Stockholders per Common Share | Basic and Diluted Net Income Attributable to Common Stockholders per Common Share Basic earnings per share is calculated by using the weighted-average number of common shares outstanding during the period, excluding amounts associated with restricted shares. The diluted earnings per share calculation is based on the weighted-average number of shares of common stock outstanding adjusted for the number of additional shares that would have been outstanding had all potentially dilutive common shares been issued. Potentially dilutive shares of common stock include stock options, convertible debt and unvested restricted stock. The dilutive effects of stock options and restricted stock awards are based on the treasury stock method. The dilutive effect of the assumed conversion of convertible debt is determined using the if-converted method. The after-tax effect of interest expense related to the convertible securities is added back to net income, and the convertible debt is assumed to have been converted into common shares at the beginning of the period. |
Stock-Based Compensation | Stock ‑Based Compensation The Company utilizes the Black ‑Scholes pricing model to determine the fair value of stock options on the dates of grant. Restricted stock awards are measured based on the fair market values of the underlying stock on the dates of grant, unless the awards are subject to market conditions, in which case the Company uses a binomial ‑lattice model (e.g., Monte Carlo simulation model). The Monte Carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved. The Company recognizes stock ‑based compensation over the requisite service period with an offsetting credit to additional paid ‑in capital. For the Company’s performance restricted stock awards the Company estimates the number of shares the recipient is to receive by applying a probability of achieving the performance goals. The actual number of shares the recipient receives is determined at the end of the performance period based on the results achieved versus goals based on the performance targets, such as revenues and operating income. Once the number of awards is determined, the compensation cost is fixed and continues to be recognized using the accelerated attribution recognition over the requisite service period for each vesting tranche. The Company classifies benefits of tax deductions in excess of the compensation cost recognized (excess tax benefits) as a financing cash inflow with a corresponding operating cash outflow. |
Impact of Recently Issued Accounting Standards | Impact of Recently Issued Accounting Standards In January 2016, Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 requires equity investments to be measured at fair value with changes in fair value recognized in net income; simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; requires separate presentation of financial assets and financial liabilities by measurement category and form of financial assets on the balance sheet or the accompanying notes to the financial statements and clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. ASU 2016-01 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company is currently evaluating the impact that ASU 2016-01 will have on its consolidated financial statements. In November 2015, the FASB issued Accounting Standards Update ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes, which will require entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The ASU simplifies the current guidance, which requires entities to separately present deferred tax assets and deferred tax liabilities as current and noncurrent in a classified balance sheet. The ASU may be applied either prospectively or retrospectively. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2016 and interim periods within those annual periods. Earlier application is permitted as of the beginning of an interim or annual period. Management has adopted ASU 2015-17 effective for the fourth quarter 2015 and will present the net deferred tax assets as noncurrent and reclassify any current deferred tax assets and liabilities in the consolidated balance sheet on a prospective basis. As per the early adoption of ASU 2015-17 and the prospective treatment by the Company, the prior periods have not been adjusted. If the prior period was adjusted the 2014 deferred income taxes would be a non-current deferred tax asset of $2.7 million and non-current deferred tax liability of $3.7 million. In September 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-16, Simplifying the Accounting for Measurement-Period Adjustments that eliminates the requirement in Business Combinations (Topic 805) to restate prior period financial statements for measurement period adjustments. The new guidance requires that the cumulative impact of a measurement period adjustment (including the impact on prior periods) be recognized in the reporting period in which the adjustment is identified. The new guidance does not change what constitutes a measurement period adjustment. The Company does not expect the adoption of this ASU to significantly impact the consolidated financial statements. In August 2015, the FASB issued ASU 2015-15 Interest- Imputation of Interest (Subtopic 835-30) Presentation and Subsequent Measurement of Debt Issuance Costs Associated With Line of Credit Arrangements, final guidance that requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the debt liability rather than as an asset. This publication has been updated to reflect an SEC staff member’s comment in June 2015 that the staff will not object to an entity presenting the cost of securing a revolving line of credit as an asset, regardless of whether a balance is outstanding. The Company does not expect the adoption of this ASU to significantly impact the consolidated financial statements. In May 2015, the FASB issued ASU 2015-08, Business Combinations (Topic 805): Pushdown Accounting - Amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115 (“ASU 2015-08”). The amendments in ASU 2015-08 amend various SEC paragraphs included in the FASB’s Accounting Standards Codification to reflect the issuance of Staff Accounting Bulletin No. 115 (“SAB 115”). SAB 115 rescinds portions of the interpretive guidance included in the SEC’s Staff Accounting Bulletins series and brings existing guidance into conformity with ASU No. 2014-17, “Business Combinations (Topic 805): Pushdown Accounting,” which provides an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. The Company has adopted the amendments in ASU 2015-08, effective May 8, 2015, as the amendments in the update are effective upon issuance. The adoption of this ASU did not significantly impact the consolidated financial statements. In April 2015, the FASB issued ASU 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). This amendment removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share. The updated guidance is effective for public entities for interim and annual periods beginning after December 15, 2016 and early adoption is not permitted. The Company does not expect the adoption of this ASU to significantly impact the consolidated financial statements. In April 2015, the FASB issued ASU 2015-05, Intangible – Goodwill and Other Internal Use Software (Topic 350-40), as part of its initiative to reduce complexity in accounting standards. This guidance clarified how customers in cloud computing arrangements should determine whether the arrangement includes a software license. The guidance also eliminates the existing requirement for customers to account for software licenses that they acquire by analogizing to the guidance on leases. Instead, entities will account for these arrangements as licenses of intangible assets. For public business entities, the FASB decided that the amendments will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted for all entities. The Company does not expect the adoption of this ASU to significantly impact the consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, Interest — Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance of debt issuance costs are not affected by the amendments in this update. The guidance is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Upon adoption, an entity must apply the guidance retrospectively to all prior periods presented. The Company does not expect the adoption of this ASU to significantly impact the consolidated financial statements. In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard changes the way reporting enterprises evaluate whether (a) they should consolidate limited partnerships and similar entities, (b) fees paid to a decision maker or service provider are variable interests in a VIE, and (c) variable interests in a VIE held by related parties of the reporting enterprise require the reporting enterprise to consolidate the VIE. The guidance is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2015. Early adoption is allowed, including early adoption in an interim period. A reporting entity may apply a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption or may apply the amendments retrospectively. The Company is currently assessing the impact, if any, of the adoption of this guidance on the consolidated financial statements. In May 2014, the FASB and the International Accounting Standards Board (“IASB”) (collectively, the “Boards”) jointly issued a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under US GAAP and IFRS. The standard’s core principle (issued as ASU 2014-09 by the FASB and as IFRS 15 by the IASB), is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The new guidance must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU 2014-09 by one year, and would allow entities the option to early adopt the new revenue standard as of the original effective date. The Company is currently evaluating their adoption method and the impact of the standard on the consolidated financial statements. |
Segment and Geographic Information | Segment and Geographic Information The Company’s chief operating decision ‑maker is the Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. Accordingly, the Company has determined that it currently operates in one business segment: providing cloud solutions and software ‑based activation for connected devices globally. The Company is not organized by market and is managed and operated as one business. A single management team reports to the chief operating decision maker who comprehensively manages the entire business. The Company does not operate any separate lines of business or separate business entities with respect to its services. Accordingly, the Company does not accumulate a complete set of discrete financial information with respect to separate service lines and does not have separately reportable segments. Although the Company operates in North America, Europe and Asia ‑Pacific a majority of the Company’s revenue and long lived assets are in the U.S. Revenues by geography are based on the billing addresses of the Company’s customers. The following tables set forth revenues and property and equipment, net by geographic area: Year Ended December 31, 2015 2014 2013 Revenues Domestic $ $ $ Foreign Total $ $ $ December 31, 2015 2014 Property and equipment, net: Domestic $ $ Foreign Total $ $ |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies | |
Schedule of reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share | Year Ended December 31, 2015 2014 2013 Numerator: Net income attributable to Synchronoss $ $ $ Income effect for interest on convertible debt, net of tax — Net income applicable to shares of common stock for earnings per share $ $ $ Denominator: Weighted-average common shares outstanding — basic Dilutive effect of: Shares from assumed conversion of convertible debt — Options and unvested restricted shares Weighted-average common shares outstanding — diluted |
Schedule of revenues and property and equipment, net by geographic area | Year Ended December 31, 2015 2014 2013 Revenues Domestic $ $ $ Foreign Total $ $ $ December 31, 2015 2014 Property and equipment, net: Domestic $ $ Foreign Total $ $ |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Zentry, LLC | |
Acquisition | |
Summary of fair values of assets and liabilities assumed at acquisition date | Preliminary Purchase Price Allocation Property, plant and equipment $ Intangible assets: Wtd. Avg. Technology 5 years Customer relationships 5 years Goodwill Total assets acquired Redeemable noncontrolling interest Net assets acquired $ |
SNCR, LLC | |
Acquisition | |
Summary of fair values of assets and liabilities assumed at acquisition date | Preliminary Purchase Price Allocation Intangible assets: Wtd. Avg. Technology $ 4 years Customer relationships 7 years Goodwill Total assets acquired Redeemable noncontrolling interest Net assets acquired — |
Razorsight Corporation ("Razorsight") | |
Acquisition | |
Summary of fair values of assets and liabilities assumed at acquisition date | Purchase Price Allocation Cash $ Prepaid expenses and other assets Accounts receivable Equipment Other assets - long term Intangible assets: Wtd. Avg. Technology 4 years Customer relationships 10 years Goodwill Total assets acquired Accounts payable and accrued liabilities Lease obligation Deferred revenues Contingent consideration Deferred taxes Net assets acquired $ |
F-Secure Corporation ("F-Secure") | |
Acquisition | |
Summary of fair values of assets and liabilities assumed at acquisition date | Preliminary Purchase Price Allocation Intangible assets: Wtd. Avg. Technology $ 1 year Customer relationships 5 years Goodwill Total assets acquired Accrued expenses Net assets acquired $ |
Fair Value Measurements of As28
Fair Value Measurements of Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Measurements of Assets and Liabilities | |
Schedule of assets and liabilities held and their related classifications under the fair value hierarchy | December 31, 2015 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents (A) $ $ $ — $ — Securities available-for-sale (B) — — Total assets $ $ $ $ — Liabilities Contingent consideration obligation $ $ — $ — $ Total liabilities $ $ — $ — $ Temporary Equity Redeemable noncontrolling interest $ $ — $ — $ Total temporary equity $ $ — $ — $ December 31, 2014 Total (Level 1) (Level 2) (Level 3) Assets Cash and cash equivalents (A) $ $ $ — $ — Securities available-for-sale (B) — — Total assets $ $ $ $ — Liabilities Contingent consideration obligation $ $ — $ — $ Total liabilities $ $ — $ — $ (A) Cash and cash equivalents includes money market funds. (B) Securities available-for-sale include municipal bonds, commercial papers, certificates of deposit, enhanced income money market fund and corporate bonds which are classified as marketable securities. |
Schedule of estimated fair value of investments classified as available for sale | December 31, 2015 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Available-for-sale securities: Certificates of deposit $ $ — $ $ Corporate bonds — Municipal bonds Total available-for-sale securities $ $ $ $ December 31, 2014 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Available-for-sale securities: Commercial papers $ $ $ — $ Corporate bonds — Municipal bonds Total available-for-sale securities $ $ $ $ |
Schedule unrealized losses on available for sale securities | December 31, 2015 Securities in unrealized loss position Securities in unrealized loss position less than 12 months greater than 12 months Total Gross Unrealized Fair Unrealized Fair unrealized Fair Losses Value Losses Value losses Value Certificates of deposit $ $ $ — $ — $ $ Corporate bonds — — Municipal bonds $ $ $ $ $ $ The unrealized losses and fair values of available-for-sale securities that have been in an unrealized loss position for a period of less than and greater than 12 months as of December 31, 2014 , are as follows: December 31, 2014 Securities in unrealized loss position Securities in unrealized loss position less than 12 months greater than 12 months Total Gross Unrealized Fair Unrealized Fair unrealized Fair Losses Value Losses Value losses Value Corporate bonds $ $ $ — $ — $ $ Municipal bonds — — $ $ $ — $ — $ $ |
Schedule of maturities of available-for-sale securities | December 31, 2015 Amortized Fair Cost Value Due within one year $ $ Due after 1 year through 5 years Total available-for-sale securities $ $ |
Redeemable Noncontrolling Interests | |
Fair Value Measurements of Assets and Liabilities | |
Schedule of changes in fair value of Level 3 | Balance at December 31, 2014 $ — Issuance of redeemable noncontrolling interests Net income attributable to redeemable noncontrolling interests Balance at December 31, 2015 $ |
Contingent Consideration Obligation | |
Fair Value Measurements of Assets and Liabilities | |
Schedule of changes in fair value of Level 3 | Balance at December 31, 2014 $ Fair value adjustment to contingent consideration obligation included in net income Earn-out compensation paid Strumsoft employees Razorsight Earn-out Balance at December 31, 2015 $ |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment | |
Schedule of components of property and equipment | December 31, 2015 2014 Computer hardware $ $ Computer software Construction in-progress Furniture and fixtures Building Leasehold improvements Less: Accumulated depreciation $ $ |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accrued Expenses | |
Schedule of components of accrued expenses | December 31, 2015 2014 Accrued compensation and benefits $ $ Accrued accounting fees Accrued consulting fees Accrued other Accrued income tax payable $ $ |
Stock Plans (Tables)
Stock Plans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Stock Plans | |
Schedule of stock-based compensation | December 31, 2015 2014 2013 Stock options $ $ $ Restricted stock awards ESPP Plan Total stock-based compensation before taxes $ $ $ Tax benefit $ $ $ |
Schedule of fair value assumptions | December 31, 2015 2014 2013 Expected stock price volatility % % % Risk-free interest rate % % % Expected life of options (in years) Expected dividend yield % % % The weighted-average fair value (as of the date of grant) of the options granted $ $ $ |
Schedule of information about stock options outstanding | Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Options Options Exercise Price Term (Years) Value Outstanding at December 31, 2014 Options Granted Options Exercised Options Cancelled Outstanding at December 31, 2015 $ $ Vested or expected to vest at December 31, 2015 $ $ Exercisable at December 31, 2015 $ $ |
Schedule of total intrinsic value for options exercised and fair value of vested options | December 31, 2015 2014 2013 Total intrinsic value for stock options exercised Fair value of vested options |
Summary of unvested restricted stock activity | Non-Vested Restricted Stock Number of Awards Weighted-Average Grant Date Fair Value Non-vested at December 31, 2014 $ Granted $ Vested $ Forfeited $ Non-vested at December 31, 2015 $ |
Schedule of weighted-average assumptions used to value employee stock purchase rights | December 31, 2015 2014 2013 Expected stock price volatility % % % Risk-free interest rate % % % Expected life of ESPP shares (in years) Expected dividend yield % % % The weighted-average fair value (as of the date of grant) of the ESPP shares $ $ $ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes | |
Schedule of components of income before income taxes | Year Ended December 31, 2015 2014 2013 Domestic $ $ $ Foreign Total $ $ $ |
Schedule of components of income tax (expense) benefit | Year Ended December 31, 2015 2014 2013 Current: Federal $ $ $ State Foreign Deferred: Federal State Foreign Income tax expense $ $ $ |
Schedule of reconciliations of the statutory tax rates and the effective tax rates | Year Ended December 31, 2015 2014 2013 Statutory rate % % % State taxes, net of federal benefit % % % Effect of rates different than statutory % % — % Minority interest % — % — % Non-deductible stock based compensation — % — % % Other permanent adjustments % % % Fair market value adjustment on Earn-out — % % % Research and development credit % % % Subpart F income — % % — % Change in valuation allowance % — % % Ireland deferred tax liability - migration % — % — % Customer relationship adjustment - Australia % — % — % Other — % % % Net % % % |
Schedule of significant components of the Company's deferred tax assets and liabilities | December 31, 2015 2014 Deferred tax assets: Accrued liabilities $ $ Deferred revenue Bad debts reserve Deferred compensation Federal net operating loss carry forwards State net operating loss carry forwards Foreign net operating loss carry forwards Deferred rent Capital loss carry forward Other Total deferred tax assets $ $ Deferred tax liabilities: Intangible assets $ $ Fixed assets Total deferred tax liabilities Less: valuation allowance Net deferred income tax (liabilities) assets $ $ |
Schedule of net operating loss carryforwards | 2016-2020 $ 2021-2025 2026-2035 Indefinite $ |
Schedule of reconciliation of the amounts of unrecognized tax benefits excluding interest | Unrecognized tax benefit at December 31, 2012 $ Decreases for tax positions taken during prior year Reduction due to lapse of applicable statute of limitations Increases for tax positions of current period Unrecognized tax benefit at December 31, 2013 Decreases for tax positions taken during prior year Reduction due to lapse of applicable statute of limitations Increases for tax positions of current period Unrecognized tax benefit at December 31, 2014 Increases for tax positions taken during prior year Reduction due to lapse of applicable statute of limitations Increases for tax positions of current period Unrecognized tax benefit at December 31, 2015 $ |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies | |
Schedule of aggregate annual future minimum lease payments under non-cancellable leases | Year Ending December 31: Colocation Operating Leases Capital Leases 2016 $ $ $ 2017 2018 2019 2020 and thereafter $ $ $ |
Goodwill and intangibles (Table
Goodwill and intangibles (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangibles | |
Schedule of changes in goodwill | Balance at December 31, 2013 $ Acquisitions Reclassifications, adjustments and other Translation adjustments Balance at December 31, 2014 $ Acquisitions Reclassifications, adjustments and other Translation adjustments Balance at December 31, 2015 $ |
Schedule of composition of intangible assets | December 31, 2015 Accumulated Cost Amortization Net Trade name $ $ $ Technology Customer lists and relationships Capitalized software and patents Order Backlog — $ $ $ December 31, 2014 Accumulated Cost Amortization Net Trade name $ $ $ Technology Customer lists and relationships Capitalized software and patents Order Backlog — $ $ $ |
Schedule of estimated annual amortization expense of intangible assets for the next five years | Year ended December 31: 2016 $ 2017 2018 2019 2020 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Restructuring Charges | |
Summary of the restructuring accrual and changes | Balance at Balance at December 31, 2014 Charges Payments December 31, 2015 Employment termination costs $ — $ $ $ — Facilities consolidation — Total $ — $ $ $ |
Accumulated Other Comprehensi36
Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss). | |
Schedule of changes in accumulated other comprehensive income (loss) | The changes in accumulated other comprehensive income during the year ended December 31, 2015 , are as follows, net of tax: Unrealized Net Gain (Loss) Holding Gains on on Intra-Entity Foreign Available-for-Sale Foreign Currency Currency Securities Transactions Total Balance at December 31, 2014 $ $ $ $ Other comprehensive loss before reclassifications Tax effect — Total other comprehensive loss Balance at December 31, 2015 $ $ $ $ The changes in accumulated other comprehensive income during the year ended December 31, 2014 , are as follows, net of tax: Unrealized Net Gain (Loss) Holding Gains on on Intra-Entity Foreign Available-for-Sale Foreign Currency Currency Securities Transactions Total Balance at December 31, 2013 $ $ $ $ Other comprehensive loss before reclassifications Tax effect — — Amounts reclassified from accumulated other comprehensive loss — — Total other comprehensive loss Balance at December 31, 2014 $ $ $ $ |
Summary of Significant Accoun37
Summary of Significant Accounting Policies - Research and Development (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Research and Development | |||
Unamortized software development costs | $ 6,100 | $ 6,100 | $ 1,800 |
Amortization expenses of capital software development costs | $ 2,000 | $ 837 | $ 1,200 |
Software Development | Minimum | |||
Research and Development | |||
Estimated minimum useful life of software development costs | 3 years | ||
Software Development | Maximum | |||
Research and Development | |||
Estimated maximum useful life of software development costs | 5 years |
Summary of Significant Accoun38
Summary of Significant Accounting Policies - Concentration of Credit Risk (Details) - Top Customers | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net Revenues | Customer Concentration | |||
Concentration of Credit Risk | |||
Percentage of concentration risk | 75.00% | 73.00% | 66.00% |
Accounts Receivable | Credit Concentration | |||
Concentration of Credit Risk | |||
Percentage of concentration risk | 72.00% | 68.00% |
Summary of Significant Accoun39
Summary of Significant Accounting Policies - Cash, Marketable Securities, and Property, Plant and Equipment (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Cash and Cash Equivalents | |
Maximum time period for which an investment is considered a cash equivalent | 3 months |
Minimum | |
Marketable Securities | |
Maturity period of fixed income investments | 3 months |
Maturity period of marketable securities to be classified as long-term | 12 months |
Minimum | Property, Equipment, and Leasehold Improvements | |
Property and Equipment | |
Estimated useful life of property and equipment and leasehold improvements | 3 years |
Maximum | Property, Equipment, and Leasehold Improvements | |
Property and Equipment | |
Estimated useful life of property and equipment and leasehold improvements | 5 years |
Summary of Significant Accoun40
Summary of Significant Accounting Policies - Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Summary of Significant Accounting Policies | |||
Impairment charges on goodwill | $ 0 | $ 0 | $ 0 |
Impairment of Long-Lived Assets | |||
Impairment charges on long lived assets | $ 0 | $ 0 | $ 0 |
Income Taxes | |||
Historical period used in future taxable income assumptions | 3 years |
Summary of Significant Accoun41
Summary of Significant Accounting Policies - Basic and Diluted Net Income (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||||
Basic and Diluted Net Income Attributable to Common Stockholders per Common Share | ||||||
Stock options that are anti-dilutive and excluded from calculation of diluted earnings per share (in shares) | 553 | 1,100 | 1,400 | |||
Numerator: | ||||||
Net income attributable to common stockholders | $ 40,630 | $ 38,895 | $ 23,351 | |||
Income effect for interest on convertible debt, net of tax | 1,920 | 754 | ||||
Numerator for diluted EPS- Income to common stockholders after assumed conversions | $ 42,550 | $ 39,649 | $ 23,351 | |||
Denominator: | ||||||
Weighted average common shares outstanding - basic | 42,284 | [1] | 40,418 | [2] | 38,891 | [3] |
Dilutive effect of: | ||||||
Shares from assumed conversion of convertible debt | 4,326 | 1,682 | ||||
Options and unvested restricted shares | 1,043 | 1,197 | 1,118 | |||
Weighted average common shares outstanding - diluted | 47,653 | [4] | 43,297 | [5] | 40,009 | [6] |
[1] | See notes to financial statement footnote 2 | |||||
[2] | See notes to financial statement footnote 2 | |||||
[3] | See notes to financial statement footnote 2 | |||||
[4] | See notes to financial statement footnote 2 | |||||
[5] | See notes to financial statement footnote 2 | |||||
[6] | See notes to financial statement footnote 2 |
Summary of Significant Accoun42
Summary of Significant Accounting Policies - Segment and Geographic Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015USD ($)segmentitem | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Segment and Geographic Information | |||
Number of business segments | segment | 1 | ||
Number of businesses the entity is managed and operated as | item | 1 | ||
Revenues and property and equipment, net by geographic area | |||
Revenues | $ 578,831 | $ 457,314 | $ 349,047 |
Property and equipment, net | 168,280 | 151,171 | |
Geographic area | |||
Revenues and property and equipment, net by geographic area | |||
Revenues | 578,831 | 457,314 | 349,047 |
Property and equipment, net | 168,280 | 151,171 | |
Geographic area | Domestic | |||
Revenues and property and equipment, net by geographic area | |||
Revenues | 525,968 | 405,235 | 309,322 |
Property and equipment, net | 156,961 | 141,944 | |
Geographic area | Foreign | |||
Revenues and property and equipment, net by geographic area | |||
Revenues | 52,863 | 52,079 | $ 39,725 |
Property and equipment, net | $ 11,319 | $ 9,227 |
Acquisition - 2015 Acquisitions
Acquisition - 2015 Acquisitions - Zentry (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Preliminary Purchase Price Allocation | ||||
Goodwill | $ 221,271 | $ 221,271 | $ 147,135 | $ 137,743 |
Zentry, LLC | ||||
Acquisition | ||||
Ownership Percentage | 67.00% | 67.00% | ||
Cash consideration, net of liabilities assumed | $ 48,000 | |||
License and Maintenance Revenue | $ 23,000 | |||
Preliminary Purchase Price Allocation | ||||
Property, plant and equipment | 2,900 | 2,900 | ||
Goodwill | 24,000 | 24,000 | ||
Total assets acquired | 72,000 | 72,000 | ||
Redeemable noncontrolling interest | 24,000 | 24,000 | ||
Net assets acquired | 48,000 | 48,000 | ||
Goodwill and acquisition related costs | ||||
Purchase price, tax deductible portion of goodwill | 0 | 0 | ||
Zentry, LLC | Call Option | ||||
Acquisition | ||||
Settlement threshold under option contract | $ 200,000 | |||
Weighted average trading price, period | 30 days | |||
Technology | Zentry, LLC | ||||
Preliminary Purchase Price Allocation | ||||
Intangible assets | $ 42,800 | 42,800 | ||
Weighted-average amortization period | 5 years | |||
Customer relationships | Zentry, LLC | ||||
Preliminary Purchase Price Allocation | ||||
Intangible assets | $ 2,300 | $ 2,300 | ||
Weighted-average amortization period | 5 years |
Acquisition - 2015 Acquisitio44
Acquisition - 2015 Acquisitions - SNCR, LLC (Details) - USD ($) $ in Thousands | Nov. 16, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Preliminary Purchase Price Allocation | ||||
Goodwill | $ 221,271 | $ 147,135 | $ 137,743 | |
SNCR, LLC | ||||
Acquisition | ||||
Ownership Percentage | 67.00% | |||
Preliminary Purchase Price Allocation | ||||
Goodwill | $ 14,170 | |||
Total assets acquired | 31,400 | |||
Redeemable noncontrolling interest | 31,400 | |||
Goodwill and acquisition related costs | ||||
Purchase price, tax deductible portion of goodwill | $ 0 | |||
Technology | SNCR, LLC | ||||
Preliminary Purchase Price Allocation | ||||
Intangible assets | $ 12,780 | |||
Weighted-average amortization period | 4 years | |||
Customer relationships | SNCR, LLC | ||||
Preliminary Purchase Price Allocation | ||||
Intangible assets | $ 4,450 | |||
Weighted-average amortization period | 7 years | |||
Call Option | SNCR, LLC | ||||
Acquisition | ||||
Weighted average trading price, period | 30 days |
Acquisition - 2015 Acquisitio45
Acquisition - 2015 Acquisitions - Razorsight (Details) - USD ($) | Aug. 04, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Preliminary Purchase Price Allocation | ||||
Goodwill | $ 221,271,000 | $ 147,135,000 | $ 137,743,000 | |
Razorsight Corporation ("Razorsight") | ||||
Acquisition | ||||
Cash consideration, net of liabilities assumed | $ 25,300,000 | |||
Earn-out obligation, high end of potential liability | 15,000,000 | |||
Preliminary Purchase Price Allocation | ||||
Cash | 1,172,000 | |||
Prepaid expenses and other assets | 1,111,000 | |||
Accounts receivable | 120,000 | |||
Property, plant and equipment | 879,000 | |||
Other assets - long term | 144,000 | |||
Goodwill | 10,012,000 | |||
Total assets acquired | 34,328,000 | |||
Accounts payable and accrued liabilities | 2,211,000 | |||
Lease obligation | 284,000 | |||
Deferred revenues | 965,000 | |||
Contingent consideration | 170,000 | |||
Deferred taxes | 5,414,000 | |||
Net assets acquired | 25,284,000 | |||
Goodwill and acquisition related costs | ||||
Purchase price, tax deductible portion of goodwill | $ 0 | |||
Technology | Razorsight Corporation ("Razorsight") | ||||
Preliminary Purchase Price Allocation | ||||
Intangible assets | $ 9,200,000 | |||
Weighted-average amortization period | 4 years | |||
Customer relationships | Razorsight Corporation ("Razorsight") | ||||
Preliminary Purchase Price Allocation | ||||
Intangible assets | $ 11,690,000 | |||
Weighted-average amortization period | 10 years |
Acquisition - 2015 Acquisitio46
Acquisition - 2015 Acquisitions - F-Secure Corporation (Details) - USD ($) $ in Thousands | Feb. 23, 2015 | Feb. 18, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Preliminary Purchase Price Allocation | |||||
Goodwill | $ 221,271 | $ 147,135 | $ 137,743 | ||
F-Secure Corporation ("F-Secure") | |||||
Acquisition | |||||
Cash consideration, net of liabilities assumed | $ 59,500 | ||||
Preliminary Purchase Price Allocation | |||||
Goodwill | $ 36,454 | ||||
Total assets acquired | 60,000 | ||||
Accrued Expenses | 519 | ||||
Net assets acquired | 59,481 | ||||
Goodwill and acquisition related costs | |||||
Purchase price, tax deductible portion of goodwill | $ 0 | ||||
Technology | F-Secure Corporation ("F-Secure") | |||||
Preliminary Purchase Price Allocation | |||||
Intangible assets | $ 3,071 | ||||
Weighted-average amortization period | 1 year | ||||
Customer relationships | F-Secure Corporation ("F-Secure") | |||||
Preliminary Purchase Price Allocation | |||||
Intangible assets | $ 20,475 | ||||
Weighted-average amortization period | 5 years |
Acquisition - Other information
Acquisition - Other information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Acquisition | |||
Acquisition-related costs | $ 1.8 | $ 2.5 | $ 1.7 |
Fair Value Measurements of As48
Fair Value Measurements of Assets and Liabilities - Heirarchy (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Assets | ||
Cash and cash equivalents | $ 147,634 | $ 235,967 |
Securities available-for-sale | 85,992 | 54,410 |
Total assets | 233,626 | 290,377 |
Liabilities | ||
Contingent consideration obligation | 930 | 8,000 |
Total liabilities | 930 | 8,000 |
Temporary Equity | ||
Redeemable noncontrolling interest | 61,452 | |
Transfers between Levels | ||
Fair value of asset transfers between Levels 1, 2, and 3 | 0 | |
Level 1 | ||
Assets | ||
Cash and cash equivalents | 147,634 | 235,967 |
Total assets | 147,634 | 235,967 |
Level 2 | ||
Assets | ||
Securities available-for-sale | 85,992 | 54,410 |
Total assets | 85,992 | 54,410 |
Level 3 | ||
Liabilities | ||
Contingent consideration obligation | 930 | 8,000 |
Total liabilities | 930 | $ 8,000 |
Temporary Equity | ||
Redeemable noncontrolling interest | $ 61,452 |
Fair Value Measurements of As49
Fair Value Measurements of Assets and Liabilities - AFS Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Amortized Cost to Fair Value | |||
Amortized Cost | $ 86,472 | $ 54,811 | |
Gross Unrealized Gains | 11 | 19 | |
Gross Unrealized Losses | (491) | (420) | |
Fair Value | 85,992 | 54,410 | |
Unrealized gain (loss) on securities | |||
Unrealized (loss) gain on securities | (54) | (176) | $ 2 |
Sales of marketable securities | 0 | ||
Commercial Papers | |||
Amortized Cost to Fair Value | |||
Amortized Cost | 8,994 | ||
Gross Unrealized Gains | 6 | ||
Fair Value | 9,000 | ||
Corporate bonds | |||
Amortized Cost to Fair Value | |||
Amortized Cost | 45,579 | 28,916 | |
Gross Unrealized Losses | (442) | (414) | |
Fair Value | 45,137 | 28,502 | |
Municipal Bonds | |||
Amortized Cost to Fair Value | |||
Amortized Cost | 38,564 | 16,901 | |
Gross Unrealized Gains | 11 | 13 | |
Gross Unrealized Losses | (44) | (6) | |
Fair Value | 38,531 | $ 16,908 | |
CDs | |||
Amortized Cost to Fair Value | |||
Amortized Cost | 2,329 | ||
Gross Unrealized Losses | (5) | ||
Fair Value | $ 2,324 |
Fair Value Measurements of As50
Fair Value Measurements of Assets and Liabilities - AFS Securities in Unrealized Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Securities in unrealized loss position: Unrealized Losses | ||
Securities in unrealized loss position less than 12 months | $ (490) | $ (420) |
Securities in unrealized loss position greater than 12 months | (1) | |
Securities in unrealized loss position: Total Gross unrealized losses | (491) | (420) |
Securities in unrealized loss position: Fair Value | ||
Securities in unrealized loss position less than 12 months | 68,166 | 32,078 |
Securities in unrealized loss position greater than 12 months | 550 | |
Securities in unrealized loss position: Total Fair Value | 68,716 | 32,078 |
Corporate bonds | ||
Securities in unrealized loss position: Unrealized Losses | ||
Securities in unrealized loss position less than 12 months | (442) | (414) |
Securities in unrealized loss position: Total Gross unrealized losses | (442) | (414) |
Securities in unrealized loss position: Fair Value | ||
Securities in unrealized loss position less than 12 months | 45,212 | 28,502 |
Securities in unrealized loss position: Total Fair Value | 45,212 | 28,502 |
Municipal Bonds | ||
Securities in unrealized loss position: Unrealized Losses | ||
Securities in unrealized loss position less than 12 months | (43) | (6) |
Securities in unrealized loss position greater than 12 months | (1) | |
Securities in unrealized loss position: Total Gross unrealized losses | (44) | (6) |
Securities in unrealized loss position: Fair Value | ||
Securities in unrealized loss position less than 12 months | 20,630 | 3,576 |
Securities in unrealized loss position greater than 12 months | 550 | |
Securities in unrealized loss position: Total Fair Value | 21,180 | $ 3,576 |
CDs | ||
Securities in unrealized loss position: Unrealized Losses | ||
Securities in unrealized loss position less than 12 months | (5) | |
Securities in unrealized loss position: Total Gross unrealized losses | (5) | |
Securities in unrealized loss position: Fair Value | ||
Securities in unrealized loss position less than 12 months | 2,324 | |
Securities in unrealized loss position: Total Fair Value | $ 2,324 |
Fair Value Measurements of As51
Fair Value Measurements of Assets and Liabilities - AFS Securities Expected Maturities (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Amortized Cost | |
Due within one year | $ 61,164 |
Due after 1 year through 5 years | 19,715 |
Total available-for-sale marketable securities, Amortized Cost | 80,879 |
Fair Value | |
Due within one year | 60,911 |
Due after 1 year through 5 years | 19,677 |
Total available-for-sale marketable securities, Fair Value | $ 80,588 |
Fair Value Measurements of As52
Fair Value Measurements of Assets and Liabilities - Level 3 Contingent Consideration (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Changes in fair value of the Company's Level 3 contingent consideration obligation | |||
Fair value adjustment to contingent obligation included in net income | $ 760 | $ 1,799 | $ (5,324) |
Payments on contingent consideration obligation | (4,468) | $ (1,926) | |
Level 3 | Contingent Consideration Obligation | |||
Changes in fair value of the Company's Level 3 contingent consideration obligation | |||
Balance as at the beginning of the period | 8,000 | ||
Fair value adjustment to contingent obligation included in net income | 760 | ||
Addition of Razorsight earn-out | 170 | ||
Balance as at the end of the period | 930 | $ 8,000 | |
Level 3 | Contingent Consideration Obligation | Strumsoft, Inc. (Strumsoft) | |||
Changes in fair value of the Company's Level 3 contingent consideration obligation | |||
Payments on contingent consideration obligation | $ (8,000) |
Fair Value Measurements of As53
Fair Value Measurements of Assets and Liabilities - Level 3 Redeemable Noncontrolling Interests (Details) - Redeemable Noncontrolling Interests $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Changes in fair value of the Company’s Level 3 redeemable noncontrolling interests | |
Balance at beginning of period | $ 0 |
Issuance of redeemable noncontrolling interests | 55,400 |
Net income attributable to redeemable noncontrolling interests | 6,052 |
Balance at end of period | $ 61,452 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property and Equipment | |||
Property and Equipment, gross | $ 286,238 | $ 224,988 | |
Less: Accumulated depreciation | (117,958) | (73,817) | |
Property and equipment, net | 168,280 | 151,171 | |
Depreciation expense | 43,500 | 36,100 | $ 24,600 |
Computer hardware | |||
Property and Equipment | |||
Property and Equipment, gross | 217,659 | 134,328 | |
Computer software | |||
Property and Equipment | |||
Property and Equipment, gross | 39,510 | 28,661 | |
Construction-in-progress | |||
Property and Equipment | |||
Property and Equipment, gross | 4,299 | 37,989 | |
Furniture and fixtures | |||
Property and Equipment | |||
Property and Equipment, gross | 4,040 | 3,669 | |
Building | |||
Property and Equipment | |||
Property and Equipment, gross | 8,808 | 8,808 | |
Leasehold improvements | |||
Property and Equipment | |||
Property and Equipment, gross | $ 11,922 | $ 11,533 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accrued Expenses | ||
Accrued compensation and benefits | $ 24,776 | $ 23,480 |
Accrued accounting fees | 1,622 | 1,362 |
Accrued consulting fees | 6,075 | 5,169 |
Accrued other | 12,663 | 8,813 |
Accrued income tax payable | 683 | 3,855 |
Total | $ 45,819 | $ 42,679 |
Capital Structure - Capitalizat
Capital Structure - Capitalization Information (Details) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Capital Structure | ||
Authorized capital stock (in shares) | 110,000,000 | |
Par value per share of capital stock (in dollars per share) | $ 0.0001 | |
Designated common stock (in shares) | 100,000,000 | 100,000,000 |
Designated preferred stock (in shares) | 10,000,000 | 10,000,000 |
Capital Structure - Outstanding
Capital Structure - Outstanding and Stock Incentive Plans (Details) shares in Thousands | 12 Months Ended | |
Dec. 31, 2015USD ($)Voteshares | Dec. 31, 2014shares | |
Common Stock and Preferred Stock | ||
Preferred stock outstanding | shares | 0 | 0 |
Common Stock | ||
Common Stock and Preferred Stock | ||
Number of votes per share | Vote | 1 | |
Dividends declared or paid | $ | $ 0 |
Capital Structure - Treasury St
Capital Structure - Treasury Stock (Details) - Common - 2012 Stock Repurchase Program - USD ($) $ in Millions | May. 08, 2012 | Dec. 31, 2013 |
Treasury Stock | ||
Amount authorized to be purchased under stock repurchase program | $ 25 | |
Duration of repurchase program | 12 months | |
Number of shares repurchased under program | 0 |
Stock Plans - Plan Information
Stock Plans - Plan Information (Details) shares in Millions | Dec. 31, 2015shares |
2015 Plan | |
Stockholder's Equity | |
Number of shares available for grant | 3.8 |
Stock Plans - Stock-based compe
Stock Plans - Stock-based compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based compensation expense | |||
Total stock-based compensation expense before taxes | $ 31,711 | $ 28,987 | $ 25,214 |
Tax benefit | 10,130 | 9,939 | 8,380 |
Stock-based compensation cost related to non-vested equity awards not yet recognized as an expense | $ 52,000 | ||
Weighted-average period over which stock-based compensation cost related to non-vested equity awards is expected to be recognized | 2 years 8 months 16 days | ||
Stock Options | |||
Share-based compensation expense | |||
Total stock-based compensation expense before taxes | $ 8,495 | 9,992 | 10,035 |
Restricted Stock | |||
Share-based compensation expense | |||
Total stock-based compensation expense before taxes | 22,592 | 18,353 | 14,539 |
ESPP Plan | |||
Share-based compensation expense | |||
Total stock-based compensation expense before taxes | $ 624 | $ 642 | $ 640 |
Stock Plans - Option Vesting (D
Stock Plans - Option Vesting (Details) - Stock Options | 12 Months Ended |
Dec. 31, 2015 | |
2000 Plan | First Anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 25.00% |
2000 Plan | Monthly vesting after first anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 2.10% |
2006 Plan | First Anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 25.00% |
2006 Plan | Monthly vesting after first anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 2.10% |
2010 Plan | Monthly vesting after second anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 2.10% |
2010 Plan | Second Anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 50.00% |
2015 Plan | First Anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 25.00% |
2015 Plan | Monthly vesting after first anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 2.10% |
2000 and 2006 Stock incentive plans | First Anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 25.00% |
2000 and 2006 Stock incentive plans | Monthly vesting after first anniversary | |
Stockholder's Equity | |
Percentage of awards vesting | 2.10% |
Stock Plans - Black-Scholes Ass
Stock Plans - Black-Scholes Assumptions (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Weighted-average assumptions | |||
Expected stock price volatility (as a percent) | 47.00% | 57.00% | 66.00% |
Risk-free interest rate (as a percent) | 1.27% | 1.43% | 0.87% |
Expected life (in years) | 4 years | 4 years 2 months 12 days | 4 years 6 months |
Expected dividend yield (as a percent) | 0.00% | 0.00% | 0.00% |
Weighted-average fair value (as of the date of grant) of the options granted during the period (in dollars per share) | $ 15.88 | $ 14.67 | $ 15.79 |
Stock Plans - Stock Options (De
Stock Plans - Stock Options (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Number of Options | |||
Options outstanding at the beginning of the period (in shares) | 2,767 | ||
Options Granted (in shares) | 714 | ||
Options Exercised (in shares) | (879) | ||
Options Cancelled (in shares) | (254) | ||
Options outstanding at the end of the period (in shares) | 2,348 | 2,767 | |
Vested or expected to vest (in shares) | 2,158 | ||
Exercisable (in shares) | 1,181 | ||
Weighted-Average Exercise Price | |||
Balance at the beginning of the period (in dollars per share) | $ 25.81 | ||
Options Granted (in dollars per share) | 41.85 | ||
Options Exercised (in dollars per share) | 22.68 | ||
Options Cancelled (in dollars per share) | 33.32 | ||
Balance at the end of the period (in dollars per share) | 31.04 | $ 25.81 | |
Vested or expected to vest (in dollars per share) | 30.39 | ||
Exercisable (in dollars per share) | $ 24.97 | ||
Weighted-Average Remaining Contractual Term | |||
Outstanding | 4 years 5 months 19 days | ||
Exercisable | 3 years 22 days | ||
Vested or expected to vest | 4 years 3 months 29 days | ||
Aggregate Intrinsic Value | |||
Outstanding | $ 14,517 | ||
Exercisable | 12,197 | ||
Vested or expected to vest | 14,258 | ||
Additional disclosures related to stock options | |||
Intrinsic value of stock options exercised during the period | 18,369 | $ 18,950 | $ 17,869 |
Total fair value of vested options | $ 15,657 | $ 23,546 | $ 11,928 |
Stock Plans - Restricted Stock
Stock Plans - Restricted Stock (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Restricted Stock | |
Number of Awards | |
Non-vested at the beginning of the period (in shares) | 1,342 |
Granted (in shares) | 966 |
Vested (in shares) | (691) |
Forfeited (in shares) | (205) |
Non-vested at the end of the period (in shares) | 1,412 |
Weighted-Average Grant Date Fair Value | |
Non-vested at the beginning of the period (in dollars per share) | $ / shares | $ 31.24 |
Granted (in dollars per share) | $ / shares | 40.19 |
Vested (in dollars per share) | $ / shares | 30.44 |
Forfeited (in dollars per share) | $ / shares | 38.33 |
Non-vested at the end of the period (in dollars per share) | $ / shares | $ 36.80 |
2014 Performance Stock Awards | |
Additional disclosures | |
Issuance of restricted stock (in shares) | 195 |
2015 Plan | Performance Stock Awards | |
Stockholder's Equity | |
Vesting period | 3 years |
First Anniversary | Restricted Stock | |
Stockholder's Equity | |
Percentage of awards vesting | 25.00% |
Quarterly Vesting after first anniversary | Restricted Stock | |
Stockholder's Equity | |
Percentage of awards vesting | 6.25% |
Performance Goal Achievement | 2006 Plan | Performance Stock Awards | |
Stockholder's Equity | |
Percentage of awards vesting | 33.30% |
Annual Vesting of Performance Awards After Initial Achievement | 2006 Plan | Performance Stock Awards | |
Stockholder's Equity | |
Percentage of awards vesting | 33.30% |
Stock Plans - ESPP and Other Di
Stock Plans - ESPP and Other Disclosures (Details) - ESPP Plan - $ / shares shares in Thousands | Feb. 01, 2012 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Employee Stock Purchase Plan | ||||
Term of Employee Stock Purchase Plan | 10 years | |||
Total number of shares available for purchase | 500 | |||
ESPP participation period | 6 months | |||
Percentage of fair market value of common stock | 85.00% | |||
Maximum Percentage of total combined voting power a participant is allowed to be granted a right to purchase common stock | 5.00% | |||
Weighted-average assumptions | ||||
Expected stock price volatility (as a percent) | 38.00% | 52.00% | 65.00% | |
Risk-free interest rate (as a percent) | 0.14% | 0.60% | 1.04% | |
Expected life (in years) | 6 months | 6 months | 6 months | |
Expected dividend yield (as a percent) | 0.00% | 0.00% | 0.00% | |
The weighted-average fair value (as of the date of grant) of the ESPP shares | $ 11.13 | $ 10.54 | $ 10.75 |
401(k) Plan (Details)
401(k) Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
401(k) Plan | |||
Employer contribution incurred and expensed under 401(k) Plan | $ 2.3 | $ 2 | $ 1.5 |
Income Taxes - Components of In
Income Taxes - Components of Income before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income before income taxes | |||
Domestic | $ 95,475 | $ 52,850 | $ 30,437 |
Foreign | (19,177) | 7,724 | 4,142 |
Income before income tax expense | $ 76,298 | $ 60,574 | $ 34,579 |
Income Taxes - Components of 68
Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | |||
Federal | $ (19,206) | $ (8,673) | $ (3,709) |
State | (2,220) | (2,463) | (2,661) |
Foreign | 208 | (2,505) | (3,076) |
Deferred: | |||
Federal | (10,277) | (10,437) | (3,447) |
State | (480) | (1,301) | (1,324) |
Foreign | 2,359 | 3,700 | 2,989 |
Income tax expense | $ (29,616) | $ (21,679) | $ (11,228) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Statutory Rate (Details) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of the statutory tax rates and the effective tax rates | |||
Statutory rate (as a percent) | 35.00% | 35.00% | 35.00% |
State taxes, net of federal benefit (as a percent) | 3.00% | 4.00% | 7.00% |
Effect of rates different than statutory (as a percent) | 7.00% | (4.00%) | |
Minority interest (as a percent) | (3.00%) | ||
Non-deductible stock based compensation (as a percent) | 3.00% | ||
Other permanent adjustments (as a percent) | 2.00% | 1.00% | 1.00% |
Fair market value adjustment on Earn-out (as a percent) | 1.00% | (6.00%) | |
Research and development credit (as a percent) | (3.00%) | (2.00%) | (5.00%) |
Subpart F income (as a percent) | 2.00% | ||
Change in valuation allowance (as a percent) | 2.00% | (2.00%) | |
Ireland deferred tax liability - migration | (2.00%) | ||
Customer Relationship adjustment - Australia | (2.00%) | ||
Other (as a percent) | (1.00%) | (1.00%) | |
Net (as a percent) | 39.00% | 36.00% | 32.00% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets (Liabilities) Components (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Accrued liabilities | $ 14 | $ 23 |
Deferred revenue | 316 | 213 |
Bad debts reserve | 184 | 121 |
Deferred compensation | 11,684 | 11,308 |
Federal net operating loss carry forwards | 18,637 | 20,089 |
State net operating loss carry forwards | 1,691 | 2,120 |
Foreign net operating loss carry forwards | 9,992 | 7,800 |
Deferred rent | 570 | 552 |
Capital loss carryforward | 232 | 98 |
Other | 1,761 | 2,818 |
Total deferred tax assets | 45,081 | 45,142 |
Deferred tax liabilities: | ||
Intangible assets | (24,373) | (26,481) |
Fixed assets | (28,705) | (17,099) |
Total deferred tax liabilities | (53,078) | (43,580) |
Less: valuation allowance | (4,847) | (2,553) |
Net deferred income tax (liabilities) assets | $ (12,844) | $ (991) |
Income Taxes - Carryforwards (D
Income Taxes - Carryforwards (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Details of net operating loss carryforwards | |
Net operating loss | $ 137,792 |
2016 - 2020 | |
Details of net operating loss carryforwards | |
Net operating loss | 8,161 |
2021 - 2025 | |
Details of net operating loss carryforwards | |
Net operating loss | 15,716 |
2026 - 2035 | |
Details of net operating loss carryforwards | |
Net operating loss | 66,641 |
Indefinite | |
Details of net operating loss carryforwards | |
Net operating loss | 47,274 |
Federal | |
Details of net operating loss carryforwards | |
Net operating loss | 53,200 |
State | |
Details of net operating loss carryforwards | |
Net operating loss | 37,300 |
Foreign | Indefinite | |
Details of net operating loss carryforwards | |
Net operating loss | $ 47,300 |
Income Taxes - Valuation allowa
Income Taxes - Valuation allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation allowance | ||
Deferred revenue | $ 316 | $ 213 |
Valuation allowance | 4,847 | 2,553 |
Spatial Systems Nominees PTY LTD (Spatial) | ||
Valuation allowance | ||
Valuation allowance | 2,300 | |
Operating loss carryforwards utilized | $ 249 | |
Spatial Systems Nominees PTY LTD (Spatial) | Deferred Revenue | ||
Valuation allowance | ||
Valuation allowance | $ 2,500 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Undistributed foreign earnings | |||
Royalty fees paid | $ 3,300 | ||
Undistributed earnings attributable to foreign subsidiaries considered to be indefinitely invested | 30,800 | ||
Reconciliation of beginning and ending amount of unrecognized tax benefits excluding interest | |||
Unrecognized tax benefit at the beginning of the period | 1,130 | $ 708 | $ 511 |
Decreases for tax positions taken during prior year | 38 | (218) | (5) |
Reduction due to lapse of applicable statute of limitations | (58) | (11) | (66) |
Increases for tax positions of current period | 344 | 651 | 268 |
Unrecognized tax benefit at the end of the period | 1,454 | 1,130 | 708 |
Unrecognized tax benefits that, if recognized, would impact the effective tax rate | 1,500 | 1,100 | 700 |
Accrued interest for unrecognized tax benefits | 38 | $ 24 | $ 25 |
Portion of current unrecognized tax benefit expected to be recognized | $ 44 |
Commitments and Contingencies74
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Aggregate annual future minimum lease payments under non-cancellable leases | |||
Rent expense | $ 9,000 | $ 8,000 | $ 6,700 |
Colocation | |||
Aggregate annual future minimum lease payments under non-cancellable leases | |||
2,016 | 25,310 | ||
2,017 | 14,537 | ||
2,018 | 6,037 | ||
2,019 | 5,868 | ||
2020 and thereafter | 3,714 | ||
Total | 55,466 | ||
Operating Leases | |||
Aggregate annual future minimum lease payments under non-cancellable leases | |||
2,016 | 7,820 | ||
2,017 | 7,456 | ||
2,018 | 6,898 | ||
2,019 | 6,633 | ||
2020 and thereafter | 26,454 | ||
Total | 55,261 | ||
Capital Leases | |||
Aggregate annual future minimum lease payments under non-cancellable leases | |||
2,016 | 2,707 | ||
2,017 | 2,714 | ||
2,018 | 2,582 | ||
2,019 | 2,469 | ||
2020 and thereafter | 13,023 | ||
Total | $ 23,495 |
Goodwill and Intangibles- Goodw
Goodwill and Intangibles- Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Goodwill | ||
Balance at the beginning of the period | $ 147,135 | $ 137,743 |
Acquisitions | 84,636 | 20,624 |
Reclassifications, adjustments and other | (30) | (1,287) |
Translation adjustments | (10,470) | (9,945) |
Balance at the end of the period | $ 221,271 | $ 147,135 |
Goodwill and Intangibles - Inta
Goodwill and Intangibles - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Intangible assets | |||
Amortization expense | $ 28,600 | $ 19,800 | $ 16,100 |
Intangible assets: | |||
Cost | 249,919 | 149,202 | |
Accumulated amortization | (75,597) | (49,713) | |
Net amount | 174,322 | 99,489 | |
Trade Name | |||
Intangible assets: | |||
Cost | 1,531 | 1,564 | |
Accumulated amortization | (1,372) | (1,299) | |
Net amount | 159 | 265 | |
Technology | |||
Intangible assets: | |||
Cost | 130,200 | 66,931 | |
Accumulated amortization | (35,336) | (24,260) | |
Net amount | 94,864 | 42,671 | |
Customer lists and relationships | |||
Intangible assets: | |||
Cost | 105,864 | 70,443 | |
Accumulated amortization | (33,969) | (21,126) | |
Net amount | 71,895 | 49,317 | |
Capitalized software and patents | |||
Intangible assets: | |||
Cost | 11,406 | 9,346 | |
Accumulated amortization | (4,002) | (2,110) | |
Net amount | 7,404 | 7,236 | |
Order Backlog | |||
Intangible assets: | |||
Cost | 918 | 918 | |
Accumulated amortization | $ (918) | $ (918) |
Goodwill and Intangibles - In77
Goodwill and Intangibles - Intangible Assets - Future Amortization (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Estimated future amortization expense | |
2,016 | $ 39,271 |
2,017 | 36,483 |
2,018 | 33,430 |
2,019 | 26,507 |
2,020 | $ 17,491 |
Restructuring Charges (Details)
Restructuring Charges (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2013 | |
Restructuring accrual and changes | ||
Balance at the beginning of the period | $ 0 | |
Charges | 5,090 | $ 5,172 |
Payments | (5,036) | |
Balance at the end of the period | 54 | |
Employment termination costs | ||
Restructuring accrual and changes | ||
Balance at the beginning of the period | 0 | |
Charges | 5,027 | |
Payments | (5,027) | |
Balance at the end of the period | 0 | |
Facilities consolidation | ||
Restructuring accrual and changes | ||
Balance at the beginning of the period | 0 | |
Charges | 63 | |
Payments | (9) | |
Balance at the end of the period | $ 54 |
Accumulated Other Comprehensi79
Accumulated Other Comprehensive Income - Changes in AOCI (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Changes in accumulated other comprehensive income (loss) | |||
Balance | $ 529,107 | $ 447,639 | $ 374,657 |
Total other comprehensive loss | (18,670) | (19,291) | (358) |
Balance | 609,814 | 529,107 | 447,639 |
Accumulated Other Comprehensive Income (Loss) | |||
Changes in accumulated other comprehensive income (loss) | |||
Balance | (20,014) | (723) | (365) |
Other comprehensive loss before reclassifications | (20,082) | (15,980) | |
Tax effect | 1,412 | 108 | |
Amounts reclassified from accumulated other comprehensive loss | (3,419) | ||
Total other comprehensive loss | (18,670) | (19,291) | (358) |
Balance | (38,684) | (20,014) | (723) |
Foreign Currency | |||
Changes in accumulated other comprehensive income (loss) | |||
Balance | (16,811) | (4,072) | |
Other comprehensive loss before reclassifications | (17,281) | (12,739) | |
Total other comprehensive loss | (17,281) | (12,739) | |
Balance | (34,092) | (16,811) | (4,072) |
Unrealized Holding Gains (Losses) on Available-for-Sale Securities | |||
Changes in accumulated other comprehensive income (loss) | |||
Balance | (246) | (70) | |
Other comprehensive loss before reclassifications | (79) | (284) | |
Tax effect | 25 | 108 | |
Total other comprehensive loss | (54) | (176) | |
Balance | (300) | (246) | (70) |
Unrealized (Loss) Income on Intra-Entity Foreign Currency Transactions | |||
Changes in accumulated other comprehensive income (loss) | |||
Balance | (2,957) | 3,419 | |
Other comprehensive loss before reclassifications | (2,722) | (2,957) | |
Tax effect | 1,387 | ||
Amounts reclassified from accumulated other comprehensive loss | (3,419) | ||
Total other comprehensive loss | (1,335) | (6,376) | |
Balance | $ (4,292) | $ (2,957) | $ 3,419 |
Debt - Credit Facility (Details
Debt - Credit Facility (Details) - Credit Facility - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2013 | |
Credit Facility | |||
Borrowing capacity | $ 100,000 | ||
Commitment fees | $ 332 | $ 215 | |
Amount of borrowing capacity to which the company has a right to request an increase | 150,000 | ||
Amount outstanding | $ 0 | ||
Minimum | |||
Credit Facility | |||
Commitment fee on unused balance (as a percent) | 0.25% | ||
Maximum | |||
Credit Facility | |||
Commitment fee on unused balance (as a percent) | 0.35% |
Debt - Convertible Senior Notes
Debt - Convertible Senior Notes (Details) - 2019 Notes - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Aug. 12, 2014 | |
Debt | |||
Face amount of debt issued | $ 230,000,000 | ||
Interest rate, as a percent | 0.75% | ||
Capitalized finance fees | $ 7,100,000 | ||
Conversion ratio | 0.0188072 | ||
Conversion price | $ 53.17 | ||
Repurchase price, expressed as a percentage of principal of debt repurchased | 100.00% | ||
Carrying amount of debt | $ 230,000,000 | $ 230,000,000 | |
Effective Interest Rate (as a percent) | 1.36% | ||
Fair value of debt | $ 229,600,000 | ||
Interest expense | $ 1,700,000 | $ 647,000 |
Legal Matters (Details)
Legal Matters (Details) | 1 Months Ended |
Dec. 31, 2013plaintiff | |
Commercial Court of Paris | Miyowa | |
Legal Matters | |
Number of former shareholders | 2 |
Subsequent Events Review (Detai
Subsequent Events Review (Details) - Subsequent Event - 2016 Share Repurchase Program $ in Millions | Feb. 04, 2016USD ($) |
Subsequent Events | |
Amount authorized to be purchased under stock repurchase program | $ 100 |
Minimum | |
Subsequent Events | |
Duration of repurchase program | 12 months |
Maximum | |
Subsequent Events | |
Duration of repurchase program | 18 months |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Allowance for doubtful receivables | |||
Allowance for doubtful receivables | |||
Beginning Balance | $ 88 | $ 237 | $ 258 |
Additions | 3,872 | 418 | 1,076 |
Reductions | (931) | (567) | (1,097) |
Ending Balance | 3,029 | 88 | 237 |
Valuation allowance for deferred tax assets | |||
Allowance for doubtful receivables | |||
Beginning Balance | 2,553 | 2,803 | |
Additions | 2,521 | 2,724 | 3,778 |
Reductions | (227) | (2,974) | (975) |
Ending Balance | $ 4,847 | $ 2,553 | $ 2,803 |