Pandora Media (P) 10-Q 24 Jul 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Jul. 22, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	Pandora Media, Inc.
Entity Central Index Key	1,230,276
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		212,280,921

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets
Cash and cash equivalents	$ 204,103	$ 175,957
Short-term investments	168,339	178,631
Accounts receivable, net of allowance of $1,218 at December 31, 2014 and $1,579 at June 30, 2015	233,715	218,437
Prepaid expenses and other current assets	16,664	15,389
Total current assets	622,821	588,414
Long-term investments	89,013	104,243
Property and equipment, net	54,741	42,921
Other long-term assets	13,857	13,712
Total assets	780,432	749,290
Current liabilities
Accounts payable	16,386	10,825
Accrued liabilities	25,006	15,754
Accrued royalties	81,351	73,693
Deferred revenue	27,097	14,412
Accrued compensation	39,905	34,476
Total current liabilities	189,745	149,160
Other long-term liabilities	15,177	16,773
Total liabilities	204,922	165,933
Stockholders’ equity
Common stock: 209,071,488 shares issued and outstanding at December 31, 2014 and 212,251,439 at June 30, 2015	21	21
Additional paid-in capital	837,356	781,009
Accumulated deficit	(261,319)	(196,997)
Accumulated other comprehensive loss	(548)	(676)
Total stockholders’ equity	575,510	583,357
Total liabilities and stockholders’ equity	$ 780,432	$ 749,290

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Statement of Financial Position [Abstract]
Accounts receivable, allowance	$ 1,579	$ 1,218
Common stock, shares issued (in shares)	212,251,439	209,071,488
Common stock, shares outstanding (in shares)	212,251,439	209,071,488

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenue
Advertising	$ 230,921	$ 177,324	$ 409,660	$ 317,958
Subscription and other	54,639	41,570	106,664	95,251
Total revenue	285,560	218,894	516,324	413,209
Cost of revenue
Cost of revenue - Content acquisition costs	130,134	111,461	256,157	219,736
Cost of revenue - Other	20,043	13,989	36,276	28,968
Total cost of revenue	150,177	125,450	292,433	248,704
Gross profit	135,383	93,444	223,891	164,505
Operating expenses
Product development	18,742	13,076	34,617	24,907
Sales and marketing	94,035	66,232	178,309	128,096
General and administrative	38,812	25,865	75,566	52,226
Total operating expenses	151,589	105,173	288,492	205,229
Loss from operations	(16,206)	(11,729)	(64,601)	(40,724)
Other income, net	256	100	453	192
Loss before provision for income taxes	(15,950)	(11,629)	(64,148)	(40,532)
Provision for income taxes	(115)	(99)	(174)	(127)
Net loss	$ (16,065)	$ (11,728)	$ (64,322)	$ (40,659)
Weighted-average common shares outstanding used in computing basic and diluted net loss per share (in shares)	211,742	205,706	210,840	202,798
Net loss per share, basic and diluted (in dollars per share)	$ (0.08)	$ (0.06)	$ (0.31)	$ (0.20)

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Statement of Comprehensive Income [Abstract]
Net loss	$ (16,065)	$ (11,728)	$ (64,322)	$ (40,659)
Change in foreign currency translation adjustment	(48)	(2)	(147)	16
Change in net unrealized losses on marketable securities	(283)	85	275	200
Other comprehensive income (loss)	(331)	83	128	216
Total comprehensive loss	$ (16,396)	$ (11,645)	$ (64,194)	$ (40,443)

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Operating activities
Net loss	$ (64,322)	$ (40,659)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities
Depreciation and amortization	9,365	7,109
Stock-based compensation	50,679	38,005
Amortization of premium on investments, net	1,229	1,380
Other operating activities	944	446
Changes in operating assets and liabilities
Accounts receivable	(16,123)	(13,542)
Prepaid expenses and other assets	(2,104)	(3,253)
Accounts payable and accrued liabilities	10,363	1,095
Accrued royalties	7,697	6,145
Accrued compensation	5,897	10,748
Deferred revenue	12,685	(19,887)
Reimbursement of cost of leasehold improvements	749	3,161
Net cash provided by (used in) operating activities	17,059	(9,252)
Investing activities
Purchases of property and equipment	(17,947)	(16,424)
Purchases of investments	(111,541)	(194,122)
Proceeds from maturities of investments	132,119	116,831
Proceeds from sale of investments	3,662	0
Payments related to acquisition	(200)	0
Net cash provided by (used in) investing activities	6,093	(93,715)
Financing activities
Proceeds from employee stock purchase plan	3,275	2,482
Proceeds from exercise of stock options	2,862	12,562
Tax payments from net share settlements of restricted stock units	(907)	0
Net cash provided by financing activities	5,230	15,044
Effect of exchange rate changes on cash and cash equivalents	(236)	16
Net increase (decrease) in cash and cash equivalents	28,146	(87,907)
Cash and cash equivalents at beginning of period	175,957	245,755
Cash and cash equivalents at end of period	204,103	157,848
Supplemental disclosures of cash flow information
Cash paid during the period for interest	219	246
Purchases of property and equipment recorded in accounts payable and accrued liabilities	$ 3,637	$ 3,337

Description of Business and Bas

Description of Business and Basis of Presentation	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business and Basis of Presentation	Description of Business and Basis of Presentation Pandora Media, Inc. provides an internet radio service offering a personalized experience for each listener wherever and whenever they want to listen to radio on a wide range of smartphones, tablets, computers and car audio systems, as well as a range of other internet-connected devices. We have pioneered a new form of radio—one that uses intrinsic qualities of music to initially create stations and then adapts playlists in real-time based on the individual feedback of each listener. We generate a majority of our revenue by offering local and national advertisers an opportunity to deliver targeted messages to our listeners using a combination of audio, display and video advertisements. We also generate revenue by offering a paid subscription service which we call Pandora One. We were incorporated as a California corporation in January 2000 and reincorporated as a Delaware corporation in December 2010. Our principal operations are located in the United States; we also operate in Australia and New Zealand. As used herein, “Pandora,” “we,” “our,” the “Company” and similar terms include Pandora Media, Inc. and its subsidiaries, unless the context indicates otherwise. Basis of Presentation The interim unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) along with the instructions to Form 10-Q and Article 10 of Securities and Exchange Commission ("SEC") Regulation S-X, and include the accounts of Pandora and our wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of our management, the interim unaudited condensed consolidated financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of our financial position for the periods presented. These interim unaudited condensed consolidated financial statements are not necessarily indicative of the results expected for the full fiscal year or for any subsequent period and should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2014. Certain changes in presentation have been made to conform the prior period presentation to current period reporting. We have reclassified certain non-cash amounts from the amortization of debt issuance costs and the change in accounts receivable line items to the other operating activities line item in our condensed consolidated statements of cash flows. We have also reclassified certain non-cash amounts from the purchases of property and equipment line item to the prepaid expenses and other assets line item of our condensed consolidated statements of cash flows. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Estimates are used in several areas including, but not limited to determining accrued royalties, selling prices for elements sold in multiple-element arrangements, the allowance for doubtful accounts, the fair value of stock options, market stock units ("MSUs") and the Employee Stock Purchase Plan ("ESPP"), the impact of forfeitures on stock-based compensation, the provision for (benefit from) income taxes and the subscription return reserve. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, our financial statements could be affected. In many cases, the accounting treatment of a particular transaction is specifically dictated by U.S. GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting among available alternatives would not produce a materially different result.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Other than discussed below, there have been no material changes to our significant accounting policies as compared to those described in our Annual Report on Form 10-K for the year ended December 31, 2014. Stock-Based Compensation — MSUs We implemented a market stock unit program in March 2015 for certain key executives. Specifically, MSUs measure Pandora’s total stockholder return (“TSR”) performance against that of the Russell 2000 Index across three performance periods. We have determined the grant-date fair value of the MSUs using a Monte Carlo simulation performed by a third-party valuation specialist. The Monte Carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved. These variables include our expected stock price volatility over the expected term of the award, actual and projected employee stock option exercise behaviors and the risk-free interest rate for the expected term of the award. The variables used in these models are reviewed on an annual basis and adjusted, as needed. We recognize stock-based compensation for the MSUs over the requisite service period using the accelerated attribution method. Concentration of Credit Risk For the three and six months ended June 30, 2014 and 2015 , we had no customers that accounted for more than 10% of our total revenue. As of December 31, 2014 and June 30, 2015 , we had no customers that accounted for more than 10% of our total accounts receivable. Recently Issued Accounting Standards In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2014-9, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-9”). ASU 2014-9 outlines a single comprehensive model for entities to use in accounting for revenue. Under the guidance, revenue is recognized when a company 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. The standard may be effective for public entities with annual and interim reporting periods beginning after December 15, 2017. Entities have the option of using either a full retrospective or a modified retrospective approach to adopt the guidance. We are currently evaluating implementation methods and the effect that implementation of this standard will have on our consolidated financial statements upon adoption. In August 2014, the FASB issued Accounting Standards Update No. 2014-15, Going Concern (Subtopic 205-40) (“ASU 2014-15”). ASU 2014-15 requires management of all entities to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued (or available to be issued when applicable). The guidance is effective for fiscal years beginning after December 15, 2016 and for interim periods within that fiscal year. We do not expect the adoption of this guidance to have a material effect on our consolidated financial statements.

Cash, Cash Equivalents and Inve

Cash, Cash Equivalents and Investments	6 Months Ended
	Jun. 30, 2015
Cash and Cash Equivalents [Abstract]
Cash, Cash Equivalents and Investments	Cash, Cash Equivalents and Investments Cash, cash equivalents and investments consisted of the following: As of As of (in thousands) Cash and cash equivalents Cash $ 72,487 $ 99,001 Money market funds 89,113 94,948 Commercial paper 9,349 7,749 Corporate debt securities 5,008 2,405 Total cash and cash equivalents $ 175,957 $ 204,103 Short-term investments Commercial paper $ 45,443 $ 42,582 Corporate debt securities 128,691 123,255 U.S. government and government agency debt securities 4,497 2,502 Total short-term investments $ 178,631 $ 168,339 Long-term investments Corporate debt securities $ 100,998 $ 89,013 U.S. government and government agency debt securities 3,245 — Total long-term investments $ 104,243 $ 89,013 Cash, cash equivalents and investments $ 458,831 $ 461,455 Our short-term investments have maturities of twelve months or less and are classified as available-for-sale. Our long-term investments have maturities of greater than twelve months and are classified as available-for-sale. The following tables summarize our available-for-sale securities’ adjusted cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category as of December 31, 2014 and June 30, 2015 . As of December 31, 2014 Adjusted Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Money market funds $ 89,113 $ — $ — $ 89,113 Commercial paper 54,792 — — 54,792 Corporate debt securities 235,135 6 (444 ) 234,697 U.S. government and government agency debt securities 7,751 — (9 ) 7,742 Total cash equivalents and marketable securities $ 386,791 $ 6 $ (453 ) $ 386,344 As of June 30, 2015 Adjusted Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Money market funds $ 94,948 $ — $ — $ 94,948 Commercial paper 50,331 — — 50,331 Corporate debt securities 214,847 35 (209 ) 214,673 U.S. government and government agency debt securities 2,500 2 — 2,502 Total cash equivalents and marketable securities $ 362,626 $ 37 $ (209 ) $ 362,454 The following table presents available-for-sale investments by contractual maturity date as of December 31, 2014 and June 30, 2015 . As of December 31, 2014 Adjusted Cost Fair Value (in thousands) Due in one year or less $ 282,206 $ 282,101 Due after one year through three years 104,585 104,243 Total $ 386,791 $ 386,344 As of June 30, 2015 Adjusted Cost Fair Value (in thousands) Due in one year or less $ 273,501 $ 273,441 Due after one year through three years 89,125 89,013 Total $ 362,626 $ 362,454 The following tables summarize our available-for-sale securities’ fair value and gross unrealized losses aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position as of December 31, 2014 and June 30, 2015 . As of December 31, 2014 Twelve Months or Less More than Twelve Months Total Fair Gross Unrealized Losses Fair Gross Unrealized Losses Fair Gross Unrealized Losses (in thousands) Money market funds $ — $ — $ — $ — $ — $ — Commercial paper — — — — — — Corporate debt securities 192,699 (422 ) 12,148 (22 ) 204,847 (444 ) U.S. government and government agency debt securities 5,240 (9 ) — — 5,240 (9 ) Total $ 197,939 $ (431 ) $ 12,148 $ (22 ) $ 210,087 $ (453 ) As of June 30, 2015 Twelve Months or Less More than Twelve Months Total Fair Gross Unrealized Losses Fair Gross Unrealized Losses Fair Gross Unrealized Losses (in thousands) Money market funds $ — $ — $ — $ — $ — $ — Commercial paper — — — — — — Corporate debt securities 135,552 (188 ) 19,738 (21 ) 155,290 (209 ) U.S. government and government agency debt securities — — — — — — Total $ 135,552 $ (188 ) $ 19,738 $ (21 ) $ 155,290 $ (209 ) Our investment policy requires investments to be investment grade, primarily rated “A1” by Standard & Poor’s or “P1” by Moody’s or better for short-term investments and rated “A” by Standard & Poor’s or “A2” by Moody’s or better for long-term investments, with the objective of minimizing the potential risk of principal loss. In addition, the investment policy limits the amount of credit exposure to any one issuer. The unrealized losses on our available-for-sale securities as of June 30, 2015 were primarily a result of unfavorable changes in interest rates subsequent to the initial purchase of these securities. As of June 30, 2015 , we owned 121 securities that were in an unrealized loss position. We do not intend nor expect to need to sell these securities before recovering the associated unrealized losses. We expect to recover the full carrying value of these securities. As a result, no portion of the unrealized losses at June 30, 2015 is deemed to be other-than-temporary and the unrealized losses are not deemed to be credit losses. When evaluating the investments for other-than-temporary impairment, we review factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and our intent to sell, or whether it is more likely than not we will be required to sell, the investment before recovery of the investment’s amortized cost basis. During the three and six months ended June 30, 2015 , we did no t recognize any impairment charges. During the three and six months ended June 30, 2015 , we had proceeds from the sale of available-for-sale securities of $3.7 million . We did no t recognize a realized gain or loss in connection with these sales.

Fair Value

Fair Value	6 Months Ended
	Jun. 30, 2015
Fair Value Disclosures [Abstract]
Fair Value	Fair Value We record cash equivalents and short-term investments at fair value. Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are required to be disclosed by level within the following fair value hierarchy: Level 1 — Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 — Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 — Inputs lack observable market data to corroborate management’s estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. When determining fair value, whenever possible we use observable market data and rely on unobservable inputs only when observable market data is not available. The fair value of these financial assets and liabilities was determined using the following inputs at December 31, 2014 and June 30, 2015 : As of December 31, 2014 Fair Value Measurement Using Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Total (in thousands) Assets Money market funds $ 89,113 $ — $ 89,113 Commercial paper — 54,792 54,792 Corporate debt securities — 234,697 234,697 U.S. government and government agency debt securities — 7,742 7,742 Total assets measured at fair value $ 89,113 $ 297,231 $ 386,344 As of June 30, 2015 Fair Value Measurement Using Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Total (in thousands) Assets Money market funds $ 94,948 $ — $ 94,948 Commercial paper — 50,331 50,331 Corporate debt securities — 214,673 214,673 U.S. government and government agency debt securities — 2,502 2,502 Total assets measured at fair value $ 94,948 $ 267,506 $ 362,454 Our money market funds are classified as Level 1 within the fair value hierarchy because they are valued primarily using quoted market prices. Our other cash equivalents and short-term investments are classified as Level 2 within the fair value hierarchy because they are valued using professional pricing sources for identical or comparable instruments, rather than direct observations of quoted prices in active markets. As of December 31, 2014 and June 30, 2015 , we held no Level 3 assets or liabilities.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Legal Proceedings We have been in the past, and continue to be, a party to rate-setting, privacy and patent infringement litigation which have consumed, and may continue to consume, financial and managerial resources. We are also from time to time subject to various other legal proceedings and claims arising in the ordinary course of our business. We record a liability when we believe that it is both probable that a loss has been incurred and the amount can be reasonably estimated. Our management periodically evaluates developments that could affect the amount, if any, of liability that we have previously accrued and make adjustments as appropriate. Determining both the likelihood and the estimated amount of a loss requires significant judgment, and management’s judgment may be incorrect. We do not believe the ultimate resolution of any pending legal matters is likely to have a material adverse effect on our business, financial position, results of operations or cash flows. Performing Rights Organization ("PRO") rate-setting litigation On November 5, 2012, we filed a petition in the rate court in the U.S. District Court for the Southern District of New York established by the consent decree between the American Society of Composers, Authors and Publishers (“ASCAP”) and the U.S. Department of Justice for the determination of reasonable license fees and terms for an ASCAP blanket license for the period from January 1, 2011 through December 31, 2015. A trial to determine the royalty rate for this blanket license concluded in February 2014, and in March 2014, the court issued its opinion establishing a royalty rate of 1.85% of revenue before certain deductions. On April 14, 2014, ASCAP, Sony/ATV, EMI Music Publishing, and Universal Publishing Group filed notices of appeal of the district court’s decision with the Second Circuit Court of Appeals. Oral arguments were held before the Second Circuit on March 19, 2015. On May 6, 2015 the Second Circuit upheld the district court’s ruling. On June 3, 2015, ASCAP petitioned the Second Circuit for a rehearing. On June 26, 2015, that petition was denied. On June 13, 2013, Broadcast Music, Inc. (“BMI”) filed a petition in the rate court in the U.S. District Court for the Southern District of New York established by the consent decree between BMI and the U.S. Department of Justice for the determination of reasonable fees and terms for a BMI blanket license for the period from January 1, 2013 through December 31, 2016. The rate proceeding concluded on March 13, 2015, and in May 2015, the court issued its opinion establishing a royalty rate of 2.5% of revenue before certain deductions. The district court's opinion did not have a material impact on our consolidated statements of operations for the three and six months ended June 30, 2015 . On June 26, 2015, we filed a notice of appeal of the court's decision with the Second Circuit Court of Appeals. Pre-1972 copyright litigation On April 17, 2014, UMG Recordings, Inc., Sony Music Entertainment, Capitol Records, LLC, Warner Music Group Corp. and ABKCO Music and Records, Inc. filed suit against Pandora Media Inc. in the Supreme Court of the State of New York. The complaint claims common law copyright infringement and unfair competition arising from allegations that Pandora owes royalties for the public performance of sound recordings recorded prior to February 15, 1972. On October 2, 2014, Flo & Eddie Inc. filed suit against Pandora Media Inc. in the federal district court for the Central District of California. The complaint alleges misappropriation and conversion in connection with the public performance of sound recordings recorded prior to February 15, 1972. On December 19, 2014, Pandora filed a motion to strike the complaint pursuant to California’s Anti-Strategic Lawsuit Against Public Participation (“Anti-SLAPP”) statute. This motion was denied, and Pandora has appealed the ruling to the Ninth Circuit Court of Appeals. As a result, the district court litigation has been stayed pending the Ninth Circuit's review. The outcome of any litigation is inherently uncertain. Based on our current knowledge we do not believe it is probable that the final outcome of the matters discussed above will, individually or in the aggregate, have a material adverse effect on our business, financial position, results of operations or cash flows; however, in light of the uncertainties involved in such matters, there can be no assurance that the outcome of each case or the costs of litigation, regardless of outcome, will not have a material adverse effect on our business. In particular, rate court proceedings could take years to complete, could be very costly and may result in current and past royalty rates that are materially less favorable than rates we currently pay or have paid in the past. Indemnification Agreements, Guarantees and Contingencies In the ordinary course of business, we are party to certain contractual agreements under which we may provide indemnifications of varying scope, terms and duration to customers, vendors, lessors, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by us or from intellectual property infringement claims made by third parties. In addition, we have entered into indemnification agreements with directors and certain officers and employees that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. Such indemnification provisions are accounted for in accordance with guarantor’s accounting and disclosure requirements for guarantees, including indirect guarantees of indebtedness of others. To date, we have not incurred, do not anticipate incurring and therefore have not accrued for, any costs related to such indemnification provisions. While the outcome of these matters cannot be predicted with certainty, we do not believe that the outcome of any claims under indemnification arrangements will have a material adverse effect on our financial position, results of operations or cash flows.

Other Long-Term Assets

Other Long-Term Assets	6 Months Ended
	Jun. 30, 2015
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Other Long-Term Assets	Other Long-Term Assets As of As of (in thousands) Other long-term assets Intangible assets $ 6,939 $ 6,766 Long-term security deposits 4,947 5,370 Other 1,826 1,721 Total other long-term assets $ 13,712 $ 13,857 Acquisition In June 2013, we entered into an agreement to purchase the assets of KXMZ-FM for a total purchase price of $0.6 million in cash, which is included in the other long-term assets line item of our condensed consolidated balance sheets. The Federal Communications Commission ("FCC") approved the transfer of the FCC licenses and the acquisition was completed in June 2015. We have accounted for this acquisition as a business combination in the three months ended June 30, 2015 .

Debt Instruments

Debt Instruments	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
Debt Instruments	Debt Instruments We are party to a $60.0 million credit facility with a syndicate of financial institutions, which expires on September 12, 2018. As of June 30, 2015 , we had no borrowings outstanding, $1.1 million in letters of credit outstanding and $58.9 million of available borrowing capacity under the credit facility. We are in compliance with all financial covenants associated with the credit facility as of June 30, 2015 .

Stock-based Compensation Plans

Stock-based Compensation Plans and Awards	6 Months Ended
	Jun. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation Plans and Awards	Stock-based Compensation Plans and Awards ESPP The ESPP allows eligible employees to purchase shares of our common stock through payroll deductions of up to 15% of their eligible compensation. The ESPP provides for six -month offering periods, commencing in February and August of each year. The per-share fair value of shares to be granted under the ESPP is determined on the first day of the offering period using the Black-Scholes option pricing model using the following assumptions: Three months ended June 30, Six months ended June 30, 2014 2015 2014 2015 Expected life (in years) 0.5 0.5 0.5 0.5 Risk-free interest rate 0.08 % 0.07 % 0.08 % 0.05% - 0.07% Expected volatility 42 % 42 % 42 % 42 % Expected dividend yield 0 % 0 % 0 % 0 % During the three months ended June 30, 2014 and 2015 , we withheld $1.6 million and $1.7 million in contributions from employees and recognized $0.6 million and $0.6 million of stock-based compensation expense related to the ESPP, respectively. During the six months ended June 30, 2014 and 2015 , we withheld $2.5 million and $3.3 million in contributions from employees and recognized $0.9 million and $1.2 million of stock-based compensation expense related to the ESPP, respectively. In the three and six months ended June 30, 2015 , 282,966 shares of common stock were issued under the ESPP. There were no shares of common stock issued under the ESPP in the three and six months ended June 30, 2014 . Employee Stock-Based Awards Our 2011 Equity Incentive Plan (the “2011 Plan”) provides for the issuance of stock options, restricted stock units and other stock-based awards to our employees. The 2011 Plan is administered by the compensation committee of our board of directors. Stock options We measure stock-based compensation expenses for stock options at the grant date fair value of the award and recognize expenses on a straight-line basis over the requisite service period, which is generally the vesting period. We estimate the fair value of stock options using the Black-Scholes option-pricing model. During the three months ended June 30, 2014 and 2015 , we recorded stock-based compensation expense from stock options of approximately $3.7 million and $2.4 million . During the six months ended June 30, 2014 and 2015 , we recorded stock-based compensation expense from stock options of approximately $7.2 million and $5.2 million . There were no options granted in the three months ended June 30, 2014 or during the three and six months ended June 30, 2015 . Restricted stock units ("RSUs") The fair value of the restricted stock units is expensed ratably over the vesting period. RSUs typically have an initial annual cliff vest and then vest quarterly thereafter over the service period, which is generally four years . During the three months ended June 30, 2014 and 2015 , we recorded stock-based compensation expense from RSUs of approximately $16.3 million and $24.1 million . During the six months ended June 30, 2014 and 2015 , we recorded stock-based compensation expense from RSUs of approximately $29.9 million and $43.7 million . Market stock units We implemented a market stock unit program in March 2015 for certain key executives. Specifically, MSUs measure Pandora’s TSR performance against that of the Russell 2000 Index across three performance periods. Pandora’s relative TSR is calculated using the average adjusted closing stock price of Pandora stock, and the Russell 2000 Index, for ninety calendar days prior to the beginning of each performance period and the last ninety calendar days of the performance period. The target MSUs are divided across three performance periods as follows: • One-third of the target MSUs are eligible to be earned for a performance period that is the first calendar year of the MSU grant (the “One-Year Performance Period”); • One-third of the target MSUs are eligible to be earned for a performance period that is the first two calendar years of the MSU grant (the “Two-Year Performance Period”); and • Any remaining portion of the target MSUs are eligible to be earned for a performance period that is the entire three calendar years of the MSU grant (the “Three-Year Performance Period”). For each performance period, a “performance multiplier” is calculated by comparing Pandora’s relative TSR for the period to the Russell 2000 Index TSR for the same period. The target number of shares will vest if the Pandora TSR is equal to the Russell 2000 Index TSR for the period. For each percentage point that the Pandora TSR falls below the Russell 2000 Index TSR for the period, the performance multiplier is decreased by three percentage points. The performance multiplier is capped at 100% for the One-Year and Two-Year Performance Periods. However, the full award is eligible for a payout up to 200% of target with all upside tied to the Three-Year Performance Period. For each percentage point that the Pandora TSR exceeds the Russell 2000 Index TSR for the Three-Year Performance Period, the performance multiplier is increased by 2% . We have determined the grant-date fair value of the MSUs using a Monte Carlo simulation performed by a third-party valuation firm. We recognize stock-based compensation for the MSUs over the requisite service period, which is approximately three years, using the accelerated attribution method. During the three and six months ended June 30, 2015 , we granted 776,000 MSUs at a total grant-date fair value of $4.3 million . During the three and six months ended June 30, 2015 , we recorded stock-based compensation expense from MSUs of approximately $0.5 million and $0.6 million . Stock-based Compensation Expense Stock-based compensation expense related to all employee and non-employee stock-based awards was as follows: Three months ended Six months ended 2014 2015 2014 2015 (in thousands) (unaudited) (in thousands) (unaudited) Stock-based compensation expense Cost of revenue - Other $ 1,032 $ 1,406 $ 1,913 $ 2,613 Product development 4,426 5,354 7,887 9,959 Sales and marketing 9,922 13,327 18,233 24,671 General and administrative 5,233 7,397 9,972 13,436 Total stock-based compensation expense $ 20,613 $ 27,484 $ 38,005 $ 50,679

Net Loss Per Share

Net Loss Per Share	6 Months Ended
	Jun. 30, 2015
Earnings Per Share [Abstract]
Net Loss Per Share	Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including stock options, restricted stock units and market stock units, to the extent dilutive. Basic and diluted net loss per share were the same for the three and six months ended June 30, 2014 and 2015 , as the inclusion of all potential common shares outstanding would have been anti-dilutive. The following table sets forth the computation of historical basic and diluted net loss per share: Three months ended June 30, Six months ended June 30, 2014 2015 2014 2015 (in thousands except per share amounts) (in thousands except per share amounts) Numerator Net loss $ (11,728 ) $ (16,065 ) $ (40,659 ) $ (64,322 ) Denominator Weighted-average common shares outstanding used in computing basic and diluted net loss per share 205,706 211,742 202,798 210,840 Net loss per share, basic and diluted $ (0.06 ) $ (0.08 ) $ (0.20 ) $ (0.31 ) The following potential common shares outstanding were excluded from the computation of diluted net loss per share because including them would have been anti-dilutive: As of June 30, 2014 2015 (in thousands) Options to purchase common stock 12,647 10,478 Restricted stock units 11,797 16,189 Market stock units — 776 Total common stock equivalents 24,444 27,443

Subsequent Event

Subsequent Event	6 Months Ended
	Jun. 30, 2015
Subsequent Events [Abstract]
Subsequent Event	Subsequent Event On July 1, 2015, we completed the acquisition of Next Big Sound, Inc. ("NBS"), a privately-held company that provides analytics for online music, including analyzing the popularity of musicians in social networks, streaming services and radio. We will include the financial results of NBS in our condensed consolidated financial statements as of the date of acquisition starting in the three months ended September 30, 2015. On July 22, 2015, we amended the operating lease agreement for our office in New York, New York to increase both the leased space and the term of the lease, which previously required monthly lease payments through September 2024. This amendment is expected to result in an additional commitment of approximately $37.8 million through 2025.

Summary of Significant Accoun17

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The interim unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) along with the instructions to Form 10-Q and Article 10 of Securities and Exchange Commission ("SEC") Regulation S-X, and include the accounts of Pandora and our wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of our management, the interim unaudited condensed consolidated financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of our financial position for the periods presented. These interim unaudited condensed consolidated financial statements are not necessarily indicative of the results expected for the full fiscal year or for any subsequent period and should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2014. Certain changes in presentation have been made to conform the prior period presentation to current period reporting. We have reclassified certain non-cash amounts from the amortization of debt issuance costs and the change in accounts receivable line items to the other operating activities line item in our condensed consolidated statements of cash flows. We have also reclassified certain non-cash amounts from the purchases of property and equipment line item to the prepaid expenses and other assets line item of our condensed consolidated statements of cash flows.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Estimates are used in several areas including, but not limited to determining accrued royalties, selling prices for elements sold in multiple-element arrangements, the allowance for doubtful accounts, the fair value of stock options, market stock units ("MSUs") and the Employee Stock Purchase Plan ("ESPP"), the impact of forfeitures on stock-based compensation, the provision for (benefit from) income taxes and the subscription return reserve. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, our financial statements could be affected. In many cases, the accounting treatment of a particular transaction is specifically dictated by U.S. GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting among available alternatives would not produce a materially different result.
Stock-Based Compensation - Market Stock Units (''MSUs'')	Stock-Based Compensation — MSUs We implemented a market stock unit program in March 2015 for certain key executives. Specifically, MSUs measure Pandora’s total stockholder return (“TSR”) performance against that of the Russell 2000 Index across three performance periods. We have determined the grant-date fair value of the MSUs using a Monte Carlo simulation performed by a third-party valuation specialist. The Monte Carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved. These variables include our expected stock price volatility over the expected term of the award, actual and projected employee stock option exercise behaviors and the risk-free interest rate for the expected term of the award. The variables used in these models are reviewed on an annual basis and adjusted, as needed. We recognize stock-based compensation for the MSUs over the requisite service period using the accelerated attribution method.
Concentration of Credit Risk	Concentration of Credit Risk For the three and six months ended June 30, 2014 and 2015 , we had no customers that accounted for more than 10% of our total revenue. As of December 31, 2014 and June 30, 2015 , we had no customers that accounted for more than 10% of our total accounts receivable.
Recently Issued Accounting Standards	Recently Issued Accounting Standards In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2014-9, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-9”). ASU 2014-9 outlines a single comprehensive model for entities to use in accounting for revenue. Under the guidance, revenue is recognized when a company 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. The standard may be effective for public entities with annual and interim reporting periods beginning after December 15, 2017. Entities have the option of using either a full retrospective or a modified retrospective approach to adopt the guidance. We are currently evaluating implementation methods and the effect that implementation of this standard will have on our consolidated financial statements upon adoption. In August 2014, the FASB issued Accounting Standards Update No. 2014-15, Going Concern (Subtopic 205-40) (“ASU 2014-15”). ASU 2014-15 requires management of all entities to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued (or available to be issued when applicable). The guidance is effective for fiscal years beginning after December 15, 2016 and for interim periods within that fiscal year. We do not expect the adoption of this guidance to have a material effect on our consolidated financial statements.

Cash, Cash Equivalents and In18

Cash, Cash Equivalents and Investments (Tables)	6 Months Ended
	Jun. 30, 2015
Cash and Cash Equivalents [Abstract]
Schedule of cash, cash equivalents and investments	Cash, cash equivalents and investments consisted of the following: As of As of (in thousands) Cash and cash equivalents Cash $ 72,487 $ 99,001 Money market funds 89,113 94,948 Commercial paper 9,349 7,749 Corporate debt securities 5,008 2,405 Total cash and cash equivalents $ 175,957 $ 204,103 Short-term investments Commercial paper $ 45,443 $ 42,582 Corporate debt securities 128,691 123,255 U.S. government and government agency debt securities 4,497 2,502 Total short-term investments $ 178,631 $ 168,339 Long-term investments Corporate debt securities $ 100,998 $ 89,013 U.S. government and government agency debt securities 3,245 — Total long-term investments $ 104,243 $ 89,013 Cash, cash equivalents and investments $ 458,831 $ 461,455
Summary of available-for-sale securities' adjusted cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category	The following tables summarize our available-for-sale securities’ adjusted cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category as of December 31, 2014 and June 30, 2015 . As of December 31, 2014 Adjusted Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Money market funds $ 89,113 $ — $ — $ 89,113 Commercial paper 54,792 — — 54,792 Corporate debt securities 235,135 6 (444 ) 234,697 U.S. government and government agency debt securities 7,751 — (9 ) 7,742 Total cash equivalents and marketable securities $ 386,791 $ 6 $ (453 ) $ 386,344 As of June 30, 2015 Adjusted Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Money market funds $ 94,948 $ — $ — $ 94,948 Commercial paper 50,331 — — 50,331 Corporate debt securities 214,847 35 (209 ) 214,673 U.S. government and government agency debt securities 2,500 2 — 2,502 Total cash equivalents and marketable securities $ 362,626 $ 37 $ (209 ) $ 362,454
Schedule of available-for-sale investments by contractual maturity date	The following table presents available-for-sale investments by contractual maturity date as of December 31, 2014 and June 30, 2015 . As of December 31, 2014 Adjusted Cost Fair Value (in thousands) Due in one year or less $ 282,206 $ 282,101 Due after one year through three years 104,585 104,243 Total $ 386,791 $ 386,344 As of June 30, 2015 Adjusted Cost Fair Value (in thousands) Due in one year or less $ 273,501 $ 273,441 Due after one year through three years 89,125 89,013 Total $ 362,626 $ 362,454
Summary of available-for-sale securities' fair value and gross unrealized losses	The following tables summarize our available-for-sale securities’ fair value and gross unrealized losses aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position as of December 31, 2014 and June 30, 2015 . As of December 31, 2014 Twelve Months or Less More than Twelve Months Total Fair Gross Unrealized Losses Fair Gross Unrealized Losses Fair Gross Unrealized Losses (in thousands) Money market funds $ — $ — $ — $ — $ — $ — Commercial paper — — — — — — Corporate debt securities 192,699 (422 ) 12,148 (22 ) 204,847 (444 ) U.S. government and government agency debt securities 5,240 (9 ) — — 5,240 (9 ) Total $ 197,939 $ (431 ) $ 12,148 $ (22 ) $ 210,087 $ (453 ) As of June 30, 2015 Twelve Months or Less More than Twelve Months Total Fair Gross Unrealized Losses Fair Gross Unrealized Losses Fair Gross Unrealized Losses (in thousands) Money market funds $ — $ — $ — $ — $ — $ — Commercial paper — — — — — — Corporate debt securities 135,552 (188 ) 19,738 (21 ) 155,290 (209 ) U.S. government and government agency debt securities — — — — — — Total $ 135,552 $ (188 ) $ 19,738 $ (21 ) $ 155,290 $ (209 )

Fair Value (Tables)

Fair Value (Tables)	6 Months Ended
	Jun. 30, 2015
Fair Value Disclosures [Abstract]
Schedule of fair value of financial assets and liabilities	The fair value of these financial assets and liabilities was determined using the following inputs at December 31, 2014 and June 30, 2015 : As of December 31, 2014 Fair Value Measurement Using Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Total (in thousands) Assets Money market funds $ 89,113 $ — $ 89,113 Commercial paper — 54,792 54,792 Corporate debt securities — 234,697 234,697 U.S. government and government agency debt securities — 7,742 7,742 Total assets measured at fair value $ 89,113 $ 297,231 $ 386,344 As of June 30, 2015 Fair Value Measurement Using Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Total (in thousands) Assets Money market funds $ 94,948 $ — $ 94,948 Commercial paper — 50,331 50,331 Corporate debt securities — 214,673 214,673 U.S. government and government agency debt securities — 2,502 2,502 Total assets measured at fair value $ 94,948 $ 267,506 $ 362,454

Other Long-Term Assets (Tables)

Other Long-Term Assets (Tables)	6 Months Ended
	Jun. 30, 2015
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Schedule of other long-term assets	As of As of (in thousands) Other long-term assets Intangible assets $ 6,939 $ 6,766 Long-term security deposits 4,947 5,370 Other 1,826 1,721 Total other long-term assets $ 13,712 $ 13,857

Stock-based Compensation Plan21

Stock-based Compensation Plans and Awards (Tables)	6 Months Ended
	Jun. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of assumptions used for determining the per-share fair value of shares granted under the ESPP	The per-share fair value of shares to be granted under the ESPP is determined on the first day of the offering period using the Black-Scholes option pricing model using the following assumptions: Three months ended June 30, Six months ended June 30, 2014 2015 2014 2015 Expected life (in years) 0.5 0.5 0.5 0.5 Risk-free interest rate 0.08 % 0.07 % 0.08 % 0.05% - 0.07% Expected volatility 42 % 42 % 42 % 42 % Expected dividend yield 0 % 0 % 0 % 0 %
Schedule of stock-based compensation expenses related to all employee and non-employee stock-based awards	Stock-based compensation expense related to all employee and non-employee stock-based awards was as follows: Three months ended Six months ended 2014 2015 2014 2015 (in thousands) (unaudited) (in thousands) (unaudited) Stock-based compensation expense Cost of revenue - Other $ 1,032 $ 1,406 $ 1,913 $ 2,613 Product development 4,426 5,354 7,887 9,959 Sales and marketing 9,922 13,327 18,233 24,671 General and administrative 5,233 7,397 9,972 13,436 Total stock-based compensation expense $ 20,613 $ 27,484 $ 38,005 $ 50,679

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	6 Months Ended
	Jun. 30, 2015
Earnings Per Share [Abstract]
Schedule of the computation of historical basic and diluted net loss per share	The following table sets forth the computation of historical basic and diluted net loss per share: Three months ended June 30, Six months ended June 30, 2014 2015 2014 2015 (in thousands except per share amounts) (in thousands except per share amounts) Numerator Net loss $ (11,728 ) $ (16,065 ) $ (40,659 ) $ (64,322 ) Denominator Weighted-average common shares outstanding used in computing basic and diluted net loss per share 205,706 211,742 202,798 210,840 Net loss per share, basic and diluted $ (0.06 ) $ (0.08 ) $ (0.20 ) $ (0.31 )
Schedule of potential common shares outstanding that were excluded from the computation of diluted net loss per share	The following potential common shares outstanding were excluded from the computation of diluted net loss per share because including them would have been anti-dilutive: As of June 30, 2014 2015 (in thousands) Options to purchase common stock 12,647 10,478 Restricted stock units 11,797 16,189 Market stock units — 776 Total common stock equivalents 24,444 27,443

Summary of Significant Accoun23

Summary of Significant Accounting Policies - Narrative (Details)	1 Months Ended	3 Months Ended		6 Months Ended	12 Months Ended
	Mar. 31, 2015performance_period	Jun. 30, 2015customer	Jun. 30, 2014customer	Jun. 30, 2015customer	Dec. 31, 2014customer
Revenue | Customer concentration risk
Concentration Risk [Line Items]
Number of major customers representing 10% or more of total revenue/total accounts receivable		0	0
Accounts receivable | Customer concentration risk
Concentration Risk [Line Items]
Number of major customers representing 10% or more of total revenue/total accounts receivable				0	0
Market stock units
Concentration Risk [Line Items]
Number of performance periods | performance_period	3

Cash, Cash Equivalents and In24

Cash, Cash Equivalents and Investments - Schedule of cash, cash equivalents and investments (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014	Jun. 30, 2014	Dec. 31, 2013
Cash, Cash Equivalents and Investments
Total cash and cash equivalents	$ 204,103	$ 175,957	$ 157,848	$ 245,755
Total short-term investments	168,339	178,631
Total long-term investments	89,013	104,243
Cash, cash equivalents and investments	461,455	458,831
Cash
Cash, Cash Equivalents and Investments
Total cash and cash equivalents	99,001	72,487
Money market funds
Cash, Cash Equivalents and Investments
Total cash and cash equivalents	94,948	89,113
Commercial paper
Cash, Cash Equivalents and Investments
Total cash and cash equivalents	7,749	9,349
Total short-term investments	42,582	45,443
Corporate debt securities
Cash, Cash Equivalents and Investments
Total cash and cash equivalents	2,405	5,008
Total short-term investments	123,255	128,691
Total long-term investments	89,013	100,998
U.S. government and government agency debt securities
Cash, Cash Equivalents and Investments
Total short-term investments	2,502	4,497
Total long-term investments	$ 0	$ 3,245

Cash, Cash Equivalents and In25

Cash, Cash Equivalents and Investments - Summary of available-for-sale securities' adjusted cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Adjusted Cost	$ 362,626	$ 386,791
Unrealized Gains	37	6
Unrealized Losses	(209)	(453)
Fair Value	362,454	386,344
Money market funds
Schedule of Available-for-sale Securities [Line Items]
Adjusted Cost	94,948	89,113
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	94,948	89,113
Commercial paper
Schedule of Available-for-sale Securities [Line Items]
Adjusted Cost	50,331	54,792
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	50,331	54,792
Corporate debt securities
Schedule of Available-for-sale Securities [Line Items]
Adjusted Cost	214,847	235,135
Unrealized Gains	35	6
Unrealized Losses	(209)	(444)
Fair Value	214,673	234,697
U.S. government and government agency debt securities
Schedule of Available-for-sale Securities [Line Items]
Adjusted Cost	2,500	7,751
Unrealized Gains	2	0
Unrealized Losses	0	(9)
Fair Value	$ 2,502	$ 7,742

Cash, Cash Equivalents and In26

Cash, Cash Equivalents and Investments - Schedule of available-for-sale investments by contractual maturity date (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Adjusted Cost
Due in one year or less	$ 273,501	$ 282,206
Due after one year through three years	89,125	104,585
Total	362,626	386,791
Fair Value
Due in one year or less	273,441	282,101
Due after one year through three years	89,013	104,243
Total	$ 362,454	$ 386,344

Cash, Cash Equivalents and In27

Cash, Cash Equivalents and Investments - Summary of available-for-sale securities' fair value and gross unrealized losses (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, continuous unrealized loss position, twelve months or less, fair value	$ 135,552	$ 197,939
Available-for-sale securities, continuous unrealized loss position, twelve months or less, gross unrealized loss	(188)	(431)
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value	19,738	12,148
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, gross unrealized loss	(21)	(22)
Available-for-sale securities, continuous unrealized loss position, fair value	155,290	210,087
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss	(209)	(453)
Corporate debt securities
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, continuous unrealized loss position, twelve months or less, fair value	135,552	192,699
Available-for-sale securities, continuous unrealized loss position, twelve months or less, gross unrealized loss	(188)	(422)
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value	19,738	12,148
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, gross unrealized loss	(21)	(22)
Available-for-sale securities, continuous unrealized loss position, fair value	155,290	204,847
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss	(209)	(444)
U.S. government and government agency debt securities
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, continuous unrealized loss position, twelve months or less, fair value	0	5,240
Available-for-sale securities, continuous unrealized loss position, twelve months or less, gross unrealized loss	0	(9)
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value	0	0
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, gross unrealized loss	0	0
Available-for-sale securities, continuous unrealized loss position, fair value	0	5,240
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss	$ 0	$ (9)

Cash, Cash Equivalents and In28

Cash, Cash Equivalents and Investments - Narrative (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2015USD ($)security	Jun. 30, 2015USD ($)security	Jun. 30, 2014USD ($)
Cash and Cash Equivalents [Abstract]
Number of owned securities that were in an unrealized loss position | security	121	121
Unrealized losses deemed to be other-than-temporary	$ 0	$ 0
Proceeds from sale of available-for-sale securities		3,662,000	$ 0
Realized gain or loss in connection with sale of available-for-sale securities		$ 0

Fair Value - Schedule of fair v

Fair Value - Schedule of fair value of financial assets and liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Assets:
Total assets measured at fair value	$ 362,454	$ 386,344
Money market funds
Assets:
Total assets measured at fair value	94,948	89,113
Commercial paper
Assets:
Total assets measured at fair value	50,331	54,792
Corporate debt securities
Assets:
Total assets measured at fair value	214,673	234,697
U.S. government and government agency debt securities
Assets:
Total assets measured at fair value	2,502	7,742
Quoted Prices in Active Markets for Identical Instruments (Level 1)
Assets:
Total assets measured at fair value	94,948	89,113
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Money market funds
Assets:
Total assets measured at fair value	94,948	89,113
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Commercial paper
Assets:
Total assets measured at fair value	0	0
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Corporate debt securities
Assets:
Total assets measured at fair value	0	0
Quoted Prices in Active Markets for Identical Instruments (Level 1) | U.S. government and government agency debt securities
Assets:
Total assets measured at fair value	0	0
Significant Other Observable Inputs (Level 2)
Assets:
Total assets measured at fair value	267,506	297,231
Significant Other Observable Inputs (Level 2) | Money market funds
Assets:
Total assets measured at fair value	0	0
Significant Other Observable Inputs (Level 2) | Commercial paper
Assets:
Total assets measured at fair value	50,331	54,792
Significant Other Observable Inputs (Level 2) | Corporate debt securities
Assets:
Total assets measured at fair value	214,673	234,697
Significant Other Observable Inputs (Level 2) | U.S. government and government agency debt securities
Assets:
Total assets measured at fair value	$ 2,502	$ 7,742

Fair Value - Narrative (Details

Fair Value - Narrative (Details) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	$ 362,454,000	$ 386,344,000
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	0	0
Total liabilities measured at fair value	$ 0	$ 0

Commitments and Contingencies -

Commitments and Contingencies - Narrative (Details)	1 Months Ended
	May. 31, 2015	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]
Royalty expense, percent	2.50%	1.85%

Other Long-Term Assets - Schedu

Other Long-Term Assets - Schedule of other long-term assets (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Other long-term assets
Intangible assets	$ 6,766	$ 6,939
Long-term security deposits	5,370	4,947
Other	1,721	1,826
Total other long-term assets	$ 13,857	$ 13,712

Other Long-Term Assets - Narrat

Other Long-Term Assets - Narrative (Details) $ in Millions	1 Months Ended
	Jun. 30, 2013USD ($)
KXMZ-FM
Business Combination, Separately Recognized Transactions [Line Items]
Purchase price of assets of KXMZ-FM	$ 0.6

Debt Instruments - Narrative (D

Debt Instruments - Narrative (Details)	Jun. 30, 2015USD ($)
Line of credit
Debt Instruments
Maximum borrowings available	$ 60,000,000
Outstanding balance of borrowings	0
Available borrowing capacity	58,900,000
Letter of credit
Debt Instruments
Outstanding amount	$ 1,100,000

Stock-based Compensation Plan35

Stock-based Compensation Plans and Awards - Narrative (Details) $ in Thousands	1 Months Ended	3 Months Ended		6 Months Ended
	Mar. 31, 2015performance_period	Jun. 30, 2015USD ($)shares	Jun. 30, 2014USD ($)shares	Jun. 30, 2015USD ($)shares	Jun. 30, 2014USD ($)shares
Stock-based Compensation Plans and Awards
Stock-based compensation expense		$ 27,484	$ 20,613	$ 50,679	$ 38,005
Employee stock
Stock-based Compensation Plans and Awards
Percentage of eligible compensation to purchase common stock through payroll deductions (as a percent)		15.00%		15.00%
Offering period				6 months
Contributions from employees withheld		$ 1,700	1,600	$ 3,300	2,500
Stock-based compensation expense		$ 600	$ 600	$ 1,200	$ 900
Common stock issued (in shares) | shares		282,966	0	282,966	0
Stock options
Stock-based Compensation Plans and Awards
Stock-based compensation expense		$ 2,400	$ 3,700	$ 5,200	$ 7,200
Option grants in period | shares		0	0	0	0
Restricted stock units
Stock-based Compensation Plans and Awards
Stock-based compensation expense		$ 24,100	$ 16,300	$ 43,700	$ 29,900
Vesting period				4 years
Market stock units
Stock-based Compensation Plans and Awards
Stock-based compensation expense		$ 500		$ 600
Number of performance periods | performance_period	3
Total stockholder return, duration period	90 days
Performance multiplier, percentage point decrease	3.00%
Performance multiplier, percentage point increase	2.00%
Grants in period | shares		776,000		776,000
Total grant date fair value		$ 4,300		$ 4,300
Market stock units | One-Year Performance Period
Stock-based Compensation Plans and Awards
Vesting percent	33.33%
Market stock units | Two-Year Performance Period
Stock-based Compensation Plans and Awards
Vesting percent	33.33%
Market stock units | Maximum | One and Two-Year Performance Period
Stock-based Compensation Plans and Awards
Performance multiplier	100.00%
Market stock units | Maximum | Three-Year Performance Period
Stock-based Compensation Plans and Awards
Performance multiplier	200.00%

Stock-based Compensation Plan36

Stock-based Compensation Plans and Awards - Schedule of assumptions used for determining the per-share fair value (Details) - Employee stock - Black Scholes Options Pricing Model	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Assumptions used to calculate per-share fair value of award
Expected life (in years)	6 months	6 months	6 months	6 months
Risk-free interest rate	0.07%	0.08%		0.08%
Expected volatility	42.00%	42.00%	42.00%	42.00%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Minimum
Assumptions used to calculate per-share fair value of award
Risk-free interest rate			0.05%
Maximum
Assumptions used to calculate per-share fair value of award
Risk-free interest rate			0.07%

Stock-based Compensation Plan37

Stock-based Compensation Plans and Awards - Schedule of stock-based compensation expenses related to all employee and non-employee stock-based awards (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Stock-based compensation expenses:
Total stock-based compensation expense	$ 27,484	$ 20,613	$ 50,679	$ 38,005
Cost of revenue - Other
Stock-based compensation expenses:
Total stock-based compensation expense	1,406	1,032	2,613	1,913
Product development
Stock-based compensation expenses:
Total stock-based compensation expense	5,354	4,426	9,959	7,887
Sales and marketing
Stock-based compensation expenses:
Total stock-based compensation expense	13,327	9,922	24,671	18,233
General and administrative
Stock-based compensation expenses:
Total stock-based compensation expense	$ 7,397	$ 5,233	$ 13,436	$ 9,972

Net Loss Per Share - Schedule o

Net Loss Per Share - Schedule of the computation of historical basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Numerator
Net loss	$ (16,065)	$ (11,728)	$ (64,322)	$ (40,659)
Denominator
Weighted-average common shares outstanding used in computing basic and diluted net loss per share (in shares)	211,742	205,706	210,840	202,798
Net loss per share, basic and diluted (in dollars per share)	$ (0.08)	$ (0.06)	$ (0.31)	$ (0.20)

Net Loss Per Share - Schedule39

Net Loss Per Share - Schedule of potential common shares outstanding that were excluded from the computation of diluted net loss per share (Details) - shares shares in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Anti-dilutive securities
Total common stock equivalents (in shares)	27,443	24,444
Options to purchase common stock
Anti-dilutive securities
Total common stock equivalents (in shares)	10,478	12,647
Restricted stock units
Anti-dilutive securities
Total common stock equivalents (in shares)	16,189	11,797
Market stock units
Anti-dilutive securities
Total common stock equivalents (in shares)	776	0

Subsequent Event - Narrative (D

Subsequent Event - Narrative (Details) $ in Millions	Jul. 22, 2015USD ($)
New York, New York | Subsequent Event
Subsequent Event [Line Items]
Operating lease, additional commitment	$ 37.8