EQUITY AWARD PLAN | 9 Months Ended |
Sep. 30, 2014 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' |
EQUITY AWARD PLAN | ' |
EQUITY AWARD PLAN |
Stock Option and Restricted Stock Unit Activity |
The following table summarizes the outstanding stock option activity and a summary of information related to stock options (in thousands, except per share amounts and years): |
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| Common Stock Options Outstanding | | | | |
| Number of | | Weighted | | Weighted | | Aggregate | | | | |
Shares | Average | Average | Intrinsic | | | | |
| Exercise Price Per Share | Remaining | Value | | | | |
| | Contractual Life (Years) | | | | | |
Balance, December 31, 2013 | 19,609 | | $ | 4.51 | | | 7.3 | | $ | 195,142 | | | | | |
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Options granted | 362 | | 11.61 | | | | | | | | | | |
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Options exercised | -2,866 | | 2.02 | | | | | | | | | | |
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Options forfeited | -449 | | 10.65 | | | | | | | | | | |
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Balance, September 30, 2014 | 16,656 | | $ | 4.92 | | | 6.7 | | $ | 146,668 | | | | | |
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Options exercisable as of September 30, 2014 | 11,032 | | $ | 3.45 | | | 6.2 | | $ | 111,567 | | | | | |
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Options vested and expected to vest as of September 30, 2014 | 16,465 | | $ | 4.86 | | | 6.7 | | $ | 145,873 | | | | | |
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The weighted average grant date fair value of stock options was approximately $7.41 and $8.33 per share for the three months ended September 30, 2014 and 2013, respectively, and $6.88 and $11.22 for the nine months ended September 30, 2014 and 2013, respectively. |
The total intrinsic value of options exercised was approximately $15.0 million and $24.9 million for the three months ended September 30, 2014 and 2013, respectively, and $31.7 million and $50.5 million for the nine months ended September 30, 2014 and 2013, respectively. |
The following table summarizes the outstanding activity of RSUs and a summary of information related to RSUs (in thousands, except per share amounts and years): |
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| Restricted Stock Units Outstanding | | | |
| Number of Shares | | Weighted | | Weighted | | Aggregate | | | |
Average | Average | Intrinsic | | | |
Grant Date Fair Value | Remaining | Value | | | |
Per Share | Contractual Life (Years) | | | | |
Balance, December 31, 2013 | 1,011 | | | $ | 17.11 | | | 1.6 | | $ | 14,356 | | | | |
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RSUs granted | 782 | | | 11.49 | | | | | | | | |
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RSUs vested | (264 | ) | | 17.81 | | | | | | | | |
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RSUs forfeited | (106 | ) | | 15.12 | | | | | | | | |
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Balance, September 30, 2014 | 1,423 | | | $ | 14.04 | | | 1.4 | | $ | 19,006 | | | | |
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The following table summarizes the stock activity and the total number of shares available for grant under the 2012 Plan as of September 30, 2014 (in thousands): |
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| Number of | | | | | | | | | | | | | |
Shares | | | | | | | | | | | | | |
Balance, December 31, 2013 | 8,547 | | | | | | | | | | | | | | |
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Additional shares reserved for issuance | 4,035 | | | | | | | | | | | | | | |
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RSUs granted | (782 | ) | | | | | | | | | | | | | |
RSUs forfeited | 106 | | | | | | | | | | | | | | |
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Options granted | (362 | ) | | | | | | | | | | | | | |
Options forfeited | 449 | | | | | | | | | | | | | | |
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Balance, September 30, 2014 | 11,993 | | | | | | | | | | | | | | |
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Fair Value Disclosures |
The Company measures compensation expense for all stock-based payment awards, including stock options and RSUs granted to employees and purchases under the Company's Employee Stock Purchase Plan (“ESPP”), based on the estimated fair values on the date of the grant. The fair value of each stock option granted is estimated using the Black-Scholes option pricing model. The fair value of each RSU granted represents the closing price of the Company's common stock on the date of grant. The fair value of purchases under the Company's ESPP is calculated based on the closing price of the Company's stock on the date of grant and the value of put and call options estimated using the Black-Scholes option pricing model. Stock-based compensation is recognized on a straight-line basis over the requisite service period, net of estimated forfeitures. The forfeiture rate is based on an analysis of the Company’s actual historical forfeitures. |
The Company accounts for stock options issued to non-employees based on the fair value of the awards determined using the Black-Scholes option pricing model. The fair value of stock options granted to non-employees is re-measured as the stock options vest, and the resulting change in fair value, if any, is recognized in the Company’s condensed consolidated statement of operations during the period the related services are rendered. |
Employee Stock Options |
The following table summarizes the weighted average assumptions relating to the Company's stock options: |
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| Three Months Ended September 30, | | Nine Months Ended September 30, | | | | |
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| 2014 | | 2013 | | 2014 | | 2013 | | | | |
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Volatility | 62.2 | % | | 68.4 | % | | 63.7 | % | | 69.6 | % | | | | |
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Expected term (years) | 6.1 | | | 6.1 | | | 6.1 | | | 6.1 | | | | | |
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Risk-free interest rate | 2 | % | | 1.7 | % | | 1.9 | % | | 1.3 | % | | | | |
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Dividend yield | — | | | — | | | — | | | — | | | | | |
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Employee Stock Purchase Plan |
There were no stock purchase rights granted under the ESPP during the three months ended September 30, 2014 and September 30, 2013. The following table summarizes the assumptions relating to the Company's ESPP: |
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| Nine Months Ended September 30, | | | | | | | | | | |
| 2014 | | 2013 | | | | | | | | | | |
Volatility | 45.8 | % | | 57.6 | % | | | | | | | | | | |
Expected term (years) | 0.5 | | | 0.5 | | | | | | | | | | | |
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Risk-free interest rate | 0.1 | % | | 0.1 | % | | | | | | | | | | |
Dividend yield | — | | | — | | | | | | | | | | | |
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Stock-based Compensation Expense |
The following table summarizes the stock-based compensation expense recorded for stock awards issued to employees and non-employees (in thousands): |
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| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2014 | | 2013 | | 2014 | | 2013 |
Cost of revenue | $ | 266 | | | $ | 193 | | | $ | 764 | | | $ | 575 | |
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Research and development | 2,124 | | | 1,994 | | | 6,346 | | | 4,772 | |
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Sales and marketing | 1,799 | | | 1,223 | | | 5,124 | | | 3,410 | |
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General and administrative | 1,994 | | | 1,476 | | | 6,635 | | | 4,472 | |
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Total stock-based compensation | $ | 6,183 | | | $ | 4,886 | | | $ | 18,869 | | | $ | 13,229 | |
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At September 30, 2014, the total unrecognized stock-based compensation expense related to employees and non-employees under the Company's stock plans was $41.4 million, net of estimated forfeitures. The unamortized expense will be recognized over a weighted-average period of 1.8 years. |
For the three and nine months ended September 30, 2013, the Company recognized $0.4 million in stock-based compensation related to the cash settlement of equity awards held by former YFind employees. |