Document and Entity Information
Document and Entity Information Statement - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 21, 2018 | Jun. 30, 2017 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | TABLEAU SOFTWARE INC | ||
Entity Central Index Key | 1,303,652 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Well-Known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 3.8 | ||
Common Class A | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 67,902,696 | ||
Common Class B | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 13,633,546 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets | ||
Cash and cash equivalents | $ 627,878 | $ 908,717 |
Short-term Investments | 226,787 | 0 |
Accounts receivable, net | 203,366 | 206,765 |
Prepaid expenses and other current assets | 30,514 | 36,011 |
Income taxes receivable | 673 | 131 |
Total current assets | 1,089,218 | 1,151,624 |
Long-term Investments | 148,364 | 0 |
Property and equipment, net | 106,753 | 106,637 |
Goodwill | 35,083 | 15,531 |
Deferred income taxes | 5,287 | 1,449 |
Deposits and other assets | 14,090 | 11,958 |
Total assets | 1,398,795 | 1,287,199 |
Current liabilities | ||
Accounts payable | 4,448 | 17,637 |
Accrued compensation and employee-related benefits | 96,390 | 70,230 |
Other accrued liabilities | 37,722 | 53,418 |
Income taxes payable | 4,743 | 1,893 |
Deferred revenue | 419,426 | 285,543 |
Total current liabilities | 562,729 | 428,721 |
Deferred revenue | 28,058 | 26,930 |
Other long-term liabilities | 54,385 | 39,700 |
Total liabilities | 645,172 | 495,351 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity | ||
Preferred stock | 0 | 0 |
Additional paid-in capital | 1,168,563 | 1,007,205 |
Accumulated other comprehensive income (loss) | (11,991) | 1,593 |
Accumulated deficit | (402,957) | (216,958) |
Total stockholders' equity | 753,623 | 791,848 |
Total liabilities and stockholders' equity | 1,398,795 | 1,287,199 |
Common Class B | ||
Stockholders' equity | ||
Common Stock | 1 | 2 |
Common Class A | ||
Stockholders' equity | ||
Common Stock | $ 7 | $ 6 |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Parenthetical - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Convertible Preferred Stock | ||
Preferred stock par value (in USD 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 Class B | ||
Common stock par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Shares authorized for issuance | 75,000,000 | 75,000,000 |
Common Stock, Shares, Issued | 14,492,846 | 18,336,609 |
Common Stock, Shares, Outstanding | 14,492,846 | 18,336,609 |
Common Class A | ||
Common stock par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Shares authorized for issuance | 750,000,000 | 750,000,000 |
Common Stock, Shares, Issued | 65,969,499 | 58,381,813 |
Common Stock, Shares, Outstanding | 65,969,499 | 58,381,813 |
Consolidated Statement of Opera
Consolidated Statement of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Revenues | ||||
License | $ 429,204 | $ 481,659 | $ 423,766 | |
Maintenance and services | 447,855 | 345,284 | 229,821 | |
Total revenues | 877,059 | 826,943 | 653,587 | |
Cost of revenues | ||||
License | 13,534 | 7,003 | 3,852 | |
Maintenance and services | 100,025 | 92,087 | 69,833 | |
Total cost of revenues | [1] | 113,559 | 99,090 | 73,685 |
Gross profit | 763,500 | 727,853 | 579,902 | |
Operating expenses | ||||
Sales and marketing | [1] | 517,446 | 476,506 | 356,723 |
Research and development | [1] | 334,148 | 302,759 | 204,131 |
General and administrative | [1] | 102,871 | 88,149 | 71,078 |
Total operating expenses | 954,465 | 867,414 | 631,932 | |
Operating loss | (190,965) | (139,561) | (52,030) | |
Other income, net | 12,266 | 2,134 | 1,223 | |
Loss before income tax expense | (178,699) | (137,427) | (50,807) | |
Income tax expense | 6,861 | 7,022 | 32,893 | |
Net loss | $ (185,560) | $ (144,449) | $ (83,700) | |
Net loss per share: | ||||
Basic (in USD per share) | $ (2.35) | $ (1.92) | $ (1.17) | |
Diluted (in USD per share) | $ (2.35) | $ (1.92) | $ (1.17) | |
Weighted average shares used to compute net loss per share: | ||||
Basic (in shares) | 78,869 | 75,162 | 71,701 | |
Diluted (in shares) | 78,869 | 75,162 | 71,701 | |
[1] | Includes stock-based compensation expense as follows: Year Ended December 31, 2017 2016 2015 (in thousands)Cost of revenues$11,029 $10,595 $7,031Sales and marketing74,065 68,411 45,205Research and development104,280 91,044 55,269General and administrative20,909 15,662 11,963 |
Consolidated Statement of Oper5
Consolidated Statement of Operations - Parenthetical - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cost of revenues | |||
Allocated Share-based Compensation Expense | $ 11,029 | $ 10,595 | $ 7,031 |
Sales and marketing | |||
Allocated Share-based Compensation Expense | 74,065 | 68,411 | 45,205 |
Research and development | |||
Allocated Share-based Compensation Expense | 104,280 | 91,044 | 55,269 |
General and administrative | |||
Allocated Share-based Compensation Expense | $ 20,909 | $ 15,662 | $ 11,963 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss Statement - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (185,560) | $ (144,449) | $ (83,700) |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation | (12,920) | 950 | 503 |
Net unrealized loss on available-for-sale securities | (664) | 0 | 0 |
Comprehensive loss | $ (199,144) | $ (143,499) | $ (83,197) |
Consolidated Statements of Shar
Consolidated Statements of Shareholders Equity Statement - USD ($) $ in Thousands | Total | Common Stock (Class A and B) | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Accumulated Deficit) |
Balances (in shares), period start at Dec. 31, 2014 | 69,868,219 | ||||
Balances, period start at Dec. 31, 2014 | $ 672,006 | $ 7 | $ 660,668 | $ 140 | $ 11,191 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Proceeds from issuance of common stock (in shares) | 3,336,245 | ||||
Issuance of common stock | 20,117 | $ 0 | 20,117 | ||
Stock-based compensation expense | 119,468 | 119,468 | |||
Excess tax benefit from stock-based compensation | 5,551 | 5,551 | |||
Other comprehensive income, net | 503 | 503 | |||
Net loss | (83,700) | (83,700) | |||
Balances (in shares), period end at Dec. 31, 2015 | 73,204,464 | ||||
Balances, period end at Dec. 31, 2015 | 733,945 | $ 7 | 805,804 | 643 | (72,509) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Proceeds from issuance of common stock (in shares) | 3,960,475 | ||||
Issuance of common stock | $ 34,357 | $ 1 | 34,356 | ||
Repurchase of common stock (in shares) | (446,517) | ||||
Repurchase of common stock | $ (20,009) | (20,009) | |||
Stock-based compensation expense | 185,712 | 185,712 | |||
Excess tax benefit from stock-based compensation | 1,342 | 1,342 | |||
Other comprehensive income, net | 950 | 950 | |||
Net loss | (144,449) | (144,449) | |||
Balances (in shares), period end at Dec. 31, 2016 | 76,718,422 | ||||
Balances, period end at Dec. 31, 2016 | 791,848 | $ 8 | 1,007,205 | 1,593 | (216,958) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Cumulative effect of a change in accounting principle related to stock-based compensation | Accounting Standards Update 2016-09 [Member] | 439 | (439) | |||
Proceeds from issuance of common stock (in shares) | 5,008,351 | ||||
Issuance of common stock | $ 38,856 | $ 0 | 38,856 | ||
Repurchase of common stock (in shares) | (1,264,428) | ||||
Repurchase of common stock | $ (79,991) | (79,991) | |||
Stock-based compensation expense | 202,054 | 202,054 | |||
Other comprehensive income, net | (13,584) | (13,584) | |||
Net loss | (185,560) | (185,560) | |||
Balances (in shares), period end at Dec. 31, 2017 | 80,462,345 | ||||
Balances, period end at Dec. 31, 2017 | $ 753,623 | $ 8 | $ 1,168,563 | $ (11,991) | $ (402,957) |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating activities | |||
Net loss | $ (185,560) | $ (144,449) | $ (83,700) |
Adjustments to reconcile net loss to net cash provided by operating activities | |||
Depreciation and amortization expense | 44,746 | 43,006 | 23,667 |
Accretion (Amortization) of Discounts and Premiums, Investments | 359 | 0 | 0 |
Stock-based compensation expense | 210,283 | 185,712 | 119,468 |
Deferred income taxes | (2,988) | 1,219 | 28,558 |
Changes in operating assets and liabilities | |||
Accounts receivable, net | 12,493 | (78,197) | (34,225) |
Prepaid expenses, deposits and other assets | 8,054 | (18,987) | (13,783) |
Income taxes receivable | (515) | (56) | 147 |
Deferred revenue | 123,938 | 116,860 | 71,383 |
Accounts payable and accrued liabilities | 13,529 | 71,157 | 30,224 |
Income taxes payable | 2,528 | 997 | 664 |
Net cash provided by operating activities (1) | 226,867 | 177,262 | 142,403 |
Investing activities | |||
Purchases of property and equipment | (61,823) | (60,732) | (45,130) |
Business combinations, net of cash acquired | (23,966) | (16,399) | (1,000) |
Purchases of investments | (421,719) | 0 | 0 |
Maturities of investments | 30,630 | 0 | 0 |
Sales of investments | 14,916 | 0 | 0 |
Net cash used in investing activities | (461,962) | (77,131) | (46,130) |
Financing activities | |||
Proceeds from issuance of common stock | 38,856 | 34,356 | 20,117 |
Repurchases of common stock | (79,991) | (20,009) | 0 |
Net cash provided by (used in) financing activities(1) | (41,135) | 14,347 | 20,117 |
Effect of exchange rate changes on cash and cash equivalents | (4,609) | (1,661) | (1,103) |
Net increase (decrease) in cash and cash equivalents | (280,839) | 112,817 | 115,287 |
Cash and cash equivalents | |||
Beginning of year | 908,717 | 795,900 | 680,613 |
End of year | 627,878 | 908,717 | 795,900 |
Supplemental disclosures | |||
Cash paid for income taxes | 4,347 | 1,513 | 959 |
Non-cash activities | |||
Accrued purchases of property and equipment | 6,470 | 26,548 | 10,012 |
Asset retirement obligations recognized, net | $ 1,003 | $ 745 | $ 271 |
Consolidated Statement of Cash9
Consolidated Statement of Cash Flows - Parenthetical - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Net Cash Provided by Operating Activities | $ 177,262 | $ 142,403 |
Net Cash Provided by (Used in) Financing Activities | 14,347 | 20,117 |
Adjustments for New Accounting Pronouncement [Member] | ||
Net Cash Provided by Operating Activities | 2,200 | 5,600 |
Net Cash Provided by (Used in) Financing Activities | $ (2,200) | $ (5,600) |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Tableau Software, Inc., a Delaware corporation, and its wholly-owned subsidiaries (the "Company", "we", "us" or "our") are headquartered in Seattle, Washington. Our software products put the power of data into the hands of everyday people, allowing a broad population of business users to engage with their data, ask questions, solve problems and create value. Based on innovative core technologies originally developed at Stanford University, our products dramatically reduce the complexity, inflexibility and expense associated with traditional business intelligence applications. We currently offer four key products: Tableau Desktop, a self-service, powerful analytics product for anyone with data; Tableau Server, a business intelligence platform for organizations; Tableau Online, a hosted software-as-a-service ("SaaS") version of Tableau Server; and Tableau Public, a free cloud-based platform for analyzing and sharing public data. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Accounting Principles The consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with 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 period. Our estimates include the useful lives of our property and equipment and other lease-related assets, liabilities and costs and the collectability of our accounts receivable. We also use estimates in stock-based compensation, income taxes, business combinations, investments and accrued liabilities. Actual results could differ from those estimates. Foreign Currency The financial statements of our foreign subsidiaries with a functional currency other than U.S. dollars have been translated into U.S. dollars. Assets and liabilities of these subsidiaries are translated at the exchange rate in effect at each period-end. Income statement amounts are translated at the average rate of exchange prevailing during the period. Translation adjustments arising from the use of differing exchange rates from period to period are included in other comprehensive income (loss). As of December 31, 2017 and 2016 , we had a cumulative translation gain (loss) of $(11.3) million and $1.6 million , respectively. Gains and losses on foreign currency transactions are included in other income, net. Foreign currency transaction gains (losses) were $4.1 million , $(0.6) million and $0.6 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Risks and Uncertainties Inherent in our business are various risks and uncertainties, including our limited history of operating our business at its current scale and development of advanced technologies in a rapidly changing industry. These risks include our ability to manage our growth and our ability to attract new customers and expand sales to existing customers, as well as other risks and uncertainties. In the event that we do not successfully implement our business plan, certain assets may not be recoverable, certain liabilities may not be paid and investments in our capital stock may not be recoverable. Our success depends upon the acceptance of our technology, development of sales and distribution channels and our ability to generate significant revenues from the sale of our technology. Segments We follow the authoritative literature that established annual and interim reporting standards for an enterprise's operating segments and related disclosures about its products and services, geographic regions and major customers. We operate our business as one operating segment. Our chief operating decision makers ("CODM") are our Chief Executive Officer and Chief Financial Officer, who review financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. Revenue Recognition We generate revenues primarily in the form of software license fees and related maintenance and services fees. Software license fees include fees from the sales of perpetual, term and subscription licenses. Maintenance and services fees primarily consist of fees for maintenance services (including support and unspecified upgrades and enhancements when and if they are available), training and professional services that are not essential to the functionality of the software. We recognize revenues when all of the following conditions are met: • there is persuasive evidence of an arrangement; • the software or services have been delivered to the customer; • the amount of fees to be paid by the customer is fixed or determinable; and • the collection of the related fees is probable. We use click-through license agreements, signed agreements and purchase orders as evidence of an arrangement. We deliver all of our software electronically. Electronic delivery occurs when we provide the customer with access to the software and license key via a secure portal. We assess whether the fee is fixed or determinable at the outset of the arrangement. Our typical terms of payment are due 30 days from delivery. We assess collectability based on a number of factors such as collection history and creditworthiness of the customer. If we determine that collectability is not probable, revenue is deferred until collectability becomes probable, generally upon receipt of cash. Substantially all of our software licenses are sold in multiple-element arrangements that include maintenance services and may include professional services and training. Vendor specific objective evidence ("VSOE") of the fair value for software licenses is not available as our software licenses are never sold without maintenance; however, VSOE generally exists for all undelivered elements and any services that are not essential to the functionality of the delivered software. Therefore, we account for delivered software licenses under the residual method. Maintenance agreements consist of fees for providing software updates on a when and if available basis and technical support for software products ("post-contract support" or "PCS") for an initial term, generally one year. We have established VSOE of the fair value for maintenance on perpetual licenses based on stated substantive renewal rates or the price when sold on a standalone basis. Stated renewal rates are considered to be substantive if they are at least 15% of the actual price charged for the software license. VSOE of the fair value for standalone maintenance contracts is considered to have been established when a substantial majority of individual sales transactions within the previous 12 months falls within a reasonably narrow range, which we have defined to be plus or minus 15% of the median sales price of actual standalone sales transactions. License arrangements may include professional services and training. In determining whether professional services and training revenues should be accounted for separately from license revenues, we evaluate: • whether such services are considered essential to the functionality of the software using factors such as the nature of the software products; • whether they are ready for use by the customer upon receipt; • the nature of the services, which typically do not involve significant customization to or development of the underlying software code; • the availability of services from other vendors; • whether the timing of payments for license revenues coincides with performance of services; and • whether milestones or acceptance criteria exist that affect the realizability of the software license fee. To date, professional services have not been considered essential to the functionality of the software. The VSOE of the fair value of our professional services and training is based on the price for these same services when they are sold separately. Revenues related to professional services are billed on a time and materials basis and are recognized as the services are performed. Revenues related to training services are billed on a fixed fee basis and are recognized as the services are delivered. Payments received in advance of services performed are deferred and recognized when the related services are performed. When software is licensed for a specified term or on a subscription basis, fees for maintenance and support are generally bundled with the license fee over the entire term of the contract. In these cases, we do not have VSOE of the fair value for maintenance and support. Revenues related to term and subscription license fees are recognized ratably over the contract term beginning on the date the customer has access to the software license key and continuing through the end of the contract term. We do not offer refunds and therefore have not recorded any sales return allowance for any of the periods presented. Upon a periodic review of outstanding accounts receivable, amounts that are deemed to be uncollectable are written off against the allowance for doubtful accounts. We account for taxes collected from customers and remitted to governmental authorities on a net basis and exclude them from revenues. Cash and Cash Equivalents We consider all highly liquid investments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. We maintain cash and cash equivalent balances which exceed the insured limits by the Federal Deposit Insurance Corporation. Investments We classify our investment securities as available-for-sale. Our investment securities are stated at fair value and reported in short-term investments and long-term investments. Investments in securities with maturities of less than one year, or where management's intent is to use the investments to fund current operations, are classified as short-term investments. Investments with maturities greater than one year are classified as long-term investments. Unrealized gains and losses on available-for-sale securities are excluded from net income and reported, net of tax, in other comprehensive income (loss). Realized gains and losses and declines in the value of securities judged to be other-than-temporary are determined based on the specific identification method and are included in other income, net. In order to determine whether a decline in value is other-than-temporary, we evaluate, among other factors, our intent and ability to recover the amortized cost basis of the security. Interest on securities classified as available-for-sale is included in other income, net. Accounts Receivable, Net Accounts receivable consist of amounts billed and currently due from customers. Our accounts receivable are subject to collection risk. Our gross accounts receivable is reduced for this risk by a provision for doubtful accounts. This provision is for estimated losses resulting from the inability of our customers to make required payments. It is an estimate and is regularly evaluated for adequacy by taking into consideration a combination of factors. We look at factors such as past collection experience, credit quality of the customer, age of the receivable balance and current economic conditions. These factors are reviewed to determine whether a provision for doubtful accounts should be recorded to reduce the receivable balance to the amount believed to be collectible. Activity related to our provision for doubtful accounts was as follows: Year Ended December 31, 2017 2016 2015 (in thousands) Balance at the beginning of the year $ 1,065 $ 888 $ 1,111 Bad debt expense 650 750 250 Accounts written off (712 ) (573 ) (473 ) Balance at the end of the year $ 1,003 $ 1,065 $ 888 Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. The estimated useful lives range from approximately one to twelve years. Leasehold improvements are amortized over the shorter of the estimated useful life or the remaining lease term. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in results of operations. Maintenance and repairs that do not improve or extend the lives of the respective assets are charged to expense in the period incurred. Leases and Asset Retirement Obligations Leases are categorized at their inception as either operating or capital leases. Within some lease agreements, rent holidays and other incentives are included. Rent expense is recognized on a straight-line method, over the term of the agreement generally beginning once control of the space is achieved, without regard to deferred payment terms, such as rent holidays that defer the commencement date of required rent payments. Additionally, incentives received are treated as a reduction of expense over the term of the agreement. Liabilities are established for the present value of estimated future costs to retire leasehold improvements at the termination or expiration of a lease. A corresponding asset is recorded in the period in which the obligation is incurred. Such assets are amortized over the estimated useful life of the asset, and the recorded liabilities are accreted to the future value of the estimated retirement costs. Impairment of Long-Lived Assets We evaluate the recoverability of long-lived assets in accordance with authoritative guidance on accounting for the impairment or disposal of long-lived assets. We evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. Such impairment is recognized in the event the carrying value of such assets exceeds their fair value. If the carrying value of the net assets assigned exceeds the fair value of the assets, then the second step of the impairment test is performed in order to determine the implied fair value. No impairment of long-lived assets occurred in the periods presented. Software Development Costs Software development costs associated with the development of new products, enhancements of existing products and quality assurance activities consists of employee, consulting and other external personnel costs. The costs incurred internally from the research and development ("R&D") of computer software products are charged to expense until technological feasibility has been established for the product. Once technological feasibility is established, all software costs are capitalized until the product is available for release to customers. Judgment is required in determining when technological feasibility of a product is established. To date, we have determined that technological feasibility of software products is reached shortly before the products are released. Costs incurred after establishment of technological feasibility have not been material, and therefore, we have expensed all R&D costs as they were incurred. R&D expenses primarily consist of personnel-related costs attributable to our R&D personnel and allocated overhead, which includes facilities-related costs. We capitalize certain costs relating to software developed or modified solely to meet our internal requirements and for which there are no substantive plans to market the software. To date, we have not capitalized any such costs as these costs have not been material. Intangible Asset Costs Costs related to filing and pursuing patent and trademark applications are expensed as incurred, as recoverability of such expenditures is uncertain. These intangible asset-related legal costs are generally reported as a component of general and administrative expenses. Advertising Expenses We expense all advertising costs as incurred and classify such costs as sales and marketing expenses. Advertising expenses for the years ended December 31, 2017 , 2016 and 2015 were $28.2 million , $21.7 million and $11.3 million , respectively. Income Taxes Income taxes are accounted for under the asset and liability method in accordance with authoritative guidance for income taxes. Deferred income tax assets are recognized for deductible temporary differences, net operating loss carryforwards, and tax credit carryforwards if it is more likely than not that the tax benefits will be realized. We consider future taxable income, historical operating results and ongoing prudent and feasible tax planning strategies in assessing the need for a valuation allowance. A valuation allowance is recorded to reduce our deferred income tax assets to the net amount that we believe is more likely than not to be realized. In the event we determine that we are able to realize our deferred income tax assets in excess of our net recorded amount, we would reduce the valuation allowance associated with the deferred income tax assets in the period the determination is made, which may result in a tax benefit in the statement of operations. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Our assumptions, judgments and estimates relative to the value of net deferred income taxes take into account predictions of the amount and category of future taxable income, such as income from operations or capital gains income. Actual operating results and the underlying amount and category of income in future years could render our current assumptions, judgments and estimates of recoverable net deferred income taxes inaccurate. Any of the assumptions, judgments and estimates mentioned above could cause our actual income tax obligations to differ from our estimates, thus materially impacting our financial position and results of operations. Concentrations of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments and accounts receivable. Our investment portfolio consists of investment-grade securities diversified among security types, industries and issuers. Our cash and cash equivalents and investments are held and managed by recognized financial institutions that follow our investment policy. Our policy limits the amount of credit exposure to any one security issue or issuer. We extend credit to customers based upon an evaluation of the customer's financial condition. As of December 31, 2017 and 2016 , no individual customer accounted for 10% or more of total accounts receivable. For the years ended December 31, 2017 , 2016 and 2015 , no individual customer represented 10% or more of our total revenues. Business Combinations As of the date of an acquisition, we recognize the identifiable assets acquired and liabilities assumed at fair value. Any excess of the consideration over the fair value of identifiable net assets is recorded as goodwill. Amounts that are not part of the consideration transferred are recognized separately from a business combination and are expensed as incurred. Intangible assets acquired are measured at their acquisition date fair value using valuation techniques that are subject to judgment. Goodwill and Intangible Assets Intangible assets with a finite life are typically amortized over their useful lives which range from three to five years. Goodwill is tested for impairment on an annual basis in the third quarter and more frequently if circumstances indicate that the carrying value may not be recoverable. As part of our goodwill impairment test, we first perform a qualitative assessment to determine whether it is more likely than not that the fair value of our reporting unit is less than its carrying amount. For purposes of this assessment, we consider the enterprise to be the reporting unit. If we determine it is more likely than not that the fair value of our reporting unit is less than its carrying amount, we will perform a quantitative assessment to determine whether the fair value of our reporting unit is less than its carrying amount. We have not had any impairments of the goodwill balance. Stock-Based Compensation We record compensation expense for stock-based transactions including employee and non-employee stock option and restricted stock unit ("RSU") awards granted under our 2004 Equity Incentive Plan (the "2004 Plan") and our 2013 Equity Incentive Plan, as amended, (the "2013 Plan" and together with the 2004 Plan, the "Plans"). We also record compensation expense related to employee contributions made under our 2013 Employee Stock Purchase Plan ("2013 ESPP"). These contributions are used to purchase shares of our Class A common stock at a discount. Stock-based compensation expense is measured and recognized in the financial statements based on fair value. The fair value of each RSU award is determined based on the closing price of our Class A common stock as reported on the New York Stock Exchange on the date of grant. The fair value of each stock option award is determined at the date of grant by applying the Black-Scholes option pricing model. We also use the Black-Scholes option pricing model to determine the fair value of each common share issued under the 2013 ESPP. The fair value for 2013 ESPP grants is determined on the first day of each offering period. The Black-Scholes option pricing model utilizes the value of our underlying common stock at the measurement date, the expected or contractual term of the option or offering period, the expected volatility of our common stock, risk-free interest rates and expected dividend yield of our common stock. Prior to our IPO in May 2013, because our stock was not publicly traded we estimated the fair value of our common stock. Our board of directors considered numerous objective and subjective factors to determine the fair value of our common stock at each meeting at which awards were approved. The factors included, but were not limited to: (i) contemporaneous third-party valuations of our common stock; (ii) the prices, rights, preferences and privileges of our preferred stock that was then outstanding relative to those of our common stock; (iii) the lack of marketability of our common stock; (iv) our actual operating and financial results; (v) current business conditions and projections; and (vi) the likelihood of achieving a liquidity event, such as an IPO or merger or acquisition, given prevailing market conditions. After the completion of our IPO, our common stock has been valued by reference to the closing price of our Class A common stock as reported on the New York Stock Exchange. We recognize stock-based compensation expense using the straight-line method over the requisite service period. We account for forfeitures as they occur. For awards subject to technology milestones, we recognize compensation cost over the required service period if it is probable that the technology milestone will be met. If our assessment of the probability of the technology milestone being met changes, we recognize the impact of the change in estimate in the period of the change. Excess tax benefits resulting from the settlement of stock awards are recorded to income tax expense. Fair Value Measurements We categorize assets and liabilities recorded at fair value on our consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The levels of the fair value hierarchy are as follows: • Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3—Inputs are unobservable inputs based on our own assumptions and valuation techniques used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. We establish fair value of our assets and liabilities using the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and using a fair value hierarchy based on the inputs used to measure fair value. The carrying amounts reported in the consolidated financial statements approximate the fair value for cash equivalents, accounts receivable, accounts payable, and accrued and other current liabilities, due to their short-term nature. We value our investments using quoted prices for identical instruments in active markets when available. If we are unable to obtain quoted prices for identical instruments in active markets, we value our investments using quoted market prices for comparable instruments. To date, all of our investments can be valued using one of these two methodologies. Recently Adopted Accounting Pronouncements In March 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-09 related to stock-based compensation. The guidance, which simplifies the accounting and presentation for share-based payments, provides for a number of amendments that impact the accounting for income taxes and the accounting for forfeitures. We adopted this standard in the first quarter of 2017. Upon adoption, we recognized all of the previously unrecognized excess tax benefits related to stock awards using the modified retrospective transition method . These excess tax benefits, recognized upon adoption, were recorded as a deferred tax asset, which was then fully offset by our U.S. federal and state deferred tax asset valuation allowance resulting in no impact to our accumulated deficit. Without the valuation allowance, our deferred tax asset would have increased by $180.9 million . Immediately prior to adoption, we had no unrecognized excess tax benefits related to stock awards in jurisdictions outside the United States. All future excess tax benefits resulting from the settlement of stock awards will be recorded to income tax expense. Prior to the adoption of ASU 2016-09, excess tax benefits related to stock awards were required to be presented as an inflow from financing activities and an outflow from operating activities on the statement of cash flows. Under the new standard, all tax-related cash flows resulting from share-based payments are reported as operating activities. We adopted the new requirement retrospectively, and for the years ended December 31, 2016 and December 31, 2015 , this resulted in an increase to net cash provided by operating activities of $2.2 million and $5.6 million , and a corresponding decrease to net cash provided by (used in) financing activities of $2.2 million and $5.6 million , respectively. Also, as part of the adoption of the standard, we made the policy election to account for forfeitures as they occur. Using the modified retrospective adoption method, we recognized a $0.4 million cumulative-effect increase to our accumulated deficit for previously estimated forfeitures. In January 2017, the FASB issued ASU 2017-04, simplifying the accounting for goodwill impairment. The new guidance removes step two of the two-step quantitative goodwill impairment test, which requires a hypothetical purchase price allocation. We adopted this standard in the third quarter of 2017 as part of our annual goodwill impairment testing. The adoption of this standard did not impact these consolidated financial statements. Recent Accounting Pronouncements Not yet Adopted In May 2014, the FASB issued ASU 2014-09 related to revenue recognition. Since the issuance of ASU 2014-09, the FASB has also issued ASU 2016-08, ASU 2016-10, ASU 2016-12, ASU 2016-20 and ASU 2017-14, all of which clarify certain aspects of ASU 2014-09. The new standard will change the way we recognize revenue, including the identification of contractual performance obligations and the allocation of transaction price, to depict the transfer of promised goods or services to customers at the amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. We will adopt this standard effective January 1, 2018 on a modified retrospective basis and apply the new standard only to contracts that are not completed contracts at January 1, 2018. The new standard will materially impact the timing of revenue recognition related to our on-premises term license agreements. We have historically recognized revenue related to on-premises term license agreements ratably over the term of the licensing agreement. Under the new standard, revenue allocable to the license portion of the arrangement will be recognized upon delivery of the license. Maintenance revenue related to on-premises term license agreements will continue to be recognized ratably over the term of the licensing agreement. The new standard will also impact our determination of standalone selling prices, which will impact the allocation of transaction price to each performance obligation, thereby impacting the timing of revenue recognition depending on when each performance obligation is recognized. The impacts to the timing of revenue recognition will also affect our deferred revenue balance. As of December 31, 2017, we had $142 million of on-premises deferred license revenue on our balance sheet. Upon adoption, a portion of this amount will be recorded to retained earnings for the impacts from the allocation of standalone selling prices under the new standard. The new standard also requires the capitalization of certain incremental costs of obtaining a contract, which will impact the period in which we record our sales commissions expense. We have historically recognized sales commissions expense upfront. Under the new guidance, we are required to recognize these expenses consistently with the transfer of goods or services. This will result in a deferral of some sales compensation costs. We will amortize these deferred costs on a straight-line basis over four years. The new standard will also impact our internal control environment, including our financial statement disclosure controls, our business process controls and enhancements necessary to update our business systems. We are currently finalizing the implementation controls necessary to adopt this new standard. In February 2016, the FASB issued ASU 2016-02 related to lease accounting. The new guidance will require lessees to recognize right-of-use assets and lease liabilities on the balance sheet for operating leases that do not meet the definition of a short-term lease. ASU 2016-02 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2018 and requires modified retrospective transition. Under the new standard we anticipate that our current real estate leases will continue to be classified as operating leases and a significant amount of our currently outstanding operating lease commitments will be recorded to the balance sheet as a right-of-use asset and a corresponding lease liability. Our evaluation of the new standard will extend into future periods and we will update our disclosures, including the expected impacts of the new standard, as we progress towards the required adoption date. In June 2016, the FASB issued ASU 2016-13, related to credit losses. The new guidance replaces the existing incurred loss impairment model with an expected credit loss model and requires a financial asset measured at amortized cost to be presented at the net amount expected to be collected. ASU 2016-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted. We are currently evaluating the impact that this standard will have on our consolidated financial statements. In October 2016, the FASB issued ASU 2016-16 related to the accounting for income tax effects on intra-entity asset transfers of assets other than inventory. The new guidance will require reporting entities to recognize tax expense from the sale of assets when the transfer occurs, even though the pre-tax effects of the transaction are eliminated in consolidation. We will adopt the new standard, in the first quarter of 2018, on a modified retrospective basis. We are currently evaluating the impact that this standard will have on our consolidated financial statements. |
Balance Sheet Detail
Balance Sheet Detail | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Detail | Balance Sheet Detail Property and Equipment, Net Property and equipment, net consisted of the following: Useful Life December 31, (in months) 2017 2016 (in thousands) Computer equipment and software 36 $ 98,737 $ 92,536 Furniture and fixtures 36 25,232 18,953 Leasehold improvements 10-150 85,482 37,308 Construction in progress 313 35,099 209,764 183,896 Less: Accumulated depreciation and amortization (103,011 ) (77,259 ) $ 106,753 $ 106,637 Depreciation and amortization expense was $44.7 million , $43.0 million and $23.7 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Goodwill The only changes in the carrying amounts of goodwill during the years ended December 31, 2017 and 2016 were increases of $19.6 million related to our acquisition of ClearGraph in 2017 and $14.6 million related to our acquisition of Hyper in 2016. See Note 7 for further discussion of these acquisitions. Accrued Compensation and Employee-Related Benefits Accrued compensation and employee-related benefits consisted of the following: December 31, 2017 2016 (in thousands) Accrued commissions $ 31,333 $ 24,801 Accrued bonuses 25,435 19,080 Accrued vacation 14,512 13,003 Other 25,110 13,346 Total $ 96,390 $ 70,230 |
Short-Term and Long-Term Invest
Short-Term and Long-Term Investments (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Short-term and Long-term Investments Disclosure | Short-Term and Long-Term Investments The following table represents our short-term and long-term investments in available-for-sale securities as of December 31, 2017 , and is based on contractual years to maturity: Amortized Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Short-term investments Commercial paper $ 9,970 $ — $ — $ 9,970 U.S. treasury securities 160,206 — (121 ) 160,085 U.S. agency securities 9,917 — (24 ) 9,893 Corporate bonds 46,901 3 (65 ) 46,839 Total short-term investments 226,994 3 (210 ) 226,787 Long-term investments U.S. treasury securities 79,371 — (202 ) 79,169 U.S. agency securities 18,570 — (102 ) 18,468 Corporate bonds 50,880 — (153 ) 50,727 Total long-term investments 148,821 — (457 ) 148,364 Total short-term and long-term investments $ 375,815 $ 3 $ (667 ) $ 375,151 We did not hold any short-term or long-term investments as of December 31, 2016 . We earn interest on our cash equivalents and investments. For the years ended December 31, 2017 , 2016 and 2015 , we earned interest income of $8.5 million , $2.7 million and $0.6 million , respectively. As of December 31, 2017 , there were no investments that had been in a net loss position for 12 months or greater. The unrealized losses on investments as of December 31, 2017 were primarily caused by increases in interest rates. None of the unrealized losses represent other-than-temporary impairments based on our evaluation of available evidence as of December 31, 2017 . |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following table presents the fair value of our financial assets using the fair value hierarchy: December 31, 2017 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents Money market funds $ 582,835 $ — $ — $ 582,835 Commercial paper — 8,984 — 8,984 Short-term investments Commercial paper — 9,970 — 9,970 U.S. treasury securities — 160,085 — 160,085 U.S. agency securities — 9,893 — 9,893 Corporate bonds — 46,839 — 46,839 Long-term investments U.S. treasury securities — 79,169 — 79,169 U.S. agency securities — 18,468 18,468 Corporate bonds — 50,727 — 50,727 Total $ 582,835 $ 384,135 $ — $ 966,970 December 31, 2016 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents Money market funds $ 872,161 $ — $ — $ 872,161 Total $ 872,161 $ — $ — $ 872,161 We did not have any investments in prime money market funds as of December 31, 2017 and 2016 . We have no material financial assets or liabilities measured using Level 3 inputs. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of our loss before income tax expense consisted of the following: Year Ended December 31, 2017 2016 2015 (in thousands) United States $ (134,723 ) $ (100,725 ) $ (27,779 ) International (43,976 ) (36,702 ) (23,028 ) Total $ (178,699 ) $ (137,427 ) $ (50,807 ) Income tax expense (benefit) consisted of the following: Year Ended December 31, 2017 2016 2015 (in thousands) United States $ (592 ) $ 2,147 $ 28,630 International 7,453 4,875 4,263 Total $ 6,861 $ 7,022 $ 32,893 The provision (benefit) for income taxes consisted of the following: Year Ended December 31, 2017 2016 2015 (in thousands) Current: Federal $ — $ 1,447 $ 4,009 State 233 402 771 Foreign 10,704 5,230 5,240 Total current income tax expense 10,937 7,079 10,020 Deferred: Federal (892 ) 258 22,011 State 67 40 1,839 Foreign (3,251 ) (355 ) (977 ) Total deferred income tax expense (benefit) (4,076 ) (57 ) 22,873 Total income tax expense $ 6,861 $ 7,022 $ 32,893 A reconciliation of the U.S. federal statutory income tax provision (benefit) to the effective income tax expense for each year follows: Year Ended December 31, 2017 2016 2015 (in thousands) Income tax benefit at statutory rate $ (62,545 ) $ (48,098 ) $ (17,783 ) State taxes, net of federal tax benefit (4,714 ) (3,466 ) (896 ) Impact of foreign income taxes 23,232 14,566 10,582 Impact of Tax Cuts and Jobs Act of 2017 87,584 — — Research and development and other tax credits (12,563 ) (8,462 ) (10,187 ) Stock-based compensation (13,466 ) 5,098 3,174 Non-deductible meals and entertainment expenses 1,182 1,212 1,395 Impact of valuation allowance (13,598 ) 46,174 46,737 Other, net 1,749 (2 ) (129 ) Total income tax expense $ 6,861 $ 7,022 $ 32,893 Our effective tax rate differs from the U.S. federal statutory rate primarily due to the impact of the valuation allowance on our U.S. federal and state deferred income tax assets and losses in jurisdictions where a tax benefit is not available. In addition, due to the adoption of ASU 2016-09 in 2017, all excess tax benefits and deficiencies are recognized as an income tax benefit in the current year. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Act”) was signed with an effective date of January 1, 2018. The Act, which significantly revised U.S. tax law, included many important changes, including but not limited to a reduction of the U.S. corporate tax rate from 35%, down to 21%, a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings and fundamental changes to the taxation of multinational entities including a shift from a worldwide tax system to a territorial system. The Act had minimal impact to our income tax provision in 2017, mostly due to our domestic valuation allowance. Based on available guidance we recorded $87.6 million of additional income tax expense in the fourth quarter of 2017, mostly caused by the change in the U.S. corporate tax rate, applied to our U.S. federal and state deferred income tax assets, based on the rates applicable when these assets reverse in the future. This additional income tax expense was offset by a decrease in the domestic valuation allowance of $88.1 million . On December 22, 2017, Staff Accounting Bulletin No. 118 ("SAB 118") was issued to assist in addressing uncertainty in applying GAAP to the accounting and reporting of tax reform changes related to the Act. We have considered these changes, including all available guidance, in determining our income tax provision for 2017. Additional work is necessary to do a more detailed analysis of historical foreign earnings as well as potential correlative adjustments. Any subsequent adjustment to these amounts may be recorded to current income tax expense when the analysis is complete. The tax effects of temporary differences and carryforwards that gave rise to deferred income tax assets and liabilities consisted of the following: December 31, 2017 2016 (in thousands) Deferred income tax assets: Net operating loss carryforwards $ 133,187 $ — Tax credit carryforwards 59,343 17,904 Stock-based compensation 15,512 18,589 Accrued compensation 11,487 14,268 Deferred revenue 5,334 3,728 Deferred rent 12,483 9,037 Depreciation and amortization (1) 966 4,839 Other (1) 1,149 699 Total deferred income tax assets 239,461 69,064 Deferred income tax liabilities: Prepaid assets 4,177 4,231 Total deferred income tax liabilities 4,177 4,231 Net deferred income tax assets before valuation allowance 235,284 64,833 Less: valuation allowance (230,545 ) (63,384 ) Net deferred income tax assets $ 4,739 $ 1,449 Reported as: Deferred income taxes 5,287 1,449 Other long-term liabilities (548 ) — Net deferred income tax assets $ 4,739 $ 1,449 (1) Certain amounts within the components of deferred taxes as of December 31, 2016 have been reclassified to conform to the presentation as of December 31, 2017. We determine our deferred income tax assets and liabilities based on differences between the financial reporting and tax basis of assets and liabilities using the enacted tax rates and laws that will be in effect when we expect the differences to reverse . We regularly assess the need for a valuation allowance against our deferred income tax assets by considering both positive and negative evidence related to whether it is more likely than not that our deferred income tax assets will be realized. A valuation allowance is recorded when it is more likely than not that all or some portion of the deferred income tax assets will not be realized. In evaluating our ability to recover our deferred income tax assets within the jurisdiction from which they arise, we consider all available positive and negative evidence, including scheduled reversals of deferred income tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. In 2015, we established a valuation allowance of $46.7 million for our U.S. federal and state deferred income tax assets, in part due to our three-year cumulative GAAP net loss adjusted for permanent tax differences, which is a significant piece of negative evidence for recording the valuation allowance. In 2016, we increased the valuation allowance to $63.4 million as of December 31, 2016. In 2017, we determined our U.S. federal and state deferred income tax assets continue to be currently not more likely than not to be realized; therefore, we increased the valuation allowance to $230.5 million as of December 31, 2017 . The increase in the valuation allowance during 2017 was primarily attributable to an adjustment of $180.9 million related to previously unrecognized deferred tax assets that were recorded upon the adoption of ASU 2016-09. The remaining difference is associated with the current year change in U.S. federal and state deferred income tax assets, less the effect of the Act. We have gross net operating loss carryforwards totaling $895.9 million , R&D tax credit carryforwards of $64.4 million and Federal foreign tax credits of $12.4 million . If not utilized, a portion of these attributes will begin to expire in 2034. Utilization of our net operating loss and tax credit carryforwards may be subject to limitations upon certain ownership changes as provided by the Internal Revenue Code and similar state provisions. Such limitations could result in the expiration of the net operating loss and tax credit carryforwards before their utilization. We are subject to income taxes in the U.S. and in numerous foreign jurisdictions. The statute of limitations for adjustments to our historic tax obligations will vary from jurisdiction to jurisdiction. Furthermore, net operating loss and tax credit carryforwards may be subject to adjustment after the expiration of the statute of limitations for the year such net operating losses and tax credits originated. In general, the tax years for U.S. federal and state income tax purposes open for examination are for 2013 and forward due to our net operating loss carryforwards. Income tax expense includes both U.S. and international income taxes. Except as required under U.S. tax law, we do not provide for U.S. income taxes on our undistributed earnings of foreign subsidiaries that have not been previously taxed because we intend to invest such undistributed earnings indefinitely outside of the U.S. As of December 31, 2017 , cash held by foreign subsidiaries was $35.6 million . We have reserves for taxes to address potential exposures involving tax positions that we believe could be challenged by taxing authorities even though we believe the positions we have taken are appropriate. We believe our tax reserves are adequate to cover potential liabilities. We review the tax reserves as circumstances warrant and adjust the reserves as events occur that affect our potential liability for additional taxes. It is often difficult to predict the final outcome or timing of resolution of any particular tax matter. Various events, some of which cannot be predicted, such as clarification of tax law by administrative or judicial means, may occur and would require us to increase or decrease our reserves and effective income tax rate. The total gross amount of unrecognized tax benefits was $19.9 million , $12.9 million and $10.8 million as of December 31, 2017 , 2016 and 2015 , respectively. Of the total gross amount of unrecognized tax benefits, the portion recorded to liabilities pertaining to uncertain tax positions was $1.4 million , $0.7 million and $0.7 million as of December 31, 2017 , 2016 and 2015 , respectively. Our increase in unrecognized tax benefits relates primarily to the R&D tax credits generated in the current year, which are recorded net of the corresponding deferred tax asset. These amounts represent the gross amount of exposure in individual jurisdictions and do not reflect any additional benefits expected to be realized if such positions were not sustained. To the extent that any uncertain tax positions are resolved in our favor, it may have a positive impact on our effective income tax rate. We do not expect any material decrease on our unrecognized tax position within the next twelve months. The following table shows the gross changes in our unrecognized tax position. Year Ended December 31, 2017 2016 2015 (in thousands) Balance, beginning of year $ 12,909 $ 10,781 $ 7,116 Gross increases to tax positions related to prior periods 1,289 28 545 Gross increases related to current tax positions 5,683 2,100 3,120 Balance, end of year $ 19,881 $ 12,909 $ 10,781 Interest or penalties, if incurred, would be recognized as a component of income tax expense. No penalties or interest were recognized or accrued for at December 31, 2017 , 2016 and 2015 . On July 27, 2015, the U.S. Tax Court issued an opinion related to litigation in Altera Corp v. Commissioner. This litigation relates to the treatment of stock-based compensation expense in an intercompany cost sharing arrangement with one of Altera's foreign subsidiaries. In its opinion, the U.S. Tax Court invalidated the portion of the Treasury regulations requiring the inclusion of stock-based compensation expense in such intercompany cost-sharing arrangements. On February 19, 2016, the IRS appealed the U.S. Tax Court's decision. As the final resolution of this litigation remains uncertain, we have not recorded potentially favorable benefits related to the current or prior periods. We will continue to monitor developments related to this case and the potential impact of those developments on our current and future financial statements. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations ClearGraph On August 1, 2017, we acquired all issued and outstanding stock of ClearGraph, a privately-held Delaware corporation, for $24.1 million in cash. ClearGraph is a startup that enables smart data discovery and data analysis through natural language query technology. As a result of this acquisition, we acquired all of the assets and assumed all of the liabilities of ClearGraph, and we accounted for this transaction as a business combination. Pro forma results of operations for this acquisition have not been presented as the effects were not material to our financial results. The following table summarizes the purchase price allocation based on the estimated fair value of the net assets acquired: August 1, 2017 (in thousands) Cash $ 161 Technology asset 5,000 Goodwill 19,552 Other liabilities, net (586 ) Net assets acquired $ 24,127 The technology asset acquired in this business combination is being amortized on the straight-line method over a period of five years. Goodwill generated from this business combination is primarily attributable to expected synergies between the technology asset acquired and our key products. None of the goodwill recognized with this transaction is expected to be deductible for U.S. income tax purposes. Additional information, such as that related to income tax and other contingencies, existing as of the acquisition date but unknown to us, may become known at a later time. In accordance with GAAP, if this occurs during the 12 month period subsequent to the acquisition date, we may update the amounts and allocations recorded as of the acquisition date, which are presented in the table above. Hyper On March 1, 2016, we acquired Hyper, a high-performance main-memory database system, for $16.4 million in cash. Through this acquisition we acquired new technology, capable of enhancing our key products, and additional engineering talent. We have accounted for this transaction as a business combination, and allocated $1.8 million to the acquired technology intangible asset. The remaining purchase price was recorded to goodwill, which is primarily attributable to the synergies between Hyper and our key products. No other assets or liabilities were identified as part of the acquisition. A portion of the goodwill balance associated with this transaction is deductible for U.S. income tax purposes. Pro forma results of operations for this acquisition have not been presented as the effects were not material to our consolidated financial results. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity Common Stock Our certificate of incorporation, as amended and restated, authorizes us to issue 75,000,000 shares of Class B common stock, at $0.0001 par value per share, and 750,000,000 shares of Class A common stock, at $0.0001 par value per share. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each holder of Class B common stock is entitled to ten votes per share and each holder of Class A common stock is entitled to one vote per share. Shares of Class B common stock may be converted into Class A common stock at any time at the option of the stockholder, and are automatically converted upon sale or transfer, to Class A common stock, subject to certain limited exceptions. At its discretion, the board of directors may declare dividends on shares of common stock, subject to the rights of our preferred stockholders, if any. Upon liquidation or dissolution, holders of common stock will receive distributions only after preferred stock preferences have been satisfied. Preferred Stock Our certificate of incorporation, as amended and restated, authorizes us to issue 10,000,000 shares of preferred stock at $0.0001 par value per share. Our board of directors has the authority to provide for the issuance of all the shares in one or more series. At its discretion, our board of directors may designate the voting rights and preferences of the preferred stock. As of December 31, 2017 and 2016 , no shares of preferred stock were outstanding. Stock Repurchase Program On November 1, 2016, we announced that our board of directors approved a stock repurchase program, under which we were authorized to repurchase up to $200 million of our outstanding Class A common stock. The repurchase program has no expiration date and may be modified, suspended or discontinued at any time. Repurchases under the program may be made from time to time on the open market at prevailing market prices, in privately negotiated transactions, in transactions structured through investment banking institutions or a combination of the foregoing, in compliance with Rule 10b-18 under the Securities Exchange Act of 1934. During the year ended December 31, 2017 , we repurchased 1,264,428 shares of our outstanding Class A common stock at an average price of $63.26 per share for $80.0 million . During the year ended December 31, 2016 , we repurchased 446,517 shares of our outstanding Class A common stock at an average price of $44.81 per share for $20.0 million . All repurchases were made in open market transactions using cash on hand and all of the shares repurchased were retired. As of December 31, 2017 we were authorized to repurchase a remaining $100.0 million of our Class A common stock under our repurchase program. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Our 2004 Plan authorized the granting of options to purchase shares of our Class B common stock, RSUs and other stock-based awards to our employees, consultants, officers and directors. In December 2012, we modified the 2004 Plan to increase the number of shares of Class B common stock authorized thereunder to 26,473,282 . Our 2013 Plan, which was the successor to our 2004 Plan, authorizes the granting of options to purchase shares of our Class A common stock, RSUs and other stock-based awards to our employees, consultants, officers and directors. Options granted under the Plans may be incentive or nonstatutory stock options. Incentive stock options may only be granted to employees. The term of each option is stated in the award agreement, but shall be no more than ten years from the date of grant. The board of directors determines the period over which options and RSUs become vested. Currently, the vesting period for our options and RSUs is typically four years. Our 2013 ESPP allows eligible employees to purchase shares of our Class A common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to plan limitations. The 2013 ESPP currently includes purchase periods approximately six months in duration starting on the first trading date on or after June 1 st and December 1 st of each year. Participants are able to purchase shares of our common stock at 85% of the lower of its fair market value on (i) the first day of the purchase period or on (ii) the purchase date, which is the last day of the purchase period. A summary of the option activity during the year ended December 31, 2017 follows: Options Outstanding Shares Weighted Average Exercise Price per Share Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (in years) (in thousands) Balances at December 31, 2016 4,486,416 $ 9.59 Options exercised (1,467,464 ) 8.46 Options canceled (78 ) 9.30 Options forfeited (1,761 ) 26.38 Balances at December 31, 2017 3,017,113 $ 10.13 4.33 $ 178,207 Vested and expected to vest at December 31, 2017 3,017,113 $ 10.13 4.33 $ 178,207 Exercisable at December 31, 2017 2,965,550 $ 9.36 4.25 $ 177,468 The stock options are exercisable at a price equal to the market value of the underlying shares of common stock on the date of the grant. For periods prior to the IPO this value was determined by our board of directors. After the IPO, this value was determined by reference to the closing price of our Class A common stock on the New York Stock Exchange on the date of the grant. The total intrinsic value of options exercised during 2017 , 2016 and 2015 was $74.5 million , $63.3 million and $224.6 million , respectively. The intrinsic value is the difference between the current fair value of the stock and the exercise price of the stock option. The total grant date fair value of options vested during 2017 , 2016 and 2015 was $1.2 million , $7.8 million and $11.7 million , respectively. A summary of the RSU activity during the year ended December 31, 2017 follows: Number of Shares Underlying Outstanding RSUs Weighted-Average Grant-Date Fair Value per RSU Non-Vested outstanding at December 31, 2016 7,141,294 $ 65.62 RSUs granted 4,183,285 60.62 RSUs vested (2,936,710 ) 66.03 RSUs forfeited (1,209,854 ) 65.12 Non-Vested outstanding at December 31, 2017 7,178,015 $ 62.79 An RSU award entitles the holder to receive shares of our Class A common stock as the award vests, which is generally based on length of service. Our non-vested RSUs do not have nonforfeitable rights to dividends or dividend equivalents. For awards subject to technology milestones, we recognize compensation cost over the required service period if it is probable that the technology milestone will be met. If our assessment of the probability of the technology milestone being met changes, we recognize the impact of the change in estimate in the period of the change. The weighted-average grant date fair value of RSUs granted in 2017 , 2016 and 2015 was $60.62 , $44.61 and $101.52 , respectively. The total intrinsic value of RSUs vested during 2017 , 2016 and 2015 was $185.7 million , $92.5 million and $89.1 million , respectively. Stock-based compensation expense is amortized using the straight-line method over the requisite service period. As of December 31, 2017 , total unrecognized compensation expense related to stock options and non-vested RSUs was $399.0 million , which is expected to be recognized over a weighted-average period of 2.6 years . We account for forfeitures as they occur. The summary of shares available for issuance for equity-based awards (including stock options and RSUs) during the year ended December 31, 2017 follows: Shares Available for Grant 2013 Plan 2013 ESPP Balances at December 31, 2016 6,342,962 3,503,385 Authorized 3,835,921 767,184 Granted (4,183,285 ) (604,177 ) Canceled 78 — Forfeited 1,211,615 — Balances at December 31, 2017 7,207,291 3,666,392 Pursuant to the provisions of our 2013 Plan, the number of shares authorized for issuance increases annually on January 1 st by the lesser of 5% of the total number of shares of our capital stock outstanding on December 31 st of the preceding calendar year or an amount determined by our board of directors. Pursuant to the provisions of our 2013 ESPP, the number of shares authorized for issuance increases annually on January 1 st by the lesser of 1% of the total number of shares of our capital stock outstanding on December 31 st of the preceding calendar year, 4,000,000 shares of Class A common stock, or an amount determined by our board of directors. There are no shares available for grant under our 2004 plan. Valuation Assumptions Stock-based awards granted to our employees, consultants, officers and directors are measured based on the grant date fair value of the awards. For the years ended December 31, 2017 and 2015, there were no options granted. The weighted average grant date fair value of stock options granted for the year ended December 31, 2016 was $23.73 . For the year ended December 31, 2016, the fair value of options was estimated using the Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2016 Risk-free interest rates 1.2% Expected term 5.2 years Expected dividends None Expected volatility 48.0% There were 604,177 and 549,327 Class A common stock shares issued under the 2013 ESPP for the years ended December 31, 2017 and 2016 , respectively. For the year ended December 31, 2015 , there were no Class A common stock shares issued under the 2013 ESPP. The first offering period under the 2013 ESPP commenced on December 1, 2015. For the years ended December 31, 2017 , 2016 and 2015 , the fair value of common share purchase rights under the 2013 ESPP was estimated using the Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2017 2016 2015 Risk-free interest rates 1.1% - 1.5% 0.5% - 0.6% 0.4% Expected term 0.5 years 0.5 years 0.5 years Expected dividends None None None Expected volatility 28.6% - 30.5% 42.0% - 50.1% 48.0% The risk-free interest rates are based on the rates for a U.S. Treasury zero-coupon issue with a term that approximates the expected life of the award at the date closest to the grant date for stock options and to the first date of the purchase period for shares expected to be issued under our 2013 ESPP. The expected term represents the period that our stock-based awards are expected to be outstanding. For awards of stock options, the expected term assumptions were determined based on actual experience adjusted for expected employee exercise behavior. The expected term for shares expected to be issued under our 2013 ESPP is based on the duration of each purchase period, which is approximately six months. We have not paid and do not expect to pay dividends. We estimate expected future volatility based on the annualized daily historical volatility of our stock price. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Operating Lease Commitments and Expected Sublease Receipts We conduct our operations in leased facilities under leases expiring at various dates through 2029 . We recognize rent expense on a straight-line basis over the defined lease periods. Total rent expense under operating leases, net of sublease income, was approximately $41.1 million , $44.1 million and $18.3 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Future minimum lease payments under non-cancellable operating leases, net of future expected sublease payments to be received under non-cancellable subleases, as of December 31, 2017 are as follows: Year Ending December 31, Operating Lease Commitments Expected Sublease Receipts Net (in thousands) 2018 $ 43,529 $ (8,563 ) $ 34,966 2019 42,979 (10,606 ) 32,373 2020 43,849 (7,113 ) 36,736 2021 43,308 (1,180 ) 42,128 2022 42,991 (597 ) 42,394 Thereafter 175,175 (121 ) 175,054 Total $ 391,831 $ (28,180 ) $ 363,651 Liabilities for Loss on Lease Obligations and Related Exit Costs During the fourth quarter of 2016 and the first quarter of 2017, we consolidated operations in some of our leased real estate properties and vacated certain leased office spaces. In the first quarter of 2017 , we recognized additional operating expenses of $10.3 million , of which $4.8 million related to losses on cease-use and $1.3 million resulted from additional expenses related to sublease of certain real estate properties. The remainder was recognized as additional depreciation expense attributable to adjustments to the useful lives of certain leasehold improvements. The expense recognized was included in our overhead allocation. A cease-use loss liability was recorded for the leased office spaces we vacated and was calculated as the present value of the total remaining lease payment obligation offset by estimated sublease rental income, adjusted for deferred items and estimated direct costs to obtain sublease rentals. During 2016 , we recognized additional operating expenses of $13.9 million , of which $5.5 million related to losses on cease-use. The remainder was recognized as additional depreciation expense attributable to adjustments to the useful lives of certain leasehold improvements. The expense recognized during the year was included in our overhead allocation. A cease-use loss liability was recorded for the leased office spaces we vacated and was calculated as the present value of the total remaining lease payment obligation offset by estimated sublease rental income, adjusted for deferred items and estimated direct costs to obtain sublease rentals. Contractual Commitments Our contractual commitments are associated with agreements that are enforceable and legally binding and that specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions and the approximate timing of the transaction. Obligations under contracts that we can cancel without a significant penalty are not included. The following table represents our contractual commitments as of December 31, 2017 : Payments Due by Year Total 2018 2019 2020 Thereafter (in thousands) Contractual commitments $ 27,458 $ 12,665 $ 11,975 $ 2,818 $ — Legal Proceedings We are subject to certain routine legal proceedings, as well as demands and claims that arise in the normal course of our business. We make a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. We are not aware of any pending legal proceedings that we believe, individually or in the aggregate, would be expected to have a material adverse effect on our business, operating results or financial condition. We may, in the future, be party to litigation arising in the ordinary course of business, including claims that we allegedly infringe upon third party intellectual property rights. Such claims, even if not meritorious, could result in the expenditure of significant financial and management resources. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Retirement Plan | Retirement Plan We offer a salary deferral 401(k) plan for our U.S. employees. The plan allows employees to contribute a percentage of their pretax earnings annually, subject to limitations imposed by the IRS. The plan also allows us to make matching contributions, subject to certain limitations. We contributed $3.7 million , $3.6 million and $2.8 million for the years ended December 31, 2017 , 2016 and 2015 , respectively, to the 401(k) plan. |
Segments and Information about
Segments and Information about Revenues by Geographic Region | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segments and Information about Revenues by Geographic Area | Segments and Information about Revenues by Geographic Area The following table presents our revenues by geographic region of end users who purchased products or services for the periods presented below: Year Ended December 31, 2017 2016 2015 (in thousands) United States and Canada $ 605,773 $ 586,494 $ 489,329 International 271,286 240,449 164,258 Total revenues $ 877,059 $ 826,943 $ 653,587 Substantially all of our long-lived assets were located in the United States as of December 31, 2017 and 2016 . |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Loss Per Share We calculate basic net income (loss) per share by dividing our net income (loss) for the period by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed giving effect to all potential common shares that were dilutive and outstanding during the period. For the years ended December 31, 2017 , 2016 and 2015 , basic net loss per share is the same as diluted net loss per share as the inclusion of all potentially dilutive common shares outstanding is anti-dilutive when we are in a net loss position. The following table presents the computation of basic and diluted net loss per share: Year Ended December 31, 2017 2016 2015 (in thousands, except per share data) Net loss per share - basic and diluted Net loss $ (185,560 ) $ (144,449 ) $ (83,700 ) Weighted average shares outstanding used to compute basic and diluted net loss per share 78,869 75,162 71,701 Net loss per share - basic and diluted $ (2.35 ) $ (1.92 ) $ (1.17 ) The following shares subject to outstanding awards were excluded from the computation of diluted net loss per share for the periods presented as their effect would have been antidilutive: Year Ended December 31, 2017 2016 2015 (in thousands) Shares subject to outstanding common stock awards 10,488 12,017 11,510 |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (Unaudited) | Quarterly Financial Information (Unaudited) The following table contains selected unaudited financial data for each quarter of 2017 and 2016 . The unaudited information should be read in conjunction with our financial statements and these notes to the consolidated financial statements. We believe that the following unaudited information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. Three Months Ended Dec 31, 2017 Sept 30, 2017 June 30, 2017 March 31, 2017 Dec 31, 2016 Sept 30, 2016 June 30, 2016 March 31, 2016 (in thousands, except per share amounts) Total revenues $ 249,356 $ 214,917 $ 212,880 $ 199,906 $ 250,653 $ 206,057 $ 198,535 $ 171,698 Gross profit 219,046 184,988 186,215 173,251 222,950 182,027 173,671 149,205 Net loss (41,838 ) (46,553 ) (42,522 ) (54,647 ) (21,088 ) (30,261 ) (47,522 ) (45,578 ) Net loss per share: Basic and diluted $ (0.52 ) $ (0.59 ) $ (0.54 ) $ (0.71 ) $ (0.28 ) $ (0.40 ) $ (0.64 ) $ (0.62 ) |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Accounting Principles | Accounting Principles The consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with 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 period. Our estimates include the useful lives of our property and equipment and other lease-related assets, liabilities and costs and the collectability of our accounts receivable. We also use estimates in stock-based compensation, income taxes, business combinations, investments and accrued liabilities. Actual results could differ from those estimates. |
Foreign Currency | Foreign Currency The financial statements of our foreign subsidiaries with a functional currency other than U.S. dollars have been translated into U.S. dollars. Assets and liabilities of these subsidiaries are translated at the exchange rate in effect at each period-end. Income statement amounts are translated at the average rate of exchange prevailing during the period. Translation adjustments arising from the use of differing exchange rates from period to period are included in other comprehensive income (loss). As of December 31, 2017 and 2016 , we had a cumulative translation gain (loss) of $(11.3) million and $1.6 million , respectively. Gains and losses on foreign currency transactions are included in other income, net. Foreign currency transaction gains (losses) were $4.1 million , $(0.6) million and $0.6 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Risks and Uncertainties | Risks and Uncertainties Inherent in our business are various risks and uncertainties, including our limited history of operating our business at its current scale and development of advanced technologies in a rapidly changing industry. These risks include our ability to manage our growth and our ability to attract new customers and expand sales to existing customers, as well as other risks and uncertainties. In the event that we do not successfully implement our business plan, certain assets may not be recoverable, certain liabilities may not be paid and investments in our capital stock may not be recoverable. Our success depends upon the acceptance of our technology, development of sales and distribution channels and our ability to generate significant revenues from the sale of our technology. |
Segments | Segments We follow the authoritative literature that established annual and interim reporting standards for an enterprise's operating segments and related disclosures about its products and services, geographic regions and major customers. We operate our business as one operating segment. Our chief operating decision makers ("CODM") are our Chief Executive Officer and Chief Financial Officer, who review financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. |
Revenue Recognition | Revenue Recognition We generate revenues primarily in the form of software license fees and related maintenance and services fees. Software license fees include fees from the sales of perpetual, term and subscription licenses. Maintenance and services fees primarily consist of fees for maintenance services (including support and unspecified upgrades and enhancements when and if they are available), training and professional services that are not essential to the functionality of the software. We recognize revenues when all of the following conditions are met: • there is persuasive evidence of an arrangement; • the software or services have been delivered to the customer; • the amount of fees to be paid by the customer is fixed or determinable; and • the collection of the related fees is probable. We use click-through license agreements, signed agreements and purchase orders as evidence of an arrangement. We deliver all of our software electronically. Electronic delivery occurs when we provide the customer with access to the software and license key via a secure portal. We assess whether the fee is fixed or determinable at the outset of the arrangement. Our typical terms of payment are due 30 days from delivery. We assess collectability based on a number of factors such as collection history and creditworthiness of the customer. If we determine that collectability is not probable, revenue is deferred until collectability becomes probable, generally upon receipt of cash. Substantially all of our software licenses are sold in multiple-element arrangements that include maintenance services and may include professional services and training. Vendor specific objective evidence ("VSOE") of the fair value for software licenses is not available as our software licenses are never sold without maintenance; however, VSOE generally exists for all undelivered elements and any services that are not essential to the functionality of the delivered software. Therefore, we account for delivered software licenses under the residual method. Maintenance agreements consist of fees for providing software updates on a when and if available basis and technical support for software products ("post-contract support" or "PCS") for an initial term, generally one year. We have established VSOE of the fair value for maintenance on perpetual licenses based on stated substantive renewal rates or the price when sold on a standalone basis. Stated renewal rates are considered to be substantive if they are at least 15% of the actual price charged for the software license. VSOE of the fair value for standalone maintenance contracts is considered to have been established when a substantial majority of individual sales transactions within the previous 12 months falls within a reasonably narrow range, which we have defined to be plus or minus 15% of the median sales price of actual standalone sales transactions. License arrangements may include professional services and training. In determining whether professional services and training revenues should be accounted for separately from license revenues, we evaluate: • whether such services are considered essential to the functionality of the software using factors such as the nature of the software products; • whether they are ready for use by the customer upon receipt; • the nature of the services, which typically do not involve significant customization to or development of the underlying software code; • the availability of services from other vendors; • whether the timing of payments for license revenues coincides with performance of services; and • whether milestones or acceptance criteria exist that affect the realizability of the software license fee. To date, professional services have not been considered essential to the functionality of the software. The VSOE of the fair value of our professional services and training is based on the price for these same services when they are sold separately. Revenues related to professional services are billed on a time and materials basis and are recognized as the services are performed. Revenues related to training services are billed on a fixed fee basis and are recognized as the services are delivered. Payments received in advance of services performed are deferred and recognized when the related services are performed. When software is licensed for a specified term or on a subscription basis, fees for maintenance and support are generally bundled with the license fee over the entire term of the contract. In these cases, we do not have VSOE of the fair value for maintenance and support. Revenues related to term and subscription license fees are recognized ratably over the contract term beginning on the date the customer has access to the software license key and continuing through the end of the contract term. We do not offer refunds and therefore have not recorded any sales return allowance for any of the periods presented. Upon a periodic review of outstanding accounts receivable, amounts that are deemed to be uncollectable are written off against the allowance for doubtful accounts. We account for taxes collected from customers and remitted to governmental authorities on a net basis and exclude them from revenues. |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. We maintain cash and cash equivalent balances which exceed the insured limits by the Federal Deposit Insurance Corporation. |
Investments | Investments We classify our investment securities as available-for-sale. Our investment securities are stated at fair value and reported in short-term investments and long-term investments. Investments in securities with maturities of less than one year, or where management's intent is to use the investments to fund current operations, are classified as short-term investments. Investments with maturities greater than one year are classified as long-term investments. Unrealized gains and losses on available-for-sale securities are excluded from net income and reported, net of tax, in other comprehensive income (loss). Realized gains and losses and declines in the value of securities judged to be other-than-temporary are determined based on the specific identification method and are included in other income, net. In order to determine whether a decline in value is other-than-temporary, we evaluate, among other factors, our intent and ability to recover the amortized cost basis of the security. Interest on securities classified as available-for-sale is included in other income, net. |
Accounts Receivable | Accounts Receivable, Net Accounts receivable consist of amounts billed and currently due from customers. Our accounts receivable are subject to collection risk. Our gross accounts receivable is reduced for this risk by a provision for doubtful accounts. This provision is for estimated losses resulting from the inability of our customers to make required payments. It is an estimate and is regularly evaluated for adequacy by taking into consideration a combination of factors. We look at factors such as past collection experience, credit quality of the customer, age of the receivable balance and current economic conditions. These factors are reviewed to determine whether a provision for doubtful accounts should be recorded to reduce the receivable balance to the amount believed to be collectible. |
Property and Equipment | Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. The estimated useful lives range from approximately one to twelve years. Leasehold improvements are amortized over the shorter of the estimated useful life or the remaining lease term. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in results of operations. Maintenance and repairs that do not improve or extend the lives of the respective assets are charged to expense in the period incurred. |
Leases and Asset Retirement Obligations | Leases and Asset Retirement Obligations Leases are categorized at their inception as either operating or capital leases. Within some lease agreements, rent holidays and other incentives are included. Rent expense is recognized on a straight-line method, over the term of the agreement generally beginning once control of the space is achieved, without regard to deferred payment terms, such as rent holidays that defer the commencement date of required rent payments. Additionally, incentives received are treated as a reduction of expense over the term of the agreement. Liabilities are established for the present value of estimated future costs to retire leasehold improvements at the termination or expiration of a lease. A corresponding asset is recorded in the period in which the obligation is incurred. Such assets are amortized over the estimated useful life of the asset, and the recorded liabilities are accreted to the future value of the estimated retirement costs. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We evaluate the recoverability of long-lived assets in accordance with authoritative guidance on accounting for the impairment or disposal of long-lived assets. We evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. Such impairment is recognized in the event the carrying value of such assets exceeds their fair value. If the carrying value of the net assets assigned exceeds the fair value of the assets, then the second step of the impairment test is performed in order to determine the implied fair value. No impairment of long-lived assets occurred in the periods presented. |
Software Development Costs | Software Development Costs Software development costs associated with the development of new products, enhancements of existing products and quality assurance activities consists of employee, consulting and other external personnel costs. The costs incurred internally from the research and development ("R&D") of computer software products are charged to expense until technological feasibility has been established for the product. Once technological feasibility is established, all software costs are capitalized until the product is available for release to customers. Judgment is required in determining when technological feasibility of a product is established. To date, we have determined that technological feasibility of software products is reached shortly before the products are released. Costs incurred after establishment of technological feasibility have not been material, and therefore, we have expensed all R&D costs as they were incurred. R&D expenses primarily consist of personnel-related costs attributable to our R&D personnel and allocated overhead, which includes facilities-related costs. We capitalize certain costs relating to software developed or modified solely to meet our internal requirements and for which there are no substantive plans to market the software. To date, we have not capitalized any such costs as these costs have not been material. |
Intangible Asset Costs | Intangible Asset Costs Costs related to filing and pursuing patent and trademark applications are expensed as incurred, as recoverability of such expenditures is uncertain. These intangible asset-related legal costs are generally reported as a component of general and administrative expenses. |
Advertising Expenses | Advertising Expenses We expense all advertising costs as incurred and classify such costs as sales and marketing expenses. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method in accordance with authoritative guidance for income taxes. Deferred income tax assets are recognized for deductible temporary differences, net operating loss carryforwards, and tax credit carryforwards if it is more likely than not that the tax benefits will be realized. We consider future taxable income, historical operating results and ongoing prudent and feasible tax planning strategies in assessing the need for a valuation allowance. A valuation allowance is recorded to reduce our deferred income tax assets to the net amount that we believe is more likely than not to be realized. In the event we determine that we are able to realize our deferred income tax assets in excess of our net recorded amount, we would reduce the valuation allowance associated with the deferred income tax assets in the period the determination is made, which may result in a tax benefit in the statement of operations. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Our assumptions, judgments and estimates relative to the value of net deferred income taxes take into account predictions of the amount and category of future taxable income, such as income from operations or capital gains income. Actual operating results and the underlying amount and category of income in future years could render our current assumptions, judgments and estimates of recoverable net deferred income taxes inaccurate. Any of the assumptions, judgments and estimates mentioned above could cause our actual income tax obligations to differ from our estimates, thus materially impacting our financial position and results of operations. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, investments and accounts receivable. Our investment portfolio consists of investment-grade securities diversified among security types, industries and issuers. Our cash and cash equivalents and investments are held and managed by recognized financial institutions that follow our investment policy. Our policy limits the amount of credit exposure to any one security issue or issuer. We extend credit to customers based upon an evaluation of the customer's financial condition. |
Business Combinations | Business Combinations As of the date of an acquisition, we recognize the identifiable assets acquired and liabilities assumed at fair value. Any excess of the consideration over the fair value of identifiable net assets is recorded as goodwill. Amounts that are not part of the consideration transferred are recognized separately from a business combination and are expensed as incurred. Intangible assets acquired are measured at their acquisition date fair value using valuation techniques that are subject to judgment. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Intangible assets with a finite life are typically amortized over their useful lives which range from three to five years. Goodwill is tested for impairment on an annual basis in the third quarter and more frequently if circumstances indicate that the carrying value may not be recoverable. As part of our goodwill impairment test, we first perform a qualitative assessment to determine whether it is more likely than not that the fair value of our reporting unit is less than its carrying amount. For purposes of this assessment, we consider the enterprise to be the reporting unit. If we determine it is more likely than not that the fair value of our reporting unit is less than its carrying amount, we will perform a quantitative assessment to determine whether the fair value of our reporting unit is less than its carrying amount. We have not had any impairments of the goodwill balance. |
Stock-Based Compensation | Stock-Based Compensation We record compensation expense for stock-based transactions including employee and non-employee stock option and restricted stock unit ("RSU") awards granted under our 2004 Equity Incentive Plan (the "2004 Plan") and our 2013 Equity Incentive Plan, as amended, (the "2013 Plan" and together with the 2004 Plan, the "Plans"). We also record compensation expense related to employee contributions made under our 2013 Employee Stock Purchase Plan ("2013 ESPP"). These contributions are used to purchase shares of our Class A common stock at a discount. Stock-based compensation expense is measured and recognized in the financial statements based on fair value. The fair value of each RSU award is determined based on the closing price of our Class A common stock as reported on the New York Stock Exchange on the date of grant. The fair value of each stock option award is determined at the date of grant by applying the Black-Scholes option pricing model. We also use the Black-Scholes option pricing model to determine the fair value of each common share issued under the 2013 ESPP. The fair value for 2013 ESPP grants is determined on the first day of each offering period. The Black-Scholes option pricing model utilizes the value of our underlying common stock at the measurement date, the expected or contractual term of the option or offering period, the expected volatility of our common stock, risk-free interest rates and expected dividend yield of our common stock. Prior to our IPO in May 2013, because our stock was not publicly traded we estimated the fair value of our common stock. Our board of directors considered numerous objective and subjective factors to determine the fair value of our common stock at each meeting at which awards were approved. The factors included, but were not limited to: (i) contemporaneous third-party valuations of our common stock; (ii) the prices, rights, preferences and privileges of our preferred stock that was then outstanding relative to those of our common stock; (iii) the lack of marketability of our common stock; (iv) our actual operating and financial results; (v) current business conditions and projections; and (vi) the likelihood of achieving a liquidity event, such as an IPO or merger or acquisition, given prevailing market conditions. After the completion of our IPO, our common stock has been valued by reference to the closing price of our Class A common stock as reported on the New York Stock Exchange. We recognize stock-based compensation expense using the straight-line method over the requisite service period. We account for forfeitures as they occur. For awards subject to technology milestones, we recognize compensation cost over the required service period if it is probable that the technology milestone will be met. If our assessment of the probability of the technology milestone being met changes, we recognize the impact of the change in estimate in the period of the change. Excess tax benefits resulting from the settlement of stock awards are recorded to income tax expense. |
Fair Value Measurements | Fair Value Measurements We categorize assets and liabilities recorded at fair value on our consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The levels of the fair value hierarchy are as follows: • Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3—Inputs are unobservable inputs based on our own assumptions and valuation techniques used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. We establish fair value of our assets and liabilities using the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and using a fair value hierarchy based on the inputs used to measure fair value. The carrying amounts reported in the consolidated financial statements approximate the fair value for cash equivalents, accounts receivable, accounts payable, and accrued and other current liabilities, due to their short-term nature. We value our investments using quoted prices for identical instruments in active markets when available. If we are unable to obtain quoted prices for identical instruments in active markets, we value our investments using quoted market prices for comparable instruments. To date, all of our investments can be valued using one of these two methodologies. |
New Accounting Pronouncements | Recently Adopted Accounting Pronouncements In March 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-09 related to stock-based compensation. The guidance, which simplifies the accounting and presentation for share-based payments, provides for a number of amendments that impact the accounting for income taxes and the accounting for forfeitures. We adopted this standard in the first quarter of 2017. Upon adoption, we recognized all of the previously unrecognized excess tax benefits related to stock awards using the modified retrospective transition method . These excess tax benefits, recognized upon adoption, were recorded as a deferred tax asset, which was then fully offset by our U.S. federal and state deferred tax asset valuation allowance resulting in no impact to our accumulated deficit. Without the valuation allowance, our deferred tax asset would have increased by $180.9 million . Immediately prior to adoption, we had no unrecognized excess tax benefits related to stock awards in jurisdictions outside the United States. All future excess tax benefits resulting from the settlement of stock awards will be recorded to income tax expense. Prior to the adoption of ASU 2016-09, excess tax benefits related to stock awards were required to be presented as an inflow from financing activities and an outflow from operating activities on the statement of cash flows. Under the new standard, all tax-related cash flows resulting from share-based payments are reported as operating activities. We adopted the new requirement retrospectively, and for the years ended December 31, 2016 and December 31, 2015 , this resulted in an increase to net cash provided by operating activities of $2.2 million and $5.6 million , and a corresponding decrease to net cash provided by (used in) financing activities of $2.2 million and $5.6 million , respectively. Also, as part of the adoption of the standard, we made the policy election to account for forfeitures as they occur. Using the modified retrospective adoption method, we recognized a $0.4 million cumulative-effect increase to our accumulated deficit for previously estimated forfeitures. In January 2017, the FASB issued ASU 2017-04, simplifying the accounting for goodwill impairment. The new guidance removes step two of the two-step quantitative goodwill impairment test, which requires a hypothetical purchase price allocation. We adopted this standard in the third quarter of 2017 as part of our annual goodwill impairment testing. The adoption of this standard did not impact these consolidated financial statements. Recent Accounting Pronouncements Not yet Adopted In May 2014, the FASB issued ASU 2014-09 related to revenue recognition. Since the issuance of ASU 2014-09, the FASB has also issued ASU 2016-08, ASU 2016-10, ASU 2016-12, ASU 2016-20 and ASU 2017-14, all of which clarify certain aspects of ASU 2014-09. The new standard will change the way we recognize revenue, including the identification of contractual performance obligations and the allocation of transaction price, to depict the transfer of promised goods or services to customers at the amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. We will adopt this standard effective January 1, 2018 on a modified retrospective basis and apply the new standard only to contracts that are not completed contracts at January 1, 2018. The new standard will materially impact the timing of revenue recognition related to our on-premises term license agreements. We have historically recognized revenue related to on-premises term license agreements ratably over the term of the licensing agreement. Under the new standard, revenue allocable to the license portion of the arrangement will be recognized upon delivery of the license. Maintenance revenue related to on-premises term license agreements will continue to be recognized ratably over the term of the licensing agreement. The new standard will also impact our determination of standalone selling prices, which will impact the allocation of transaction price to each performance obligation, thereby impacting the timing of revenue recognition depending on when each performance obligation is recognized. The impacts to the timing of revenue recognition will also affect our deferred revenue balance. As of December 31, 2017, we had $142 million of on-premises deferred license revenue on our balance sheet. Upon adoption, a portion of this amount will be recorded to retained earnings for the impacts from the allocation of standalone selling prices under the new standard. The new standard also requires the capitalization of certain incremental costs of obtaining a contract, which will impact the period in which we record our sales commissions expense. We have historically recognized sales commissions expense upfront. Under the new guidance, we are required to recognize these expenses consistently with the transfer of goods or services. This will result in a deferral of some sales compensation costs. We will amortize these deferred costs on a straight-line basis over four years. The new standard will also impact our internal control environment, including our financial statement disclosure controls, our business process controls and enhancements necessary to update our business systems. We are currently finalizing the implementation controls necessary to adopt this new standard. In February 2016, the FASB issued ASU 2016-02 related to lease accounting. The new guidance will require lessees to recognize right-of-use assets and lease liabilities on the balance sheet for operating leases that do not meet the definition of a short-term lease. ASU 2016-02 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2018 and requires modified retrospective transition. Under the new standard we anticipate that our current real estate leases will continue to be classified as operating leases and a significant amount of our currently outstanding operating lease commitments will be recorded to the balance sheet as a right-of-use asset and a corresponding lease liability. Our evaluation of the new standard will extend into future periods and we will update our disclosures, including the expected impacts of the new standard, as we progress towards the required adoption date. In June 2016, the FASB issued ASU 2016-13, related to credit losses. The new guidance replaces the existing incurred loss impairment model with an expected credit loss model and requires a financial asset measured at amortized cost to be presented at the net amount expected to be collected. ASU 2016-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted. We are currently evaluating the impact that this standard will have on our consolidated financial statements. In October 2016, the FASB issued ASU 2016-16 related to the accounting for income tax effects on intra-entity asset transfers of assets other than inventory. The new guidance will require reporting entities to recognize tax expense from the sale of assets when the transfer occurs, even though the pre-tax effects of the transaction are eliminated in consolidation. We will adopt the new standard, in the first quarter of 2018, on a modified retrospective basis. We are currently evaluating the impact that this standard will have on our consolidated financial statements. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Activity Related to Provision for Doubtful Accounts | Activity related to our provision for doubtful accounts was as follows: Year Ended December 31, 2017 2016 2015 (in thousands) Balance at the beginning of the year $ 1,065 $ 888 $ 1,111 Bad debt expense 650 750 250 Accounts written off (712 ) (573 ) (473 ) Balance at the end of the year $ 1,003 $ 1,065 $ 888 |
Balance Sheet Detail (Tables)
Balance Sheet Detail (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Property and Equipment, Net | Property and equipment, net consisted of the following: Useful Life December 31, (in months) 2017 2016 (in thousands) Computer equipment and software 36 $ 98,737 $ 92,536 Furniture and fixtures 36 25,232 18,953 Leasehold improvements 10-150 85,482 37,308 Construction in progress 313 35,099 209,764 183,896 Less: Accumulated depreciation and amortization (103,011 ) (77,259 ) $ 106,753 $ 106,637 |
Accrued Compensation and Employee Related Benefits | Accrued compensation and employee-related benefits consisted of the following: December 31, 2017 2016 (in thousands) Accrued commissions $ 31,333 $ 24,801 Accrued bonuses 25,435 19,080 Accrued vacation 14,512 13,003 Other 25,110 13,346 Total $ 96,390 $ 70,230 |
Short-Term and Long-Term Inve27
Short-Term and Long-Term Investments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Schedule of Available-for-sale Securities | |
Short-term and Long-term Investments | The following table represents our short-term and long-term investments in available-for-sale securities as of December 31, 2017 , and is based on contractual years to maturity: Amortized Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Short-term investments Commercial paper $ 9,970 $ — $ — $ 9,970 U.S. treasury securities 160,206 — (121 ) 160,085 U.S. agency securities 9,917 — (24 ) 9,893 Corporate bonds 46,901 3 (65 ) 46,839 Total short-term investments 226,994 3 (210 ) 226,787 Long-term investments U.S. treasury securities 79,371 — (202 ) 79,169 U.S. agency securities 18,570 — (102 ) 18,468 Corporate bonds 50,880 — (153 ) 50,727 Total long-term investments 148,821 — (457 ) 148,364 Total short-term and long-term investments $ 375,815 $ 3 $ (667 ) $ 375,151 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets | The following table presents the fair value of our financial assets using the fair value hierarchy: December 31, 2017 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents Money market funds $ 582,835 $ — $ — $ 582,835 Commercial paper — 8,984 — 8,984 Short-term investments Commercial paper — 9,970 — 9,970 U.S. treasury securities — 160,085 — 160,085 U.S. agency securities — 9,893 — 9,893 Corporate bonds — 46,839 — 46,839 Long-term investments U.S. treasury securities — 79,169 — 79,169 U.S. agency securities — 18,468 18,468 Corporate bonds — 50,727 — 50,727 Total $ 582,835 $ 384,135 $ — $ 966,970 December 31, 2016 Level 1 Level 2 Level 3 Total (in thousands) Cash equivalents Money market funds $ 872,161 $ — $ — $ 872,161 Total $ 872,161 $ — $ — $ 872,161 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | he components of our loss before income tax expense consisted of the following: Year Ended December 31, 2017 2016 2015 (in thousands) United States $ (134,723 ) $ (100,725 ) $ (27,779 ) International (43,976 ) (36,702 ) (23,028 ) Total $ (178,699 ) $ (137,427 ) $ (50,807 ) |
Schedule Of Income Tax Expense Benefit By Geographic Area Table | Income tax expense (benefit) consisted of the fol |
Schedule of Components of Income Tax Expense (Benefit) | The provision (benefit) for income taxes consisted of the following: Year Ended December 31, 2017 2016 2015 (in thousands) Current: Federal $ — $ 1,447 $ 4,009 State 233 402 771 Foreign 10,704 5,230 5,240 Total current income tax expense 10,937 7,079 10,020 Deferred: Federal (892 ) 258 22,011 State 67 40 1,839 Foreign (3,251 ) (355 ) (977 ) Total deferred income tax expense (benefit) (4,076 ) (57 ) 22,873 Total income tax expense $ 6,861 $ 7,022 $ 32,893 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the U.S. federal statutory income tax provision (benefit) to the effective income tax expense for each year follows: Year Ended December 31, 2017 2016 2015 (in thousands) Income tax benefit at statutory rate $ (62,545 ) $ (48,098 ) $ (17,783 ) State taxes, net of federal tax benefit (4,714 ) (3,466 ) (896 ) Impact of foreign income taxes 23,232 14,566 10,582 Impact of Tax Cuts and Jobs Act of 2017 87,584 — — Research and development and other tax credits (12,563 ) (8,462 ) (10,187 ) Stock-based compensation (13,466 ) 5,098 3,174 Non-deductible meals and entertainment expenses 1,182 1,212 1,395 Impact of valuation allowance (13,598 ) 46,174 46,737 Other, net 1,749 (2 ) (129 ) Total income tax expense $ 6,861 $ 7,022 $ 32,893 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences and carryforwards that gave rise to deferred income tax assets and liabilities consisted of the following: December 31, 2017 2016 (in thousands) Deferred income tax assets: Net operating loss carryforwards $ 133,187 $ — Tax credit carryforwards 59,343 17,904 Stock-based compensation 15,512 18,589 Accrued compensation 11,487 14,268 Deferred revenue 5,334 3,728 Deferred rent 12,483 9,037 Depreciation and amortization (1) 966 4,839 Other (1) 1,149 699 Total deferred income tax assets 239,461 69,064 Deferred income tax liabilities: Prepaid assets 4,177 4,231 Total deferred income tax liabilities 4,177 4,231 Net deferred income tax assets before valuation allowance 235,284 64,833 Less: valuation allowance (230,545 ) (63,384 ) Net deferred income tax assets $ 4,739 $ 1,449 Reported as: Deferred income taxes 5,287 1,449 Other long-term liabilities (548 ) — Net deferred income tax assets $ 4,739 $ 1,449 |
Schedule of Unrecognized Tax Benefits Roll Forward | The following table shows the gross changes in our unrecognized tax position. Year Ended December 31, 2017 2016 2015 (in thousands) Balance, beginning of year $ 12,909 $ 10,781 $ 7,116 Gross increases to tax positions related to prior periods 1,289 28 545 Gross increases related to current tax positions 5,683 2,100 3,120 Balance, end of year $ 19,881 $ 12,909 $ 10,781 |
Business Combinations Business
Business Combinations Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Purchase Price Allocation | August 1, 2017 (in thousands) Cash $ 161 Technology asset 5,000 Goodwill 19,552 Other liabilities, net (586 ) Net assets acquired $ 24,127 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Option Activity | A summary of the option activity during the year ended December 31, 2017 follows: Options Outstanding Shares Weighted Average Exercise Price per Share Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (in years) (in thousands) Balances at December 31, 2016 4,486,416 $ 9.59 Options exercised (1,467,464 ) 8.46 Options canceled (78 ) 9.30 Options forfeited (1,761 ) 26.38 Balances at December 31, 2017 3,017,113 $ 10.13 4.33 $ 178,207 Vested and expected to vest at December 31, 2017 3,017,113 $ 10.13 4.33 $ 178,207 Exercisable at December 31, 2017 2,965,550 $ 9.36 4.25 $ 177,468 |
Summary of RSU Activity | summary of the RSU activity during the year ended December 31, 2017 follows: Number of Shares Underlying Outstanding RSUs Weighted-Average Grant-Date Fair Value per RSU Non-Vested outstanding at December 31, 2016 7,141,294 $ 65.62 RSUs granted 4,183,285 60.62 RSUs vested (2,936,710 ) 66.03 RSUs forfeited (1,209,854 ) 65.12 Non-Vested outstanding at December 31, 2017 7,178,015 $ 62.79 |
Schedule Of Equity Based Awards Available | The summary of shares available for issuance for equity-based awards (including stock options and RSUs) during the year ended December 31, 2017 follows: Shares Available for Grant 2013 Plan 2013 ESPP Balances at December 31, 2016 6,342,962 3,503,385 Authorized 3,835,921 767,184 Granted (4,183,285 ) (604,177 ) Canceled 78 — Forfeited 1,211,615 — Balances at December 31, 2017 7,207,291 3,666,392 |
Fair Value Assumptions - Options | For the year ended December 31, 2016, the fair value of options was estimated using the Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2016 Risk-free interest rates 1.2% Expected term 5.2 years Expected dividends None Expected volatility 48.0% |
Fair Value Assumptions - ESPP | For the years ended December 31, 2017 , 2016 and 2015 , the fair value of common share purchase rights under the 2013 ESPP was estimated using the Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2017 2016 2015 Risk-free interest rates 1.1% - 1.5% 0.5% - 0.6% 0.4% Expected term 0.5 years 0.5 years 0.5 years Expected dividends None None None Expected volatility 28.6% - 30.5% 42.0% - 50.1% 48.0% |
Commitments and Contigencies (T
Commitments and Contigencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual Commitments | The following table represents our contractual commitments as of December 31, 2017 : Payments Due by Year Total 2018 2019 2020 Thereafter (in thousands) Contractual commitments $ 27,458 $ 12,665 $ 11,975 $ 2,818 $ — |
Future Minimum Lease Payments | Future minimum lease payments under non-cancellable operating leases, net of future expected sublease payments to be received under non-cancellable subleases, as of December 31, 2017 are as follows: Year Ending December 31, Operating Lease Commitments Expected Sublease Receipts Net (in thousands) 2018 $ 43,529 $ (8,563 ) $ 34,966 2019 42,979 (10,606 ) 32,373 2020 43,849 (7,113 ) 36,736 2021 43,308 (1,180 ) 42,128 2022 42,991 (597 ) 42,394 Thereafter 175,175 (121 ) 175,054 Total $ 391,831 $ (28,180 ) $ 363,651 |
Segments and Information abou33
Segments and Information about Revenues by Geographic Region (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated | The following table presents our revenues by geographic region of end users who purchased products or services for the periods presented below: Year Ended December 31, 2017 2016 2015 (in thousands) United States and Canada $ 605,773 $ 586,494 $ 489,329 International 271,286 240,449 164,258 Total revenues $ 877,059 $ 826,943 $ 653,587 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Earnings Per Share, Basic and Diluted | The following table presents the computation of basic and diluted net loss per share: Year Ended December 31, 2017 2016 2015 (in thousands, except per share data) Net loss per share - basic and diluted Net loss $ (185,560 ) $ (144,449 ) $ (83,700 ) Weighted average shares outstanding used to compute basic and diluted net loss per share 78,869 75,162 71,701 Net loss per share - basic and diluted $ (2.35 ) $ (1.92 ) $ (1.17 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following shares subject to outstanding awards were excluded from the computation of diluted net loss per share for the periods presented as their effect would have been antidilutive: Year Ended December 31, 2017 2016 2015 (in thousands) Shares subject to outstanding common stock awards 10,488 12,017 11,510 |
Quarterly Financial Informati35
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | Three Months Ended Dec 31, 2017 Sept 30, 2017 June 30, 2017 March 31, 2017 Dec 31, 2016 Sept 30, 2016 June 30, 2016 March 31, 2016 (in thousands, except per share amounts) Total revenues $ 249,356 $ 214,917 $ 212,880 $ 199,906 $ 250,653 $ 206,057 $ 198,535 $ 171,698 Gross profit 219,046 184,988 186,215 173,251 222,950 182,027 173,671 149,205 Net loss (41,838 ) (46,553 ) (42,522 ) (54,647 ) (21,088 ) (30,261 ) (47,522 ) (45,578 ) Net loss per share: Basic and diluted $ (0.52 ) $ (0.59 ) $ (0.54 ) $ (0.71 ) $ (0.28 ) $ (0.40 ) $ (0.64 ) $ (0.62 ) |
Description of Business Narrati
Description of Business Narrative (Details) | Dec. 31, 2017product |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of products | 4 |
Summary of Significant Accoun37
Summary of Significant Accounting Policies (Details) | 12 Months Ended | |||
Dec. 31, 2017USD ($)segment | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 01, 2017USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Deferred Tax Assets | $ 239,461,000 | $ 69,064,000 | ||
Net Cash Provided by Operating Activities | 226,867,000 | 177,262,000 | $ 142,403,000 | |
Net Cash Provided by (Used in) Financing Activities | $ (41,135,000) | 14,347,000 | 20,117,000 | |
Amortization period, deferred sales compensation costs | 4 years | |||
Class of Stock [Line Items] | ||||
Cumulative translation gain (loss) | $ (11,300,000) | 1,600,000 | ||
Foreign currency transaction gain (loss) | $ 4,100,000 | (600,000) | 600,000 | |
Number of operating segments | segment | 1 | |||
Terms of payment due | 30 days | |||
VSOE Sales % variance compared to median sales price of standalone transactions | 15.00% | |||
VSOE sales period of evaluation | 12 months | |||
Impairment of long-lived assets | $ 0 | 0 | 0 | |
Advertising expenses | $ 28,200,000 | 21,700,000 | 11,300,000 | |
Accounting Standards Update 2016-09 [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Net Cash Provided by Operating Activities | 2,200,000 | 5,600,000 | ||
Net Cash Provided by (Used in) Financing Activities | $ (2,200,000) | $ (5,600,000) | ||
Scenario, Adjustment [Member] | Accounting Standards Update 2016-09 - Without Valuation [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Deferred Tax Assets | $ 180,900,000 | |||
Retained Earnings (Accumulated Deficit) | Accounting Standards Update 2016-09 [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 400,000 | |||
Minimum | ||||
Class of Stock [Line Items] | ||||
Useful life of property and equipment (in years) | 1 year | |||
Finite-Lived Intangible Asset, Useful Life | 3 years | |||
Maximum | ||||
Class of Stock [Line Items] | ||||
Useful life of property and equipment (in years) | 12 years | |||
Finite-Lived Intangible Asset, Useful Life | 5 years | |||
On-Premises Software License Arrangement [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
On-premises deferred license revenue | $ 142,000,000 |
Summary of Significant Accoun38
Summary of Significant Accounting Policies Activity Related to Allowance for Doubtful Accounts (Details) - Allowance for doubtful accounts - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at the beginning of the year | $ 1,065 | $ 888 | $ 1,111 |
Bad debt expense | 650 | 750 | 250 |
Accounts written off | (712) | (573) | (473) |
Balance at the end of the year | $ 1,003 | $ 1,065 | $ 888 |
Balance Sheet Detail - Property
Balance Sheet Detail - Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 209,764 | $ 183,896 |
Less: Accumulated depreciation and amortization | (103,011) | (77,259) |
Property and equipment, net | $ 106,753 | 106,637 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life (in months) | 1 year | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life (in months) | 12 years | |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Useful life (in months) | 36 months | |
Property and equipment, Gross | $ 98,737 | 92,536 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Useful life (in months) | 36 months | |
Property and equipment, Gross | $ 25,232 | 18,953 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 85,482 | 37,308 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life (in months) | 10 months | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life (in months) | 150 months | |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 313 | $ 35,099 |
Balance Sheet Detail - Addition
Balance Sheet Detail - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Depreciation and amortization expense | $ 44,746 | $ 43,006 | $ 23,667 |
Goodwill, Period Increase (Decrease) | $ 19,600 | $ 14,600 |
Balance Sheet Detail - Accrued
Balance Sheet Detail - Accrued Compensation and Other Employee Related Benefits (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued commissions | $ 31,333 | $ 24,801 |
Accrued bonuses | 25,435 | 19,080 |
Accrued vacation | 14,512 | 13,003 |
Other | 25,110 | 13,346 |
Total | $ 96,390 | $ 70,230 |
Short-Term and Long-Term Inve42
Short-Term and Long-Term Investments (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Schedule of Available-for-sale Securities | |
Amortized Cost | $ 375,815 |
Unrealized Gains | 3 |
Unrealized Losses | (667) |
Fair Value | 375,151 |
Short-term Investments | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 226,994 |
Unrealized Gains | 3 |
Unrealized Losses | (210) |
Fair Value | 226,787 |
Short-term Investments | Commercial Paper, Not Included with Cash and Cash Equivalents | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 9,970 |
Unrealized Gains | 0 |
Unrealized Losses | 0 |
Fair Value | 9,970 |
Short-term Investments | U.S. Treasury Securities | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 160,206 |
Unrealized Gains | 0 |
Unrealized Losses | (121) |
Fair Value | 160,085 |
Short-term Investments | U.S. Agency Securities | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 9,917 |
Unrealized Gains | 0 |
Unrealized Losses | (24) |
Fair Value | 9,893 |
Short-term Investments | Corporate bonds | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 46,901 |
Unrealized Gains | 3 |
Unrealized Losses | (65) |
Fair Value | 46,839 |
Long-term Investments | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 148,821 |
Unrealized Gains | 0 |
Unrealized Losses | (457) |
Fair Value | 148,364 |
Long-term Investments | U.S. Treasury Securities | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 79,371 |
Unrealized Gains | 0 |
Unrealized Losses | (202) |
Fair Value | 79,169 |
Long-term Investments | U.S. Agency Securities | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 18,570 |
Unrealized Gains | 0 |
Unrealized Losses | (102) |
Fair Value | 18,468 |
Long-term Investments | Corporate bonds | |
Schedule of Available-for-sale Securities | |
Amortized Cost | 50,880 |
Unrealized Gains | 0 |
Unrealized Losses | (153) |
Fair Value | $ 50,727 |
Short-Term and Long-Term Inve43
Short-Term and Long-Term Investments Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Income and Expenses [Abstract] | |||
Interest Income | $ 8.5 | $ 2.7 | $ 0.6 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | $ 966,970 | $ 872,161 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 582,835 | 872,161 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 384,135 | |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 0 | |
Cash and cash equivalents | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 582,835 | 872,161 |
Cash and cash equivalents | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 582,835 | $ 872,161 |
Commercial Paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 8,984 | |
Commercial Paper [Member] | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 8,984 | |
Commercial Paper, Not Included with Cash and Cash Equivalents | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 9,970 | |
Commercial Paper, Not Included with Cash and Cash Equivalents | Short-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 9,970 | |
U.S. Treasury Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 160,085 | |
U.S. Treasury Securities | Short-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 160,085 | |
U.S. Treasury Securities | Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 79,169 | |
U.S. Treasury Securities | Long-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 79,169 | |
U.S. Agency Securities | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 9,893 | |
U.S. Agency Securities | Short-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 9,893 | |
U.S. Agency Securities | Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 18,468 | |
U.S. Agency Securities | Long-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 18,468 | |
Corporate bonds | Short-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 46,839 | |
Corporate bonds | Short-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 46,839 | |
Corporate bonds | Long-term Investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | 50,727 | |
Corporate bonds | Long-term Investments | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments fair value | $ 50,727 |
Income Taxes - Income Before Pr
Income Taxes - Income Before Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (134,723) | $ (100,725) | $ (27,779) |
International | (43,976) | (36,702) | (23,028) |
Loss before income tax expense | $ (178,699) | $ (137,427) | $ (50,807) |
Income Taxes - Income Taxes Exp
Income Taxes - Income Taxes Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Expense Benefit [Line Items] | |||
Provision (benefit) for income taxes | $ 6,861 | $ 7,022 | $ 32,893 |
United States | |||
Income Tax Expense Benefit [Line Items] | |||
Provision (benefit) for income taxes | (592) | 2,147 | 28,630 |
International | |||
Income Tax Expense Benefit [Line Items] | |||
Provision (benefit) for income taxes | $ 7,453 | $ 4,875 | $ 4,263 |
Income Taxes - Provision for Cu
Income Taxes - Provision for Current and Deferred Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current | |||
Federal | $ 0 | $ 1,447 | $ 4,009 |
State | 233 | 402 | 771 |
Foreign | 10,704 | 5,230 | 5,240 |
Total current income tax expense | 10,937 | 7,079 | 10,020 |
Deferred | |||
Federal | (892) | 258 | 22,011 |
State | 67 | 40 | 1,839 |
Foreign | (3,251) | (355) | (977) |
Total deferred income tax expense (benefit) | (4,076) | (57) | 22,873 |
Total income tax expense | $ 6,861 | $ 7,022 | $ 32,893 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes Differs from U.S. Federal Statutory Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Income tax provision (benefit) at statutory rate | $ (62,545) | $ (48,098) | $ (17,783) |
State taxes, net of federal tax benefit | (4,714) | (3,466) | (896) |
Impact of Tax Cuts and Jobs Act of 2017 | 87,584 | 0 | 0 |
Impact of foreign income taxes | 23,232 | 14,566 | 10,582 |
Research and development and other tax credits | (12,563) | (8,462) | (10,187) |
Stock-based compensation | (13,466) | 5,098 | 3,174 |
Non-deductible meals and entertainment | 1,182 | 1,212 | 1,395 |
Impact of valuation allowance | (13,598) | 46,174 | 46,737 |
Other, net | 1,749 | (2) | (129) |
Total income tax expense | $ 6,861 | $ 7,022 | $ 32,893 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred income tax assets | |||
Net operating loss carryforwards | $ 133,187 | $ 0 | |
Tax credit carryforwards | 59,343 | 17,904 | |
Stock-based compensation | 15,512 | 18,589 | |
Accrued compensation | 11,487 | 14,268 | |
Deferred revenue | 5,334 | 3,728 | |
Deferred rent | 12,483 | 9,037 | |
Depreciation and amortization | 966 | 4,839 | |
Other | 1,149 | 699 | |
Total deferred income tax assets | 239,461 | 69,064 | |
Deferred income tax liabilities | |||
Prepaid assets | 4,177 | 4,231 | |
Total deferred income tax liabilities | 4,177 | 4,231 | |
Net deferred income tax assets before valuation allowance | 235,284 | 64,833 | |
Less: Valuation allowance | (230,545) | (63,384) | $ (46,700) |
Net deferred income tax assets | 4,739 | 1,449 | |
Components of Deferred Tax Assets Reported As | |||
Deferred income taxes | 5,287 | 1,449 | |
Other long-term liabilities | (548) | 0 | |
Net deferred income tax assets | $ 4,739 | $ 1,449 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jan. 01, 2017 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||||
Additional Income Tax Expense, Impact of Tax Cuts and Jobs Act of 2017 | $ 87,600,000 | ||||
Decrease to Valuation Allowance, Impact of Tax Cuts and Jobs Act of 2017 | 88,100,000 | ||||
Net operating loss carryforwards | 895,900,000 | ||||
R&D tax credit carryforwards | 64,400,000 | ||||
Deferred Tax Assets, Tax Credit Carryforwards, Foreign | 12,400,000 | ||||
Cash held by foreign subsidiaries | 35,600,000 | ||||
Unrecognized tax benefits | 19,881,000 | $ 12,909,000 | $ 10,781,000 | $ 7,116,000 | |
Unrecognized tax benefits, liability | 1,400,000 | 700,000 | 700,000 | ||
Income tax penalties and interest expense | 0 | 0 | 0 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Valuation allowance | $ 230,545,000 | $ 63,384,000 | $ 46,700,000 | ||
Accounting Standards Update 2016-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Valuation allowance | $ 180,900,000 |
Income Taxes - Changes in Unrec
Income Taxes - Changes in Unrecognized Tax Position (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | |||
Balance, beginning of period | $ 12,909 | $ 10,781 | $ 7,116 |
Gross increases to tax positions related to prior periods | 1,289 | 28 | 545 |
Gross increases related to current tax positions | 5,683 | 2,100 | 3,120 |
Balance, end of period | $ 19,881 | $ 12,909 | $ 10,781 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Thousands | Aug. 01, 2017 | Mar. 01, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition | ||||
Technology asset amortization period | 5 years | |||
Goodwill | $ 35,083 | $ 15,531 | ||
ClearGraph | ||||
Business Acquisition | ||||
Cash | $ 161 | |||
Technology asset | 5,000 | |||
Goodwill | 19,552 | |||
Other Liabilities, net | (586) | |||
Payments to Acquire Businesses, Gross | $ 24,127 | |||
HyPer | ||||
Business Acquisition | ||||
Technology asset | $ 1,800 | |||
Payments to Acquire Businesses, Gross | $ 16,400 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | 12 Months Ended | ||
Dec. 31, 2017USD ($)votes$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Nov. 01, 2016USD ($) | |
Class of Stock [Line Items] | |||
Approved repurchase amount | $ | $ 200,000,000 | ||
Repurchase of common stock (in shares) | 1,264,428 | 446,517 | |
Average price (in USD per share) | $ / shares | $ 63.26 | $ 44.81 | |
Repurchase of common stock | $ | $ 79,991,000 | $ 20,009,000 | |
Remaining authorized repurchase amount | $ | $ 100,000,000 | ||
Common Class B | |||
Class of Stock [Line Items] | |||
Shares authorized for issuance | 75,000,000 | 75,000,000 | |
Common stock par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |
Votes per share entitled to share holder | votes | 10 | ||
Common Class A | |||
Class of Stock [Line Items] | |||
Shares authorized for issuance | 750,000,000 | 750,000,000 | |
Common stock par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |
Votes per share entitled to share holder | votes | 1 | ||
Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred stock authorized (in shares) | 10,000,000 | 10,000,000 | |
Preferred stock par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |
Preferred stock outstanding (in shares) | 0 | 0 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost | $ 399 | ||
Weighted-average remaining vesting period (in years) | 2 years 6 months 29 days | ||
Weighted-average fair value options granted (in USD per share) | $ 23.73 | ||
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award expiration period (in years) | 10 years | ||
Vesting period (in years) | 4 years | ||
Total intrinsic value of options exercised | $ 74.5 | $ 63.3 | $ 224.6 |
Fair value of options vested | $ 1.2 | $ 7.8 | $ 11.7 |
2004 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for grant (in shares) | 0 | ||
2004 Plan | Common Class B | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized (in shares) | 26,473,282 | ||
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Annual increase in shares authorized for grant (percent) | 1.00% | ||
Annual increase in shares authorized for grant (in shares) | 4,000,000 | ||
Shares issued (in shares) | 0 | ||
ESPP | Common Class A | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
ESPP maximum deduction (percent) | 15.00% | ||
ESPP purchase period (in months) | 6 months | ||
ESPP purchase price, percent of fair market value (percent) | 85.00% | ||
2013 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Annual increase in shares authorized for grant (percent) | 5.00% | ||
Shares available for grant (in shares) | 7,207,291 | 6,342,962 | |
Options granted (in shares) | 4,183,285 | ||
2013 Plan | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted (in shares) | 0 | ||
2013 Plan | Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average grant date fair value of RSUs granted (in USD per share) | $ 60.62 | $ 44.61 | $ 101.52 |
Fair value of RSUs vested in period | $ 185.7 | $ 92.5 | $ 89.1 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Option Activity Under Stock option Plan (Details) - Stock options $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($)$ / sharesshares | |
Options Outstanding | |
Beginning of balance (in shares) | shares | 4,486,416 |
Options exercised (in shares) | shares | (1,467,464) |
Options canceled (in shares) | shares | (78) |
Options forfeited (in shares) | shares | (1,761) |
Ending of balance (in shares) | shares | 3,017,113 |
Vested and expected to vest (in shares) | shares | 3,017,113 |
Exercisable (in shares) | shares | 2,965,550 |
Weighted Average Exercise Price Per Share | |
Beginning balance (in USD per share) | $ / shares | $ 9.59 |
Options exercised (in USD per share) | $ / shares | 8.46 |
Options canceled (in USD per share) | $ / shares | 9.30 |
Options forfeited (in USD per share) | $ / shares | 26.38 |
Ending balance (in USD per share) | $ / shares | 10.13 |
Vested and expected to vest (in USD per share) | $ / shares | 10.13 |
Exercisable (in USD per share) | $ / shares | $ 9.36 |
Weighted-Average Remaining Contractual Term | |
Ending balance (term) | 4 years 3 months 29 days |
Vested and expected to vest (term) | 4 years 3 months 29 days |
Exercisable (term) | 4 years 3 months |
Aggregate Intrinsic Value | |
Ending balance | $ | $ 178,207 |
Vested and expected to vest | $ | 178,207 |
Exercisable | $ | $ 177,468 |
Stock-Based Compensation - Su56
Stock-Based Compensation - Summary of RSU Activity (Details) - 2013 Plan - Restricted Stock Units (RSUs) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Shares Underlying Outstanding RSUs | |||
Beginning of period (in shares) | 7,141,294 | ||
RSUs granted (in shares) | 4,183,285 | ||
RSUs vested (in shares) | (2,936,710) | ||
RSUs forfeited (in shares) | (1,209,854) | ||
End of period (in shares) | 7,178,015 | 7,141,294 | |
Weighted-Average Grant-Date Fair Value per RSU | |||
Beginning of period (in USD per share) | $ 65.62 | ||
RSUs granted (in USD per share) | 60.62 | $ 44.61 | $ 101.52 |
RSUs vested (in USD per share) | 66.03 | ||
RSUs forfeited (in USD per share) | 65.12 | ||
End of period(in USD per share) | $ 62.79 | $ 65.62 |
Stock-Based Compensation - Equi
Stock-Based Compensation - Equity Based Awards (including Stock Options and RSUs (Details) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
2013 Plan | ||
Shares Available for Grant | ||
Beginning of period (in shares) | 6,342,962 | |
Authorized (in shares) | 3,835,921 | |
Options granted (in shares) | (4,183,285) | |
Canceled (in shares) | 78 | |
Options forfeited (in shares) | 1,211,615 | |
End of period (in shares) | 7,207,291 | 6,342,962 |
2013 ESPP | Common Class A | ||
Shares Available for Grant | ||
Beginning of period (in shares) | 3,503,385 | |
Authorized (in shares) | 767,184 | |
Options granted (in shares) | (604,177) | (549,327) |
Canceled (in shares) | 0 | |
Options forfeited (in shares) | 0 | |
End of period (in shares) | 3,666,392 | 3,503,385 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value of Options Estimated Using Black-Scholes Option Pricing Model (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rates (percent) | 0.40% | ||
Risk-free interest rates, minimum (percent) | 1.10% | 0.50% | |
Risk-free interest rates, maximum (percent) | 1.50% | 0.60% | |
Expected term (in years) | 6 months | 6 months | 6 months |
Expected dividends | $ 0 | $ 0 | $ 0 |
Expected volatility (percent) | 48.00% | ||
Expected volatility, minimum (percent) | 28.60% | 42.00% | |
Expected volatility, minimum (percent) | 30.50% | 50.10% | |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rates (percent) | 1.20% | ||
Expected term (in years) | 5 years 1 month 25 days | ||
Expected dividends | $ 0 | ||
Expected volatility (percent) | 48.00% |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Contractual Commitments | |||
Total | $ 27,458 | ||
2,018 | 12,665 | ||
2,019 | 11,975 | ||
2,020 | 2,818 | ||
Thereafter | 0 | ||
Operating Lease Commitments | |||
Operating Leases, 2018 | 43,529 | ||
Operating Leases, 2019 | 42,979 | ||
Operating Leases, 2020 | 43,849 | ||
Operating Leases, 2021 | 43,308 | ||
Operating Leases, 2022 | 42,991 | ||
Operating Leases, Thereafter | 175,175 | ||
Operating Leases, Total | 391,831 | ||
Expected Sublease Receipts | |||
Expected Sublease Receipts, 2018 | (8,563) | ||
Expected Sublease Receipts, 2019 | (10,606) | ||
Expected Sublease Receipts, 2020 | (7,113) | ||
Expected Sublease Receipts, 2021 | (1,180) | ||
Expected Sublease Receipts, 2022 | (597) | ||
Expected Sublease Receipts, Thereafter | (121) | ||
Expected Sublease Receipts, Total | (28,180) | ||
Net | |||
Net, 2018 | 34,966 | ||
Net, 2019 | 32,373 | ||
Net, 2020 | 36,736 | ||
Net, 2021 | 42,128 | ||
Net, 2022 | 42,394 | ||
Net, Thereafter | 175,054 | ||
Net, Total | 363,651 | ||
Operating Leases, Rent Expense, Net | 41,100 | $ 44,100 | $ 18,300 |
Lease Obligations and Related Exit Costs | 10,300 | 13,900 | |
Cease-Use Loss | 4,800 | $ 5,500 | |
Sublease Expenses | $ 1,300 |
Retirement Plan Additional Info
Retirement Plan Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Retirement Benefits [Abstract] | |||
Employer matching contributions | $ 3.7 | $ 3.6 | $ 2.8 |
Segments and Information abou61
Segments and Information about Revenues by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 249,356 | $ 214,917 | $ 212,880 | $ 199,906 | $ 250,653 | $ 206,057 | $ 198,535 | $ 171,698 | $ 877,059 | $ 826,943 | $ 653,587 |
United States and Canada | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 605,773 | 586,494 | 489,329 | ||||||||
International | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 271,286 | $ 240,449 | $ 164,258 |
Net Income (Loss) Per Share - C
Net Income (Loss) Per Share - Computation of Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||||||||||
Earnings Per Share, Basic and Diluted | $ (0.52) | $ (0.59) | $ (0.54) | $ (0.71) | $ (0.28) | $ (0.40) | $ (0.64) | $ (0.62) | $ (2.35) | $ (1.92) | $ (1.17) |
Earnings Per Share, Basic [Abstract] | |||||||||||
Net loss | $ (41,838) | $ (46,553) | $ (42,522) | $ (54,647) | $ (21,088) | $ (30,261) | $ (47,522) | $ (45,578) | $ (185,560) | $ (144,449) | $ (83,700) |
Basic (in shares) | 78,869 | 75,162 | 71,701 | ||||||||
Net income (loss) per share - diluted (in USD per share) | $ (2.35) | $ (1.92) | $ (1.17) |
Net Income (Loss) Per Share - S
Net Income (Loss) Per Share - Shares Excluded From Computation of Diluted Net Income per Share Attributable to Common Stockholders (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Common Stock (Class A and B) | |||
Dilutive Securities, Effect on Basic Earnings Per Share [Abstract] | |||
Shares subject to outstanding common stock awards | 10,488 | 12,017 | 11,510 |
Quarterly Financial Informati64
Quarterly Financial Information (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenues | $ 249,356 | $ 214,917 | $ 212,880 | $ 199,906 | $ 250,653 | $ 206,057 | $ 198,535 | $ 171,698 | $ 877,059 | $ 826,943 | $ 653,587 |
Gross profit | 219,046 | 184,988 | 186,215 | 173,251 | 222,950 | 182,027 | 173,671 | 149,205 | 763,500 | 727,853 | 579,902 |
Net loss | $ (41,838) | $ (46,553) | $ (42,522) | $ (54,647) | $ (21,088) | $ (30,261) | $ (47,522) | $ (45,578) | $ (185,560) | $ (144,449) | $ (83,700) |
Earnings Per Share, Basic and Diluted [Abstract] | |||||||||||
Basic and diluted (in USD per share) | $ (0.52) | $ (0.59) | $ (0.54) | $ (0.71) | $ (0.28) | $ (0.40) | $ (0.64) | $ (0.62) | $ (2.35) | $ (1.92) | $ (1.17) |