Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Jan. 31, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | CHEGG, INC | ||
Entity Central Index Key | 1,364,954 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 91,830,713 | ||
Entity Public Float | $ 402,351,715 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 77,329 | $ 67,029 |
Short-term investments | 0 | 17,800 |
Accounts receivable, net of allowance for doubtful accounts of $436 and $378 at December 31, 2016 and December 31, 2015, respectively | 9,206 | 13,157 |
Prepaid expenses | 2,579 | 3,117 |
Other current assets | 22,259 | 31,732 |
Total current assets | 111,373 | 132,835 |
Long-term investments | 0 | 4,229 |
Textbook library, net | 2,575 | 29,728 |
Property and equipment, net | 35,305 | 19,971 |
Goodwill | 116,239 | 91,301 |
Intangible assets, net | 20,748 | 8,865 |
Other assets | 4,412 | 4,427 |
Total assets | 290,652 | 291,356 |
Current liabilities | ||
Accounts payable | 5,175 | 5,860 |
Deferred revenue | 14,836 | 14,971 |
Accrued liabilities | 44,319 | 35,280 |
Total current liabilities | 64,330 | 56,111 |
Long-term liabilities | ||
Total other long-term liabilities | 4,383 | 4,170 |
Total liabilities | 68,713 | 60,281 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value – 10,000,000 shares authorized, no shares issued and outstanding at December 31, 2016 and December 31, 2015 | 0 | 0 |
Common stock, $0.001 par value – 400,000,000 shares authorized; 91,708,839 and 88,099,983 shares issued and outstanding at December 31, 2016 and December 31, 2015, respectively | 92 | 88 |
Additional paid-in capital | 593,351 | 560,242 |
Accumulated other comprehensive loss | (176) | (172) |
Accumulated deficit | (371,328) | (329,083) |
Total stockholders' equity | 221,939 | 231,075 |
Total liabilities and stockholders' equity | $ 290,652 | $ 291,356 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable, current | $ 436 | $ 378 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 91,708,839 | 88,099,983 |
Common stock, shares outstanding | 91,708,839 | 88,099,983 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Net revenues: | |||
Rental | $ 39,837 | $ 120,365 | $ 181,570 |
Services | 181,264 | 131,996 | 87,460 |
Sales | 32,989 | 49,012 | 35,804 |
Net revenues: | 254,090 | 301,373 | 304,834 |
Cost of revenues: | |||
Rental | 28,637 | 98,162 | 145,760 |
Services | 54,767 | 43,794 | 31,158 |
Sales | 36,197 | 47,893 | 34,067 |
Cost of revenues: | 119,601 | 189,849 | 210,985 |
Gross profit | 134,489 | 111,524 | 93,849 |
Operating expenses: | |||
Technology and development | 66,331 | 59,391 | 49,386 |
Sales and marketing | 53,949 | 64,082 | 72,315 |
General and administrative | 55,372 | 45,209 | 41,837 |
Restructuring (credits) charges | (423) | 4,868 | 0 |
Gain on liquidation of textbooks | (670) | (4,326) | (4,555) |
Total operating expenses | 174,559 | 169,224 | 158,983 |
Loss from operations | (40,070) | (57,700) | (65,134) |
Interest expense, net and other (expense) income, net: | |||
Interest expense, net | (171) | (247) | (317) |
Other (expense) income, net | (297) | 216 | 879 |
Total interest expense, net and other (expense) income, net | (468) | (31) | 562 |
Loss before provision for income taxes | (40,538) | (57,731) | (64,572) |
Provision for income taxes | 1,707 | 1,479 | 186 |
Net loss | $ (42,245) | $ (59,210) | $ (64,758) |
Net loss per share, basic and diluted (in dollars per share) | $ (0.47) | $ (0.68) | $ (0.78) |
Weighted average shares used to compute net loss per share, basic and diluted (in shares) | 90,534 | 86,818 | 83,205 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (42,245) | $ (59,210) | $ (64,758) |
Other comprehensive loss: | |||
Change in unrealized gain (loss) on available for sale investments | 25 | (8) | 2 |
Change in foreign currency translation adjustments, net of tax | (29) | (151) | (9) |
Other comprehensive loss | (4) | (159) | (7) |
Total comprehensive loss | $ (42,249) | $ (59,369) | $ (64,765) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Common stock, beginning balance, shares at Dec. 31, 2013 | 81,708,000 | ||||
Beginning balance at Dec. 31, 2013 | $ 274,240 | $ 82 | $ 479,279 | $ (6) | $ (205,115) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of stock options and ESPP, shares | 1,004,000 | ||||
Issuance of common stock upon exercise of stock options and ESPP | 2,713 | $ 1 | 2,712 | ||
Net issuance of common stock for settlement of restricted stock units (RSUs), shares | 873,000 | ||||
Net issuance of common stock for settlement of restricted stock units (RSUs) | (3,979) | $ 1 | (3,980) | ||
Warrant exercises, shares | 104,000 | ||||
Warrant exercises | 0 | 0 | |||
Issuance of common stock in connection with acquisition, shares | 408,000 | ||||
Issuance of common stock in connection with acquisition | 2,585 | 2,585 | |||
Repurchase of common stock, shares | (89,000) | ||||
Repurchase of common stock | (604) | (604) | |||
Share-based compensation expense | 36,853 | 36,853 | |||
Other comprehensive loss | (7) | (7) | |||
Net loss | (64,758) | (64,758) | |||
Beginning balance at Dec. 31, 2014 | 247,043 | $ 84 | 516,845 | (13) | (269,873) |
Common stock, ending balance, shares at Dec. 31, 2014 | 84,008,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of stock options and ESPP, shares | 2,165,000 | ||||
Issuance of common stock upon exercise of stock options and ESPP | 13,696 | $ 2 | 13,694 | ||
Net issuance of common stock for settlement of restricted stock units (RSUs), shares | 1,624,000 | ||||
Net issuance of common stock for settlement of restricted stock units (RSUs) | (8,710) | $ 2 | (8,712) | ||
Warrant exercises, shares | 368,000 | ||||
Warrant exercises | 0 | 0 | |||
Issuance of common stock in connection with acquisition, shares | 125,000 | ||||
Issuance of common stock in connection with acquisition | 825 | 825 | |||
Repurchase of common stock, shares | (190,000) | ||||
Repurchase of common stock | (1,185) | (1,185) | |||
Share-based compensation expense | 38,775 | 38,775 | |||
Other comprehensive loss | (159) | (159) | |||
Net loss | (59,210) | (59,210) | |||
Beginning balance at Dec. 31, 2015 | $ 231,075 | $ 88 | 560,242 | (172) | (329,083) |
Common stock, ending balance, shares at Dec. 31, 2015 | 88,099,983 | 88,100,000 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of stock options and ESPP, shares | 590,000 | ||||
Issuance of common stock upon exercise of stock options and ESPP | $ 2,104 | $ 1 | 2,103 | ||
Net issuance of common stock for settlement of restricted stock units (RSUs), shares | 3,019,000 | ||||
Net issuance of common stock for settlement of restricted stock units (RSUs) | (10,776) | $ 3 | (10,779) | ||
Share-based compensation expense | 41,785 | 41,785 | |||
Other comprehensive loss | (4) | (4) | |||
Net loss | (42,245) | (42,245) | |||
Beginning balance at Dec. 31, 2016 | $ 221,939 | $ 92 | $ 593,351 | $ (176) | $ (371,328) |
Common stock, ending balance, shares at Dec. 31, 2016 | 91,708,839 | 91,709,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities | |||
Net loss | $ (42,245) | $ (59,210) | $ (64,758) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Textbook library depreciation expense | 9,267 | 43,553 | 70,147 |
Amortization of warrants and deferred loan costs | 105 | 151 | 187 |
Other depreciation and amortization expense | 14,520 | 11,511 | 11,159 |
Share-based compensation expense | 41,785 | 38,775 | 36,888 |
Provision (release) for bad debts | 58 | (77) | 234 |
Gain on liquidation of textbooks | (670) | (4,326) | (4,555) |
Loss from write-offs of textbooks | 1,090 | 5,297 | 10,534 |
Deferred income taxes | 0 | 0 | (1,291) |
Realized gain on sale of securities | (11) | 0 | (21) |
Loss from disposal of property and equipment | 0 | 967 | 0 |
Impairment of intangible assets | 0 | 0 | 1,552 |
Change in assets and liabilities net of effect of acquisition of businesses: | |||
Accounts receivable | (127) | 712 | (1,709) |
Prepaid expenses and other current assets | 10,039 | (27,878) | (2,981) |
Other assets | 1,437 | (592) | (155) |
Accounts payable | (728) | (4,236) | 5,037 |
Deferred revenue | (272) | (9,620) | 1,657 |
Accrued liabilities | (9,499) | 5,237 | 7,448 |
Other liabilities | 189 | (346) | (898) |
Net cash provided by (used in) operating activities | 24,938 | (82) | 68,475 |
Cash flows from investing activities | |||
Purchases of textbooks | (886) | (32,297) | (112,814) |
Proceeds from liquidations of textbooks | 25,646 | 38,260 | 58,119 |
Purchases of marketable securities | (7,633) | (35,610) | (70,706) |
Proceeds from sale of marketable securities | 22,830 | 350 | 46,358 |
Maturities of marketable securities | 6,844 | 47,840 | 50,700 |
Purchases of property and equipment | (24,689) | (8,253) | (5,083) |
Acquisition of businesses, net of cash acquired | (27,055) | 0 | (53,872) |
Release of cash from escrow | 0 | 0 | (52) |
Purchase of strategic equity investment | (1,020) | (2,019) | 0 |
Net cash (used in) provided by investing activities | (5,963) | 8,271 | (87,350) |
Cash flows from financing activities | |||
Common stock issued under stock plans, net | 2,104 | 13,696 | 2,712 |
Payment of taxes related to the net share settlement of RSUs | (10,779) | (8,710) | (3,980) |
Repurchase of common stock | 0 | (2,263) | (604) |
Net cash (used in) provided by financing activities | (8,675) | 2,723 | (1,872) |
Net increase (decrease) in cash and cash equivalents | 10,300 | 10,912 | (20,747) |
Cash and cash equivalents, beginning of period | 67,029 | 56,117 | 76,864 |
Cash and cash equivalents, end of period | 77,329 | 67,029 | 56,117 |
Supplemental cash flow data: | |||
Interest | 50 | 95 | 114 |
Income taxes | 1,094 | 827 | 625 |
Non-cash investing and financing activities: | |||
Accrued purchases of long-lived assets | 2,333 | 1,771 | 5,132 |
Issuance of common stock related to prior acquisition | 0 | 825 | 2,585 |
Accrued deferred cash consideration related to acquisition | $ 17,378 | $ 0 | $ 0 |
Background and Basis of Present
Background and Basis of Presentation | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | Background and Basis of Presentation Company and Background Chegg, Inc. (Chegg, the Company, we, us, or our), headquartered in Santa Clara, California, was incorporated as a Delaware corporation in July 2005. Chegg is the leading student-first connected learning platform. Our goal is to help students transition from high school to college to career, with a view to improving student outcomes. We help students study more effectively for college admission exams, find the right college to accomplish their goals, get better grades and test scores while in school, and find internships that allow them to gain valuable skills to help them enter the workforce after college. Our student-first connected learning platform offers products and services that help students transition from high school to college to career. Basis of Presentation Our fiscal year ends on December 31 and in this report we refer to the year ended December 31, 2016 , December 31, 2015 , and December 31, 2014 as 2016 , 2015 , and 2014 , respectively. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States (U.S. GAAP) requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities; the disclosure of contingent liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting periods. Significant estimates, assumptions, and judgments are used for, but not limited to: revenue recognition, recoverability of accounts receivable, determination of the useful lives and salvage value assigned to our textbook library, restructuring charges, share-based compensation expense including estimated forfeitures, accounting for income taxes, useful lives assigned to long-lived assets for depreciation and amortization, impairment of goodwill and long-lived assets, and the valuation of acquired intangible assets. We base our estimates on historical experience, knowledge of current business conditions, and various other factors we believe to be reasonable under the circumstances. These estimates are based on management’s knowledge about current events and expectations about actions we may undertake in the future. Actual results could differ from these estimates, and such differences could be material to our financial position and results of operations. Principles of Consolidation The consolidated financial statements include the accounts of Chegg and our wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with U.S. GAAP. Cash and Cash Equivalents and Restricted Cash We consider all highly liquid investments with an original maturity date of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents, which consist of cash, money market accounts, commercial paper, corporate securities and agency bonds at financial institutions, are stated at cost, which approximates fair value. We classify certain restricted cash balances within other current assets and other assets on the accompanying consolidated balance sheets based upon the term of the remaining restrictions. As of December 31, 2016 , we had approximately $0.1 million of restricted cash that consisted of a security deposit for our offices in Oregon and New York. As of December 31, 2015 , we had approximately $0.8 million of restricted cash that consisted of a deposit pledged as security for our corporate credit cards and a letter of credit pledged as a security deposit for our headquarters and a sales office. The deposit pledged as security for our corporate credit cards of approximately $0.3 million as of December 31, 2015 is classified in other current assets in our consolidated balance sheets due to the short-term nature of the restriction. The amounts related to the security deposits of approximately $0.1 million and $0.5 million as of December 31, 2016 and 2015 , respectively, are classified in other assets in our consolidated balance sheets as these amounts are restricted for periods that exceed one year from the balance sheet dates. Investments We hold investments in marketable securities, consisting of corporate securities, commercial paper and agency bonds. We classify our marketable securities as available-for-sale investments that are either short or long-term based on the nature of each security based on the contractual maturity of the investment when purchased. Our available-for-sale investments are carried at estimated fair value with any unrealized gains and losses, net of taxes, included in accumulated other comprehensive loss in stockholders’ equity. Unrealized losses are charged against other (expense) income, net when a decline in fair value is determined to be other-than-temporary. We did not record any such impairment charges in the periods presented. We determined realized gains or losses on the sale of marketable securities on a specific identification method, and recorded such gains or losses as other (expense) income, net. For the years ended December 31, 2015 and 2014 , the Company's gross realized gains and losses on short-term investments were not significant. Accounts Receivable Accounts receivable are recorded at the invoiced amount and are non-interest bearing. We generally grant uncollateralized credit terms to our customers, which include textbook wholesalers, and marketing services customers, and maintain an allowance for doubtful accounts to account for potentially uncollectible receivables. Allowance for Doubtful Accounts We assess the creditworthiness of our customers based on multiple sources of information, and analyze such factors as our historical bad debt experience, industry and geographic concentrations of credit risk, economic trends, and customer payment history. This assessment requires significant judgment. Because of this assessment, we maintain an allowance for doubtful accounts for estimated losses resulting from the inability of certain customers to make all of their required payments. In making this estimate, we analyze historical payment performance and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. Accounts receivable are written off as a decrease to the allowance for doubtful accounts when all collection efforts have been exhausted and an account is deemed uncollectible. Concentration of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, and marketable securities invested in highly liquid instruments in accordance with our investment policy. We place the majority of our cash and cash equivalents and restricted cash with financial institutions in the United States that we believe to be of high credit quality, and accordingly minimal credit risk exists with respect to these instruments. Certain of our cash balances held with financial institutions are in excess of Federal Deposit Insurance Corporation limits. Our investment portfolio consists of investment-grade marketable securities diversified among security types, industries and issuers. Our investments were held and managed by recognized financial institutions that followed our investment policy with the main objective of preserving capital and maintaining liquidity. Concentrations of credit risk with respect to trade receivables exist to the full extent of amounts presented in the financial statements. We had no textbook wholesalers that represented greater than 10% of our net accounts receivable balance as of December 31, 2016 and two textbook wholesalers that represented 16% and 11% of our net accounts receivable balance as of December 31, 2015 , respectively. No customers represented over 10% of net revenues in 2016 , 2015 or 2014 . Textbook Library We consider our print textbook library to be a long-term productive asset and, as such, classify it as a non-current asset in our consolidated balance sheets. Cash outflows for the acquisition of our print textbook library, net of changes in related accounts payable and accrued liabilities historically was classified as cash flows from investing activities in our consolidated statements of cash flows. As a result of our strategic partnership with Ingram, since May 1, 2015, Ingram has made all new investments in the print textbook library and we also provided Ingram with extended payment terms through 2016 for the purchase of textbooks, before moving to normal payment terms in January 2017. As such, we have recorded any cash outflows as a result of this partnership as an operating activity in our consolidated statements of cash flows as we are no longer purchasing print textbooks but rather providing extended payments terms to Ingram to facilitate their purchase of new textbooks. Cash inflows received from the liquidation of print textbooks are classified as cash flows from investing activities in our consolidated statements of cash flows, consistent with other long-term asset classification of our existing print textbook library. The gain or loss from the liquidation of print textbooks previously rented is recorded as a component of operating expenses in our consolidated statement of operations and is classified as cash flow from operating activities. All print textbooks in our textbook library are stated at cost, which includes the purchase price less accumulated depreciation. We record allowances for lost or damaged print textbooks in cost of revenues in our consolidated statements of operations based on our assessment of our print textbook library on a book-by-book basis. Write-offs result from lost or damaged books, books no longer considered to be rentable, or when books are not returned to us after the rental period by our customers. We depreciate our print textbooks, less an estimated salvage value, over an estimated useful life of three years using an accelerated method of depreciation, as we estimate this method most accurately reflects the actual pattern of decline in the economic value of the assets. The salvage value considers the historical trend and projected liquidation proceeds for print textbooks. The useful life is determined based on the time period in which the print textbooks are held and rented before liquidation. In accordance with our policy, we review the estimated useful lives of our print textbook library on an ongoing basis. Depreciation expense and write-offs of print textbooks are recorded in cost of revenues in our consolidated statements of operations. During 2016 , 2015 and 2014 , print textbook depreciation expense was approximately $9.3 million , $43.6 million and $70.1 million , respectively, and write-offs were approximately $1.1 million , $5.3 million and $10.5 million , respectively. Property and Equipment Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives of the assets: Classification Useful Life Computers and equipment 3 years Software 3 years Furniture and fixtures 5 years Leasehold improvements Shorter of the remaining lease term or the estimated useful life of 5 years Content 5 years We capitalize costs related to the purchase or development of Chegg Study and Test Prep content and amortize these costs over a period of five years. Depreciation and amortization expense are generally classified within the corresponding cost of revenues and operating expenses categories in our consolidated statements of operations. Depreciation and amortization expense during the years ended December 31, 2016 , 2015 and 2014 were approximately $9.9 million , $6.8 million and $6.2 million , respectively. The cost of maintenance and repairs is expensed as incurred. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from their respective accounts, and any gain or loss on such sale or disposal is reflected in loss from operations. Software Development Costs We capitalize costs related to software developed or obtained for internal use when certain criteria have been met. Costs incurred during the application development stage for internal-use software are capitalized in property and equipment and amortized over the estimated useful life of the software, generally up to three years. We had no capitalized software development costs as of December 31, 2016 or 2015 . During the year ended December 31, 2016 , we had no amortization of capitalized software development costs and during the years ended December 31, 2015 and 2014 , the amortization of capitalized software development costs totaled approximately $0.5 million in each year. Goodwill Goodwill represents the excess of the fair value of consideration paid over the estimated fair value of assets acquired and liabilities assumed in a business acquisition. Goodwill is not amortized but rather tested for impairment at least annually on October 1, or more frequently if certain events or indicators of impairment occur between annual impairment tests. We first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. In our qualitative assessment, we consider factors including economic conditions, industry and market conditions and developments, overall financial performance and other relevant entity-specific events in determining whether it is more likely than not that the fair value of our reporting unit is less than the carrying amount. We completed our annual impairment test on October 1 of 2016 and 2015 , each of which did not result in any impairment as our qualitative assessment did not indicate that it is more likely than not that the fair value of our reporting unit is less than the carrying amount. Acquired Intangible Assets and Other Long-Lived Assets Acquired intangible assets with finite useful lives, which include developed technology, customer lists, trade names and non-compete agreements, are amortized over their estimated useful lives. We assess the impairment of acquired intangible assets and other long-lived assets when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Indefinite-Lived Intangibles We make judgments about the recoverability of purchased indefinite-lived intangible assets at least annually on October 1 or more frequently whenever events or changes in circumstances indicate that an impairment may exist to determine whether it is more likely than not that the carrying value of the assets may not be recoverable. Recoverability of indefinite-lived intangible assets is measured by comparing the carrying amount of the asset to the future undiscounted cash flows that the asset is expected to generate. If we determine that an individual asset is impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. We completed our annual impairment test on October 1 of 2016 and 2015 , each of which did not result in any impairment. Revenue Recognition and Deferred Revenue We derive our revenues, net of allowances, for refunds or charge backs from our payment processors who process payments from credit cards, debit cards and PayPal. Revenues are recognized when the four basic criteria for revenue recognition have been met as follows: persuasive evidence of an arrangement exists, delivery has occurred and title has transferred, the sale price is fixed or determinable, and collection is reasonably assured. Revenues are presented net of sales tax collected from customers to be remitted to governmental authorities and net of allowances for estimated cancellations and customer returns, which are based on historical data. Customer refunds from cancellations and returns are recorded as a reduction to revenues. We generate revenues from our Required Materials product line including the rental of print textbooks and eTextbooks and, to a lesser extent, through the sales of print textbooks through our website purchased by us on a just-in-time basis. Rental revenues were historically recognized ratably over the term of the rental period, generally two to five months, for the print textbooks that we owned. As of November 2016, we no longer rent our print textbooks and therefore all revenues from print textbook rentals from this date forward are commission-based. Commission-based print textbook rental revenues are recognized immediately in the period the transaction occurs. Revenues from selling textbooks on a just-in-time basis are recognized upon shipment. We do not hold an inventory of textbooks for sale. Our customers pay for the rental and sale of print textbooks on our website primarily by credit card, resulting in immediate settlement of our accounts receivable. Shipping costs charged to customers in the sale or rental of textbooks are recorded in revenues and the related expenses are recorded as cost of revenues. We generate revenues from our Chegg Services product line including our Chegg Study service, our Chegg Tutors service, and our writing tools service that we offer to students. These services are offered to students through monthly or annual subscriptions and we recognize revenues ratably over the respective subscription period. Our Chegg Services also include enrollment marketing services and brand advertising, which we offer either on a subscription or on an a la carte basis. Enrollment marketing services connect colleges and graduate schools with students seeking admission or scholarship opportunities at these institutions. Brand advertising offers brands unique ways to connect with students. Finally, Chegg Services includes our internship services and our Test Prep service currently covering the ACT and SAT exams. Revenues are recognized ratably or as earned over the subscription service, generally one year. Revenues from enrollment marketing services or brand advertising delivered on an a la carte basis, without a subscription, is recognized when delivery of the respective lead or service has occurred. For these services, we bill the customer at the inception, over the term of the customer arrangement or as the services are performed. Upon satisfactory assessment of creditworthiness, we generally grant credit to our enrollment marketing services and brand advertising customers with normal credit terms, typically 30 days. Some of our customer arrangements for enrollment marketing services include multiple deliverables, which include the delivery of student leads as well as other services to the end customer. We have determined these deliverables qualify as separate units of accounting, as they have value to the customer on a standalone basis and our arrangements do not contain a right of return. For these arrangements that contain multiple deliverables, we allocate the arrangement consideration based on the relative selling price method in accordance with the selling price hierarchy, which includes: (1) vendor-specific objective evidence of fair value (VSOE), when available; (2) third-party evidence of selling price (TPE), if VSOE does not exist; and (3) estimated selling price (ESP), if neither VSOE nor TPE is available. We determine VSOE based on our historical pricing and discounting practices for the specific solution when sold separately and when a substantial majority of the selling prices for these services fall within a narrow range. TPE is determined based on competitor prices for similar deliverables when sold separately. Generally our go-to-market strategy differs from that of our peers, and our offerings contain a significant level of differentiation such that the comparable pricing of services with similar functionality cannot be obtained. If we have not established VSOE or TPE for our enrollment marketing services, we have used ESP in our allocation of arrangement consideration. Additionally, we limit the amount of revenues recognized for delivered elements to the amount that is not contingent on future delivery of services or other future performance obligations. Deferred revenue primarily consists of advanced payments from students related to rentals and subscriptions that have not been recognized, and marketing services that have yet to be performed. Deferred revenue is recognized as revenues ratably over the term or when the services are provided and all other revenue recognition criteria have been met. We evaluate whether we are acting as a principal or an agent, and therefore would record the gross sales amount and related costs as revenues or the net amount earned as commissions from the sale of third party products. Our determination is based on our evaluation of certain indicators including whether we are the principal in the transaction, are subject to inventory risk, have latitude in establishing prices and selecting suppliers, none of which is presumptive or determinative. We generally operate as the principal and so in those instances revenues are recorded at the gross sale price. We generally record the net amounts as commissions earned when such amounts are determined using a fixed percentage of the transaction price, we are not subject to inventory risk or responsible for the fulfillment of the textbooks. We operate as an agent in our strategic partnership with Ingram and therefore our revenues include a commission on the total revenues that we earn from Ingram upon their fulfillment of a rental transaction using books for which Ingram has title and risk of loss. We also present our revenues separately for rental, services and sales. Rental revenue includes the rental of print textbooks for which we take title and bear the risk of loss; service revenue includes Chegg Study, Chegg Tutors, our writing tools service, enrollment marketing, brand advertising, eTextbooks, and commissions we earn from Ingram and other e-commerce partners; sale revenue includes just-in-time sale of print textbooks and the sale of other required materials. Cost of Revenues Our cost of revenues consists primarily of expenses associated with the delivery and distribution of our products and services. Cost of revenues related to our print textbook rentals included print textbook depreciation expense, shipping and other fulfillment costs, the cost of textbooks sold, payment processing costs, write-offs and allowances related to the print textbook library, and all expenses associated with our distribution and customer service centers, including personnel and warehousing costs. The cost of textbooks sold, shipping and other fulfillment costs and payment processing expenses are recognized upon shipment, while print textbook depreciation is recognized under an accelerated method over the life of the textbook. We believe this method most accurately reflects the actual pattern of decline in the economic value of the assets, resulting in higher costs earlier in the textbook lifecycle. Cost of revenues also includes the depreciation of our eTextbook Reader software, publisher content fees for eTextbooks, content amortization expense related to content that we develop or license, including publisher agreements for which we pay one-time license fees for published content, enrollment marketing services leads purchased from third-party suppliers to fulfill leads that we are unable to fulfill through our internal database, personnel costs and other direct costs related to providing the content or services. In addition, cost of revenues includes allocated information technology and facilities costs. Technology and Development Costs Technology and development expenses consist primarily of salaries, benefits and share-based compensation expense for employees on our product and web design, engineering and technical teams who are maintaining our website, developing new products and improving existing products. Technology and development costs also include web hosting costs, third-party development costs and allocated information technology and facilities costs. We expense substantially all of our technology and development costs as they are incurred. Advertising Costs Advertising costs are expensed as incurred and consist primarily of online advertising and marketing promotional expenditures. During years ended December 31, 2016 , 2015 and 2014 , advertising costs were approximately $18.4 million , $25.0 million , and $22.4 million , respectively. Share-based Compensation Share-based compensation expense for stock options, restricted stock units (RSUs), performance-based restricted stock units (PSUs), and employee stock purchase plan (ESPP) are accounted for under the fair value method, which requires us to measure the cost of employee share-based compensation awards based on the grant-date fair value of the award. Share-based compensation expense for stock options and our ESPP is estimated at the date of grant using the Black-Scholes-Merton option pricing model while expense for RSUs and PSUs is measured based on the closing fair market value of the Company’s common stock on the date of grant. We recognize compensation cost for all share-based compensation awards that are expected to vest on a straight-line basis over the requisite service period of the awards, which is generally the option vesting period. These amounts are reduced by estimated forfeitures, which are estimated at the time of the grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Equity awards issued to non-employees are recorded at their fair value on the measurement date and are subject to adjustment each period as the underlying awards vest or consulting services are performed. Income Taxes We account for income taxes under an asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and the tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established, when necessary, to reduce deferred tax assets to an amount that is more likely than not to be realized. We recognize the benefit from a tax position only if it is more likely than not that the position would be sustained upon audit based solely on the technical merits of the tax position. Our policy is to include interest and penalties related to unrecognized tax benefits as a component of income tax expense. Restructuring Charges Restructuring charges are primarily comprised of severance costs, contract and program termination costs, asset impairments and costs of facility consolidation and closure. Restructuring charges are recorded upon approval of a formal management plan and are included in the operating results of the period in which such plan is approved and the expense becomes estimable. To estimate restructuring charges, management utilizes assumptions of the number of employees that would be involuntarily terminated and of future costs to operate and eventually vacate duplicate facilities. Severance and other employee separation costs are accrued when it is probable that benefits will be paid and the amount is reasonably estimable. The rates used in determining severance accruals are based on our policies and practices and negotiated settlements. Restructuring charges for employee workforce reductions are recorded upon employee notification for employees whose required continuing service period is 60 days or less and ratably over the employee’s continuing service period for employees whose required continuing service period is greater than 60 days. Strategic Investment We have entered into an equity investment in a privately-held business to achieve certain strategic business objectives. Our investment in equity securities of this privately-held business is accounted for under the cost method. We periodically review this investment for other-than-temporary declines in fair value based on the specific identification method and write down investments when an other-than-temporary decline has occurred. Any fair value estimates are made based on consideration of the current cash position, recent operational performance, and forecasts of the investees. Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less the weighted-average unvested common stock subject to repurchase or forfeiture. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including stock options, warrants, restricted stock units (RSUs), and performance-based restricted stock units (PSUs), to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential common shares outstanding would have been anti-dilutive. The following table sets forth the computation of historical basic and diluted net loss per share (in thousands, except per share amounts): Year Ended 2016 2015 2014 Numerator: Net loss $ (42,245 ) $ (59,210 ) $ (64,758 ) Denominator: Weighted-average common shares outstanding 90,534 86,818 83,241 Less: Weighted-average unvested common shares subject to repurchase or forfeiture — — (36 ) Weighted average shares used to compute net loss per share, basic and diluted 90,534 86,818 83,205 Net loss per share, basic and diluted $ (0.47 ) $ (0.68 ) $ (0.78 ) The following potential weighted-average shares of common stock outstanding were excluded from the computation of diluted net loss per share attributable to common stockholders because including them would have been anti-dilutive (in thousands): Year Ended December 31, 2016 2015 2014 Options to purchase common stock 10,799 11,446 14,253 RSUs and PSUs 1,239 200 289 Employee stock purchase plan 15 — — Warrants to purchase common stock 200 299 996 Total common stock equivalents 12,253 11,945 15,538 Foreign Currency Translation The functional currency of our foreign subsidiaries is the local currency. Adjustments resulting from the translation of foreign currencies into U.S. dollars for balance sheet amounts are based on the exchange rates as of the consolidated balance sheet date. Non-monetary balance sheet items denominated in a currency other than the applicable functional currency are translated using the historical rate. Revenues and expenses are translated at average exchange rates during the period. Foreign currency translation gains or losses are included in accumulated other comprehensive loss as a component of stockholders’ equity on the consolidated balance sheets. Gains or losses resulting from foreign currency transactions, which are denominated in currencies other than the entity’s functional currency, are included in other income (expense), net in the consolidated statements of operations and were not material during 2016 , 2015 or 2014 . Recent Accounting Pronouncements In December 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-20 Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . ASU 2016-20 provides for corrections and improvements for specific areas of Topic 606. In May 2016, the FASB issued ASU No. 2016-12 Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients . ASU 2016-12 provides for improvements and practical expedients for specific areas of Topic 606. In April 2016, the FASB issued ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing . ASU 2016-10 provides for clarification of two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance. In March 2016, the FASB issued ASU No. 2016-08 Revenue from Contracts with Customers (Topic 606) - Principal versus Agent Considerations (Reporting Revenue Gross versus Net) . ASU No. 2016-08 requires an entity to determine whether the nature of its promise to provide goods or services to a customer is performed in a principal or agent capacity and to recognize revenue in a gross or net manner based on its principal/agent designation. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers . This standard outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASUs 2016-20, 2016-12, 2016-10, 2016-08, and 2014-09 allow for companies to choose to apply the standard retrospectively to each prior reporting period presented (full retrospective application) or retrospectively with the cumulative effect of initially applying the standard as an adjustment to the opening balance of retained earnings of the annual reporting period that includes the date of initial application (modified retrospective application). We plan to adopt the standard under the modified retrospective application. Each guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early application is permitted only as of annual reporting periods beginning after Dece |
Cash and Cash Equivalents, Inve
Cash and Cash Equivalents, Investments and Restricted Cash | 12 Months Ended |
Dec. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents, Investments and Restricted Cash | Cash and Cash Equivalents, Investments and Restricted Cash The following table shows our cash and cash equivalents, restricted cash and investments’ adjusted cost, net unrealized loss and fair value as of December 31, 2016 and December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Cost Net Unrealized Loss Fair Value Cost Net Unrealized Loss Fair Value Cash and cash equivalents: Cash $ 77,329 $ — $ 77,329 $ 52,905 $ — $ 52,905 Money market funds — — — 6,672 — 6,672 Commercial paper — — — 5,453 — 5,453 Corporate securities — — — 600 (1 ) 599 Agency bond — — — 1,400 — 1,400 Total cash and cash equivalents $ 77,329 $ — $ 77,329 $ 67,030 $ (1 ) $ 67,029 Short-term investments: Commercial paper $ — $ — $ — $ 3,746 $ — $ 3,746 Corporate securities — — — 10,572 (12 ) 10,560 Agency bonds — — — 3,494 — 3,494 Total short-term investments $ — $ — $ — $ 17,812 $ (12 ) $ 17,800 Long-term investments: Corporate securities $ — $ — $ — $ 3,241 $ (10 ) $ 3,231 Agency bond — — — 1,001 (3 ) 998 Long-term corporate securities $ — $ — $ — $ 4,242 $ (13 ) $ 4,229 Short-term restricted cash $ — $ — $ — $ 300 $ — $ 300 Long-term restricted cash 104 — 104 478 — 478 Total restricted cash $ 104 $ — $ 104 $ 778 $ — $ 778 As of December 31, 2016 , we did not carry a balance of cash equivalents, short-term or long-term investments. Our investment policy generally limits the amount of credit exposure to any one issuer. The policy requires investments generally to be investment grade, with the primary objective of preserving capital and maintaining liquidity. Fair values were determined for each individual security in the investment portfolio. When evaluating an investment for other-than-temporary impairment, we review factors such as the length of time and extent to which fair value has been below its cost basis, the financial condition of the issuer and any changes thereto, changes in market interest rates and our intent to sell or whether it is more likely than not it will be required to sell, and the investment before recovery of the investment’s cost basis. During the year ended December 31, 2016 , we did not recognize any impairment charges. Strategic Investment During the years ended December 31, 2016 and 2015 , we invested $1.0 million and $2.0 million , respectively, in a third party to expand our customer reach. Our total investment of $3.0 million is included in other assets on our consolidated balance sheets. We did not record other-than-temporary impairment charges on this investment during the years ended December 31, 2016 and 2015 as there were no significant identified events or changes in circumstances that would be considered an indicator for impairment. |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | Fair Value Measurement We have established a fair value hierarchy used to determine the fair value of our financial instruments 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 inputs that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments. Level 3—Inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value; the inputs require significant management judgment or estimation. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. We had no financial instruments measured and recorded at fair value on a recurring basis as of December 31, 2016 and amounts as of December 31, 2015 are classified based on the valuation technique level in the table below (in thousands): December 31, 2015 Total Quoted Prices Significant Assets: Cash equivalents: Money market funds $ 6,672 $ 6,672 $ — Commercial paper 5,453 — 5,453 Corporate securities 599 — 599 Agency bond 1,400 — 1,400 Short-term investments: Commercial paper 3,746 — 3,746 Corporate securities 10,560 — 10,560 Agency bonds 3,494 — 3,494 Long-term investments: Corporate securities 3,231 — 3,231 Agency bond 998 — 998 Total assets measured and recorded at fair value $ 36,153 $ 6,672 $ 29,481 We value our marketable securities based on quoted prices in active markets for identical assets (Level 1 inputs) or inputs other than quoted prices that are observable either directly or indirectly (Level 2 inputs) in determining fair value. We classify all of our fixed income available-for-sale securities as having Level 2 inputs. The valuation techniques used to measure the fair value of our financial instruments having Level 2 inputs were derived from non-binding market consensus prices that are corroborated by observable market data, quoted market prices for similar instruments, or pricing models such as discounted cash flow techniques. The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. |
Long-Lived Assets
Long-Lived Assets | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Long-Lived Assets | Long-Lived Assets Textbook Library, Net Textbook library, net consisted of the following (in thousands): December 31, 2016 2015 Textbook library $ 33,980 $ 100,783 Less accumulated depreciation (31,405 ) (71,055 ) Textbook library, net $ 2,575 $ 29,728 Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): December 31, 2016 2015 Computer and equipment $ 1,597 $ 1,313 Software 4,324 2,591 Furniture and fixtures 2,148 1,652 Leasehold improvements 5,342 4,983 Content 49,725 27,359 Property and equipment 63,136 37,898 Less accumulated depreciation and amortization (27,831 ) (17,927 ) Property and equipment, net $ 35,305 $ 19,971 |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Fiscal Year 2016 Acquisitions In May 2016 , we acquired all of the outstanding interests of Imagine Easy Solutions, LLC (Imagine Easy), a privately held online learning company based in New York that provides a portfolio of online writing tools. We anticipate this acquisition will enhance our ability to acquire new students, increase the value of our platform to our existing students, and have a meaningful and positive impact on their outcomes. The total fair value of the purchase consideration was $42.3 million . The purchase consideration included deferred cash consideration of $17.0 million , of which the present value of $16.8 million was recorded as accrued liabilities on our consolidated balance sheet as of December 31, 2016 . We will accrete into the deferred cash consideration of $17.0 million until it is paid to the sellers in April 2017. During the year ended December 31, 2016 , we recorded accretion expense of $0.4 million through other (expense), income, net on our consolidated statement of operations. Further, the consideration included an escrow and a hold-back amount of $4.2 million and $0.5 million , respectively, for general representations and warranties and potential post-closing adjustments. The escrow amount will be released in July 2017, and the hold-back amount was released during the third quarter of 2016. In December 2016 , we acquired certain assets of RefME Ltd., a privately held online learning company based in London, England, to enhance our already existing portfolio of writing tools. The total fair value of the purchase consideration was $1.8 million . The purchase consideration included deferred cash consideration of $0.8 million , of which $0.2 million was paid out during the year ended December 31, 2016 and the remaining $0.6 million was recorded as accrued liabilities on our consolidated balance sheet as of December 31, 2016 and will be paid out in three quarterly installments in 2017. The acquisition date fair value of the purchase consideration for the above transactions consisted of the following (in thousands): Initial cash consideration $ 22,007 Net working capital adjustment 200 Fair value of deferred cash consideration 17,127 Escrow 4,200 Hold-back 500 Fair value of purchase consideration $ 44,034 Included in the purchase agreement for the acquisition of Imagine Easy are additional contingent payments of up to $18.0 million , of which $3.0 million relates to the achievement of performance conditions for the fiscal year ended 2016 . These performance conditions were achieved therefore these payments will be made over the next three years, subject to continued employment of the sellers, and will be expensed ratably as technology and development and general and administrative expense on our consolidated statements of operations. These contingent payments may be settled by us, at our sole discretion, either in cash or shares of our common stock. We have accrued $1.0 million as of December 31, 2016 for these contingent payments which is included within accrued liabilities on our condensed consolidated balance sheet. The fair value of the intangible assets acquired was determined under the acquisition method of accounting for business combinations. The excess of the purchase consideration paid over the fair value of net identifiable assets acquired was recorded as goodwill. Goodwill is primarily attributable to the potential for future product offerings as well as our expanded student reach. The amounts recorded for goodwill are expected to be deductible for tax purposes. The following table presents the total allocation of purchase consideration recorded in our consolidated balance sheets as of the acquisition date (in thousands): Cash $ 59 Accounts receivable 2,610 Favorable lease acquired 300 Other acquired assets 212 Acquired intangible assets: Trade names 1,840 Domain names 1,330 Advertiser relationships 6,600 User base 550 Non-compete agreements 508 Developed technology 5,660 Total acquired intangible assets 16,488 Total identifiable assets acquired 19,669 Liabilities assumed (573 ) Net identifiable assets acquired 19,096 Goodwill 24,938 Total fair value of purchase consideration $ 44,034 During the year ended December 31, 2016 , we incurred $1.1 million of acquisition-related expenses associated with the above acquisitions which have been included in general and administrative expenses in our consolidated statements of operations. Fiscal Year 2014 Acquisitions On October 1, 2014, we acquired 100% of the business of internships.com, a division of CareerArc Group, headquartered in Burbank, California. With this acquisition, we aimed to expand our user base and expose new users to our services. We see the acquisition of internships.com as a method to connect the ending of the student life cycle to the beginning of their career. The total fair value of the purchase consideration was $10.0 million in cash, and $1.0 million in stock that was placed into escrow, for indemnification against breaches of general representations and warranties, and was released in the year ended December 31, 2016 . On June 5, 2014, we acquired 100% of the outstanding shares and voting interest of InstaEDU, Inc. (InstaEDU), headquartered in San Francisco, California. With this acquisition, we aimed to expand our digital offerings to help students excel in school by including real time tutoring services. We see the acquisition of InstaEDU as a method to connect the textbook offering and service offerings of Chegg together. The total fair value of the purchase consideration was $31.1 million in cash. This included $4.5 million that was placed into escrow for indemnification against breaches of general representations and warranties, and was released during the year ended December 31, 2015. On April 9, 2014, we acquired 100% of the outstanding shares and voting interest of The Campus Special, LLC and The Campus Special Food, LLC (together, the Campus Special), headquartered in Duluth, Georgia for a total fair value purchase consideration of $16.0 million , consisting of $14.0 million in cash and 250,000 shares of our common stock, and all of such shares of our common stock were placed in escrow for indemnification against breaches of general representations and warranties that were released during the year ended December 31, 2015 , and a fair value contingent consideration of additional shares of common stock, which is payable on the attainment of certain performance metrics in 2014 and 2015. The metrics related to 2014 were not met and as such those shares were not released. The shares associated with the 2015 metrics were released as a result of our exit from the print coupon business. On March 7, 2014, we acquired certain assets from Bookstep LLC, (Bookstep) to expand our technical resources and research and development capabilities. The total fair value of the purchase consideration was $0.5 million . The acquisition agreement requires us to pay approximately $2.5 million in cash, payable over two years, contingent upon the continuation of services by a certain number of consultants during the period after acquisition. The fair value of these subsequent payments was $2.5 million , which was accounted for as post-combination compensation expense. The acquisition date fair value of the consideration for the above four transactions consisted of the following as of December 31, 2014 (in thousands): Cash consideration $ 55,537 Fair value of stock escrow consideration 2,585 Fair value of stock contingent consideration 193 Fair value of purchase consideration $ 58,315 The fair value of the intangible assets acquired was determined under the acquisition method of accounting for business combinations. The excess of purchase consideration paid over the fair value of identifiable intangible assets acquired was recorded as goodwill. The following table summarizes the fair value of the net identifiable assets acquired in the year ended December 31, 2014 (in thousands): Cash $ 1,665 Other acquired assets 595 Acquired intangible assets: Developed technology 4,174 Customer lists 3,770 Trade names 5,990 Non-compete agreements 1,630 Corporate partnerships 243 Master services agreements 1,030 Total acquired intangible assets 16,837 Total identifiable assets acquired 19,097 Liabilities assumed (2,538 ) Net identifiable assets acquired 16,559 Goodwill 41,756 Net assets acquired $ 58,315 During the fourth quarter of 2014 , we determined that we would not continue to support or look to expand our print coupon business, resulting in a significant decrease in the expected future cash flows. As a result an impairment analysis was performed based on a discounted cash flow analysis with key assumptions based on the future revenues expected until the services were removed from our website. The analysis indicated that the carrying amounts of the intangible assets acquired will not be fully recoverable, resulting in an impairment charge totaling $1.6 million , which is included as an operating expense within sales and marketing on our consolidated statements of operations. For the year ended December 31, 2014, we incurred $0.7 million of acquisition-related expenses associated with the four acquisitions which have been included in general and administrative expenses in the consolidated statements of operations. The amounts recorded for goodwill related to the Bookstep, Campus Special and internships.com transactions are deductible for tax purposes. The amount recorded for goodwill related to the InstaEDU transaction is not deductible for tax purposes. The pro forma results of operations of the above acquisitions have not been presented as the financial impact to our consolidated statements of operations is not material. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill consists of the following (in thousands): December 31, 2016 December 31, 2015 Beginning balance $ 91,301 $ 91,301 Additions due to acquisitions 24,938 — Ending balance $ 116,239 $ 91,301 Intangible assets as of December 31, 2016 and December 31, 2015 consist of the following (in thousands, except weighted-average amortization period): December 31, 2016 Weighted-Average Amortization Period (in months) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technologies 60 $ 15,077 $ (8,245 ) $ 6,832 Customer lists 47 9,970 (3,673 ) 6,297 Trade names 47 5,513 (1,998 ) 3,515 Non-compete agreements 30 1,728 (1,249 ) 479 Master service agreements 21 1,030 (1,005 ) 25 Indefinite-lived trade name — 3,600 — 3,600 Total intangible assets $ 36,918 $ (16,170 ) $ 20,748 December 31, 2015 Weighted-Average Amortization Period (in months) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technologies 52 $ 9,417 $ (6,702 ) $ 2,715 Customer lists 20 2,820 (2,239 ) 581 Trade names 48 2,343 (920 ) 1,423 Non-compete agreements 28 1,220 (832 ) 388 Master service agreements 21 1,030 (872 ) 158 Indefinite-lived trade name — 3,600 — 3,600 Total intangible assets $ 20,430 $ (11,565 ) $ 8,865 During the years ended December 31, 2016 , 2015 and 2014 , amortization expense related to our acquired intangible assets totaled approximately $4.6 million , $4.8 million and $5.0 million , respectively. As part of our acquisition of internships.com in October 2014 , we acquired an indefinite-lived trade name intangible asset valued at $3.6 million . We will assess this asset for impairment annually during the fourth quarter or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. As of December 31, 2016 , the estimated future amortization expense related to our finite-lived intangible assets is as follows (in thousands): 2017 $ 5,350 2018 4,446 2019 3,510 2020 2,153 2021 815 Thereafter 874 Total $ 17,148 |
Balance Sheet Details
Balance Sheet Details | 12 Months Ended |
Dec. 31, 2016 | |
Balance Sheet Details [Abstract] | |
Balance Sheet Details | Balance Sheet Details Other Current Assets Other current assets consist of the following (in thousands): December 31, 2016 2015 Reimbursement from Ingram $ 18,759 $ 28,875 Other 3,500 2,857 Other Current Assets $ 22,259 $ 31,732 Accrued Liabilities Accrued liabilities consist of the following (in thousands): December 31, 2016 2015 Accrued shipping for cycle returns $ 1,334 $ 3,355 Refund reserve 487 4,538 Taxes payable 2,927 3,913 Accrued deferred cash consideration related to acquisition 17,378 — Payable to Ingram 8,237 9,965 Other 13,956 13,509 Accrued Liabilities $ 44,319 $ 35,280 |
Debt Obligations
Debt Obligations | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt Obligations | Debt Obligations In September 2016 , we entered into a revolving line of credit with an aggregate principal amount of $30.0 million (the Line of Credit) with an accordion feature that, subject to the lender's discretion, allows us to borrow up to a total of $50.0 million . This new line of credit replaced the previous line of credit that expired in August 2016. The Line of Credit matures September 2019 and requires us to repay the outstanding balance upon maturity. We will pay a fee equal to 0.25% per year on the average daily unused amount of the Line of Credit and a base interest rate equal to the LIBOR. In addition, we will pay a fee for each issued letter of credit which will be determined based on our current leverage ratio at the time the letter of credit is issued. If our leverage ratio is less than 1.00% , we will pay a fee equal to 1.50% per year and if our leverage ratio is greater than or equal to 1.00% , we will pay a fee equal to 2.50% per year. Our leverage ratio is a ratio of all obligations owed to the bank divided by our consolidated EBITDA. EBITDA for the purposes of calculating our leverage ratio is defined as net profit (loss) before tax, plus interest expense, plus non-cash stock compensation (net of capitalized interest expense), depreciation expense, amortization expense and other non-cash expenses (assuming there are no future cash costs), plus expenses incurred in connection with permitted acquisitions (including without limitation accrued acquisition-related contingent expenses) in an amount not to exceed $6.0 million per calendar year, plus non-recurring expenses in an amount not to exceed $2.0 million per calendar year. We must maintain financial covenants under the Line of Credit as follows: (1) maintain a balance of unrestricted cash at the Bank of not less than $30.0 million at all times, other than the three months ending March 31, 2017 and June 30, 2017 , and not less than $25.0 million during the three months ending March 31, 2017 and June 30, 2017 ; and (2) achieve EBITDA, on a trailing 12 month basis, of not less than (i) $25.0 million for the period of time from September 30, 2016 through June 30, 2017 , (ii) $30.0 million for the period of time from September 30, 2017 through June 30, 2018 , and (iii) $35.0 million for the period of time from September 30, 2018 through the maturity of the Line of Credit. As of December 31, 2015 , we had a revolving credit facility with an aggregate principal amount of $30.0 million (the Revolving Credit Facility) with an accordion feature that, subject to certain financial criteria, allowed us to borrow up to a total of $65.0 million beginning the quarter ended December 31, 2015. The Revolving Credit Facility carried, at our election, a base interest rate of the greater of the Federal Funds Rate plus 0.5% or one-month LIBOR plus 1% or a LIBOR based interest rate plus additional interest of up to 4.5% depending on our leverage ratio. The Revolving Credit Facility expired in August 2016. As of December 31, 2016 , we were in compliance with the financial covenants of the Line of Credit. Further, we had no amounts outstanding and were able to borrow up to $30.0 million under the Line of Credit. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We lease our offices under operating leases, which expire at various dates through 2022 . Our primary operating lease commitments at December 31, 2016 related to our headquarters in Santa Clara, California and our office in San Francisco, California. We recognize rent expense on a straight-line basis over the lease period. Where leases contain escalation clauses, rent abatements, or concessions, such as rent holidays and landlord or tenant incentives or allowances, we apply them in the determination of straight-line rent expense over the lease term. Rental expense, net of sublease income, was approximately $1.9 million , $2.5 million and $3.3 million in the years ended December 31, 2016 , 2015 and 2014 , respectively. The aggregate future minimum lease payments as of December 31, 2016 , are as follows (in thousands): 2017 $ 2,001 2018 1,927 2019 1,099 2020 749 2021 317 Thereafter 138 Total $ 6,231 From time to time, third parties may assert patent infringement claims against us in the form of letters, litigation, or other forms of communication. In addition, we may from time to time be subject to other legal proceedings and claims in the ordinary course of business, including claims of alleged infringement of trademarks, copyrights and other intellectual property rights; employment claims; and general contract or other claims. We may also, from time to time, be subject to various legal or government claims, disputes, or investigations. Such matters may include, but not be limited to, claims, disputes, or investigations related to warranty, refund, breach of contract, employment, intellectual property, government regulation, or compliance or other matters. In July 2010, the Kentucky Tax Authority issued a property tax assessment of approximately $1.0 million related to our textbook library located in our Kentucky warehouse for the 2009 and 2010 tax years under audit. In March 2011, we filed a protest with the Kentucky Board of Tax Appeals that was rejected in March 2012. In September 2012, we filed a complaint seeking declaratory rights against the Commonwealth of Kentucky in the Bullitt Circuit Court of Kentucky, and that case was subsequently dismissed in favor of administration remedies with the Kentucky Tax Authority. We received a final Notice of Tax due in October 2012 from the Kentucky Tax Authority and we appealed this notice in November 2012 with the Kentucky Board of Tax Appeals. In May 2013, we presented an Offer in Judgment to the Kentucky Tax Authority of approximately $150,000 , excluding tax and penalties, an amount that we have accrued for the two years under audit. We accrued this amount as of December 31, 2012. We appealed to the Kentucky Board of Tax Appeals in July 2013 and the Board issued a ruling in favor of the Kentucky Department of Revenue in January 2014 maintaining the property tax assessment. In February 2014, we filed an appeal to the Franklin Circuit Court in Kentucky and in June 2014 the Circuit Court held in abeyance our motion to appeal. In October 2014 the Franklin Circuit Court in Kentucky issued its opinion and order reversing the Board of Tax Appeal's decision, setting aside the Kentucky Department of Revenue's tax assessments against us and further vacating all penalties and interest. The Kentucky Department of Revenue has appealed the Circuit Court ruling. On March 4, 2016, the Kentucky Court of Appeals ruled unanimously in our favor, affirming our position that no property tax was owed on the textbooks. The Kentucky Department of Revenue petitioned the Kentucky Supreme Court for a discretionary review, which was denied in September 2016. The case was determined in our favor with no property tax due related to our textbook library. We are not aware of any other pending legal matters or claims, individually or in the aggregate, that are expected to have a material adverse impact on our consolidated financial position, results of operations, or cash flows. However, our determination of whether a claim will proceed to litigation cannot be made with certainty, nor can the results of litigation be predicted with certainty. Nevertheless, defending any of these actions, regardless of the outcome, may be costly, time consuming, distract management personnel, and have a negative effect on our business. An adverse outcome in any of these actions, including a judgment or settlement, may cause a material adverse effect on our future business, operating results, and/or financial condition. |
Guarantees and Indemnifications
Guarantees and Indemnifications | 12 Months Ended |
Dec. 31, 2016 | |
Guarantees And Indemnifications [Abstract] | |
Guarantees and Indemnifications | Guarantees and Indemnifications We have agreed to indemnify our directors and officers for certain events or occurrences, subject to certain limits, while such persons are or were serving at our request in such capacity. We may terminate the indemnification agreements with these persons upon termination of employment, but termination will not affect claims for indemnification related to events occurring prior to the effective date of termination. We have a directors’ and officers’ insurance policy that limits our potential exposure up to the limits of our insurance coverage. In addition, we also have other indemnification agreements with various vendors against certain claims, liabilities, losses, and damages. The maximum amount of potential future indemnification is unlimited. We believe the fair value of these indemnification agreements is minimal. We have not recorded any liabilities for these agreements as of December 31, 2016 . |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Common Stock | Common Stock We are authorized to issue 400 million shares of common stock, with a par value per share of $0.001 . As of December 31, 2016 , we have reserved the following shares of common stock for future issuance: December 31, 2016 Warrants to purchase common stock 200,000 Outstanding stock options 11,333,624 Outstanding RSUs 14,142,109 Shares available for grant under the stock plans 9,574,896 Shares available for issuance under employee stock purchase plan 5,310,428 Total common shares reserved for future issuance 40,561,057 Stock Plans 2013 Equity Incentive Plan On June 6, 2013, the Board of Directors adopted our 2013 Equity Incentive Plan (the 2013 Plan), which was subsequently approved by our stockholders on August 29, 2013. The 2013 Plan became effective on November 11, 2013 and replaced the 2005 Plan. On the effective date of the 2013 Plan, 12,000,000 shares of our common stock were reserved for issuance, plus an additional 3,838,985 shares reserved but not issued or subject to outstanding awards under our 2005 Plan on the effective date of the 2013 Plan, plus, on and after the effective date of the 2013 Plan, (i) shares that are subject to outstanding awards under the 2005 Plan which cease to be subject to such awards, (ii) shares issued under the 2005 Plan that are forfeited or repurchased at their original issue price and (iii) shares subject to awards under the 2005 Plan that are used to pay the exercise price of an option or withheld to satisfy the tax withholding obligations related to any award. As of December 31, 2016 there were 9,574,896 shares available for grant under the 2013 Plan. The 2013 Plan permits the granting of incentive stock options, non-qualified stock options, RSUs, stock appreciation rights, restricted shares of common stock and performance share awards. The exercise price of stock options may not be less than the 100% of the fair market value of the common stock on the date of grant. Options granted pursuant to the 2013 Plan generally expire no later than ten years. 2013 Employee Stock Purchase Plan On June 6, 2013, our board of directors adopted our 2013 Employee Stock Purchase Plan (the 2013 ESPP) and our stockholders subsequently approved the 2013 ESPP Plan on August 29, 2013. The 2013 ESPP permits eligible employees to acquire shares of our common stock by accumulating funds through periodic payroll deductions of up to 15% of base salary. Our 2013 ESPP is intended to qualify as an ESPP under Section 423 of the Code and employees will receive a 15% discount to the lesser of the fair market value of our common stock on (i) the first trading day of the applicable offering period or (ii) the last day of each purchase period in the applicable offering period. Each offering period may run for no more than six months. We have reserved 4,000,000 shares of our common stock under our 2013 ESPP. The aggregate number of shares issued over the term of our 2013 ESPP will not exceed 20,000,000 shares of our common stock. As of December 31, 2016 , there were 5,310,428 shares of common stock available for future issuance under the 2013 ESPP. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stockholders' Equity | Stockholders' Equity Share-based Compensation Total share-based compensation expense recorded for employees and non-employees, is as follows (in thousands): Year Ended December 31, 2016 2015 2014 Cost of revenues $ 172 $ 262 $ 617 Technology and development 14,771 11,992 10,451 Sales and marketing 6,124 7,901 11,300 General and administrative 20,718 18,620 14,520 Total share-based compensation expense $ 41,785 $ 38,775 $ 36,888 Total share-based compensation expense for consultants was $0.5 million , $0.4 million and $0.7 million in the years ended December 31, 2016 , 2015 and 2014 , respectively. There was no capitalized share-based compensation expense as of December 31, 2016 , 2015 or 2014 . Fair Value of Stock Options We estimate the fair value of each stock option award using the Black-Scholes-Merton option-pricing model, which utilizes the fair value of our common stock based on active market and requires input on the following subjective assumptions: Expected Term. The expected term for options granted to employees, officers, and directors is calculated as the midpoint between the vesting date and the end of the contractual term of the options. The expected term for options granted to consultants is determined using the remaining contractual life. Expected Volatility. The expected volatility was historically based on the average volatility of public companies within our peer group as our common stock had previously not been publicly trading for a long enough period to rely on our own expected volatility. Beginning with stock options granted during the fourth quarter of 2015, we have based the expected volatility on the average volatility of our stock price as we now have over two years of trading history. Expected Dividends. The dividend assumption is based on our historical experience. To date we have not paid any dividends on our common stock. Risk-Free Interest Rate. The risk-free interest rate used in the valuation method is the implied yield currently available on the United States treasury zero-coupon issues, with a remaining term equal to the expected life term of our options. The following table summarizes the key assumptions used to determine the fair value of our stock options granted to employees, officers and directors: Year Ended December 31, 2016 2015 2014 Expected term (years) 5.50 5.50-6.00 6.07 Expected volatility 56.94 % 50.68%-51.69% 55.91%-56.83% Dividend yield — % — % — % Risk-free interest rate 1.43 % 1.75%-1.86% 1.88%-2.02% Weighted-average grant-date fair value per share $ 2.58 $ 3.54 $ 3.82 Fair Value of Restricted Stock Units (RSUs) and of Performance-Based Restricted Stock Units (PSUs) RSUs and PSUs are converted into shares of our common stock upon vesting on a one-for-one basis. Vesting of RSUs is subject to the employee’s continuing service to us, while vesting of PSUs is subject to our achievement of specified corporate financial performance objectives in addition to the employee's continuing service to us. The compensation expense related to RSUs and PSUs is determined using the fair value of our common stock on the date of grant and the expense is recognized on a straight-line basis over the vesting period. RSUs are typically fully vested at the end of three or four years while PSUs vest subject to the achievement of performance objectives and if achieved, typically vest over two to three years . We assess the achievement of performance objectives on a quarterly basis and adjust our share-based payment expense as appropriate. Fair Value of 2013 ESPP Under the 2013 ESPP, rights to purchase shares are generally granted during the second and fourth quarter of each year. We estimate the fair value of rights granted under the 2013 ESPP at the date of grant using the Black-Scholes-Merton option-pricing model. The following table summarizes the key assumptions used to determine the fair value of rights granted under the 2013 ESPP: Year Ended December 31, 2016 2015 2014 Expected term (years) 0.50 0.50 0.50 Expected volatility 35.10%-75.74% 36.20%-49.59% 40.54%-46.42% Dividend yield — % — % — % Risk-free interest rate 0.38%-0.62% 0.09%-0.31% 0.05%-0.07% Weighted-average grant-date fair value per share $ 1.79 $ 1.98 $ 1.68 There were 467,979 shares purchased under the 2013 ESPP for the year ended December 31, 2016 at an average price per share of $3.76 with cash proceeds from the issuance of shares of $1.8 million . There were 419,137 shares purchased under the 2013 ESPP for the year ended December 31, 2015 at an average price per share of $5.81 with cash proceeds from the issuance of shares of $2.4 million . Stock Option Activity Stock option activity under our equity incentive plans was as follows: Options Outstanding Number of Options Outstanding Weighted- Average Exercise Price per Share Weighted-Average Remaining Contractual Term in Years Aggregate Intrinsic Value Balance at December 31, 2015 12,415,492 $ 8.68 6.24 $ 5,082,489 Granted 232,700 5.00 Exercised (121,538 ) 2.81 Canceled (1,193,030 ) 9.31 Balance at December 31, 2016 11,333,624 $ 8.60 5.22 $ 6,608,611 As of December 31, 2016 Options exercisable 10,818,738 $ 8.64 5.07 $ 6,004,970 Options vested and expected to vest 11,299,893 $ 8.60 5.21 $ 6,569,584 The total intrinsic value of options exercised during 2016 , 2015 and 2014 , was approximately $0.6 million , $3.2 million and $3.1 million , respectively. As of December 31, 2016 , our total unrecognized compensation expense for stock options granted to employees, officers, directors, and consultants was approximately $1.6 million , which will be recognized over a weighted-average vesting period of approximately 0.7 years . We recognize only the portion of the stock options granted to employees that is ultimately expected to vest as compensation expense. Estimated forfeitures are determined based on historical data and management’s expectation of exercise behaviors. Forfeiture rates and the resulting compensation expense are revised in subsequent periods if actual forfeitures differ from the estimate. RSU and PSU Activity RSUs and PSUs Outstanding Number of RSUs and PSUs Outstanding Weighted Average Grant Date Fair Value Balance at December 31, 2015 13,270,650 $ 6.38 Granted 10,307,836 4.62 Released (5,104,641 ) 6.37 Canceled (4,331,736 ) 6.06 Balance at December 31, 2016 14,142,109 $ 5.20 2014 PSU Grants In February 2014, we granted PSUs under the 2013 Plan to certain of our executive officers. The PSUs entitle the executives to receive a certain number of shares of our common stock based on our satisfaction of certain financial and strategic performance targets during 2014 (the 2014 Performance Period). Based on the achievement of the performance conditions during the 2014 Performance Period for the February grants, the final settlement of the PSU awards was 120% of the target shares underlying the PSU awards based on a specified objective formula approved by the Compensation Committee. These PSUs will vest annually over a three year period, with the first year vesting in February 2015. The target number of shares underlying the 2014 Performance Period PSUs that were granted to certain executive officers during the year ended December 31, 2014 totaled 1,208,560 shares and had a weighted average grant date fair value of $6.37 per share. As of December 31, 2014 , 120% of the PSUs vested. In June 2014, we granted PSUs under the 2013 Plan to the employees of InstaEDU, which were based on achieving certain revenue targets in 2014 and 2015. The target number of shares underlying the PSUs that were granted to certain employees of our InstaEDU acquisition during the year ended December 31, 2014 totaled 2,280,081 and had a weighted average grant date fair value of $6.00 per share. As of December 31, 2015 , metrics related to the 2014 and 2015 periods were not achieved and the shares were canceled following the attainment certification by our compensation committee. 2015 PSU Grants In February 2015, we granted PSUs under the 2013 Plan to certain of our key employees (the February 2015 grants). The PSUs entitle the employees to receive a certain number of shares of our common stock based on our satisfaction of certain financial and strategic performance targets during 2015 (the 2015 Performance Period) and 2016 (the 2016 Performance Period). Based on the achievement of the performance conditions during the 2015 Performance Period for the February 2015 grants, the final settlement met the minimum threshold for the 2015 Performance Period based on a specified objective formula approved by the Compensation Committee of the Board of Directors (the Compensation Committee). The PSUs related to the 2015 Performance Period vest annually over a one or three year period depending on the employee, with the initial vesting occurring in February 2016. In March 2016, the financial and strategic performance targets were set by the Compensation Committee for the 2016 Performance Period for the February 2015 grants. Based on the achievement of the performance conditions during the 2016 Performance Period for the February 2015 grants, the final settlement met the minimum threshold for the 2016 Performance Period based on a specified objective formula approved by the Compensation Committee. The PSUs related to the 2016 Performance Period vest over a one year period with vesting occurring in March 2017. During the year ended December 31, 2016 , the Compensation Committee approved a modification of the performance targets related to the 2015 Performance Period of the February 2015 grant for 26 employees. As a result of the modification, we recorded an expense of $1.5 million during the year ended December 31, 2016 . The number of shares underlying the PSUs granted during the year ended December 31, 2015 totaled 2,300,824 shares and had a weighted average grant date fair value of $6.59 per share. During the year ended December 31, 2016 , 688,464 shares were released relating to the 2015 Performance Period. As of December 31, 2016 , we expect a significant portion of the remaining PSUs related to the 2016 Performance Period to vest. 2016 PSU Grants In March 2016, we granted PSUs under the 2013 Plan to certain of our key executives. The PSUs entitle the executives to receive a certain number of shares of our common stock based on our satisfaction of certain financial and strategic performance targets during 2016. Based on the achievement of the performance conditions for the March 2016 grant, the final settlement met the minimum threshold based on a specified objective formula approved by the Compensation Committee. These PSUs will vest over a three year period depending on the employee, with the initial vesting occurring in March 2018. The number of shares underlying the PSUs granted during the year ended December 31, 2016 totaled 2,377,842 shares and had a weighted average grant date fair value of $4.32 per share. As of December 31, 2016 , we expect a significant portion of these PSUs to vest. As of December 31, 2016 , we had a total of approximately $36.2 million of unrecognized compensation costs related to RSUs and PSUs that is expected to be recognized over the remaining weighted average period of 1.9 years . Stock Warrants As of December 31, 2016 , we had a total of 200,000 common stock warrants exercisable at a weighted average exercise price of $12.00 . No common stock warrants were exercised in the year ended December 31, 2016 . During the year ended December 31, 2015, 795,549 common stock warrants were exercised at a weighted average exercise price of $4.12 . During the year ended December 31, 2014, 122,733 common stock warrants were exercised at a weighted average exercise price of $0.82 . |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We recorded an income tax provision of approximately $1.7 million , $1.5 million and $0.2 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. The income tax provision for the year ended December 31, 2016 was primarily due to state and foreign income tax expense and federal tax expense related to tax amortization of acquired indefinite lived intangible assets. The income tax provision for year ended December 31, 2015 was primarily due to state and foreign income tax expense and federal tax expense related to tax amortization of acquired indefinite lived intangible assets. The income tax provision for the year ended December 31, 2014 was primarily the result of foreign and state income taxes offset by the release of valuation allowance of $1.3 million resulting from our acquisition of InstaEDU. Our income tax provision consisted of the following (in thousands): Year Ended December 31, 2016 2015 2014 Current income taxes: Federal $ (18 ) $ — $ — State 321 263 304 Foreign 959 778 871 Total current income taxes 1,262 1,041 1,175 Deferred income taxes: Federal 503 484 (1,003 ) State 48 56 33 Foreign (106 ) (102 ) (19 ) Total deferred income taxes 445 438 (989 ) Total income tax provision $ 1,707 $ 1,479 $ 186 Loss before provision for income taxes consisted of the following (in thousands): Year Ended December 31, 2016 2015 2014 United States $ (42,687 ) $ (59,376 ) $ (65,930 ) Foreign 2,149 1,645 1,358 Total $ (40,538 ) $ (57,731 ) $ (64,572 ) The differences between our income tax provision as presented in the accompanying consolidated statements of operations and the income tax expense computed at the federal statutory rate consists of the items shown in the following table as a percentage of pretax loss (in percentages): Year Ended December 31, 2016 2015 2014 Income tax at U.S. statutory rate 34.0 % 34.0 % 34.0 % State, net of federal benefit 1.7 3.7 5.1 Share-based compensation (9.1 ) (7.0 ) (6.5 ) Non-deductible expenses (0.2 ) (0.2 ) (0.4 ) Other (1.4 ) — (0.5 ) Change in valuation allowance (29.2 ) (33.1 ) (32.0 ) Total (4.2 )% (2.6 )% (0.3 )% A summary of our deferred tax assets is as follows (in thousands): Year Ended December 31, 2016 2015 Deferred tax assets: Accrued expenses and reserves $ 5,069 $ 7,351 Share-based compensation 23,864 21,676 Deferred revenue 1,085 1,488 Net operating loss carryforwards 73,708 58,664 Property and equipment, textbooks and intangibles assets 5,168 7,577 Other items 1,407 1,612 Gross deferred tax assets 110,301 98,368 Valuation allowance (110,045 ) (98,209 ) Total deferred tax assets 256 159 Deferred tax liabilities: Intangible asset (1,413 ) (862 ) Total deferred tax liabilities (1,413 ) (862 ) Net deferred tax liability $ (1,157 ) $ (703 ) At December 31, 2016 and 2015 the deferred tax liability is created by the tax amortization of acquired indefinite lived intangible assets. Under the accounting guidance this deferred tax liability cannot be used as a source of income for recognition of deferred tax assets when determining the amount of valuation allowance to be recorded. Realization of the deferred tax assets is dependent upon future taxable income, the amount and timing of which are uncertain. Accordingly, the federal and state gross deferred tax assets have been fully offset by a valuation allowance. The net valuation allowance increased by approximately $11.8 million and $19.1 million during 2016 and 2015 , respectively. As of December 31, 2016 , we had net operating loss carryforwards for federal and state income tax purposes of approximately $200.7 million and $151.5 million , respectively, which will begin to expire in years beginning 2028 and 2017 , respectively. As of December 31, 2016 , we had tax credit carryforwards for federal and state income tax purposes of approximately $3.5 million and $4.3 million , respectively. The federal credits expire in various years beginning in 2030 . The state credits do not expire. Utilization of our net operating losses and tax credit carryforwards may be subject to substantial annual limitations due to ownership change limitations provided by the Internal Revenue Code of 1986, as amended (IRC), and similar state provisions. Such annual limitations could result in the expiration of the net operating losses and tax credit carryforwards before utilization. As of December 31, 2016 and 2015 , we have permanently reinvested approximately $6.0 million and $4.4 million of earnings from our international subsidiaries, respectively, and have not provided for U.S. federal income and foreign withholding taxes. If we were to distribute these earnings, such earnings could be subject to income or other taxes upon repatriation. Determination of the amount of unrecognized deferred tax liability related to these earnings is not practicable. During the year ended December 31, 2016 , we settled an audit relating to an examination by the tax authorities in India for the fiscal filing period ending March 31, 2012 for which we had received a notice of adjustment relating to our transfer pricing between the US and our Indian subsidiary. Also, the fiscal filing periods ending March 31, 2013 and 2014 were settled with no adjustment. Additionally, during the year ended December 31, 2016 we were informed that we would be under examination by the tax authorities in India for the fiscal filing period ending March 31, 2015. We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. During 2016 we recognized a decrease of $18 thousand and an increase during 2015 and 2014 of $0.1 million and $0.1 million of interest and penalties, respectively. Accrued interest and penalties as of December 31, 2016 and 2015 were approximately $0.6 million and $0.7 million , respectively. We file tax returns in U.S. federal, state, and certain foreign jurisdictions with varying statutes of limitations. Due to net operating loss and credit carryforwards, all of the tax years since inception through the 2016 tax year remain subject to examination by the U.S. federal and some state authorities. Foreign jurisdictions remain subject to examination up to approximately seven years from the filing date. A reconciliation of the beginning and ending balances of the total amount of unrecognized tax benefits, excluding accrued interest and penalties, is as follows (in thousands): Year Ended December 31, 2016 2015 2014 Beginning balance $ 4,849 $ 4,272 $ 2,994 Increase in tax positions for prior years 478 82 406 Decrease in tax positions for prior years (855 ) (416 ) (284 ) Decrease in tax positions for prior year settlement (32 ) (61 ) — Decrease in tax positions for prior years due to statutes lapsing (76 ) — — Increase in tax positions for current year 595 948 1,172 Change due to translation of foreign currencies (77 ) 24 (16 ) Ending balance $ 4,882 $ 4,849 $ 4,272 The actual amount of any taxes due could vary significantly depending on the ultimate timing and nature of any settlement. We believe that the amount by which the unrecognized tax benefits may increase or decrease within the next 12 months is not estimable. The amount of unrecognized tax benefits, if recognized, that would affect the effective tax rate is $1.5 million for the year ended December 31, 2016 . One or more of these unrecognized tax benefits could be subject to a valuation allowance if and when recognized in a future period, which could impact the timing of any related effective tax rate benefit. |
Restructuring (Credits) Charges
Restructuring (Credits) Charges | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring (Credits) Charges | Restructuring (Credits) Charges 2015 Restructuring Plan During the year ended December 31, 2016 , we recorded restructuring credits of $0.4 million primarily related to a partial reversal of previously accrued lease termination costs due to our subtenant leasing additional space. During the year ended December 31, 2015 , we recorded restructuring charges of $4.9 million related to our exits from our print coupon business and our Kentucky warehouse. The charges during the year ended December 31, 2015 included one-time employee termination benefits for 71 employees of $1.9 million and lease termination and other costs of $3.0 million . As a result of our strategic partnership with Ingram, we have successfully exited our warehouse facilities in the year ended December 31, 2015 . Costs incurred to date related to the lease termination and other costs are expected to be fully paid by 2021. The following table summarizes the activity related to the accrual for restructuring charges (in thousands): Workforce Reduction Costs Lease Termination and Other Costs Total Balance at January 1, 2015 $ — $ — $ — Restructuring charges 1,885 2,983 4,868 Cash payments (1,830 ) (675 ) (2,505 ) Write-offs — (317 ) (317 ) Other — 472 472 Balance at December 31, 2015 $ 55 $ 2,463 $ 2,518 Restructuring credits — (423 ) (423 ) Cash payments (55 ) (1,734 ) (1,789 ) Balance at December 31, 2016 $ — $ 306 $ 306 As of December 31, 2016 , the $0.3 million liability was comprised of a short-term accrual of $0.1 million included within accrued liabilities and a long-term accrual of $0.2 million included within other liabilities on the consolidated balance sheet. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions Our Chief Executive Officer is a member of the Board of Directors of Adobe Systems Incorporated (Adobe). During the years ended December 31, 2016 , 2015 and 2014 , we had purchases of $3.1 million , $2.9 million and $0.9 million , respectively, from Adobe. We had no revenues in the year ended December 31, 2016 and $0.1 million and $1.0 million in revenues in the years ended December 31, 2015 and 2014 , respectively, from Adobe. We had $0.3 million and $0.4 million in payables as of December 31, 2016 and 2015 , respectively, to Adobe. We had no outstanding accounts receivables as of December 31, 2016 and 2015 from Adobe. One of our board members is also a member of the Board of Directors of Cengage Learning, Inc. (Cengage). During the years ended December 31, 2016 , 2015 and 2014 , we had purchases of $10.2 million , $11.5 million and $12.4 million , respectively, from Cengage. We had $0.6 million and $0.1 million in revenues from Cengage in the years ended December 31, 2016 and 2015 , respectively, and no revenues in 2014 . We had an immaterial amount in payables as of December 31, 2016 and 2015 to Cengage. We had $0.1 million in outstanding accounts receivables as of December 31, 2016 and no outstanding accounts receivables as of December 31, 2015 from Cengage. One of our board members is also a member of the Board of Directors of Groupon, Inc. (Groupon). During the years ended December 31, 2016 and 2015 , we had purchases of $0.6 million and $0.1 million , respectively, from Groupon and an immaterial amount in 2014 . We had no revenues in the years ended December 31, 2016 , 2015 and 2014 from Groupon. We had an immaterial amount in payables as of December 31, 2016 and 2015 to Groupon. We had no outstanding accounts receivables as of December 31, 2016 and 2015 from Groupon. One of our board members is also a member of the Board of Directors of Synack, Inc. (Synack). During the years ended December 31, 2016 and 2015 , we had purchases of $0.2 million and $0.1 million , respectively, of services from Synack. Transactions with the above related parties have been conducted on an arms-length basis and the terms of our contracts are consistent with our contracts with other independent parties. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan We sponsor a 401(k) savings plan for eligible employees and their beneficiaries. Contributions by us are discretionary. Participants may contribute, on a pretax basis, a percentage of their annual compensation, but not to exceed a maximum contribution amount pursuant to Section 401(k) of the IRC. During 2016 , 2015 and 2014 , our matching contributions totaled approximately $0.9 million , $0.8 million , and $0.8 million , respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Our chief operating decision-maker is our Chief Executive Officer who makes resource allocation decisions and reviews financial information presented on a consolidated basis. Accordingly, we have determined that we have a single operating and reporting segment and operating unit structure. Product Information We derive our revenues from our Chegg Services and Required Materials product lines. Chegg Services includes our products and services we provide to supplement the requirements and help students with their coursework as well as our marketing services which help to complete our offering of services to students. Required Materials includes all products that are essential for students to meet the requirements of their coursework. Chegg Services includes Chegg Study, Chegg Tutors, Writing Tools (newly acquired in May 2016), Enrollment Marketing, Brand Partnership, Internships, and Test Prep . Required Materials includes the rental and sale of print textbooks, our web-based, multiplatform eTextbook Reader, eTextbooks and supplemental course materials and the commissions earned through our Ingram partnership. The following table sets forth our total net revenues for the periods shown for our Chegg Services and Required Materials product lines (in thousands): December 31, 2016 2015 2014 Chegg Services $ 129,335 $ 94,285 $ 68,117 Required Materials 124,755 207,088 236,717 Total net revenues $ 254,090 $ 301,373 $ 304,834 Geographic Information Our headquarters and most of our operations are located in the United States. We conduct our sales, marketing and customer service activities primarily in the United States. Geographic revenues information is based on the location of the customer. In 2016 , 2015 and 2014 , substantially all of our revenues and long-lived assets are located in the United States. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (unaudited) | Selected Quarterly Financial Data (unaudited) Three Months Ended March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Total net revenues $ 66,654 $ 53,036 $ 71,343 $ 63,057 Gross profit $ 27,731 $ 31,629 $ 32,644 $ 42,485 Net loss $ (15,685 ) $ (9,008 ) $ (16,063 ) $ (1,489 ) Weighted average shares used to compute net loss per share, basic and diluted 89,118 90,416 91,059 91,526 Net loss per share, basic and diluted $ (0.18 ) $ (0.10 ) $ (0.17 ) $ (0.02 ) Three Months Ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Total net revenues $ 84,872 $ 67,061 $ 81,286 $ 68,154 Gross profit $ 19,379 $ 30,805 $ 19,566 $ 41,774 Net (loss) income $ (28,542 ) $ (10,131 ) $ (24,167 ) $ 3,630 Weighted average shares used to compute net (loss) income per share: Basic 84,794 86,741 87,706 87,993 Diluted 84,794 86,741 87,706 93,225 Net (loss) income per share: Basic $ (0.34 ) $ (0.12 ) $ (0.28 ) $ 0.04 Diluted $ (0.34 ) $ (0.12 ) $ (0.28 ) $ 0.04 We recorded restructuring credits of $0.1 million , $0.1 million , $0.2 million and $44 thousand in the three months ended December 31, 2016 , September 30, 2016 , June 30, 2016 and March 31, 2016 , respectively. We recorded restructuring charges of $1.6 million , $0.3 million , $0.5 million and $2.5 million in the three months ended December 31, 2015 , September 30, 2015 , June 30, 2015 and March 31, 2015 , respectively. |
Significant Accounting Polici27
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States (U.S. GAAP) requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities; the disclosure of contingent liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting periods. Significant estimates, assumptions, and judgments are used for, but not limited to: revenue recognition, recoverability of accounts receivable, determination of the useful lives and salvage value assigned to our textbook library, restructuring charges, share-based compensation expense including estimated forfeitures, accounting for income taxes, useful lives assigned to long-lived assets for depreciation and amortization, impairment of goodwill and long-lived assets, and the valuation of acquired intangible assets. We base our estimates on historical experience, knowledge of current business conditions, and various other factors we believe to be reasonable under the circumstances. These estimates are based on management’s knowledge about current events and expectations about actions we may undertake in the future. Actual results could differ from these estimates, and such differences could be material to our financial position and results of operations. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Chegg and our wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with U.S. GAAP. |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash We consider all highly liquid investments with an original maturity date of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents, which consist of cash, money market accounts, commercial paper, corporate securities and agency bonds at financial institutions, are stated at cost, which approximates fair value. We classify certain restricted cash balances within other current assets and other assets on the accompanying consolidated balance sheets based upon the term of the remaining restrictions. A |
Investments | Investments We hold investments in marketable securities, consisting of corporate securities, commercial paper and agency bonds. We classify our marketable securities as available-for-sale investments that are either short or long-term based on the nature of each security based on the contractual maturity of the investment when purchased. Our available-for-sale investments are carried at estimated fair value with any unrealized gains and losses, net of taxes, included in accumulated other comprehensive loss in stockholders’ equity. Unrealized losses are charged against other (expense) income, net when a decline in fair value is determined to be other-than-temporary. We did not record any such impairment charges in the periods presented. We determined realized gains or losses on the sale of marketable securities on a specific identification method, and recorded such gains or losses as other (expense) income, net. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable Accounts receivable are recorded at the invoiced amount and are non-interest bearing. We generally grant uncollateralized credit terms to our customers, which include textbook wholesalers, and marketing services customers, and maintain an allowance for doubtful accounts to account for potentially uncollectible receivables. Allowance for Doubtful Accounts We assess the creditworthiness of our customers based on multiple sources of information, and analyze such factors as our historical bad debt experience, industry and geographic concentrations of credit risk, economic trends, and customer payment history. This assessment requires significant judgment. Because of this assessment, we maintain an allowance for doubtful accounts for estimated losses resulting from the inability of certain customers to make all of their required payments. In making this estimate, we analyze historical payment performance and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. Accounts receivable are written off as a decrease to the allowance for doubtful accounts when all collection efforts have been exhausted and an account is deemed uncollectible. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, and marketable securities invested in highly liquid instruments in accordance with our investment policy. We place the majority of our cash and cash equivalents and restricted cash with financial institutions in the United States that we believe to be of high credit quality, and accordingly minimal credit risk exists with respect to these instruments. Certain of our cash balances held with financial institutions are in excess of Federal Deposit Insurance Corporation limits. Our investment portfolio consists of investment-grade marketable securities diversified among security types, industries and issuers. Our investments were held and managed by recognized financial institutions that followed our investment policy with the main objective of preserving capital and maintaining liquidity. C |
Textbook Library | Textbook Library We consider our print textbook library to be a long-term productive asset and, as such, classify it as a non-current asset in our consolidated balance sheets. Cash outflows for the acquisition of our print textbook library, net of changes in related accounts payable and accrued liabilities historically was classified as cash flows from investing activities in our consolidated statements of cash flows. As a result of our strategic partnership with Ingram, since May 1, 2015, Ingram has made all new investments in the print textbook library and we also provided Ingram with extended payment terms through 2016 for the purchase of textbooks, before moving to normal payment terms in January 2017. As such, we have recorded any cash outflows as a result of this partnership as an operating activity in our consolidated statements of cash flows as we are no longer purchasing print textbooks but rather providing extended payments terms to Ingram to facilitate their purchase of new textbooks. Cash inflows received from the liquidation of print textbooks are classified as cash flows from investing activities in our consolidated statements of cash flows, consistent with other long-term asset classification of our existing print textbook library. The gain or loss from the liquidation of print textbooks previously rented is recorded as a component of operating expenses in our consolidated statement of operations and is classified as cash flow from operating activities. All print textbooks in our textbook library are stated at cost, which includes the purchase price less accumulated depreciation. We record allowances for lost or damaged print textbooks in cost of revenues in our consolidated statements of operations based on our assessment of our print textbook library on a book-by-book basis. Write-offs result from lost or damaged books, books no longer considered to be rentable, or when books are not returned to us after the rental period by our customers. We depreciate our print textbooks, less an estimated salvage value, over an estimated useful life of three years using an accelerated method of depreciation, as we estimate this method most accurately reflects the actual pattern of decline in the economic value of the assets. The salvage value considers the historical trend and projected liquidation proceeds for print textbooks. The useful life is determined based on the time period in which the print textbooks are held and rented before liquidation. In accordance with our policy, we review the estimated useful lives of our print textbook library on an ongoing basis. De |
Property and Equipment | The cost of maintenance and repairs is expensed as incurred. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from their respective accounts, and any gain or loss on such sale or disposal is reflected in loss from operations Property and Equipment Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives of the assets: |
Software Development Costs | Software Development Costs We capitalize costs related to software developed or obtained for internal use when certain criteria have been met. Costs incurred during the application development stage for internal-use software are capitalized in property and equipment and amortized over the estimated useful life of the software, generally up to three years. |
Goodwill | Goodwill Goodwill represents the excess of the fair value of consideration paid over the estimated fair value of assets acquired and liabilities assumed in a business acquisition. Goodwill is not amortized but rather tested for impairment at least annually on October 1, or more frequently if certain events or indicators of impairment occur between annual impairment tests. We first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. In our qualitative assessment, we consider factors including economic conditions, industry and market conditions and developments, overall financial performance and other relevant entity-specific events in determining whether it is more likely than not that the fair value of our reporting unit is less than the carrying amount. We completed our annual impairment test on October 1 of 2016 and 2015 , each of which did not result in any impairment as our qualitative assessment did not indicate that it is more likely than not that the fair value of our reporting unit is less than the carrying amount. |
Acquired Intangible Assets, and Other Long-Lived Assets | Acquired Intangible Assets and Other Long-Lived Assets Acquired intangible assets with finite useful lives, which include developed technology, customer lists, trade names and non-compete agreements, are amortized over their estimated useful lives. We assess the impairment of acquired intangible assets and other long-lived assets when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. |
Indefinite-Lived Intangibles | Indefinite-Lived Intangibles We make judgments about the recoverability of purchased indefinite-lived intangible assets at least annually on October 1 or more frequently whenever events or changes in circumstances indicate that an impairment may exist to determine whether it is more likely than not that the carrying value of the assets may not be recoverable. Recoverability of indefinite-lived intangible assets is measured by comparing the carrying amount of the asset to the future undiscounted cash flows that the asset is expected to generate. If we determine that an individual asset is impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. We completed our annual impairment test on October 1 of 2016 and 2015 , each of which did not result in any impairment. |
Revenue Recognition and Deferred Revenue | Revenue Recognition and Deferred Revenue We derive our revenues, net of allowances, for refunds or charge backs from our payment processors who process payments from credit cards, debit cards and PayPal. Revenues are recognized when the four basic criteria for revenue recognition have been met as follows: persuasive evidence of an arrangement exists, delivery has occurred and title has transferred, the sale price is fixed or determinable, and collection is reasonably assured. Revenues are presented net of sales tax collected from customers to be remitted to governmental authorities and net of allowances for estimated cancellations and customer returns, which are based on historical data. Customer refunds from cancellations and returns are recorded as a reduction to revenues. We generate revenues from our Required Materials product line including the rental of print textbooks and eTextbooks and, to a lesser extent, through the sales of print textbooks through our website purchased by us on a just-in-time basis. Rental revenues were historically recognized ratably over the term of the rental period, generally two to five months, for the print textbooks that we owned. As of November 2016, we no longer rent our print textbooks and therefore all revenues from print textbook rentals from this date forward are commission-based. Commission-based print textbook rental revenues are recognized immediately in the period the transaction occurs. Revenues from selling textbooks on a just-in-time basis are recognized upon shipment. We do not hold an inventory of textbooks for sale. Our customers pay for the rental and sale of print textbooks on our website primarily by credit card, resulting in immediate settlement of our accounts receivable. Shipping costs charged to customers in the sale or rental of textbooks are recorded in revenues and the related expenses are recorded as cost of revenues. We generate revenues from our Chegg Services product line including our Chegg Study service, our Chegg Tutors service, and our writing tools service that we offer to students. These services are offered to students through monthly or annual subscriptions and we recognize revenues ratably over the respective subscription period. Our Chegg Services also include enrollment marketing services and brand advertising, which we offer either on a subscription or on an a la carte basis. Enrollment marketing services connect colleges and graduate schools with students seeking admission or scholarship opportunities at these institutions. Brand advertising offers brands unique ways to connect with students. Finally, Chegg Services includes our internship services and our Test Prep service currently covering the ACT and SAT exams. Revenues are recognized ratably or as earned over the subscription service, generally one year. Revenues from enrollment marketing services or brand advertising delivered on an a la carte basis, without a subscription, is recognized when delivery of the respective lead or service has occurred. For these services, we bill the customer at the inception, over the term of the customer arrangement or as the services are performed. Upon satisfactory assessment of creditworthiness, we generally grant credit to our enrollment marketing services and brand advertising customers with normal credit terms, typically 30 days. Some of our customer arrangements for enrollment marketing services include multiple deliverables, which include the delivery of student leads as well as other services to the end customer. We have determined these deliverables qualify as separate units of accounting, as they have value to the customer on a standalone basis and our arrangements do not contain a right of return. For these arrangements that contain multiple deliverables, we allocate the arrangement consideration based on the relative selling price method in accordance with the selling price hierarchy, which includes: (1) vendor-specific objective evidence of fair value (VSOE), when available; (2) third-party evidence of selling price (TPE), if VSOE does not exist; and (3) estimated selling price (ESP), if neither VSOE nor TPE is available. We determine VSOE based on our historical pricing and discounting practices for the specific solution when sold separately and when a substantial majority of the selling prices for these services fall within a narrow range. TPE is determined based on competitor prices for similar deliverables when sold separately. Generally our go-to-market strategy differs from that of our peers, and our offerings contain a significant level of differentiation such that the comparable pricing of services with similar functionality cannot be obtained. If we have not established VSOE or TPE for our enrollment marketing services, we have used ESP in our allocation of arrangement consideration. Additionally, we limit the amount of revenues recognized for delivered elements to the amount that is not contingent on future delivery of services or other future performance obligations. Deferred revenue primarily consists of advanced payments from students related to rentals and subscriptions that have not been recognized, and marketing services that have yet to be performed. Deferred revenue is recognized as revenues ratably over the term or when the services are provided and all other revenue recognition criteria have been met. We evaluate whether we are acting as a principal or an agent, and therefore would record the gross sales amount and related costs as revenues or the net amount earned as commissions from the sale of third party products. Our determination is based on our evaluation of certain indicators including whether we are the principal in the transaction, are subject to inventory risk, have latitude in establishing prices and selecting suppliers, none of which is presumptive or determinative. We generally operate as the principal and so in those instances revenues are recorded at the gross sale price. We generally record the net amounts as commissions earned when such amounts are determined using a fixed percentage of the transaction price, we are not subject to inventory risk or responsible for the fulfillment of the textbooks. We operate as an agent in our strategic partnership with Ingram and therefore our revenues include a commission on the total revenues that we earn from Ingram upon their fulfillment of a rental transaction using books for which Ingram has title and risk of loss. We also present our revenues separately for rental, services and sales. Rental revenue includes the rental of print textbooks for which we take title and bear the risk of loss; service revenue includes Chegg Study, Chegg Tutors, our writing tools service, enrollment marketing, brand advertising, eTextbooks, and commissions we earn from Ingram and other e-commerce partners; sale revenue includes just-in-time sale of print textbooks and the sale of other required materials. C |
Cost of Revenues | Cost of Revenues Our cost of revenues consists primarily of expenses associated with the delivery and distribution of our products and services. Cost of revenues related to our print textbook rentals included print textbook depreciation expense, shipping and other fulfillment costs, the cost of textbooks sold, payment processing costs, write-offs and allowances related to the print textbook library, and all expenses associated with our distribution and customer service centers, including personnel and warehousing costs. The cost of textbooks sold, shipping and other fulfillment costs and payment processing expenses are recognized upon shipment, while print textbook depreciation is recognized under an accelerated method over the life of the textbook. We believe this method most accurately reflects the actual pattern of decline in the economic value of the assets, resulting in higher costs earlier in the textbook lifecycle. Cost of revenues also includes the depreciation of our eTextbook Reader software, publisher content fees for eTextbooks, content amortization expense related to content that we develop or license, including publisher agreements for which we pay one-time license fees for published content, enrollment marketing services leads purchased from third-party suppliers to fulfill leads that we are unable to fulfill through our internal database, personnel costs and other direct costs related to providing the content or services. In addition, cost of revenues includes allocated information technology and facilities costs. T |
Technology and Development Costs | Technology and Development Costs Technology and development expenses consist primarily of salaries, benefits and share-based compensation expense for employees on our product and web design, engineering and technical teams who are maintaining our website, developing new products and improving existing products. Technology and development costs also include web hosting costs, third-party development costs and allocated information technology and facilities costs. We expense substantially all of our technology and development costs as they are incurred. A |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and consist primarily of online advertising and marketing promotional expenditures. |
Share-based Compensation | Share-based Compensation Share-based compensation expense for stock options, restricted stock units (RSUs), performance-based restricted stock units (PSUs), and employee stock purchase plan (ESPP) are accounted for under the fair value method, which requires us to measure the cost of employee share-based compensation awards based on the grant-date fair value of the award. Share-based compensation expense for stock options and our ESPP is estimated at the date of grant using the Black-Scholes-Merton option pricing model while expense for RSUs and PSUs is measured based on the closing fair market value of the Company’s common stock on the date of grant. We recognize compensation cost for all share-based compensation awards that are expected to vest on a straight-line basis over the requisite service period of the awards, which is generally the option vesting period. These amounts are reduced by estimated forfeitures, which are estimated at the time of the grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Equity awards issued to non-employees are recorded at their fair value on the measurement date and are subject to adjustment each period as the underlying awards vest or consulting services are performed. |
Income Taxes | Income Taxes We account for income taxes under an asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and the tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established, when necessary, to reduce deferred tax assets to an amount that is more likely than not to be realized. We recognize the benefit from a tax position only if it is more likely than not that the position would be sustained upon audit based solely on the technical merits of the tax position. Our policy is to include interest and penalties related to unrecognized tax benefits as a component of income tax expense. |
Restructuring Charges | Restructuring Charges Restructuring charges are primarily comprised of severance costs, contract and program termination costs, asset impairments and costs of facility consolidation and closure. Restructuring charges are recorded upon approval of a formal management plan and are included in the operating results of the period in which such plan is approved and the expense becomes estimable. To estimate restructuring charges, management utilizes assumptions of the number of employees that would be involuntarily terminated and of future costs to operate and eventually vacate duplicate facilities. Severance and other employee separation costs are accrued when it is probable that benefits will be paid and the amount is reasonably estimable. The rates used in determining severance accruals are based on our policies and practices and negotiated settlements. Restructuring charges for employee workforce reductions are recorded upon employee notification for employees whose required continuing service period is 60 days or less and ratably over the employee’s continuing service period for employees whose required continuing service period is greater than 60 days. |
Strategic Investments | Strategic Investment We have entered into an equity investment in a privately-held business to achieve certain strategic business objectives. Our investment in equity securities of this privately-held business is accounted for under the cost method. We periodically review this investment for other-than-temporary declines in fair value based on the specific identification method and write down investments when an other-than-temporary decline has occurred. Any fair value estimates are made based on consideration of the current cash position, recent operational performance, and forecasts of the investees. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less the weighted-average unvested common stock subject to repurchase or forfeiture. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including stock options, warrants, restricted stock units (RSUs), and performance-based restricted stock units (PSUs), to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential common shares outstanding would have been anti-dilutive. |
Foreign Currency Translations | Foreign Currency Translation The functional currency of our foreign subsidiaries is the local currency. Adjustments resulting from the translation of foreign currencies into U.S. dollars for balance sheet amounts are based on the exchange rates as of the consolidated balance sheet date. Non-monetary balance sheet items denominated in a currency other than the applicable functional currency are translated using the historical rate. Revenues and expenses are translated at average exchange rates during the period. Foreign currency translation gains or losses are included in accumulated other comprehensive loss as a component of stockholders’ equity on the consolidated balance sheets. Gains or losses resulting from foreign currency transactions, which are denominated in currencies other than the entity’s functional currency, are included in other income (expense), net in the consolidated statements of operations and were not material during 2016 , 2015 or 2014 . |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-20 Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . ASU 2016-20 provides for corrections and improvements for specific areas of Topic 606. In May 2016, the FASB issued ASU No. 2016-12 Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients . ASU 2016-12 provides for improvements and practical expedients for specific areas of Topic 606. In April 2016, the FASB issued ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing . ASU 2016-10 provides for clarification of two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance. In March 2016, the FASB issued ASU No. 2016-08 Revenue from Contracts with Customers (Topic 606) - Principal versus Agent Considerations (Reporting Revenue Gross versus Net) . ASU No. 2016-08 requires an entity to determine whether the nature of its promise to provide goods or services to a customer is performed in a principal or agent capacity and to recognize revenue in a gross or net manner based on its principal/agent designation. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers . This standard outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASUs 2016-20, 2016-12, 2016-10, 2016-08, and 2014-09 allow for companies to choose to apply the standard retrospectively to each prior reporting period presented (full retrospective application) or retrospectively with the cumulative effect of initially applying the standard as an adjustment to the opening balance of retained earnings of the annual reporting period that includes the date of initial application (modified retrospective application). We plan to adopt the standard under the modified retrospective application. Each guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. We plan to adopt the guidance starting in the first quarter of 2018. We are currently in the process of evaluating the impact this guidance may have on our consolidated financial statements and related disclosures and have initially determined that a potential area of impact subject to further evaluation is our revenue recognition as it relates to our commissions based revenue streams and performance related obligations. We will continue to evaluate the guidance updates as we near our adoption date. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . ASU 2016-18 requires an entity to explain the change during a period in restricted cash equivalents on the consolidated statements of cash flows and include such amounts when reconciling beginning-of-period and end-of-period total amounts shown on the consolidated statements of cash flows. Early adoption is permitted, and the guidance requires a retrospective adoption. The guidance is effective for annual periods after December 15, 2017, and we are currently in the process of evaluating the impact of this new guidance. In August 2016, the FASB issued ASU No. 2016-15 Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force) . ASU 2016-15 provides for specific guidance on eight cash flow issues where the previously U.S. GAAP was either unclear or did not include specific guidance. The guidance requires a retrospective application and is effective for annual periods after December 15, 2017, with earlier application permitted as of the beginning of an interim or annual reporting period. We have elected to early adopt this standard which did not result in any changes to the presentation of our consolidated statements of cash flows for the years ended December 31, 2016 , 2015 , and 2014 . In March 2016 the FASB issued ASU No. 2016-09 Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . ASU 2016-09 provides for simplification involving several aspects of the accounting for share-based payment transactions, including the income tax consequences, an option to recognize gross share-based compensation expense with actual forfeitures recognized as they occur, and classification on the statement of cash flows. In addition to these simplifications, ASU 2016-09 also eliminates the guidance in Topic 718 that was indefinitely deferred shortly after the issuance of FASB Statement No. 123 (revised 2004), Share-Based Payment . Early adoption is permitted and the application of the guidance is different for each update included within ASU 2016-09. The guidance is effective for annual periods after December 15, 2016. We plan to adopt the guidance starting in the first quarter of 2017 and we do not anticipate the provisions in this update to have a material impact on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . ASU 2016-02 requires an entity to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement, and presentation of expenses will depend on classification as a finance or operating lease. The amendments in this update also require certain quantitative and qualitative disclosures about leasing arrangements. Early adoption is permitted, and the guidance requires a modified retrospective adoption. The guidance is effective for annual periods after December 15, 2018, and we are currently in the process of evaluating the impact of this new guidance. In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 requires all financial assets and liabilities not accounted for under the equity method to be measured at fair value with the changes in fair value recognized in net income. The amendments in this update also require an entity to separately present in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. In addition, the amendments in this update supersede the requirement to disclose the methods and significant assumptions used in calculating the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet for public business entities. Early adoption is not permitted except for the comprehensive income presentation requirement, and the updated guidance requires a prospective application with a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The guidance is effective for annual periods after December 15, 2017, and we are currently in the process of evaluating the impact of this new guidance. |
Significant Accounting Polici28
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Useful Lives For Property And Equipment | Property and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives of the assets: Classification Useful Life Computers and equipment 3 years Software 3 years Furniture and fixtures 5 years Leasehold improvements Shorter of the remaining lease term or the estimated useful life of 5 years Content 5 years |
Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of historical basic and diluted net loss per share (in thousands, except per share amounts): Year Ended 2016 2015 2014 Numerator: Net loss $ (42,245 ) $ (59,210 ) $ (64,758 ) Denominator: Weighted-average common shares outstanding 90,534 86,818 83,241 Less: Weighted-average unvested common shares subject to repurchase or forfeiture — — (36 ) Weighted average shares used to compute net loss per share, basic and diluted 90,534 86,818 83,205 Net loss per share, basic and diluted $ (0.47 ) $ (0.68 ) $ (0.78 ) |
Common Shares Outstanding Excluded from Computation of Diluted Net Loss Per Share | The following potential weighted-average shares of common stock outstanding were excluded from the computation of diluted net loss per share attributable to common stockholders because including them would have been anti-dilutive (in thousands): Year Ended December 31, 2016 2015 2014 Options to purchase common stock 10,799 11,446 14,253 RSUs and PSUs 1,239 200 289 Employee stock purchase plan 15 — — Warrants to purchase common stock 200 299 996 Total common stock equivalents 12,253 11,945 15,538 |
Cash and Cash Equivalents, In29
Cash and Cash Equivalents, Investments and Restricted Cash (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents, Restricted Cash and Investments | The following table shows our cash and cash equivalents, restricted cash and investments’ adjusted cost, net unrealized loss and fair value as of December 31, 2016 and December 31, 2015 (in thousands): December 31, 2016 December 31, 2015 Cost Net Unrealized Loss Fair Value Cost Net Unrealized Loss Fair Value Cash and cash equivalents: Cash $ 77,329 $ — $ 77,329 $ 52,905 $ — $ 52,905 Money market funds — — — 6,672 — 6,672 Commercial paper — — — 5,453 — 5,453 Corporate securities — — — 600 (1 ) 599 Agency bond — — — 1,400 — 1,400 Total cash and cash equivalents $ 77,329 $ — $ 77,329 $ 67,030 $ (1 ) $ 67,029 Short-term investments: Commercial paper $ — $ — $ — $ 3,746 $ — $ 3,746 Corporate securities — — — 10,572 (12 ) 10,560 Agency bonds — — — 3,494 — 3,494 Total short-term investments $ — $ — $ — $ 17,812 $ (12 ) $ 17,800 Long-term investments: Corporate securities $ — $ — $ — $ 3,241 $ (10 ) $ 3,231 Agency bond — — — 1,001 (3 ) 998 Long-term corporate securities $ — $ — $ — $ 4,242 $ (13 ) $ 4,229 Short-term restricted cash $ — $ — $ — $ 300 $ — $ 300 Long-term restricted cash 104 — 104 478 — 478 Total restricted cash $ 104 $ — $ 104 $ 778 $ — $ 778 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments Measured and Recorded at Fair Value on Recurring Basis | We had no financial instruments measured and recorded at fair value on a recurring basis as of December 31, 2016 and amounts as of December 31, 2015 are classified based on the valuation technique level in the table below (in thousands): December 31, 2015 Total Quoted Prices Significant Assets: Cash equivalents: Money market funds $ 6,672 $ 6,672 $ — Commercial paper 5,453 — 5,453 Corporate securities 599 — 599 Agency bond 1,400 — 1,400 Short-term investments: Commercial paper 3,746 — 3,746 Corporate securities 10,560 — 10,560 Agency bonds 3,494 — 3,494 Long-term investments: Corporate securities 3,231 — 3,231 Agency bond 998 — 998 Total assets measured and recorded at fair value $ 36,153 $ 6,672 $ 29,481 |
Long-Lived Assets (Tables)
Long-Lived Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of textbook library | Textbook library, net consisted of the following (in thousands): December 31, 2016 2015 Textbook library $ 33,980 $ 100,783 Less accumulated depreciation (31,405 ) (71,055 ) Textbook library, net $ 2,575 $ 29,728 |
Property, plant and equipment | Property and equipment, net consisted of the following (in thousands): December 31, 2016 2015 Computer and equipment $ 1,597 $ 1,313 Software 4,324 2,591 Furniture and fixtures 2,148 1,652 Leasehold improvements 5,342 4,983 Content 49,725 27,359 Property and equipment 63,136 37,898 Less accumulated depreciation and amortization (27,831 ) (17,927 ) Property and equipment, net $ 35,305 $ 19,971 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Fair Value of Consideration | The acquisition date fair value of the purchase consideration for the above transactions consisted of the following (in thousands): Initial cash consideration $ 22,007 Net working capital adjustment 200 Fair value of deferred cash consideration 17,127 Escrow 4,200 Hold-back 500 Fair value of purchase consideration $ 44,034 The acquisition date fair value of the consideration for the above four transactions consisted of the following as of December 31, 2014 (in thousands): Cash consideration $ 55,537 Fair value of stock escrow consideration 2,585 Fair value of stock contingent consideration 193 Fair value of purchase consideration $ 58,315 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The following table presents the total allocation of purchase consideration recorded in our consolidated balance sheets as of the acquisition date (in thousands): Cash $ 59 Accounts receivable 2,610 Favorable lease acquired 300 Other acquired assets 212 Acquired intangible assets: Trade names 1,840 Domain names 1,330 Advertiser relationships 6,600 User base 550 Non-compete agreements 508 Developed technology 5,660 Total acquired intangible assets 16,488 Total identifiable assets acquired 19,669 Liabilities assumed (573 ) Net identifiable assets acquired 19,096 Goodwill 24,938 Total fair value of purchase consideration $ 44,034 The following table summarizes the fair value of the net identifiable assets acquired in the year ended December 31, 2014 (in thousands): Cash $ 1,665 Other acquired assets 595 Acquired intangible assets: Developed technology 4,174 Customer lists 3,770 Trade names 5,990 Non-compete agreements 1,630 Corporate partnerships 243 Master services agreements 1,030 Total acquired intangible assets 16,837 Total identifiable assets acquired 19,097 Liabilities assumed (2,538 ) Net identifiable assets acquired 16,559 Goodwill 41,756 Net assets acquired $ 58,315 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill consists of the following (in thousands): December 31, 2016 December 31, 2015 Beginning balance $ 91,301 $ 91,301 Additions due to acquisitions 24,938 — Ending balance $ 116,239 $ 91,301 |
Intangible Assets | Intangible assets as of December 31, 2016 and December 31, 2015 consist of the following (in thousands, except weighted-average amortization period): December 31, 2016 Weighted-Average Amortization Period (in months) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technologies 60 $ 15,077 $ (8,245 ) $ 6,832 Customer lists 47 9,970 (3,673 ) 6,297 Trade names 47 5,513 (1,998 ) 3,515 Non-compete agreements 30 1,728 (1,249 ) 479 Master service agreements 21 1,030 (1,005 ) 25 Indefinite-lived trade name — 3,600 — 3,600 Total intangible assets $ 36,918 $ (16,170 ) $ 20,748 December 31, 2015 Weighted-Average Amortization Period (in months) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technologies 52 $ 9,417 $ (6,702 ) $ 2,715 Customer lists 20 2,820 (2,239 ) 581 Trade names 48 2,343 (920 ) 1,423 Non-compete agreements 28 1,220 (832 ) 388 Master service agreements 21 1,030 (872 ) 158 Indefinite-lived trade name — 3,600 — 3,600 Total intangible assets $ 20,430 $ (11,565 ) $ 8,865 |
Estimated Future Amortization Expense Related to Intangible Assets | As of December 31, 2016 , the estimated future amortization expense related to our finite-lived intangible assets is as follows (in thousands): 2017 $ 5,350 2018 4,446 2019 3,510 2020 2,153 2021 815 Thereafter 874 Total $ 17,148 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Balance Sheet Details [Abstract] | |
Schedule of Other Current Assets | Other current assets consist of the following (in thousands): December 31, 2016 2015 Reimbursement from Ingram $ 18,759 $ 28,875 Other 3,500 2,857 Other Current Assets $ 22,259 $ 31,732 |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following (in thousands): December 31, 2016 2015 Accrued shipping for cycle returns $ 1,334 $ 3,355 Refund reserve 487 4,538 Taxes payable 2,927 3,913 Accrued deferred cash consideration related to acquisition 17,378 — Payable to Ingram 8,237 9,965 Other 13,956 13,509 Accrued Liabilities $ 44,319 $ 35,280 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The aggregate future minimum lease payments as of December 31, 2016 , are as follows (in thousands): 2017 $ 2,001 2018 1,927 2019 1,099 2020 749 2021 317 Thereafter 138 Total $ 6,231 |
Convertible Preferred Stock and
Convertible Preferred Stock and Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Schedule Of Common Stock Reserved For Future Issuance | We are authorized to issue 400 million shares of common stock, with a par value per share of $0.001 . As of December 31, 2016 , we have reserved the following shares of common stock for future issuance: December 31, 2016 Warrants to purchase common stock 200,000 Outstanding stock options 11,333,624 Outstanding RSUs 14,142,109 Shares available for grant under the stock plans 9,574,896 Shares available for issuance under employee stock purchase plan 5,310,428 Total common shares reserved for future issuance 40,561,057 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation Expense for Employees and Non-Employees | Total share-based compensation expense recorded for employees and non-employees, is as follows (in thousands): Year Ended December 31, 2016 2015 2014 Cost of revenues $ 172 $ 262 $ 617 Technology and development 14,771 11,992 10,451 Sales and marketing 6,124 7,901 11,300 General and administrative 20,718 18,620 14,520 Total share-based compensation expense $ 41,785 $ 38,775 $ 36,888 |
Summary of Assumptions Used to Determine Fair Value of Stock Options Granted | The following table summarizes the key assumptions used to determine the fair value of our stock options granted to employees, officers and directors: Year Ended December 31, 2016 2015 2014 Expected term (years) 5.50 5.50-6.00 6.07 Expected volatility 56.94 % 50.68%-51.69% 55.91%-56.83% Dividend yield — % — % — % Risk-free interest rate 1.43 % 1.75%-1.86% 1.88%-2.02% Weighted-average grant-date fair value per share $ 2.58 $ 3.54 $ 3.82 |
Summary of assumptions used to determine fair value of ESPP | The following table summarizes the key assumptions used to determine the fair value of rights granted under the 2013 ESPP: Year Ended December 31, 2016 2015 2014 Expected term (years) 0.50 0.50 0.50 Expected volatility 35.10%-75.74% 36.20%-49.59% 40.54%-46.42% Dividend yield — % — % — % Risk-free interest rate 0.38%-0.62% 0.09%-0.31% 0.05%-0.07% Weighted-average grant-date fair value per share $ 1.79 $ 1.98 $ 1.68 |
Summary of Stock Option Activity | Stock option activity under our equity incentive plans was as follows: Options Outstanding Number of Options Outstanding Weighted- Average Exercise Price per Share Weighted-Average Remaining Contractual Term in Years Aggregate Intrinsic Value Balance at December 31, 2015 12,415,492 $ 8.68 6.24 $ 5,082,489 Granted 232,700 5.00 Exercised (121,538 ) 2.81 Canceled (1,193,030 ) 9.31 Balance at December 31, 2016 11,333,624 $ 8.60 5.22 $ 6,608,611 As of December 31, 2016 Options exercisable 10,818,738 $ 8.64 5.07 $ 6,004,970 Options vested and expected to vest 11,299,893 $ 8.60 5.21 $ 6,569,584 |
Summary of Restricted Stock Unit Activity | RSU and PSU Activity RSUs and PSUs Outstanding Number of RSUs and PSUs Outstanding Weighted Average Grant Date Fair Value Balance at December 31, 2015 13,270,650 $ 6.38 Granted 10,307,836 4.62 Released (5,104,641 ) 6.37 Canceled (4,331,736 ) 6.06 Balance at December 31, 2016 14,142,109 $ 5.20 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Provision | Our income tax provision consisted of the following (in thousands): Year Ended December 31, 2016 2015 2014 Current income taxes: Federal $ (18 ) $ — $ — State 321 263 304 Foreign 959 778 871 Total current income taxes 1,262 1,041 1,175 Deferred income taxes: Federal 503 484 (1,003 ) State 48 56 33 Foreign (106 ) (102 ) (19 ) Total deferred income taxes 445 438 (989 ) Total income tax provision $ 1,707 $ 1,479 $ 186 |
Schedule of Loss before Provision for Income Taxes | Loss before provision for income taxes consisted of the following (in thousands): Year Ended December 31, 2016 2015 2014 United States $ (42,687 ) $ (59,376 ) $ (65,930 ) Foreign 2,149 1,645 1,358 Total $ (40,538 ) $ (57,731 ) $ (64,572 ) |
Schedule of Effective Income Tax Rate Reconciliation | The differences between our income tax provision as presented in the accompanying consolidated statements of operations and the income tax expense computed at the federal statutory rate consists of the items shown in the following table as a percentage of pretax loss (in percentages): Year Ended December 31, 2016 2015 2014 Income tax at U.S. statutory rate 34.0 % 34.0 % 34.0 % State, net of federal benefit 1.7 3.7 5.1 Share-based compensation (9.1 ) (7.0 ) (6.5 ) Non-deductible expenses (0.2 ) (0.2 ) (0.4 ) Other (1.4 ) — (0.5 ) Change in valuation allowance (29.2 ) (33.1 ) (32.0 ) Total (4.2 )% (2.6 )% (0.3 )% |
Schedule of Deferred Tax Assets and Liabilities | A summary of our deferred tax assets is as follows (in thousands): Year Ended December 31, 2016 2015 Deferred tax assets: Accrued expenses and reserves $ 5,069 $ 7,351 Share-based compensation 23,864 21,676 Deferred revenue 1,085 1,488 Net operating loss carryforwards 73,708 58,664 Property and equipment, textbooks and intangibles assets 5,168 7,577 Other items 1,407 1,612 Gross deferred tax assets 110,301 98,368 Valuation allowance (110,045 ) (98,209 ) Total deferred tax assets 256 159 Deferred tax liabilities: Intangible asset (1,413 ) (862 ) Total deferred tax liabilities (1,413 ) (862 ) Net deferred tax liability $ (1,157 ) $ (703 ) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending balances of the total amount of unrecognized tax benefits, excluding accrued interest and penalties, is as follows (in thousands): Year Ended December 31, 2016 2015 2014 Beginning balance $ 4,849 $ 4,272 $ 2,994 Increase in tax positions for prior years 478 82 406 Decrease in tax positions for prior years (855 ) (416 ) (284 ) Decrease in tax positions for prior year settlement (32 ) (61 ) — Decrease in tax positions for prior years due to statutes lapsing (76 ) — — Increase in tax positions for current year 595 948 1,172 Change due to translation of foreign currencies (77 ) 24 (16 ) Ending balance $ 4,882 $ 4,849 $ 4,272 |
Restructuring (Credits) Charg39
Restructuring (Credits) Charges (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the activity related to the accrual for restructuring charges (in thousands): Workforce Reduction Costs Lease Termination and Other Costs Total Balance at January 1, 2015 $ — $ — $ — Restructuring charges 1,885 2,983 4,868 Cash payments (1,830 ) (675 ) (2,505 ) Write-offs — (317 ) (317 ) Other — 472 472 Balance at December 31, 2015 $ 55 $ 2,463 $ 2,518 Restructuring credits — (423 ) (423 ) Cash payments (55 ) (1,734 ) (1,789 ) Balance at December 31, 2016 $ — $ 306 $ 306 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Product Line | The following table sets forth our total net revenues for the periods shown for our Chegg Services and Required Materials product lines (in thousands): December 31, 2016 2015 2014 Chegg Services $ 129,335 $ 94,285 $ 68,117 Required Materials 124,755 207,088 236,717 Total net revenues $ 254,090 $ 301,373 $ 304,834 |
Selected Quarterly Financial 41
Selected Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Three Months Ended March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Total net revenues $ 66,654 $ 53,036 $ 71,343 $ 63,057 Gross profit $ 27,731 $ 31,629 $ 32,644 $ 42,485 Net loss $ (15,685 ) $ (9,008 ) $ (16,063 ) $ (1,489 ) Weighted average shares used to compute net loss per share, basic and diluted 89,118 90,416 91,059 91,526 Net loss per share, basic and diluted $ (0.18 ) $ (0.10 ) $ (0.17 ) $ (0.02 ) Three Months Ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Total net revenues $ 84,872 $ 67,061 $ 81,286 $ 68,154 Gross profit $ 19,379 $ 30,805 $ 19,566 $ 41,774 Net (loss) income $ (28,542 ) $ (10,131 ) $ (24,167 ) $ 3,630 Weighted average shares used to compute net (loss) income per share: Basic 84,794 86,741 87,706 87,993 Diluted 84,794 86,741 87,706 93,225 Net (loss) income per share: Basic $ (0.34 ) $ (0.12 ) $ (0.28 ) $ 0.04 Diluted $ (0.34 ) $ (0.12 ) $ (0.28 ) $ 0.04 |
Significant Accounting Polici42
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounting Policies [Abstract] | |||
Textbook library depreciation expense | $ 9,267 | $ 43,553 | $ 70,147 |
Loss from write-offs of textbooks | 1,090 | 5,297 | 10,534 |
Advertising costs | $ 18,400 | $ 25,000 | $ 22,400 |
Required employee continuing service period | 60 days |
Significant Accounting Polici43
Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Security Deposit For Office | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash | $ 0.1 | |
Security Deposit For Credit Cards And Headquarters And Sales Office | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash | $ 0.8 | |
Other current assets | Security Deposit For Credit Cards | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash | 0.3 | |
Other noncurrent assets | Security Deposit | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash | $ 0.1 | $ 0.5 |
Significant Accounting Polici44
Significant Accounting Policies - Concentration Risk (Details) - Customer Concentration Risk - Accounts Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Largest Wholesaler One | |
Restricted Cash and Cash Equivalents Items [Line Items] | |
Concentration risk, percentage | 16.00% |
Largest Wholesaler Two | |
Restricted Cash and Cash Equivalents Items [Line Items] | |
Concentration risk, percentage | 11.00% |
Significant Accounting Polici45
Significant Accounting Policies - Property Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization | $ 9,900 | $ 6,800 | $ 6,200 |
Amortization of software development costs capitalized | $ 27,831 | 17,927 | |
Computer and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 3 years | ||
Software | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 3 years | ||
Amortization of software development costs capitalized | $ 0 | $ 500 | $ 500 |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 5 years | ||
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 5 years | ||
Content | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 5 years |
Significant Accounting Polici46
Significant Accounting Policies - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||||||||||
Net loss | $ (1,489) | $ (16,063) | $ (9,008) | $ (15,685) | $ 3,630 | $ (24,167) | $ (10,131) | $ (28,542) | $ (42,245) | $ (59,210) | $ (64,758) |
Denominator: | |||||||||||
Weighted-average common shares outstanding (in shares) | 91,526 | 91,059 | 90,416 | 89,118 | 87,993 | 87,706 | 86,741 | 84,794 | 90,534 | 86,818 | 83,241 |
Less: Weighted-average unvested common shares subject to repurchase of forfeiture (in shares) | 0 | 0 | (36) | ||||||||
Weighted average shares used to compute net loss per share, basic and diluted (in shares) | 90,534 | 86,818 | 83,205 | ||||||||
Net loss per share, basic and diluted (in dollars per share) | $ (0.47) | $ (0.68) | $ (0.78) |
Significant Accounting Polici47
Significant Accounting Policies - Common Shares Outstanding Excluded From Computation Of Diluted Net Loss Per Share (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total common stock equivalents | 12,253 | 11,945 | 15,538 |
Options to purchase common stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total common stock equivalents | 10,799 | 11,446 | 14,253 |
RSUs and PSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total common stock equivalents | 1,239 | 200 | 289 |
Employee stock purchase plan | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total common stock equivalents | 15 | 0 | 0 |
Warrants to purchase common stock | Common Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total common stock equivalents | 200 | 299 | 996 |
Cash and Cash Equivalents, In48
Cash and Cash Equivalents, Investments and Restricted Cash - Schedule of Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Cash and cash equivalents: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | $ 77,329 | $ 67,030 |
Net Unrealized Loss | 0 | (1) |
Fair Value | 77,329 | 67,029 |
Short-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 17,812 |
Net Unrealized Loss | 0 | (12) |
Fair Value | 0 | 17,800 |
Long-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 4,242 |
Net Unrealized Loss | 0 | (13) |
Fair Value | 0 | 4,229 |
Commercial paper | Short-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 3,746 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 0 | 3,746 |
Corporate securities | Short-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 10,572 |
Net Unrealized Loss | 0 | (12) |
Fair Value | 0 | 10,560 |
Corporate securities | Long-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 3,241 |
Net Unrealized Loss | 0 | (10) |
Fair Value | 0 | 3,231 |
Agency bond | Short-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 3,494 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 0 | 3,494 |
Agency bond | Long-term investments: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 1,001 |
Net Unrealized Loss | 0 | (3) |
Fair Value | 0 | 998 |
Cash | Cash and cash equivalents: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 77,329 | 52,905 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 77,329 | 52,905 |
Money market funds | Cash and cash equivalents: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 6,672 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 0 | 6,672 |
Commercial paper | Cash and cash equivalents: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 5,453 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 0 | 5,453 |
Corporate securities | Cash and cash equivalents: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 600 |
Net Unrealized Loss | 0 | (1) |
Fair Value | 0 | 599 |
Agency bond | Cash and cash equivalents: | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 1,400 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 0 | 1,400 |
Short-term restricted cash | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 0 | 300 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 0 | 300 |
Long-term restricted cash | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 104 | 478 |
Net Unrealized Loss | 0 | 0 |
Fair Value | 104 | 478 |
Total restricted cash | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cost | 104 | 778 |
Net Unrealized Loss | 0 | 0 |
Fair Value | $ 104 | $ 778 |
Cash and Cash Equivalents, In49
Cash and Cash Equivalents, Investments and Restricted Cash - Strategic Investment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule of Cost-method Investments [Line Items] | |||
Investments in non-marketable equity investments | $ 1,020 | $ 2,019 | $ 0 |
Equity Investments | |||
Schedule of Cost-method Investments [Line Items] | |||
Investments in non-marketable equity investments | 1,000 | $ 2,000 | |
Other Assets | Equity Investments | |||
Schedule of Cost-method Investments [Line Items] | |||
Investments | $ 3,000 |
Fair Value Measurement (Details
Fair Value Measurement (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Short-term investments | $ 0 | $ 17,800 |
Fair Value on Recurring Basis | ||
Assets: | ||
Total assets measured and recorded at fair value | 36,153 | |
Fair Value on Recurring Basis | Commercial paper | ||
Assets: | ||
Short-term investments | 3,746 | |
Fair Value on Recurring Basis | Corporate securities | ||
Assets: | ||
Short-term investments | 10,560 | |
Long-term investments | 3,231 | |
Fair Value on Recurring Basis | Agency bond | ||
Assets: | ||
Short-term investments | 3,494 | |
Long-term investments | 998 | |
Fair Value on Recurring Basis | Money market funds | ||
Assets: | ||
Cash equivalents | 6,672 | |
Fair Value on Recurring Basis | Commercial paper | ||
Assets: | ||
Cash equivalents | 5,453 | |
Fair Value on Recurring Basis | Corporate securities | ||
Assets: | ||
Cash equivalents | 599 | |
Fair Value on Recurring Basis | Agency bond | ||
Assets: | ||
Cash equivalents | 1,400 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Total assets measured and recorded at fair value | 6,672 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial paper | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate securities | ||
Assets: | ||
Short-term investments | 0 | |
Long-term investments | 0 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Agency bond | ||
Assets: | ||
Short-term investments | 0 | |
Long-term investments | 0 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market funds | ||
Assets: | ||
Cash equivalents | 6,672 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial paper | ||
Assets: | ||
Cash equivalents | 0 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate securities | ||
Assets: | ||
Cash equivalents | 0 | |
Fair Value on Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Agency bond | ||
Assets: | ||
Cash equivalents | 0 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Total assets measured and recorded at fair value | 29,481 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Commercial paper | ||
Assets: | ||
Short-term investments | 3,746 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Corporate securities | ||
Assets: | ||
Short-term investments | 10,560 | |
Long-term investments | 3,231 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Agency bond | ||
Assets: | ||
Short-term investments | 3,494 | |
Long-term investments | 998 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Money market funds | ||
Assets: | ||
Cash equivalents | 0 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Commercial paper | ||
Assets: | ||
Cash equivalents | 5,453 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Corporate securities | ||
Assets: | ||
Cash equivalents | 599 | |
Fair Value on Recurring Basis | Significant Other Observable Inputs (Level 2) | Agency bond | ||
Assets: | ||
Cash equivalents | $ 1,400 |
Long-Lived Assets - Textbook Li
Long-Lived Assets - Textbook Library, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Textbook library | $ 33,980 | $ 100,783 |
Less accumulated depreciation | (31,405) | (71,055) |
Textbook library, net | $ 2,575 | $ 29,728 |
Long-Lived Assets - Property, P
Long-Lived Assets - Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 63,136 | $ 37,898 |
Less accumulated depreciation and amortization | (27,831) | (17,927) |
Property and equipment, net | 35,305 | 19,971 |
Computer and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,597 | 1,313 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,324 | 2,591 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,148 | 1,652 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 5,342 | 4,983 |
Content | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 49,725 | $ 27,359 |
Acquisitions - 2016 Acquisition
Acquisitions - 2016 Acquisitions (Details) $ in Millions | May 01, 2016USD ($) | Dec. 31, 2016USD ($)installment | Dec. 31, 2016USD ($)installment |
Imagine Easy Solutions, LLC | |||
Business Acquisition [Line Items] | |||
Total fair value of purchase consideration | $ 42.3 | ||
Deferred cash | 17 | ||
Accrued liabilities | $ 16.8 | $ 16.8 | |
Accretion expense | 0.4 | ||
Escrow | 4.2 | ||
Hold-back | $ 0.5 | ||
RefME Ltd. | |||
Business Acquisition [Line Items] | |||
Total fair value of purchase consideration | 1.8 | ||
Deferred cash | 0.8 | ||
Accrued liabilities | $ 0.6 | 0.6 | |
Cash consideration | $ 0.2 | ||
Number of quarterly installments | installment | 3 | 3 |
Acquisitions - 2016 Acquisiti54
Acquisitions - 2016 Acquisitions summary of Fair Value of the Consideration (Details) - USD ($) $ in Thousands | May 01, 2016 | Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 24,938 | $ 0 | |||
Acquisition related expenses | $ 700 | ||||
Imagine Easy Solutions, LLC | |||||
Business Acquisition [Line Items] | |||||
Escrow | $ 4,200 | ||||
Hold-back | 500 | ||||
Total fair value of purchase consideration | 42,300 | ||||
Contingent consideration arrangements, range of outcomes, value, high | $ 18,000 | ||||
Period for recognition | 3 years | ||||
Contingent consideration, liability, current | $ 1,000 | 1,000 | |||
Total purchase consideration | $ 42,300 | ||||
Imagine Easy Solutions, LLC | Achievement Of Performance Conditions | |||||
Business Acquisition [Line Items] | |||||
Contingent consideration arrangements, range of outcomes, value, high | 3,000 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | |||||
Business Acquisition [Line Items] | |||||
Initial cash consideration | 22,007 | ||||
Net working capital adjustment | 200 | ||||
Fair value of deferred cash consideration | 17,127 | ||||
Escrow | 4,200 | ||||
Hold-back | 500 | ||||
Total fair value of purchase consideration | 44,034 | ||||
Cash | 59 | ||||
Accounts receivable | 2,610 | ||||
Favorable lease acquired | 300 | ||||
Other acquired assets | 212 | ||||
Total acquired intangible assets | 16,488 | ||||
Total identifiable assets acquired | 19,669 | ||||
Liabilities assumed | (573) | ||||
Net identifiable assets acquired | 19,096 | ||||
Goodwill | 24,938 | ||||
Total purchase consideration | 44,034 | ||||
Acquisition related expenses | 1,100 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | Trade names | |||||
Business Acquisition [Line Items] | |||||
Total acquired intangible assets | 1,840 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | Domain names | |||||
Business Acquisition [Line Items] | |||||
Total acquired intangible assets | 1,330 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | Advertiser relationships | |||||
Business Acquisition [Line Items] | |||||
Total acquired intangible assets | 6,600 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | User base | |||||
Business Acquisition [Line Items] | |||||
Total acquired intangible assets | 550 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | Non-compete agreements | |||||
Business Acquisition [Line Items] | |||||
Total acquired intangible assets | 508 | ||||
Imagine Easy Solutions, LLC and RefME Ltd. | Developed technologies | |||||
Business Acquisition [Line Items] | |||||
Total acquired intangible assets | $ 5,660 | ||||
RefME Ltd. | |||||
Business Acquisition [Line Items] | |||||
Initial cash consideration | $ 200 | ||||
Total fair value of purchase consideration | 1,800 | ||||
Total purchase consideration | $ 1,800 |
Acquisitions - 2014 Acquisition
Acquisitions - 2014 Acquisitions (Details) $ in Millions | Oct. 01, 2014USD ($) | Jun. 05, 2014USD ($) | Apr. 09, 2014USD ($)shares | Mar. 07, 2014USD ($) | Dec. 31, 2014USD ($)acquisition |
Business Acquisition [Line Items] | |||||
Impairment | $ 1.6 | ||||
Acquisition related expenses | $ 0.7 | ||||
Number of acquisitions | acquisition | 4 | ||||
Internships.Com | |||||
Business Acquisition [Line Items] | |||||
Outstanding shares and voting interest | 100.00% | ||||
Total purchase consideration | $ 10 | ||||
Portion of purchase price held as an escrow deposit | $ 1 | ||||
InstaEDU | |||||
Business Acquisition [Line Items] | |||||
Outstanding shares and voting interest | 100.00% | ||||
Total purchase consideration | $ 31.1 | ||||
Portion of purchase price held as an escrow deposit | $ 4.5 | ||||
Campus Special | |||||
Business Acquisition [Line Items] | |||||
Outstanding shares and voting interest | 100.00% | ||||
Total purchase consideration | $ 16 | ||||
Initial cash consideration | $ 14 | ||||
Purchase consideration, shares | shares | 250,000 | ||||
Bookstep L L C | |||||
Business Acquisition [Line Items] | |||||
Total purchase consideration | $ 0.5 | ||||
Contingent purchase consideration, cash | 2.5 | ||||
Fair value of subsequent payments | $ 2.5 |
Acquisitions - 2014 Acquisiti56
Acquisitions - 2014 Acquisitions Summary of Fair Value of the Consideration (Details) - Internships.com, Campus Special, InstaEDU and Bookstep $ in Thousands | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Business Acquisition [Line Items] | |
Cash consideration | $ 55,537 |
Fair value of stock escrow consideration | 2,585 |
Fair value of stock contingent consideration | 193 |
Total fair value of purchase consideration | $ 58,315 |
Acquisitions - 2014 Acquisiti57
Acquisitions - 2014 Acquisitions Summary of Fair Value of Identifiable Intangible Assets Acquired (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | |||
Goodwill | $ 116,239 | $ 91,301 | $ 91,301 |
Internships.com, Campus Special, InstaEDU and Bookstep | |||
Business Acquisition [Line Items] | |||
Cash | 1,665 | ||
Other acquired assets | 595 | ||
Intangible asset | 16,837 | ||
Total identifiable assets acquired | 19,097 | ||
Liabilities assumed | (2,538) | ||
Net identifiable assets acquired | 16,559 | ||
Goodwill | 41,756 | ||
Net assets acquired | 58,315 | ||
Internships.com, Campus Special, InstaEDU and Bookstep | Developed technologies | |||
Business Acquisition [Line Items] | |||
Intangible asset | 4,174 | ||
Internships.com, Campus Special, InstaEDU and Bookstep | Customer lists | |||
Business Acquisition [Line Items] | |||
Intangible asset | 3,770 | ||
Internships.com, Campus Special, InstaEDU and Bookstep | Trade names | |||
Business Acquisition [Line Items] | |||
Intangible asset | 5,990 | ||
Internships.com, Campus Special, InstaEDU and Bookstep | Non-compete agreements | |||
Business Acquisition [Line Items] | |||
Intangible asset | 1,630 | ||
Internships.com, Campus Special, InstaEDU and Bookstep | Corporate partnerships | |||
Business Acquisition [Line Items] | |||
Intangible asset | 243 | ||
Internships.com, Campus Special, InstaEDU and Bookstep | Master services agreement | |||
Business Acquisition [Line Items] | |||
Intangible asset | $ 1,030 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 91,301 | $ 91,301 |
Additions due to acquisitions | 24,938 | 0 |
Ending balance | $ 116,239 | $ 91,301 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite Lived Intangible Assets [Line Items] | ||
Accumulated Amortization | $ (16,170) | $ (11,565) |
Net Carrying Amount | 17,148 | |
Indefinite-lived trade name | 3,600 | 3,600 |
Total intangible assets, gross carrying amount | 36,918 | 20,430 |
Intangible assets, net | $ 20,748 | $ 8,865 |
Developed technologies | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 60 months | 52 months |
Gross Carrying Amount | $ 15,077 | $ 9,417 |
Accumulated Amortization | (8,245) | (6,702) |
Net Carrying Amount | $ 6,832 | $ 2,715 |
Customer lists | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 47 months | 20 months |
Gross Carrying Amount | $ 9,970 | $ 2,820 |
Accumulated Amortization | (3,673) | (2,239) |
Net Carrying Amount | $ 6,297 | $ 581 |
Trade names | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 47 months | 48 months |
Gross Carrying Amount | $ 5,513 | $ 2,343 |
Accumulated Amortization | (1,998) | (920) |
Net Carrying Amount | $ 3,515 | $ 1,423 |
Non-compete agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 30 months | 28 months |
Gross Carrying Amount | $ 1,728 | $ 1,220 |
Accumulated Amortization | (1,249) | (832) |
Net Carrying Amount | $ 479 | $ 388 |
Master service agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted-Average Amortization Period | 21 months | 21 months |
Gross Carrying Amount | $ 1,030 | $ 1,030 |
Accumulated Amortization | (1,005) | (872) |
Net Carrying Amount | $ 25 | $ 158 |
Goodwill and Intangible Asset60
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite Lived Intangible Assets [Line Items] | |||
Indefinite-lived trade name | $ 3,600 | $ 3,600 | |
Acquisition-Related Intangible Assets | |||
Finite Lived Intangible Assets [Line Items] | |||
Amortization expense of acquisition related to acquired intangible assets | $ 4,600 | 4,800 | $ 5,000 |
Internships.Com | |||
Finite Lived Intangible Assets [Line Items] | |||
Indefinite-lived trade name | $ 3,600 |
Goodwill and Intangible Asset61
Goodwill and Intangible Assets - Estimated Future Amortization Expense Related to Intangible Assets (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,017 | $ 5,350 |
2,018 | 4,446 |
2,019 | 3,510 |
2,020 | 2,153 |
2,021 | 815 |
Thereafter | 874 |
Net Carrying Amount | $ 17,148 |
Balance Sheet Details (Details)
Balance Sheet Details (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Reimbursement from Ingram | $ 18,759 | $ 28,875 |
Other | 3,500 | 2,857 |
Other current assets | 22,259 | 31,732 |
Current liabilities | ||
Accrued shipping for cycle returns | 1,334 | 3,355 |
Refund reserve | 487 | 4,538 |
Taxes payable | 2,927 | 3,913 |
Accrued deferred cash consideration related to acquisition | 17,378 | 0 |
Payable to Ingram | 8,237 | 9,965 |
Other | 13,956 | 13,509 |
Accrued liabilities | $ 44,319 | $ 35,280 |
Debt Obligations (Details)
Debt Obligations (Details) - Revolving Credit Facility - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2019 | Dec. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2016 | |
Debt Instrument [Line Items] | |||||||
Face amount | $ 30,000,000 | $ 30,000,000 | |||||
Credit facility, maximum borrowing capacity | $ 65,000,000 | $ 50,000,000 | |||||
EBITDA calculation expense threshold, acquisition expenses permissible | 6,000,000 | ||||||
EBITDA calculation expense threshold, nonrecurring expenses | 2,000,000 | ||||||
Cash and cash equivalents minimum balance | 30,000,000 | ||||||
Line of credit facility, current borrowing capacity | $ 30,000,000 | ||||||
Amount outstanding | $ 0 | ||||||
Base Interest Rate | |||||||
Debt Instrument [Line Items] | |||||||
Marginal interest rate | 0.50% | ||||||
One-Month LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Marginal interest rate | 1.00% | ||||||
LIBOR Rate | |||||||
Debt Instrument [Line Items] | |||||||
Unused capacity, commitment fee percentage | 0.25% | ||||||
Marginal interest rate | 4.50% | ||||||
Total Leverage Ratio Less Than 1 Percent | |||||||
Debt Instrument [Line Items] | |||||||
Unused capacity, commitment fee percentage | 1.50% | ||||||
Total Leverage Ratio Greater Or Equal 1 Percent | |||||||
Debt Instrument [Line Items] | |||||||
Unused capacity, commitment fee percentage | 2.50% | ||||||
Scenario, Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Cash and cash equivalents minimum balance | $ 25,000,000 | ||||||
EBITDA target | $ 30,000,000 | $ 25,000,000 | $ 35,000,000 |
Commitments and Contingencies64
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | May 31, 2013 | Jul. 31, 2010 | |
Commitments and Contingencies Disclosure [Abstract] | |||||
Rental expense | $ 1,900 | $ 2,500 | $ 3,300 | ||
Property tax assessment | $ 1,000 | ||||
Offer to the tax authority excluding tax and penalties | $ 150 | ||||
Aggregate Future Minimum Lease Payments [Abstract] | |||||
2,017 | 2,001 | ||||
2,018 | 1,927 | ||||
2,019 | 1,099 | ||||
2,020 | 749 | ||||
2,021 | 317 | ||||
Thereafter | 138 | ||||
Total | $ 6,231 |
Convertible Preferred Stock a65
Convertible Preferred Stock and Common Stock (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Nov. 11, 2013 | |
Class of Stock [Line Items] | |||
Common stock, shares authorized | 400,000,000 | 400,000,000 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Warrants to purchase common stock | 200,000 | ||
Outstanding stock options | 11,333,624 | 12,415,492 | |
Total common shares reserved for future issuance | 40,561,057 | ||
2013 Plan | |||
Class of Stock [Line Items] | |||
Shares available for grant under the stock plans | 9,574,896 | ||
Total common shares reserved for future issuance | 12,000,000 | ||
Award exercise price as percent of fair market value of common stock on grant date threshold | 100.00% | ||
2005 Stock Incentive Plan | |||
Class of Stock [Line Items] | |||
Total common shares reserved for future issuance | 3,838,985 | ||
2013 Employee Stock Purchase Plan | |||
Class of Stock [Line Items] | |||
Total common shares reserved for future issuance | 5,310,428 | ||
Maximum employee subscription rate | 15.00% | ||
Employee discount on applicable offering period | 15.00% | ||
Offering period (no more than 6 months) | 6 months | ||
Shares reserved | 4,000,000 | ||
Maximum aggregate number of shares to be issued | 20,000,000 | ||
Restricted Stock Units (RSUs) | |||
Class of Stock [Line Items] | |||
Outstanding RSUs | 14,142,109 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2014 | Dec. 31, 2016USD ($)employee$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ | $ 41,785,000 | $ 38,775,000 | $ 36,888,000 | |
Stock issued under ESPP (in shares) | 467,979 | 419,137 | ||
Weighted average purchase price of shares purchased (in dollars per share) | $ / shares | $ 3.76 | $ 5.81 | ||
Exercises in period, intrinsic value | $ | $ 600,000 | $ 3,200,000 | 3,100,000 | |
Unrecognized compensation expense for stock options granted to employees, officers, directors, and consultants | $ | $ 1,600,000 | |||
Number of options, granted (shares) | 232,700 | |||
Capitalized share-based compensation expense | $ | $ 0 | 0 | $ 0 | |
Warrants to purchase common stock | 200,000 | |||
Restricted Stock Units (RSUs) | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 3 years | |||
Restricted Stock Units (RSUs) | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 4 years | |||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average vesting period for recognition of compensation expense | 8 months 16 days | |||
Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 3 years | |||
Performance based restricted stock unit award granted to executive officers | 2,300,824 | 1,208,560 | ||
Performance based restricted stock unit award granted weighted average grant date fair value (in dollars per share) | $ / shares | $ 6.59 | $ 6.37 | ||
Released in period | 688,464 | |||
Performance-based restricted stock units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 2 years | |||
Performance-based restricted stock units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 3 years | |||
Settlement of performance based restricted stock unit awards percentage | 120.00% | |||
Percentage of vesting of share-based compensation awards | 120.00% | |||
Employee stock purchase plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Proceeds from issuance of shares under ESPP | $ | $ 1,800,000 | 2,400,000 | ||
Restricted Stock Units (RSUs) and Performance Share Units (PSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average vesting period for recognition of compensation expense | 1 year 10 months 21 days | |||
Performance based restricted stock unit award granted to executive officers | 10,307,836 | |||
Performance based restricted stock unit award granted weighted average grant date fair value (in dollars per share) | $ / shares | $ 4.62 | |||
Awards forfeited | 4,331,736 | |||
Unrecognized compensation costs related to restricted stock units | $ | $ 36,200,000 | |||
Consultant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ | $ 500,000 | $ 400,000 | $ 700,000 | |
InstaEDU | Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance based restricted stock unit award granted to executive officers | 2,280,081 | |||
Performance based restricted stock unit award granted weighted average grant date fair value (in dollars per share) | $ / shares | $ 6 | |||
2015 Performance Period | Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of employees affected | employee | 26 | |||
Incremental compensation cost | $ | $ 1,500,000 | |||
2015 Performance Period | Performance-based restricted stock units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 1 year | |||
2015 Performance Period | Performance-based restricted stock units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 3 years | |||
2016 Performance Period | Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance based restricted stock unit award granted to executive officers | 2,377,842 | |||
Performance based restricted stock unit award granted weighted average grant date fair value (in dollars per share) | $ / shares | $ 4.32 | |||
Share-based Compensation Award, Tranche One | 2016 Performance Period | Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 1 year | |||
Share-based Compensation Award, Tranche Two | 2016 Performance Period | Performance-based restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of stock awards | 3 years | |||
Common Stock Warrant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock warrants remaining | 200,000 | |||
Weighted average exercise price (in dollars per share) | $ / shares | $ 12 | $ 4.12 | $ 0.82 | |
Common stock warrants exercised | 0 | 795,549 | 122,733 |
Stockholders' Equity - Share-ba
Stockholders' Equity - Share-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 41,785 | $ 38,775 | $ 36,888 |
Cost of revenues | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 172 | 262 | 617 |
Technology and development | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 14,771 | 11,992 | 10,451 |
Sales and marketing | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 6,124 | 7,901 | 11,300 |
General and administrative | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 20,718 | $ 18,620 | $ 14,520 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 5 years 6 months | 6 years 26 days | |
Expected volatility | 56.94% | ||
Dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 1.43% | ||
Weighted-average grant-date fair value per share (in dollars per share) | $ 2.58 | $ 3.54 | $ 3.82 |
Stock Options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 5 years 6 months | ||
Expected volatility | 50.68% | 55.91% | |
Risk-free interest rate | 1.75% | 1.88% | |
Stock Options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 6 years | ||
Expected volatility | 51.69% | 56.83% | |
Risk-free interest rate | 1.86% | 2.02% | |
Employee stock purchase plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 6 months | 6 months | 6 months |
Dividend yield | 0.00% | 0.00% | 0.00% |
Weighted-average grant-date fair value per share (in dollars per share) | $ 1.79 | $ 1.98 | $ 1.68 |
Employee stock purchase plan | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 35.10% | 36.20% | 40.54% |
Risk-free interest rate | 0.38% | 0.09% | 0.05% |
Employee stock purchase plan | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 75.74% | 49.59% | 46.42% |
Risk-free interest rate | 0.62% | 0.31% | 0.07% |
Stockholders' Equity - Summar69
Stockholders' Equity - Summary of Stock Option Activity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Options Outstanding | ||
Number of Options Outstanding, Beginning (shares) | 12,415,492 | |
Number of options, granted (shares) | 232,700 | |
Number of Options, Exercised (shares) | (121,538) | |
Number of Options, Canceled (shares) | (1,193,030) | |
Number of Options Outstanding, Ending (shares) | 11,333,624 | 12,415,492 |
Weighted-Average Exercise Price per Share | ||
Weighted Average Exercise Price per Share, Outstanding, Beginning (in dollars per share) | $ 8.68 | |
Weighted Average Exercise Price per Share, Granted (in dollars per share) | 5 | |
Weighted-Average Exercise Price per Share, Exercised (in dollars per share) | 2.81 | |
Weighted-Average Exercise Price per Share, Canceled (in dollars per share) | 9.31 | |
Weighted Average Exercise Price per Share, Outstanding, Ending (in dollars per share) | $ 8.60 | $ 8.68 |
Options outstanding, weighted-average remaining contractual term | 5 years 2 months 19 days | 6 years 2 months 27 days |
Options outstanding, aggregate intrinsic value | $ 6,608,611 | $ 5,082,489 |
Options exercisable, number outstanding | 10,818,738 | |
Options exercisable, Weighted Average Exercise Price (in dollars per share) | $ 8.64 | |
Options exercisable, Weighted Average Remaining Contractual Term | 5 years 26 days | |
Options exercisable, Aggregate Intrinsic Value | $ 6,004,970 | |
Options vested and expected to vest, Number Outstanding | 11,299,893 | |
Options vested and expected to vest, Weighted Average Exercise Price (in dollars per share) | $ 8.60 | |
Options vested and expected to vest, Weighted Average Remaining Contractual Term | 5 years 2 months 16 days | |
Options vested and expected to vest, Aggregate Intrinsic Value | $ 6,569,584 |
Stockholders' Equity - Summar70
Stockholders' Equity - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) and Performance Share Units (PSUs) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Restricted Stock Units Outstanding | |
Number of Restricted Stock Units Outstanding, Beginning | shares | 13,270,650 |
Number of Restricted Stock Units, Granted | shares | 10,307,836 |
Number of Restricted Stock Units, Released | shares | (5,104,641) |
Number of Restricted Stock Units, Canceled | shares | (4,331,736) |
Number of Restricted Stock Units Outstanding, Ending | shares | 14,142,109 |
Weighted-Average Grant Date Fair Value | |
Weighted Average Grant Date Fair Value, Beginning balance (in dollars per share) | $ / shares | $ 6.38 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $ / shares | 4.62 |
Weighted Average Grant Date Fair Value, Released (in dollars per share) | $ / shares | 6.37 |
Weighted Average Grant Date Fair Value, Canceled (in dollars per share) | $ / shares | 6.06 |
Weighted Average Grant Date Fair Value, Ending balance (in dollars per share) | $ / shares | $ 5.20 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating Loss Carryforwards [Line Items] | ||||
Provision for income taxes | $ 1,707 | $ 1,479 | $ 186 | |
Deferred income taxes decrease | 0 | 0 | 1,291 | |
Increase in valuation allowance | (11,800) | (19,100) | ||
Undistributed earnings of international subsidiaries | 6,000 | 4,400 | ||
Interest and penalties related to uncertain tax positions | 0 | 100 | 100 | |
Interest and penalties accrued related to uncertain tax positions | 600 | 700 | ||
Unrecognized tax benefits | 4,882 | $ 4,849 | 4,272 | $ 2,994 |
Unrecognized tax benefits that would impact the effective tax rate | 1,500 | |||
Federal | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | 200,700 | |||
Tax credit carryforwards | 3,500 | |||
State | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | 151,500 | |||
Tax credit carryforwards | $ 4,300 | |||
InstaEDU | ||||
Operating Loss Carryforwards [Line Items] | ||||
Deferred income taxes decrease | $ (1,300) |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current income taxes: | |||
Federal | $ (18) | $ 0 | $ 0 |
State | 321 | 263 | 304 |
Foreign | 959 | 778 | 871 |
Total current income taxes | 1,262 | 1,041 | 1,175 |
Deferred income taxes: | |||
Federal | 503 | 484 | (1,003) |
State | 48 | 56 | 33 |
Foreign | (106) | (102) | (19) |
Total deferred income taxes | 445 | 438 | (989) |
Total income tax provision | $ 1,707 | $ 1,479 | $ 186 |
Income Taxes - Loss before Prov
Income Taxes - Loss before Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (42,687) | $ (59,376) | $ (65,930) |
Foreign | 2,149 | 1,645 | 1,358 |
Loss before provision for income taxes | $ (40,538) | $ (57,731) | $ (64,572) |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Income tax at U.S. statutory rate | 34.00% | 34.00% | 34.00% |
State, net of federal benefit | 1.70% | 3.70% | 5.10% |
Share-based compensation | (9.10%) | (7.00%) | (6.50%) |
Non-deductible expenses | (0.20%) | (0.20%) | (0.40%) |
Other | (1.40%) | 0.00% | (0.50%) |
Change in valuation allowance | (29.20%) | (33.10%) | (32.00%) |
Total | (4.20%) | (2.60%) | (0.30%) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Accrued expenses and reserves | $ 5,069 | $ 7,351 |
Share-based compensation | 23,864 | 21,676 |
Deferred revenue | 1,085 | 1,488 |
Net operating loss carryforwards | 73,708 | 58,664 |
Property and equipment, textbooks and intangibles assets | 5,168 | 7,577 |
Other items | 1,407 | 1,612 |
Gross deferred tax assets | 110,301 | 98,368 |
Valuation allowance | (110,045) | (98,209) |
Total deferred tax assets | 256 | 159 |
Deferred tax liabilities: | ||
Intangible asset | (1,413) | (862) |
Total deferred tax liabilities | (1,413) | (862) |
Net deferred tax liability | $ (1,157) | $ (703) |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 4,849 | $ 4,272 | $ 2,994 |
Increase in tax positions for prior years | 478 | 82 | 406 |
Decrease in tax positions for prior years | (855) | (416) | (284) |
Decrease in tax positions for prior year settlement | (32) | (61) | 0 |
Decrease in tax positions for prior years due to statutes lapsing | (76) | 0 | 0 |
Increase in tax positions for current year | 595 | 948 | 1,172 |
Change due to translation of foreign currencies | (77) | 24 | (16) |
Ending balance | $ 4,882 | $ 4,849 | $ 4,272 |
Restructuring (Credits) Charg77
Restructuring (Credits) Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restructuring Reserve [Roll Forward] | |||||||||||
Restructuring charges | $ (100) | $ (100) | $ (200) | $ (44) | $ 1,600 | $ 300 | $ 500 | $ 2,500 | $ (423) | $ 4,868 | $ 0 |
2015 Restructuring Plan | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | 2,518 | 0 | 2,518 | 0 | |||||||
Restructuring charges | (423) | 4,868 | |||||||||
Cash payments | (1,789) | (2,505) | |||||||||
Write-offs | (317) | ||||||||||
Other | 472 | ||||||||||
Ending Balance | 306 | 2,518 | 306 | 2,518 | 0 | ||||||
2015 Restructuring Plan | Workforce Reduction Costs | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | 55 | 0 | 55 | 0 | |||||||
Restructuring charges | 0 | 1,885 | |||||||||
Cash payments | (55) | (1,830) | |||||||||
Write-offs | 0 | ||||||||||
Other | 0 | ||||||||||
Ending Balance | 0 | 55 | 0 | 55 | 0 | ||||||
2015 Restructuring Plan | Lease Termination and Other Costs | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | $ 2,463 | $ 0 | 2,463 | 0 | |||||||
Restructuring charges | (423) | 2,983 | |||||||||
Cash payments | (1,734) | (675) | |||||||||
Write-offs | (317) | ||||||||||
Other | 472 | ||||||||||
Ending Balance | $ 306 | $ 2,463 | $ 306 | $ 2,463 | $ 0 |
Restructuring (Credits) Charg78
Restructuring (Credits) Charges - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)position | Dec. 31, 2014USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring (credits) charges | $ (100) | $ (100) | $ (200) | $ (44) | $ 1,600 | $ 300 | $ 500 | $ 2,500 | $ (423) | $ 4,868 | $ 0 |
2015 Restructuring Plan | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring (credits) charges | (423) | 4,868 | |||||||||
Restructuring reserve | 306 | 2,518 | 306 | 2,518 | 0 | ||||||
Restructuring | 100 | 100 | |||||||||
Restructuring reserve, noncurrent | 200 | 200 | |||||||||
Workforce Reduction Costs | 2015 Restructuring Plan | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring (credits) charges | 0 | $ 1,885 | |||||||||
Number of positions eliminated | position | 71 | ||||||||||
Restructuring reserve | 0 | 55 | 0 | $ 55 | 0 | ||||||
Lease Termination and Other Costs | 2015 Restructuring Plan | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring (credits) charges | (423) | 2,983 | |||||||||
Restructuring reserve | $ 306 | $ 2,463 | $ 306 | $ 2,463 | $ 0 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016board_member | Dec. 31, 2016USD ($)board_member | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Adobe Systems | Chief Executive Officer | ||||
Related Party Transaction [Line Items] | ||||
Purchases from related party | $ 3,100,000 | $ 2,900,000 | $ 900,000 | |
Revenue from related parties | 0 | 100,000 | 1,000,000 | |
Due to related parties | 300,000 | 400,000 | ||
Due from related parties | 0 | 0 | ||
Cengage | Board Of Directors Member | ||||
Related Party Transaction [Line Items] | ||||
Purchases from related party | 10,200,000 | 11,500,000 | 12,400,000 | |
Revenue from related parties | 600,000 | 100,000 | $ 0 | |
Due from related parties | $ 100,000 | 0 | ||
Number of board members appointed to Board of Directors of related party | board_member | 1 | |||
Groupon, Inc. | Board Of Directors Member | ||||
Related Party Transaction [Line Items] | ||||
Purchases from related party | $ 600,000 | 100,000 | ||
Due from related parties | 0 | 0 | ||
Number of board members appointed to Board of Directors of related party | board_member | 1 | |||
Synack Inc. | Board Of Directors Member | ||||
Related Party Transaction [Line Items] | ||||
Purchases from related party | $ 200,000 | $ 100,000 | ||
Number of board members appointed to chief executive officer of related party | board_member | 1 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | |||
Matching contributions | $ 0.9 | $ 0.8 | $ 0.8 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2016segments | |
Segment Reporting [Abstract] | |
Number of reportable segments | 1 |
Number of operating units | 1 |
Segment Information - Revenue b
Segment Information - Revenue by Product Line (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue from External Customer [Line Items] | |||||||||||
Total Revenue | $ 63,057 | $ 71,343 | $ 53,036 | $ 66,654 | $ 68,154 | $ 81,286 | $ 67,061 | $ 84,872 | $ 254,090 | $ 301,373 | $ 304,834 |
Chegg Services | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total Revenue | 129,335 | 94,285 | 68,117 | ||||||||
Required Materials | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total Revenue | $ 124,755 | $ 207,088 | $ 236,717 |
Selected Quarterly Financial 83
Selected Quarterly Financial Data (unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net revenues | $ 63,057 | $ 71,343 | $ 53,036 | $ 66,654 | $ 68,154 | $ 81,286 | $ 67,061 | $ 84,872 | $ 254,090 | $ 301,373 | $ 304,834 |
Gross profit | 42,485 | 32,644 | 31,629 | 27,731 | 41,774 | 19,566 | 30,805 | 19,379 | 134,489 | 111,524 | 93,849 |
Net (loss) income | $ (1,489) | $ (16,063) | $ (9,008) | $ (15,685) | $ 3,630 | $ (24,167) | $ (10,131) | $ (28,542) | $ (42,245) | $ (59,210) | $ (64,758) |
Weighted average shares used to compute net (loss) income per share: | |||||||||||
Basic (in shares) | 91,526 | 91,059 | 90,416 | 89,118 | 87,993 | 87,706 | 86,741 | 84,794 | 90,534 | 86,818 | 83,241 |
Diluted (in shares) | 93,225 | 87,706 | 86,741 | 84,794 | |||||||
Net (loss) income per share: | |||||||||||
Basic (in dollars per share) | $ (0.02) | $ (0.17) | $ (0.10) | $ (0.18) | $ 0.04 | $ (0.28) | $ (0.12) | $ (0.34) | |||
Diluted (in dollars per share) | $ 0.04 | $ (0.28) | $ (0.12) | $ (0.34) | |||||||
Restructuring (credits) charges | $ (100) | $ (100) | $ (200) | $ (44) | $ 1,600 | $ 300 | $ 500 | $ 2,500 | $ (423) | $ 4,868 | $ 0 |