Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | Apr. 24, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'AWAY | ' |
Entity Registrant Name | 'HOMEAWAY INC | ' |
Entity Central Index Key | '0001366684 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 93,512,765 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $656,601 | $324,608 |
Short-term investments | 113,889 | 66,798 |
Accounts receivable, net of allowance for doubtful accounts of $1,094 and $1,038 as of March 31, 2014 and December 31, 2013, respectively | 26,097 | 20,375 |
Income tax receivable | 4,101 | 3,340 |
Prepaid expenses and other current assets | 8,968 | 7,702 |
Restricted cash | 800 | 1,607 |
Deferred tax assets | 8,314 | 8,146 |
Total current assets | 818,770 | 432,576 |
Property and equipment, net | 40,304 | 39,807 |
Goodwill | 528,335 | 507,611 |
Intangible assets, net | 85,664 | 80,665 |
Restricted cash | 584 | 573 |
Deferred tax assets | 1,353 | 1,120 |
Other non-current assets | 18,459 | 18,320 |
Total assets | 1,493,469 | 1,080,672 |
Current liabilities: | ' | ' |
Accounts payable | 6,627 | 3,539 |
Income tax payable | 2,006 | 1,992 |
Accrued expenses | 56,895 | 54,625 |
Deferred revenue | 179,614 | 151,991 |
Total current liabilities | 245,142 | 212,147 |
Convertible senior notes, net | 303,044 | ' |
Deferred revenue, less current portion | 2,845 | 2,983 |
Deferred tax liabilities | 24,173 | 24,046 |
Other non-current liabilities | 7,806 | 7,557 |
Total liabilities | 583,010 | 246,733 |
Redeemable noncontrolling interests (see Note 9) | 10,302 | 10,584 |
Stockholders' equity | ' | ' |
Common stock: $0.0001 par value; 350,000,000 shares authorized; 93,436,772 and 92,361,069 shares issued and outstanding as of March 31, 2014 and December 31, 2013, respectively | 9 | 9 |
Additional paid-in capital | 976,101 | 908,632 |
Accumulated other comprehensive loss | -1,857 | -6,747 |
Accumulated deficit | -74,096 | -78,539 |
Total stockholders' equity | 900,157 | 823,355 |
Total liabilities and stockholders' equity | $1,493,469 | $1,080,672 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Accounts receivable, Allowance for doubtful accounts | $1,094 | $1,038 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 350,000,000 | 350,000,000 |
Common stock, shares issued | 93,436,772 | 92,361,069 |
Common stock, shares outstanding | 93,436,772 | 92,361,069 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenue: | ' | ' |
Listing | $87,332 | $66,945 |
Other | 18,350 | 12,519 |
Total revenue | 105,682 | 79,464 |
Costs and expenses: | ' | ' |
Cost of revenue (exclusive of amortization shown separately below) | 15,937 | 13,281 |
Product development | 18,313 | 12,399 |
Sales and marketing | 35,617 | 26,367 |
General and administrative | 23,626 | 16,049 |
Amortization expense | 3,274 | 3,180 |
Total costs and expenses | 96,767 | 71,276 |
Operating income | 8,915 | 8,188 |
Other income (expense): | ' | ' |
Interest income | 164 | 243 |
Other expense, net | -2,535 | -1,591 |
Total other income (expense) | -2,371 | -1,348 |
Income before income taxes | 6,544 | 6,840 |
Income tax expense | -2,388 | -1,545 |
Net income | 4,156 | 5,295 |
Less: Net loss attributable to noncontrolling interests | -287 | ' |
Net income attributable to HomeAway, Inc. | $4,443 | $5,295 |
Net income per share attributable to HomeAway, Inc.: | ' | ' |
Basic and diluted | $0.05 | $0.06 |
Weighted average number of shares outstanding: | ' | ' |
Basic | 92,699 | 83,940 |
Diluted | 96,295 | 86,492 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement Of Income And Comprehensive Income [Abstract] | ' | ' |
Net income | $4,156 | $5,295 |
Other comprehensive income (loss): | ' | ' |
Foreign currency translation adjustments (net of $0 tax) | 5,035 | -4,419 |
Unrealized loss on short-term investments (net of $0 tax) | -145 | -102 |
Total other comprehensive income (loss) | 4,890 | -4,521 |
Less: Comprehensive loss attributable to noncontrolling interests | -287 | ' |
Comprehensive income attributable to HomeAway, Inc. | $9,333 | $774 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement Of Income And Comprehensive Income [Abstract] | ' | ' |
Foreign currency translation adjustments, Tax | $0 | $0 |
Unrealized loss on short-term investments, Tax | $0 | $0 |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Stockholders' Equity (Unaudited) (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Deficit [Member] |
In Thousands, except Share data | |||||
Beginning Balance, value at Dec. 31, 2013 | $823,355 | $9 | $908,632 | ($6,747) | ($78,539) |
Beginning Balance, shares at Dec. 31, 2013 | 92,361,069 | 92,361,000 | ' | ' | ' |
Issuance of stock under Company plans, net of shares withheld for taxes, value | 13,947 | ' | 13,947 | ' | ' |
Issuance of stock under Company plans, net of shares withheld for taxes, shares | ' | 1,076,000 | ' | ' | ' |
Stock-based compensation | 10,221 | ' | 10,221 | ' | ' |
Equity component of convertible note issuance, net | 87,297 | ' | 87,297 | ' | ' |
Purchase of convertible note hedge | -85,853 | ' | -85,853 | ' | ' |
Sale of warrants | 38,278 | ' | 38,278 | ' | ' |
Excess tax benefits related to employee stock options | 3,579 | ' | 3,579 | ' | ' |
Other comprehensive income | 4,890 | ' | ' | 4,890 | ' |
Net income attributable to HomeAway, Inc. | 4,443 | ' | ' | ' | 4,443 |
Ending Balance, value at Mar. 31, 2014 | $900,157 | $9 | $976,101 | ($1,857) | ($74,096) |
Ending Balance, shares at Mar. 31, 2014 | 93,436,772 | 93,437,000 | ' | ' | ' |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities | ' | ' |
Net income | $4,156 | $5,295 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation | 3,763 | 3,044 |
Amortization of intangible assets | 3,274 | 3,180 |
Amortization of premiums on securities and other | 552 | 801 |
Stock-based compensation | 10,221 | 7,456 |
Excess tax benefit from stock-based compensation | -3,579 | -1,358 |
Deferred income taxes | -2,963 | -1,218 |
Net realized/unrealized foreign exchange (gain) loss | 1,758 | -16 |
Realized loss on foreign currency forwards | 616 | 1,259 |
Changes in operating assets and liabilities, net of assets and liabilities assumed in business combinations: | ' | ' |
Accounts receivable | -5,409 | -1,880 |
Income tax receivable | -737 | -347 |
Prepaid expenses and other assets | -1,094 | -1,378 |
Accounts payable | 2,811 | -258 |
Accrued expenses | -3,982 | -406 |
Income tax payable | 3,576 | -4 |
Deferred revenue | 26,763 | 22,300 |
Other non-current liabilities | 243 | 1,011 |
Net cash provided by operating activities | 39,969 | 37,481 |
Cash flows from investing activities | ' | ' |
Acquisition of businesses, net of cash acquired | -16,766 | ' |
Change in restricted cash | 815 | -247 |
Purchases of intangibles and other assets | -193 | -30 |
Purchases of non-marketable equity investment | ' | -3,667 |
Purchases of short-term investments | -50,560 | -62,713 |
Proceeds from maturities and redemptions of marketable securities | 2,787 | 15,000 |
Net settlement of foreign currency forwards | -616 | -1,259 |
Purchases of property and equipment | -4,818 | -5,505 |
Net cash used in investing activities | -69,351 | -58,421 |
Cash flows from financing activities | ' | ' |
Proceeds from borrowings on convertible senior notes, net | 391,431 | ' |
Proceeds from issuance of warrants | 38,278 | ' |
Purchase of convertible note hedge | -85,853 | ' |
Other financing activities | -919 | ' |
Proceeds from exercise of options to purchase common stock | 13,947 | 19,539 |
Excess tax benefit from stock-based compensation | 3,579 | 1,358 |
Net cash provided by financing activities | 360,463 | 20,897 |
Effect of exchange rate changes on cash | 912 | -2,189 |
Net increase (decrease) in cash and cash equivalents | 331,993 | -2,232 |
Cash and cash equivalents at beginning of period | 324,608 | 189,478 |
Cash and cash equivalents at end of period | 656,601 | 187,246 |
Cash paid for taxes | $1,870 | $1,795 |
Description_of_Business
Description of Business | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Description of Business | ' |
1. Description of Business | |
HomeAway, Inc. (the “Company”) operates an online vacation rental property marketplace that enables property owners and managers to market properties available for rental to vacation travelers who rely on the Company’s websites to search for and find available properties. Property owners and managers pay listing fees to provide detailed listings of their properties on the Company’s websites and reach a broad audience of travelers seeking vacation rentals. Listing fees are typically annual subscriptions but can also be paid for on a performance basis, based on bookings or inquiries made by travelers to property owners and managers. A listing includes published detailed property listings, including photographs, descriptions, location, pricing, availability and contact information. The Company also sells, itself or through third parties, complementary products, including travel guarantees, insurance products and property management software and services. Travelers use the network of websites to search for vacation rentals that meet their desired criteria including location, size and price. Travelers that find properties that meet their requirements through the Company’s marketplace are able to contact property owners and managers directly by phone or through form-based communication tools on the Company’s websites. | |
The Company is a Delaware corporation headquartered in Austin, Texas. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Summary of Significant Accounting Policies | ' | ||||||||||||||||
2. Summary of Significant Accounting Policies | |||||||||||||||||
Basis of Presentation | |||||||||||||||||
The accompanying condensed consolidated financial statements include the accounts of HomeAway, Inc. and all of its wholly and majority owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim financial reporting and applicable quarterly reporting regulations of the Securities and Exchange Commission, or the SEC. All significant intercompany transactions and balances have been eliminated in consolidation. In the opinion of the Company’s management, the accompanying interim unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting of normal recurring adjustments and those items discussed in these Notes, necessary for a fair presentation of the Company’s financial position, as of March 31, 2014, the results of operations for the three months ended March 31, 2014 and March 31, 2013, the comprehensive income for the three months ended March 31, 2014 and March 31, 2013, the cash flows for the three months ended March 31, 2014 and March 31, 2013, and the changes in stockholders’ equity for the three months ended March 31, 2014. Certain information and disclosures normally included in the notes to the annual financial statements prepared in accordance with GAAP have been omitted from these interim condensed consolidated financial statements pursuant to the rules and regulations of the SEC. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013. Operating results for this interim period are not necessarily indicative of the results that may be expected for the year ending December 31, 2014 or for any other period. | |||||||||||||||||
Use of Estimates | |||||||||||||||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. These differences could have a material effect on the Company’s future results of operations and financial position. Significant items subject to estimates and assumptions include certain revenue, the allowance for doubtful accounts, the fair value of short-term investments, the carrying amounts of goodwill and other indefinite-lived intangible assets, depreciation and amortization, the valuation of stock options, deferred income taxes and the fair value of noncontrolling interests. | |||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||
Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: | |||||||||||||||||
Level 1: | Valuations based on quoted prices for identical assets and liabilities in active markets. | ||||||||||||||||
Level 2: | Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. | ||||||||||||||||
Level 3: | Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. | ||||||||||||||||
The following section describes the valuation methodologies used to measure certain financial assets and financial liabilities at fair value. | |||||||||||||||||
Money Market Funds and Short-Term Investments | |||||||||||||||||
The Company’s cash equivalents, restricted cash and short-term investments classified as Level 1 are valued using quoted prices generated by market transactions involving identical assets. Short-term investments classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. The Company did not hold any cash equivalents, restricted cash or short-term investments categorized as Level 3 as of March 31, 2014 or December 31, 2013. | |||||||||||||||||
Short-term investments include certificates of deposit, corporate bonds, U.S. government agency bonds and municipal bonds and are classified as available-for-sale and reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits. Additionally, the Company periodically assesses whether an other than temporary impairment loss on investments has occurred due to declines in fair value or other market conditions. Declines in fair value that are considered other than temporary are recorded as an impairment in the consolidated statement of operations. The Company did not record any impairments of its investments for any of the periods presented. | |||||||||||||||||
The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities and deferred revenue approximate fair value because of the relatively short maturity of these instruments. | |||||||||||||||||
The following table summarizes the basis used to measure certain financial assets at fair value on a recurring basis in the Company’s consolidated balance sheets at March 31, 2014 (in thousands): | |||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | ||||||||||||||
March 31, | Active Markets | Observable | Unobservable | ||||||||||||||
2014 | for Identical | Inputs (Level 2) | Inputs | ||||||||||||||
Assets (Level 1) | (Level 3) | ||||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Money market funds | $ | 46,801 | $ | 46,801 | $ | — | $ | — | |||||||||
Total cash equivalents | 46,801 | 46,801 | — | — | |||||||||||||
Restricted cash | |||||||||||||||||
Money market funds | 770 | 770 | — | — | |||||||||||||
Total restricted cash | 770 | 770 | — | — | |||||||||||||
Short-term investments | |||||||||||||||||
Certificates of deposit | 2,053 | — | 2,053 | — | |||||||||||||
Corporate bonds | 75,903 | — | 75,903 | — | |||||||||||||
Municipal bonds | 35,933 | — | 35,933 | — | |||||||||||||
Total short-term investments | 113,889 | — | 113,889 | — | |||||||||||||
Total financial assets | $ | 161,460 | $ | 47,571 | $ | 113,889 | $ | — | |||||||||
The following table summarizes the basis used to measure certain financial assets at fair value on a recurring basis in the Company’s consolidated balance sheets at December 31, 2013 (in thousands): | |||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | ||||||||||||||
December 31, | Active Markets | Observable | Unobservable | ||||||||||||||
2013 | for Identical | Inputs (Level 2) | Inputs | ||||||||||||||
Assets (Level 1) | (Level 3) | ||||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Money market funds | $ | 26,451 | $ | 26,451 | $ | — | $ | — | |||||||||
Total cash equivalents | 26,451 | 26,451 | — | — | |||||||||||||
Restricted cash | |||||||||||||||||
Money market funds | 758 | 758 | — | — | |||||||||||||
Total restricted cash | 758 | 758 | — | — | |||||||||||||
Short-term investments | |||||||||||||||||
Certificates of deposit | 2,054 | — | 2,054 | — | |||||||||||||
Corporate bonds | 33,257 | — | 33,257 | — | |||||||||||||
Municipal bonds | 31,487 | — | 31,487 | — | |||||||||||||
Total short-term investments | 66,798 | — | 66,798 | — | |||||||||||||
Total financial assets | $ | 94,007 | $ | 27,209 | $ | 66,798 | $ | — | |||||||||
Business Segment | |||||||||||||||||
The Company has one operating segment consisting of various products and services related to its online marketplace of accommodation rental listings. The Company’s chief operating decision maker is considered to be the Chief Executive Officer. The chief operating decision maker allocates resources and assesses performance of the business and other activities at the single operating segment level. | |||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||
Cash and cash equivalents include investments in money market funds and certificates of deposit that are readily convertible into cash. Cash and cash equivalents are stated at cost, which approximates fair value. The Company considers all highly liquid investments purchased with an original maturity date of three months or less to be cash equivalents. Cash and cash equivalents consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Demand deposit accounts | $ | 609,800 | $ | 298,157 | |||||||||||||
Money market funds | 46,801 | 26,451 | |||||||||||||||
Total | $ | 656,601 | $ | 324,608 | |||||||||||||
Restricted Cash | |||||||||||||||||
Restricted cash of $1,384,000 and $2,180,000 at March 31, 2014 and December 31, 2013, respectively, was held in accounts owned by the Company in conjunction with property license requirements, leased office space and to secure credit card availability and reimbursable direct debits due from the Company. | |||||||||||||||||
Short-term Investments | |||||||||||||||||
Short-term investments generally consist of marketable securities that have original maturities greater than ninety days as of the date of purchase. Investments in which the Company has the ability and intent, if necessary, to liquidate in order to support its current operations, including those with contractual maturities greater than one year from the date of purchase, are classified as short-term. The Company’s investment securities are classified as available-for-sale and are presented at estimated fair value with any unrealized gains and losses included in other comprehensive income (loss). | |||||||||||||||||
Cash flows from purchases, sales and maturities of available-for-sale securities are classified as cash flows from investing activities and reported gross, including any related premiums or discounts. Premiums related to purchases of available-for-sale securities were $1,740,000 and $4,048,000 during the three months ended March 31, 2014 and 2013, respectively. Fair values are based on quoted market prices. Short-term investments consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Gross | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair | ||||||||||||||
Gains | Losses | Value | |||||||||||||||
Certificates of deposit | $ | 2,055 | $ | — | $ | (2 | ) | $ | 2,053 | ||||||||
Corporate bonds | 76,062 | 35 | (194 | ) | 75,903 | ||||||||||||
Municipal bonds | 35,935 | 33 | (35 | ) | 35,933 | ||||||||||||
Total short-term investments | $ | 114,052 | $ | 68 | $ | (231 | ) | $ | 113,889 | ||||||||
December 31, 2013 | |||||||||||||||||
Gross | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair | ||||||||||||||
Gains | Losses | Value | |||||||||||||||
Certificates of deposit | $ | 2,055 | $ | — | $ | (1 | ) | $ | 2,054 | ||||||||
Corporate bonds | 33,274 | 33 | (50 | ) | 33,257 | ||||||||||||
Municipal bonds | 31,486 | 16 | (15 | ) | 31,487 | ||||||||||||
Total short-term investments | $ | 66,815 | $ | 49 | $ | (66 | ) | $ | 66,798 | ||||||||
For fixed income securities that have unrealized losses as of March 31, 2014, the Company does not intend to sell any of these investments and it is not more likely than not that it will be required to sell any of these investments before recovery of the entire amortized cost basis. The Company has evaluated these fixed income securities and determined that no credit losses exist. Accordingly, the Company has determined that the unrealized losses on fixed income securities as of March 31, 2014 are temporary in nature. | |||||||||||||||||
The following table summarizes the contractual underlying maturities of the Company’s short-term investments at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Less than 12 | 12 Months or | Total | |||||||||||||||
Months | Greater | ||||||||||||||||
Certificates of deposit | $ | 1,499 | $ | 554 | $ | 2,053 | |||||||||||
Corporate bonds | 10,834 | 65,069 | 75,903 | ||||||||||||||
Municipal bonds | 7,746 | 28,187 | 35,933 | ||||||||||||||
Total short-term investments | $ | 20,079 | $ | 93,810 | $ | 113,889 | |||||||||||
December 31, 2013 | |||||||||||||||||
Less than 12 | 12 Months or | Total | |||||||||||||||
Months | Greater | ||||||||||||||||
Certificates of deposit | $ | 500 | $ | 1,554 | $ | 2,054 | |||||||||||
Corporate bonds | 11,164 | 22,093 | 33,257 | ||||||||||||||
Municipal bonds | 3,031 | 28,456 | 31,487 | ||||||||||||||
Total short-term investments | $ | 14,695 | $ | 52,103 | $ | 66,798 | |||||||||||
Non-marketable Cost Investment | |||||||||||||||||
During the years ended December 31, 2013 and 2012, the Company purchased a non-controlling equity interest in a privately-held company in China. As of March 31, 2014, the total carrying value of the Company’s investment in the privately-held company was $10,113,000. The Company’s investment in the privately-held company is reported using the cost method of accounting or marked down to fair value when an event or circumstance indicates an other-than-temporary decline in value has occurred. It was not practicable to estimate the fair value of this asset as of March 31, 2014. No event or circumstance indicating an other-than-temporary decline in value of the Company’s interest in the non-marketable cost investment was identified. This investment is recorded in other non-current assets on the consolidated balance sheets. | |||||||||||||||||
Accounts Receivable | |||||||||||||||||
Accounts receivable are primarily generated from three sources. Amounts due from credit card merchants who process the Company’s credit card sales from property listings and remit the proceeds to the Company are the primary source of accounts receivable. Accounts receivable are also generated from Internet display advertising amounts due in the ordinary course of business as well as amounts due to the Company for property listings, other products purchased on account or amounts due from partners. Accounts receivable from Internet display advertising revenue and products purchased on account are recorded at the invoiced amount and are non-interest bearing. Accounts receivable outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance for doubtful accounts by estimating losses on receivables based on known troubled accounts and historical experiences of losses incurred. | |||||||||||||||||
Property and Equipment | |||||||||||||||||
Property and equipment are recorded at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Computer equipment and purchased software are generally depreciated over three years. Furniture and fixtures are generally depreciated over five to ten years. Leasehold improvements are depreciated on a straight-line basis over the shorter of the contractual lease period or their estimated useful life. Upon disposal, property and equipment and the related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statements of operations. Ordinary maintenance and repairs are charged to expense, while expenditures that extend the physical or economic life of the assets are capitalized. | |||||||||||||||||
The Company capitalizes certain internally developed software and website development costs. These capitalized costs were approximately $32,345,000 and $30,523,000 at March 31, 2014 and December 31, 2013, respectively, and are included in property and equipment, net, in the consolidated balance sheets. Internally developed software costs are generally depreciated over five years. | |||||||||||||||||
The Company recorded depreciation expense on internally developed software and website development costs as follows for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Depreciation expense on internally developed software and website development costs | $ | 1,294 | $ | 732 | |||||||||||||
Goodwill and Intangible Assets | |||||||||||||||||
Goodwill arises from business combinations and is measured as the excess of the purchase consideration over the sum of the acquisition-date fair values of tangible and identifiable intangible assets acquired, less any liabilities assumed. While the Company uses the best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, adjustments to the assets acquired and liabilities assumed are recorded with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. | |||||||||||||||||
Goodwill and intangible assets deemed to have indefinite useful lives, such as certain trade names, are not amortized. Tests for impairment of goodwill and indefinite-lived intangible assets are performed on an annual basis or when events or circumstances indicate that the carrying amount may not be recoverable. | |||||||||||||||||
Circumstances that could trigger an impairment test outside of the annual test include but are not limited to: a significant adverse change in the business climate or legal factors; adverse cash flow trends; an adverse action or assessment by a regulator; unanticipated competition; loss of key personnel; decline in stock price; and the results of tests for recoverability of a significant asset group. The Company determined that no triggering event occurred during any of the periods presented. | |||||||||||||||||
For goodwill and indefinite lived intangible assets, the Company completes what is referred to as the “Step 0” analysis, which involves evaluating qualitative factors, including macroeconomic conditions, industry and market considerations, cost factors, and overall financial performance related to its goodwill and its indefinite lived intangible assets. If the Company’s “Step 0” analysis indicates that it is more likely than not that the fair value of a reporting unit or of an indefinite lived intangible asset is less than its carrying amount, then the Company would perform a quantitative two-step impairment test. The quantitative analysis compares the fair value of the Company’s reporting unit or indefinite-lived intangible assets to its carrying amount, and an impairment loss is recognized equivalent to the excess of the carrying amount over fair value. If, after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of a reporting unit or indefinite lived intangible asset exceeds its carrying amount, then the quantitative impairment tests are unnecessary. | |||||||||||||||||
The Company performs an evaluation of goodwill and indefinite-lived intangible assets for impairment annually in October. | |||||||||||||||||
The determination of whether or not goodwill or indefinite-lived intangible assets have become impaired involves a significant level of judgment. Changes in the Company’s strategy and/or market conditions could significantly impact these judgments and require adjustments to recorded amounts of goodwill or intangible assets. | |||||||||||||||||
No impairment of goodwill or indefinite-lived intangible assets was identified in any of the periods presented. | |||||||||||||||||
Identifiable intangible assets consist of trade names, customer listings, technology, domain names and contractual non-competition agreements associated with acquired businesses. Intangible assets with finite lives are amortized over their estimated useful lives on a straight-line basis and reviewed for impairment whenever events or changes in circumstances indicate that an asset’s carrying value may not be recoverable (see Note 4). The straight-line method of amortization represents the Company’s best estimate of the distribution of the economic value of the identifiable intangible assets. | |||||||||||||||||
Impairment of Long-lived Assets | |||||||||||||||||
The Company evaluates long-lived assets held for use, such as property and equipment, for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. An impairment loss is recognized when estimated future undiscounted cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When an impairment loss is recognized, the carrying amount of the asset is reduced to its estimated fair value in the period in which the determination is made. No impairments of long-lived assets have been recorded during any of the periods presented. | |||||||||||||||||
Leases | |||||||||||||||||
The Company leases facilities in several countries around the world and certain equipment under non-cancelable lease agreements. The terms of certain lease agreements provide for rental payments on a graduated basis. Rent expense is recognized on a straight-line basis over the lease period and accrued as rent expense incurred but not paid. | |||||||||||||||||
Revenue Recognition | |||||||||||||||||
The Company recognizes revenue when persuasive evidence of an agreement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. | |||||||||||||||||
The Company generates a significant portion of its revenue from customers purchasing online advertising services related to the listing of their properties for rent, primarily on a subscription basis over a fixed-term. The Company also generates revenue based on the number of traveler inquiries and reservation bookings for property listings on the Company’s websites, local and national Internet display advertisers, license of property management software and ancillary products and services. | |||||||||||||||||
Payments for term-based subscriptions received in advance of services being rendered are recorded as deferred revenue and recognized on a straight-line basis over the listing period. Revenue for inquiry-based contracts are determined on a fixed fee-per-inquiry as stated in the arrangement and recognized when the service has been performed. | |||||||||||||||||
The Company earns commission revenue for reservations made online through its websites, which is calculated as a percentage of the value of the reservation. This revenue is earned as the services are performed or as the customers’ refund privileges lapse and is included in listing revenue in the consolidated statement of operations. | |||||||||||||||||
Internet display advertising revenue is generated primarily from advertisements appearing on the Company’s websites. There are several types of Internet advertisements, and the way in which advertising revenue is earned varies among them. Depending upon the terms, revenue might be earned each time an impression is delivered, each time a user clicks on an ad, each time a graphic ad is displayed, or each time a user clicks-through on the ad and takes a specified action on the destination site. | |||||||||||||||||
The Company sells gift cards with no expiration date to travelers and does not charge administrative fees on unused cards. There is a portion of the gift card obligation that, based on historical redemption patterns, will not be used by the Company’s customers and is not required to be remitted to relevant jurisdictions, or breakage. At the point of sale, the Company recognizes breakage as deferred revenue and amortizes it over 48 months based on historical redemption patterns. The Company also records commission revenue for each gift card sale over the same 48-month redemption period. | |||||||||||||||||
Through its professional software for bed and breakfasts and professional property managers, the Company makes selected, online bookable properties available to online travel agencies and channel partners. The Company receives a percentage of the transaction value or a fee from the property manager for making this inventory available, which is recognized when earned. This revenue is included in other revenue in the consolidated statement of operations. | |||||||||||||||||
The Company generates revenue from the licensing of software products, the sale of maintenance agreements and the sale of hosted software solutions. For software license sales, one year of maintenance is typically included as part of the initial purchase price of the bundled offering with annual renewals of the maintenance component of the agreement following in subsequent years. | |||||||||||||||||
The Company recognizes revenue from the sale of perpetual licenses upon delivery, which generally occurs upon electronic transfer of the license key that makes the product available to the purchaser. | |||||||||||||||||
As software is usually sold with maintenance, the amount of revenue allocated to the software license is determined by estimating the fair value of the maintenance and subtracting it from the total invoice or contract amount. Vendor-specific objective evidence, or VSOE, of the fair value of maintenance services is determined by the standard published list pricing for maintenance renewals, as the Company generally charges list prices for maintenance renewals. In determining VSOE, the Company requires that a substantial majority of the selling price for maintenance services fall within a reasonably narrow pricing range. Maintenance and support revenue is recognized ratably over the term of the agreement beginning on the activation date. Amounts that have been invoiced are recorded in accounts receivable and in deferred revenue or revenue, depending on whether the revenue recognition criteria have been met. | |||||||||||||||||
Sales of hosted software solutions are generally for a one-year period. Revenue is recognized on a straight-line basis over the contract term. Certain implementation services related to the hosting services are essential to the customer’s use of the hosting services. For sales of these hosting services where the Company is responsible for implementation, the Company recognizes implementation revenue ratably over the estimated period of the hosting relationship, which the Company considers to be three years. Recognition starts once the product has been made available to the customer. | |||||||||||||||||
Training and consulting revenue is recognized upon delivery of the training or consulting services to the end customer. | |||||||||||||||||
The Company accounts for sales incentives to customers as a reduction of revenue at the time that the revenue is recognized from the related product sale. The Company also reports revenue net of any sales tax collected. | |||||||||||||||||
Stock-Based Compensation | |||||||||||||||||
The cost of stock-based compensation is recognized in the financial statements based upon the estimated grant date fair value of the awards measured using the Black–Scholes valuation model. The fair value of restricted stock awards and units is determined based on the number of shares granted and the fair value of the Company’s common stock as of the grant date. Fair value is generally recognized as an expense on a straight-line basis, net of estimated forfeitures, over the employee requisite service period. When estimating forfeitures, the Company considers voluntary termination behaviors as well as trends of actual option forfeitures. | |||||||||||||||||
The Company uses the “with and without” approach in determining the order in which tax attributes are utilized. As a result, the Company only recognizes a tax benefit from stock-based awards in additional paid-in capital if an incremental tax benefit is realized after all other tax attributes currently available to the Company have been utilized. When tax deductions from stock-based awards are less than the cumulative book compensation expense, the tax effect of the resulting difference (“shortfall”) is charged first to additional paid-in capital to the extent of the Company’s pool of windfall tax benefits with any remainder recognized in income tax expense. The Company has determined that it has a sufficient windfall pool available and therefore no amounts have been recognized in income tax expense. In addition, the Company accounts for the indirect effects of stock-based awards on other tax attributes through the consolidated statements of operations. | |||||||||||||||||
The benefits of tax deductions in excess of recognized compensation costs are reported as financing cash inflows, but only when such excess tax benefits are realized by a reduction to current taxes payable. | |||||||||||||||||
The following table summarizes the excess tax benefit that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Excess tax benefit from stock-based compensation | $ | 3,579 | $ | 1,358 | |||||||||||||
This tax benefit has been recorded as additional paid-in capital on the Company’s consolidated balance sheets. | |||||||||||||||||
Income Taxes | |||||||||||||||||
The Company recognizes income taxes using an asset and liability approach. This approach requires the recognition of deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the Company’s consolidated financial statements or tax returns. The measurement of deferred taxes is based on provisions of the enacted tax law and the effects of future changes in tax laws or rates are not anticipated. A valuation allowance is recognized if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax asset will not be realized. Evaluating the need for an amount of a valuation allowance for deferred tax assets requires significant judgment and analysis of the positive and negative evidence available, including past operating results, estimates of future taxable income, reversals of existing taxable temporary differences and the feasibility of tax planning in order to determine whether all or some portion of the deferred tax assets will not be realized. Based on the available evidence and judgment, the Company has determined that it is more likely than not that certain loss carryforwards will not be realized; therefore, the Company has established a valuation allowance for such deferred tax assets to reduce the loss carryforward assets to amounts expected to be utilized. | |||||||||||||||||
The Company may be subject to income tax audits by the respective tax authorities in any or all of the jurisdictions in which the Company operates. The Company is currently undergoing an audit at its subsidiary in the United Kingdom. Significant judgment is required in determining uncertain tax positions. The Company recognizes the benefit of uncertain income tax positions only if these positions are more likely than not to be sustained. Also, the recognized income tax benefit is measured at the largest amount that is more than 50% likely of being realized. The Company adjusts these reserves in light of changing facts and circumstances, such as the closing of an audit or the refinement of an estimate. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as a component of income tax expense. The countries in which the Company may be subject to potential examination by tax authorities include the United States, Australia, Brazil, Colombia, France, Germany, Italy, the Netherlands, New Zealand, Singapore, Spain, Switzerland, Thailand and the United Kingdom. | |||||||||||||||||
The calculation of the Company’s tax liabilities involves the inherent uncertainty associated with the application of complex tax laws. As a multinational corporation, the Company conducts its business in many countries and is subject to taxation in many jurisdictions. The taxation of the Company’s business is subject to the application of various and sometimes conflicting tax laws and regulations as well as multinational tax conventions. The Company’s effective tax rate is highly dependent upon the geographic distribution of its worldwide earnings or losses, the tax regulations and tax rates in each geographic region, the availability of tax credits and carryforwards, and the effectiveness of its tax planning strategies. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws themselves are subject to change as a result of changes in fiscal policy, changes in legislation, and the evolution of regulations and court rulings. Consequently, taxing authorities may impose tax assessments or judgments against the Company that could materially impact its tax liability and/or its effective income tax rate. The Company believes it has adequately provided in its financial statements for additional taxes that it estimates may be assessed by the various taxing authorities. While the Company believes that it has adequately provided for all uncertain tax positions, amounts asserted by tax authorities could be greater or less than the Company’s accrued position. These tax liabilities, including the interest and penalties, are adjusted pursuant to a settlement with tax authorities, completion of audit, refinement of estimates or expiration of various statutes of limitation. | |||||||||||||||||
Foreign Currency Translation | |||||||||||||||||
The functional currency of the Company’s foreign subsidiaries is generally their respective local currency. The financial statements of the Company’s international operations are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities, the historical exchange rate for stockholders’ equity, and a weighted average exchange rate for each period for revenue, expenses, and gains and losses. Foreign currency translation adjustments are recorded as a separate component of stockholders’ equity. Gains and losses from foreign currency denominated transactions are recorded in other income (expense) in the Company’s consolidated statements of operations. | |||||||||||||||||
The following table summarizes the foreign exchange loss that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Foreign exchange loss | $ | (2,526 | ) | $ | (1,535 | ) | |||||||||||
Derivative Financial Instruments | |||||||||||||||||
As a result of the Company’s international operations, it is exposed to various market risks that may affect its consolidated results of operations, cash flows and financial position. These market risks include, but are not limited to, fluctuations in currency exchange rates. The Company’s primary foreign currency exposures are in Euros, British Pound Sterling and Australian Dollars. As a result, the Company faces exposure to adverse movements in currency exchange rates as the financial results of its operations are translated from local currency into U.S. dollars upon consolidation. Additionally, foreign exchange rate fluctuations on transactions denominated in currencies other than the functional currency result in gains and losses that are reflected in other income (expense) in the Company’s consolidated statements of operations. | |||||||||||||||||
The Company may enter into derivative instruments to hedge certain net exposures of nonfunctional currency denominated assets and liabilities, primarily related to intercompany loans, even though it does not elect to apply hedge accounting or hedge accounting does not apply. Gains and losses resulting from a change in fair value for these derivatives are reflected in the period in which the change occurs and are recognized on the consolidated statement of operations in other income (expense). Cash flows from these contracts are classified within cash flows from investing activities on the consolidated statements of cash flows. | |||||||||||||||||
The Company does not use financial instruments for trading or speculative purposes. The Company recognizes all derivative instruments on the balance sheet at fair value and its derivative instruments are generally short-term in duration. The Company is exposed to the risk that counterparties to derivative contracts may fail to meet their contractual obligations. | |||||||||||||||||
The following tables show the fair value and notional principal amounts of our outstanding or unsettled derivative instruments that are not designated as hedging instruments at March 31, 2014 and December 31, 2013 (in thousands). In addition to the notional amounts listed below, the Company also had $275,000,000 of derivatives entered into on March 31, 2014 that had a fair value of zero on March 31, 2014. | |||||||||||||||||
Balance Sheet Caption | March 31, 2014 | ||||||||||||||||
Significant Other | U.S. Dollar | ||||||||||||||||
Observable Inputs | Notional | ||||||||||||||||
(Level 2) | |||||||||||||||||
Foreign exchange-forward contracts (current) | Prepaid expenses and other current assets | $ | 48 | $ | 6,983 | ||||||||||||
Foreign exchange-forward contracts (current) | Accrued expenses | (7,380 | ) | 268,670 | |||||||||||||
Total | $ | (7,332 | ) | $ | 275,653 | ||||||||||||
Balance Sheet Caption | December 31, 2013 | ||||||||||||||||
Significant Other | U.S. Dollar | ||||||||||||||||
Observable Inputs | Notional | ||||||||||||||||
(Level 2) | |||||||||||||||||
Foreign exchange-forward contracts (current) | Prepaid expenses and other current assets | $ | 363 | $ | 20,520 | ||||||||||||
Foreign exchange-forward contracts (current) | Accrued expenses | (979 | ) | 84,292 | |||||||||||||
Total | $ | (616 | ) | $ | 104,812 | ||||||||||||
Net Income Per Share Attributable to HomeAway, Inc. | |||||||||||||||||
Basic net income per share is computed by dividing net income attributable to HomeAway, Inc. by the weighted average number of common shares outstanding during the period. Diluted income per share is computed by dividing net income attributable to HomeAway, Inc. by the weighted average common shares outstanding plus potentially dilutive common shares. The dilutive effect of outstanding options and awards is reflected in diluted earnings per share by application of the treasury stock method. | |||||||||||||||||
Restricted stock awards provide the holder of unvested shares the right to participate in dividends declared on the Company’s common stock. Accordingly, these shares are included in the weighted average shares outstanding for the computation of basic earnings per share in periods of undistributed earnings. Restricted stock awards are excluded from the basic earnings per share in periods of undistributed losses as the holders are not contractually obligated to participate in the losses of the Company. Unvested restricted stock units do not provide the holder the right to participate in dividends declared on the Company’s common stock. Accordingly, these shares are excluded in the weighted average shares outstanding for the computation of basic earnings per share in periods of undistributed earnings or losses. | |||||||||||||||||
Comprehensive Income (Loss) Attributable to HomeAway, Inc. | |||||||||||||||||
Comprehensive income (loss) attributable to HomeAway, Inc. consists of net income (loss), cumulative foreign currency translation adjustments, unrealized gain (loss) on available-for-sale securities and comprehensive income (loss) attributable to noncontrolling interests. | |||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||
In April 2014, the Financial Accounting Standards Board (“FASB”) issued amended guidance for reporting discontinued operations and disposals of components of an entity. The amended guidance requires that a disposal representing a strategic shift that has or will have a major effect on an entity’s financial results, or a business activity classified as held for sale, should be reported as discontinued operations. This new guidance also expands the disclosure requirements for discontinued operations and adds new disclosures for individually significant dispositions that do not qualify as discontinued operations. The amendments are effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014. Early adoption is permitted only for disposals that have not been previously reported. This guidance is not expected to have a material impact on our consolidated financial position or results of operations. |
Business_Combinations
Business Combinations | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Business Combinations [Abstract] | ' | ||||||||
Business Combinations | ' | ||||||||
3. Business Combinations | |||||||||
Glad to Have You, Inc. | |||||||||
In March 2014, the Company acquired Glad to Have You, Inc. (“Glad To Have You”), a United States company that is the creator of a mobile guest management solution for the vacation rental industry, for cash consideration of approximately $16,791,000. The direct acquisition costs incurred by the Company were not significant to the Company’s operating results, and all such costs were expensed as incurred and included in general and administrative expenses in the consolidated statement of operations. | |||||||||
Of the total consideration paid, $250,000 of the cash consideration was deposited in escrow as security for the benefit of the Company against breaches of representations and warranties, covenants and certain other expressly enumerated matters by the sellers. The escrow funds not used to satisfy such seller obligations will be released to the sellers two business days following the first anniversary date of the acquisition. In addition, $250,000 of the total cash consideration was deposited in escrow as security and pending final net working capital related purchase price adjustments. These amounts are expected to be paid within 120 days after acquisition. | |||||||||
The acquired goodwill primarily represents synergies associated with adding Glad To Have You’s mobile applications to the Company’s marketplace of websites to provide property owners and managers with an additional way to manage and communicate with guests during their stay. Goodwill is not deductible for tax purposes. The acquired trade name has an estimated useful life of 10 years from the date of acquisition, the developed technology has an estimated useful life of 5 years from the date of acquisition and the customer relationships have an estimated useful life of 10 years from the date of acquisition. Non-compete agreements have an estimated useful life of 3 years. The total weighted average amortization period for the intangibles acquired is 7 years. | |||||||||
The results of Glad To Have You have been included in the Company’s consolidated results since the acquisition date in March 2014. Pro forma results of operations related to this acquisition have not been presented since Glad To Have You’s operating results up to the date of acquisition were not material to the Company’s consolidated financial statements. | |||||||||
The following table summarizes the Company’s acquisition during the three months ended March 31, 2014, with amounts shown below as fair values at the acquisition date (in thousands): | |||||||||
Glad to Have You, Inc. | |||||||||
Net tangible assets (liabilities) acquired | |||||||||
Cash | $ | 25 | |||||||
Deferred revenue | (65 | ) | |||||||
Other | 17 | ||||||||
Total net tangible assets (liabilities) acquired | (23 | ) | |||||||
Deferred tax liabilities | (1,653 | ) | |||||||
Trade name | 1,177 | ||||||||
Developed technology | 3,760 | ||||||||
Customer relationships | 1,643 | ||||||||
Goodwill | 11,647 | ||||||||
Non-competition agreements | 240 | ||||||||
Purchase price | 16,791 | ||||||||
Less: Cash acquired | (25 | ) | |||||||
Net purchase price | $ | 16,766 | |||||||
Tangible net assets (liabilities) were valued at their respective carrying amounts, which the Company believes approximate their current fair values at the respective acquisition dates. | |||||||||
The valuation of identifiable intangible assets acquired reflects management’s estimates based on, among other factors, use of established valuation methods. The value of the acquired trade names was determined using a relief from royalty method. Developed technology was valued on a combination of the income and market approach. Customer relationships were valued by projecting the estimated cash flow from the Company’s existing customer relationships. Non-competition agreements have been valued based on the present value of estimated future cash flows with and without this asset. Identifiable intangible assets with definite lives are amortized over the period of estimated benefit using the straight-line method and the estimated useful lives of three to ten years. The straight-line method of amortization represents the Company’s best estimate of the distribution of the economic value of the identifiable intangible assets. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired. | |||||||||
Stayz | |||||||||
In December 2013, the Company acquired 100% of the outstanding stock of Stayz Pty Limited (“Stayz”), the leading online vacation rental marketplace in Australia, for total consideration of approximately $197,820,000. Consideration included $196,739,000 in cash paid directly to the sellers and $1,081,000 remaining due to the sellers based on completed working capital purchase price adjustments pursuant to the purchase agreement. The Company incurred approximately $3,802,000 in direct acquisition costs, all of which were expensed as incurred, and are included in general and administrative expenses in the consolidated statement of operations. The Company also entered into certain transitional service agreements with the prior owners of Stayz to have accounting, infrastructure and support services provided to the Company for a defined period of time in 2014. Amounts paid for these services are recorded as incurred and are included in the Company’s consolidated results as general and administrative expenses. | |||||||||
The fair value of assets acquired and liabilities assumed was based on a preliminary valuation and our estimates and assumptions are subject to change within the measurement period. The primary areas of the purchase price that are not yet finalized are related certain income taxes and residual goodwill. | |||||||||
The following unaudited pro forma supplemental information presents an aggregated summary of the results of operations of the Company for the three months ended March 31, 2013 and the year ended December 31, 2013, assuming the completion of the 2013 acquisition of Stayz occurred on January 1, 2012 (in thousands). | |||||||||
The unaudited pro forma supplemental information is based on estimates and assumptions that the Company believes are reasonable. Accordingly, the Company adjusted the pro forma results for quantifiable items such as direct acquisition costs, amortization of acquired intangible assets and the estimated tax provision of the pro form combined results. Further, the Company has revised the pro forma revenue and net income for the year ended December 31, 2013 by a decrease of $1.9 million and $1.3 million, respectively, based on adjustments of certain estimates, as the Company obtained additional information about the facts and circumstances that existed as of the acquisition date. The average foreign exchange rate during each of the presented years was used in preparing the supplemental information. The unaudited pro forma supplemental information prepared by the Company is not necessarily indicative of the results expected in future periods or the results that actually would have been realized had the acquired business and the Company been a combined company during the specified periods. | |||||||||
Three Months Ended | Year Ended | ||||||||
March 31, 2013 | December 31, 2013 | ||||||||
Pro forma total revenue | $ | 87,359 | $ | 370,620 | |||||
Pro forma net income | 6,964 | 28,687 |
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 3 Months Ended | ||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | ' | ||||||||||||||||||||||||||||
4. Goodwill and Other Intangible Assets | |||||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||
Changes in the Company’s goodwill balance for the year ended December 31, 2013 and the three months ended March 31, 2014 are summarized in the table below (in thousands): | |||||||||||||||||||||||||||||
Balance at December 31, 2012 | $ | 312,412 | |||||||||||||||||||||||||||
Acquired in business combinations | 198,124 | ||||||||||||||||||||||||||||
Foreign currency translation adjustment | (2,925 | ) | |||||||||||||||||||||||||||
Balance at December 31, 2013 | 507,611 | ||||||||||||||||||||||||||||
Acquired in business combinations | 11,647 | ||||||||||||||||||||||||||||
Foreign currency translation adjustment | 8,511 | ||||||||||||||||||||||||||||
Post-acquisition goodwill adjustment for the Stayz acquisition | 566 | ||||||||||||||||||||||||||||
Balance at March 31, 2014 | $ | 528,335 | |||||||||||||||||||||||||||
Pursuant to our goodwill and intangible assets accounting policy, we record goodwill adjustments for the effect on goodwill of changes to net assets and liabilities acquired during the measurement period (up to one year from the date of an acquisition). The goodwill arising from the Stayz acquisition was increased by $566,000 up to $178,343,000 due to changes in fair value estimates derived from additional information gained during the measurement period. Goodwill adjustments were not significant to our previously reported operating results or financial position. Therefore, the Company elected not to retrospectively adjust the acquisition date accounting and instead recorded the adjustment in the first quarter of 2014. | |||||||||||||||||||||||||||||
Intangible Assets | |||||||||||||||||||||||||||||
The Company’s intangible assets, excluding goodwill, consist of intangible assets acquired primarily in business combinations and were recorded at their estimated fair values on the date of acquisition. The finite-lived intangible assets that are being amortized are summarized in the table below (in thousands): | |||||||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||||||
Useful Life | Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||||
(Years) | Carrying | Amortization | Carrying | Carrying | Amortization | Carrying | |||||||||||||||||||||||
Amount | Amount | Amount | Amount | ||||||||||||||||||||||||||
Trade names and trademarks | 10 | $ | 31,768 | $ | (5,864 | ) | $ | 25,904 | $ | 30,066 | $ | (5,050 | ) | $ | 25,016 | ||||||||||||||
Developed technology | 8-Feb | 35,404 | (24,441 | ) | 10,963 | 31,513 | (23,646 | ) | 7,867 | ||||||||||||||||||||
Customer relationships | 14-Jun | 83,106 | (43,360 | ) | 39,746 | 80,510 | (41,739 | ) | 38,771 | ||||||||||||||||||||
Noncompete agreements and domain names | 5-Feb | 5,478 | (3,456 | ) | 2,022 | 5,163 | (3,181 | ) | 1,982 | ||||||||||||||||||||
Total | $ | 155,756 | $ | (77,121 | ) | $ | 78,635 | $ | 147,252 | $ | (73,616 | ) | $ | 73,636 | |||||||||||||||
Amortization of noncompete agreements is recorded over the term of the agreements. | |||||||||||||||||||||||||||||
The following table summarizes the amortization expense that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Amortization expense | $ | 3,274 | $ | 3,180 | |||||||||||||||||||||||||
The Company has the following indefinite-lived intangible assets recorded in its consolidated balance sheet as of March 31, 2014 and December 31, 2013, respectively (in thousands): | |||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Trademarks, trade names and other | $ | 7,029 | $ | 7,029 |
Accrued_Expenses
Accrued Expenses | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Payables And Accruals [Abstract] | ' | ||||||||
Accrued Expenses | ' | ||||||||
5. Accrued Expenses | |||||||||
The Company’s accrued expenses are comprised of the following at March 31, 2014, and December 31, 2013 (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Compensation and related benefits | $ | 15,430 | $ | 21,700 | |||||
Gift cards | 5,546 | 6,090 | |||||||
Contracting, consulting and professional fees | 2,616 | 4,494 | |||||||
Taxes | 7,698 | 3,425 | |||||||
Advertising | 5,914 | 3,197 | |||||||
Foreign exchange – forward contracts | 7,380 | 979 | |||||||
Traveler guarantee liability | 1,431 | 956 | |||||||
Other | 10,880 | 13,784 | |||||||
Total | $ | 56,895 | $ | 54,625 | |||||
Convertible_Senior_Notes
Convertible Senior Notes | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Convertible Senior Notes | ' | ||||||||||||||||
6. Convertible Senior Notes | |||||||||||||||||
Convertible Senior Notes | |||||||||||||||||
(In thousands) | Par Value | Equity | Liability Component of Par | ||||||||||||||
Component | Value as of | ||||||||||||||||
Recorded | |||||||||||||||||
at Issuance | March 31, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
0.125% Convertible Senior Notes due April 1, 2019 | $ | 402,500 | $ | 90,887 | -1 | $ | 303,044 | $ | — | ||||||||
-1 | This amount represents the equity component recorded at the initial issuance of the 0.125% convertible senior notes. | ||||||||||||||||
In March 2014, the Company issued at par value $402.5 million of 0.125% convertible senior notes (the “Notes”) due April 1, 2019, unless earlier purchased by the Company or converted. Interest is payable semi-annually, in arrears on April 1 and October 1 of each year commencing October 1, 2014. | |||||||||||||||||
The Notes are governed by an indenture between the Company, as issuer, and U.S. Bank National Association, as trustee. The Notes are unsecured and do not contain any financial covenants or any restrictions on the payment of dividends, the incurrence of senior debt or other indebtedness, or the issuance or repurchase of securities by the Company. | |||||||||||||||||
If converted, holders will receive cash and/or shares of the Company’s common stock, at the Company’s election. The Company’s intent is to settle the principal amount of the Notes in cash upon conversion. As a result, upon conversion of the Notes, only the amounts payable in excess of the principal amounts of the Notes are considered in diluted earnings per share under the treasury stock method. | |||||||||||||||||
Conversion | Initial | Free | |||||||||||||||
Rate per $1,000 | Conversion | Convertibility Date | |||||||||||||||
Par Value | Price per | ||||||||||||||||
Share | |||||||||||||||||
0.125% Senior Notes | 19.1703 | $ | 52.16 | October 1, 2018 | |||||||||||||
Throughout the term of the Notes, the conversion rate may be adjusted upon the occurrence of certain events as described in the indenture governing the Notes. Holders of the Notes will not receive any cash payment representing accrued and unpaid interest upon conversion of a Note. Accrued but unpaid interest will be deemed to be paid in full upon conversion rather than cancelled, extinguished or forfeited. Holders may convert their Notes under the following circumstances: | |||||||||||||||||
• | during any calendar quarter commencing after June 30, 2014, if, for at least 20 trading days during the 30 consecutive trading day period ending on the last trading day of the immediately preceding calendar quarter, the last reported sales price of the Company’s common stock for such trading day is greater than or equal to 130% of the applicable conversion price for the Notes on each applicable trading day; | ||||||||||||||||
• | during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Notes is less than 98% of the product of the sale price of the Company’s common stock and the conversion rate; | ||||||||||||||||
• | upon the occurrence of specified corporate transactions described under the indenture governing the Notes, such as a consolidation, merger or binding share exchange; or | ||||||||||||||||
• | at any time on or after October 1, 2018. | ||||||||||||||||
Holders of the Notes have the right to require the Company to purchase with cash all or a portion of the Notes upon the occurrence of a fundamental change, such as a change of control, at a purchase price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest. Following certain corporate transactions that constitute a fundamental change, the Company will increase the conversion rate for a holder who elects to convert the Notes in connection with such make-whole fundamental change. | |||||||||||||||||
In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the Notes as a whole. The excess of the principal amount of the liability component over its carrying amount (“debt discount”) is amortized to interest expense over the term of the Notes. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. | |||||||||||||||||
In accounting for the transaction costs related to the Note issuance, the Company allocated the total amount incurred to the liability and equity components based on their relative values. Transaction costs attributable to the liability component are being amortized to expense over the term of the Notes, and transaction costs attributable to the equity component were netted with the equity component in stockholders’ equity. Additionally, the Company recorded a deferred tax liability of $0.8 million in connection with the Notes. | |||||||||||||||||
The Notes consisted of the following (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Liability component : | |||||||||||||||||
Principal: | |||||||||||||||||
0.125% Senior Notes | $ | 402,500 | $ | — | |||||||||||||
Less: debt discount, net | |||||||||||||||||
0.125% Senior Notes | (99,456 | ) | — | ||||||||||||||
Net carrying amount | $ | 303,044 | $ | — | |||||||||||||
The Notes are included in the consolidated balance sheets within convertible senior notes, net (which is classified as a noncurrent liability) and is amortized over the life of the Notes using the effective interest rate method. | |||||||||||||||||
The total estimated fair value of the Company’s Notes at March 31, 2014 was $311.6 million. The fair value of the Notes was determined based on inputs that are observable in the market (Level 2). | |||||||||||||||||
Based on the closing price of the Company’s common stock of $37.67 on March 31, 2014, the if-converted value of the Notes was less than their principal amount. | |||||||||||||||||
Note Hedges | |||||||||||||||||
To minimize the impact of potential economic dilution upon conversion of the Notes, the Company entered into convertible note hedge transactions with respect to its common stock (the “Note Hedges”). | |||||||||||||||||
Date | Purchase | Shares | |||||||||||||||
(in thousands) | underlying Note | ||||||||||||||||
Hedges | |||||||||||||||||
Note Hedges | March 2014 | $ | 85,853 | 7,716,049 | |||||||||||||
The Note Hedges cover shares of the Company’s common stock at a strike price that corresponds to the initial conversion price of the respective Notes, also subject to adjustment, and are exercisable upon conversion of the Notes. The Note Hedges will expire upon the maturity of the Notes. The Note Hedges are intended to reduce the potential economic dilution upon conversion of the Notes in the event that the market value per share of the Company’s common stock, as measured under the Notes, at the time of exercise is greater than the conversion price of the Notes. The Note Hedges are separate transactions and are not part of the terms of the Notes. Holders of the Notes will not have any rights with respect to the Note Hedges. | |||||||||||||||||
Warrants | |||||||||||||||||
Date | Proceeds | Shares | Strike | ||||||||||||||
(in thousands) | Price | ||||||||||||||||
Warrants | March 2014 | $ | 38,278 | 7,716,049 | $ | 81.14 | |||||||||||
Separately, in March 2014, the Company also entered into warrant transactions (the “Warrants”), whereby the Company sold warrants to acquire, subject to anti-dilution adjustments, shares of the Company’s common stock at $81.14 per share. The Warrants have a term of five years from the date of issuance. If the average market value per share of the Company’s common stock for the reporting period, as measured under the Warrants, exceeds the strike price of the Warrants, the Warrants would have a dilutive effect on the Company’s earnings per share if the Company reports net income for fiscal 2014. The Warrants were anti-dilutive for the period ending March 31, 2014. The Warrants are separate transactions, entered into by the Company and are not part of the terms of the Notes or Note Hedges. Holders of the Notes will not have any rights with respect to the Warrants. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||||||
Commitments and Contingencies | ' | ||||||||
7. Commitments and Contingencies | |||||||||
Leases | |||||||||
The Company leases its facilities and certain office equipment under noncancellable operating leases. | |||||||||
The following table summarizes the total rental expense that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Rental expense | $ | 1,440 | $ | 1,231 | |||||
Guarantees | |||||||||
The Company offers two guarantee products to travelers: Basic Rental Guarantee and Carefree Rental Guarantee. The Basic Rental Guarantee is offered to travelers that book a vacation rental property listed on any one of the Company’s websites to protect 50% of their vacation rental payments up to $1,000 against Internet fraud. Travelers may also purchase additional protection to cover 100% of vacation rental payments up to $10,000 against Internet fraud, misrepresentation, wrongful denial of entry, wrongful deposit loss or, beginning in 2012, losses from phishing claims by the purchase of the Carefree Rental Guarantee. The Company does not maintain insurance from any third party for claims under these guarantees, and any amounts payable for claims made under these guarantees are payable by the Company. Amounts recorded for estimated future claims under the guarantees are based on historical experience and estimates of potential future claims are recorded either in cost of revenue or in general and administrative expense in the Company’s consolidated statement of operations depending on whether the expense is related to estimated claims under the Basic Rental Guarantee or to the Carefree Rental Guarantee. | |||||||||
Expected future claims for traveler guarantees, which are presented as a current liability in the Company’s consolidated balance sheets, and changes for the guarantees are as follows (in thousands): | |||||||||
Traveler guarantee liability at December 31, 2012 | $ | 566 | |||||||
Costs accrued for new vacation rentals | 2,230 | ||||||||
Guarantee obligations honored | (1,840 | ) | |||||||
Traveler guarantee liability at December 31, 2013 | $ | 956 | |||||||
Costs accrued for new vacation rentals | 1,114 | ||||||||
Guarantee obligations honored | (639 | ) | |||||||
Traveler guarantee liability at March 31, 2014 | $ | 1,431 | |||||||
The Company maintains a guarantee of £5,000,000 (approximately $8,339,000 as of March 31, 2014) in favor of a bank in the United Kingdom for extending credit to the Company in connection with the wholly owned United Kingdom subsidiary’s business of collecting its subscription revenue in advance via credit card payments. | |||||||||
Legal | |||||||||
From time to time, the Company is involved in litigation relating to claims arising in the ordinary course of business. The Company assesses its potential liability by analyzing specific litigation and regulatory matters using available information. Views on estimated losses are developed by management in consultation with inside and outside counsel, which involves a subjective analysis of potential results and outcomes, assuming various combinations of appropriate litigation and settlement strategies. After taking all of the above factors into account, the Company determines whether an estimated loss from a contingency related to litigation should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. The Company further determines whether an estimated loss from a contingency related to litigation should be disclosed by assessing whether a material loss is deemed reasonably possible. Such disclosures will include an estimate of the additional loss or range of loss or will state that such an estimate cannot be made. | |||||||||
Management believes that there are no claims or actions pending or threatened against the Company, the ultimate disposition of which would have a material impact on the Company’s consolidated financial position, results of operations or cash flows. |
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||
Stock-Based Compensation | ' | ||||||||
8. Stock-Based Compensation | |||||||||
During the three months ended March 31, 2014, the Company issued an aggregate of 119,088 restricted stock units under its 2011 Equity Incentive Plan, or 2011 Plan, for an aggregate fair value of $5,069,000. Additionally, the Company issued an aggregate of 58,571 options to purchase common stock under the 2011 Plan for an aggregate fair value of $977,000. | |||||||||
The following table summarizes the total stock-based compensation expense that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Cost of revenue | $ | 701 | $ | 845 | |||||
Product development | 2,714 | 1,727 | |||||||
Sales and marketing | 2,172 | 1,608 | |||||||
General and administrative | 4,634 | 3,276 | |||||||
Total | $ | 10,221 | $ | 7,456 | |||||
Redeemable_Noncontrolling_Inte
Redeemable Noncontrolling Interests | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Noncontrolling Interest [Abstract] | ' | ||||
Redeemable Noncontrolling Interests | ' | ||||
9. Redeemable Noncontrolling Interests | |||||
During the year ended December 31, 2013, the Company acquired 68.5% of the outstanding stock of travelmob Pte. Ltd. and 55% of the outstanding stock of Bookabach Limited. The redeemable noncontrolling interests are reported on the Consolidated Balance Sheets in mezzanine equity in “Redeemable noncontrolling interests.” | |||||
Changes in the Company’s redeemable noncontrolling interests for the year ended December 31, 2013 and the three months ended March 31, 2014 are summarized in the table below (in thousands): | |||||
Balance at December 31, 2012 | $ | — | |||
Fair value at acquisition | 10,966 | ||||
Net loss attributable to noncontrolling interests | (395 | ) | |||
Currency translation adjustments | 13 | ||||
Balance at December 31, 2013 | $ | 10,584 | |||
Net loss attributable to noncontrolling interests | (287 | ) | |||
Currency translation adjustments | 5 | ||||
Balance at March 31, 2014 | $ | 10,302 | |||
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Equity [Abstract] | ' | ||||||||
Accumulated Other Comprehensive Income (Loss) | ' | ||||||||
10. Accumulated Other Comprehensive Income (Loss) | |||||||||
Accumulated other comprehensive income (loss) consists of the following at March 31, 2014 and December 31, 2013, respectively (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Foreign currency translation | $ | (1,693 | ) | $ | (6,728 | ) | |||
Unrealized gains (losses) on short-term investments | (164 | ) | (19 | ) | |||||
Total | $ | (1,857 | ) | $ | (6,747 | ) | |||
Income_Taxes
Income Taxes | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||
Income Taxes | ' | ||||||||
11. Income Taxes | |||||||||
The following table summarizes the total income tax expense that the Company recorded, and the related effective tax rate, for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Income tax expense | $ | 2,388 | $ | 1,545 | |||||
Effective tax rate | 36.5 | % | 22.6 | % | |||||
At March 31, 2014, the Company’s effective tax rate estimate for the year ended December 31, 2014 differed from the statutory rate primarily due to the non-deductible stock compensation charges, state taxes, the effect of different statutory tax rates in foreign jurisdictions and a Subpart F inclusion and associated foreign tax credit, which is partially offset by the benefit of disqualifying dispositions of incentive stock options. At March 31, 2013, the Company’s effective tax rate estimate for the year ended December 31, 2013 differed from the statutory rate primarily due to the benefit of disqualifying dispositions of incentive stock options, which is partially offset by non-deductible stock compensation charges, state taxes, the effect of different statutory tax rates in foreign jurisdictions and the federal research and experimentation tax credit. |
Net_Income_Per_Share_Attributa
Net Income Per Share Attributable to HomeAway, Inc. | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Net Income Per Share Attributable to HomeAway, Inc. | ' | ||||||||
12. Net Income Per Share Attributable to HomeAway, Inc. | |||||||||
The following table sets forth the computation of basic and diluted net income per share of common stock (in thousands, except per share amounts): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator | |||||||||
Net income attributable to HomeAway, Inc. | $ | 4,443 | $ | 5,295 | |||||
Denominator | |||||||||
Weighted average common shares outstanding-basic | 92,699 | 83,940 | |||||||
Dilutive effect of stock options, warrants and restricted stock units | 3,596 | 2,552 | |||||||
Weighted average common shares outstanding-diluted | 96,295 | 86,492 | |||||||
Net income per share – basic and diluted | $ | 0.05 | $ | 0.06 | |||||
The following common equivalent shares were excluded from the calculation of net income per share as their inclusion would have been anti-dilutive (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Stock options | 301 | 2,990 | |||||||
Restricted stock units | 18 | 61 | |||||||
Warrants | 7,716 | — | |||||||
Total common equivalent shares excluded | 8,035 | 3,051 | |||||||
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Basis of Presentation | ' | ||||||||||||||||
Basis of Presentation | |||||||||||||||||
The accompanying condensed consolidated financial statements include the accounts of HomeAway, Inc. and all of its wholly and majority owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim financial reporting and applicable quarterly reporting regulations of the Securities and Exchange Commission, or the SEC. All significant intercompany transactions and balances have been eliminated in consolidation. In the opinion of the Company’s management, the accompanying interim unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting of normal recurring adjustments and those items discussed in these Notes, necessary for a fair presentation of the Company’s financial position, as of March 31, 2014, the results of operations for the three months ended March 31, 2014 and March 31, 2013, the comprehensive income for the three months ended March 31, 2014 and March 31, 2013, the cash flows for the three months ended March 31, 2014 and March 31, 2013, and the changes in stockholders’ equity for the three months ended March 31, 2014. Certain information and disclosures normally included in the notes to the annual financial statements prepared in accordance with GAAP have been omitted from these interim condensed consolidated financial statements pursuant to the rules and regulations of the SEC. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013. Operating results for this interim period are not necessarily indicative of the results that may be expected for the year ending December 31, 2014 or for any other period. | |||||||||||||||||
Use of Estimates | ' | ||||||||||||||||
Use of Estimates | |||||||||||||||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. These differences could have a material effect on the Company’s future results of operations and financial position. Significant items subject to estimates and assumptions include certain revenue, the allowance for doubtful accounts, the fair value of short-term investments, the carrying amounts of goodwill and other indefinite-lived intangible assets, depreciation and amortization, the valuation of stock options, deferred income taxes and the fair value of noncontrolling interests. | |||||||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||
Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: | |||||||||||||||||
Level 1: | Valuations based on quoted prices for identical assets and liabilities in active markets. | ||||||||||||||||
Level 2: | Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. | ||||||||||||||||
Level 3: | Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. | ||||||||||||||||
The following section describes the valuation methodologies used to measure certain financial assets and financial liabilities at fair value. | |||||||||||||||||
Money Market Funds and Short-Term Investments | |||||||||||||||||
The Company’s cash equivalents, restricted cash and short-term investments classified as Level 1 are valued using quoted prices generated by market transactions involving identical assets. Short-term investments classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. The Company did not hold any cash equivalents, restricted cash or short-term investments categorized as Level 3 as of March 31, 2014 or December 31, 2013. | |||||||||||||||||
Short-term investments include certificates of deposit, corporate bonds, U.S. government agency bonds and municipal bonds and are classified as available-for-sale and reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits. Additionally, the Company periodically assesses whether an other than temporary impairment loss on investments has occurred due to declines in fair value or other market conditions. Declines in fair value that are considered other than temporary are recorded as an impairment in the consolidated statement of operations. The Company did not record any impairments of its investments for any of the periods presented. | |||||||||||||||||
The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities and deferred revenue approximate fair value because of the relatively short maturity of these instruments. | |||||||||||||||||
The following table summarizes the basis used to measure certain financial assets at fair value on a recurring basis in the Company’s consolidated balance sheets at March 31, 2014 (in thousands): | |||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | ||||||||||||||
March 31, | Active Markets | Observable | Unobservable | ||||||||||||||
2014 | for Identical | Inputs (Level 2) | Inputs | ||||||||||||||
Assets (Level 1) | (Level 3) | ||||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Money market funds | $ | 46,801 | $ | 46,801 | $ | — | $ | — | |||||||||
Total cash equivalents | 46,801 | 46,801 | — | — | |||||||||||||
Restricted cash | |||||||||||||||||
Money market funds | 770 | 770 | — | — | |||||||||||||
Total restricted cash | 770 | 770 | — | — | |||||||||||||
Short-term investments | |||||||||||||||||
Certificates of deposit | 2,053 | — | 2,053 | — | |||||||||||||
Corporate bonds | 75,903 | — | 75,903 | — | |||||||||||||
Municipal bonds | 35,933 | — | 35,933 | — | |||||||||||||
Total short-term investments | 113,889 | — | 113,889 | — | |||||||||||||
Total financial assets | $ | 161,460 | $ | 47,571 | $ | 113,889 | $ | — | |||||||||
The following table summarizes the basis used to measure certain financial assets at fair value on a recurring basis in the Company’s consolidated balance sheets at December 31, 2013 (in thousands): | |||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | ||||||||||||||
December 31, | Active Markets | Observable | Unobservable | ||||||||||||||
2013 | for Identical | Inputs (Level 2) | Inputs | ||||||||||||||
Assets (Level 1) | (Level 3) | ||||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Money market funds | $ | 26,451 | $ | 26,451 | $ | — | $ | — | |||||||||
Total cash equivalents | 26,451 | 26,451 | — | — | |||||||||||||
Restricted cash | |||||||||||||||||
Money market funds | 758 | 758 | — | — | |||||||||||||
Total restricted cash | 758 | 758 | — | — | |||||||||||||
Short-term investments | |||||||||||||||||
Certificates of deposit | 2,054 | — | 2,054 | — | |||||||||||||
Corporate bonds | 33,257 | — | 33,257 | — | |||||||||||||
Municipal bonds | 31,487 | — | 31,487 | — | |||||||||||||
Total short-term investments | 66,798 | — | 66,798 | — | |||||||||||||
Total financial assets | $ | 94,007 | $ | 27,209 | $ | 66,798 | $ | — | |||||||||
Business Segment | ' | ||||||||||||||||
Business Segment | |||||||||||||||||
The Company has one operating segment consisting of various products and services related to its online marketplace of accommodation rental listings. The Company’s chief operating decision maker is considered to be the Chief Executive Officer. The chief operating decision maker allocates resources and assesses performance of the business and other activities at the single operating segment level. | |||||||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||
Cash and cash equivalents include investments in money market funds and certificates of deposit that are readily convertible into cash. Cash and cash equivalents are stated at cost, which approximates fair value. The Company considers all highly liquid investments purchased with an original maturity date of three months or less to be cash equivalents. Cash and cash equivalents consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Demand deposit accounts | $ | 609,800 | $ | 298,157 | |||||||||||||
Money market funds | 46,801 | 26,451 | |||||||||||||||
Total | $ | 656,601 | $ | 324,608 | |||||||||||||
Restricted Cash | ' | ||||||||||||||||
Restricted Cash | |||||||||||||||||
Restricted cash of $1,384,000 and $2,180,000 at March 31, 2014 and December 31, 2013, respectively, was held in accounts owned by the Company in conjunction with property license requirements, leased office space and to secure credit card availability and reimbursable direct debits due from the Company. | |||||||||||||||||
Short-term Investments | ' | ||||||||||||||||
Short-term Investments | |||||||||||||||||
Short-term investments generally consist of marketable securities that have original maturities greater than ninety days as of the date of purchase. Investments in which the Company has the ability and intent, if necessary, to liquidate in order to support its current operations, including those with contractual maturities greater than one year from the date of purchase, are classified as short-term. The Company’s investment securities are classified as available-for-sale and are presented at estimated fair value with any unrealized gains and losses included in other comprehensive income (loss). | |||||||||||||||||
Cash flows from purchases, sales and maturities of available-for-sale securities are classified as cash flows from investing activities and reported gross, including any related premiums or discounts. Premiums related to purchases of available-for-sale securities were $1,740,000 and $4,048,000 during the three months ended March 31, 2014 and 2013, respectively. Fair values are based on quoted market prices. Short-term investments consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Gross | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair | ||||||||||||||
Gains | Losses | Value | |||||||||||||||
Certificates of deposit | $ | 2,055 | $ | — | $ | (2 | ) | $ | 2,053 | ||||||||
Corporate bonds | 76,062 | 35 | (194 | ) | 75,903 | ||||||||||||
Municipal bonds | 35,935 | 33 | (35 | ) | 35,933 | ||||||||||||
Total short-term investments | $ | 114,052 | $ | 68 | $ | (231 | ) | $ | 113,889 | ||||||||
December 31, 2013 | |||||||||||||||||
Gross | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair | ||||||||||||||
Gains | Losses | Value | |||||||||||||||
Certificates of deposit | $ | 2,055 | $ | — | $ | (1 | ) | $ | 2,054 | ||||||||
Corporate bonds | 33,274 | 33 | (50 | ) | 33,257 | ||||||||||||
Municipal bonds | 31,486 | 16 | (15 | ) | 31,487 | ||||||||||||
Total short-term investments | $ | 66,815 | $ | 49 | $ | (66 | ) | $ | 66,798 | ||||||||
For fixed income securities that have unrealized losses as of March 31, 2014, the Company does not intend to sell any of these investments and it is not more likely than not that it will be required to sell any of these investments before recovery of the entire amortized cost basis. The Company has evaluated these fixed income securities and determined that no credit losses exist. Accordingly, the Company has determined that the unrealized losses on fixed income securities as of March 31, 2014 are temporary in nature. | |||||||||||||||||
The following table summarizes the contractual underlying maturities of the Company’s short-term investments at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Less than 12 | 12 Months or | Total | |||||||||||||||
Months | Greater | ||||||||||||||||
Certificates of deposit | $ | 1,499 | $ | 554 | $ | 2,053 | |||||||||||
Corporate bonds | 10,834 | 65,069 | 75,903 | ||||||||||||||
Municipal bonds | 7,746 | 28,187 | 35,933 | ||||||||||||||
Total short-term investments | $ | 20,079 | $ | 93,810 | $ | 113,889 | |||||||||||
December 31, 2013 | |||||||||||||||||
Less than 12 | 12 Months or | Total | |||||||||||||||
Months | Greater | ||||||||||||||||
Certificates of deposit | $ | 500 | $ | 1,554 | $ | 2,054 | |||||||||||
Corporate bonds | 11,164 | 22,093 | 33,257 | ||||||||||||||
Municipal bonds | 3,031 | 28,456 | 31,487 | ||||||||||||||
Total short-term investments | $ | 14,695 | $ | 52,103 | $ | 66,798 | |||||||||||
Non-marketable Cost Investment | |||||||||||||||||
During the years ended December 31, 2013 and 2012, the Company purchased a non-controlling equity interest in a privately-held company in China. As of March 31, 2014, the total carrying value of the Company’s investment in the privately-held company was $10,113,000. The Company’s investment in the privately-held company is reported using the cost method of accounting or marked down to fair value when an event or circumstance indicates an other-than-temporary decline in value has occurred. It was not practicable to estimate the fair value of this asset as of March 31, 2014. No event or circumstance indicating an other-than-temporary decline in value of the Company’s interest in the non-marketable cost investment was identified. This investment is recorded in other non-current assets on the consolidated balance sheets. | |||||||||||||||||
Accounts Receivable | ' | ||||||||||||||||
Accounts Receivable | |||||||||||||||||
Accounts receivable are primarily generated from three sources. Amounts due from credit card merchants who process the Company’s credit card sales from property listings and remit the proceeds to the Company are the primary source of accounts receivable. Accounts receivable are also generated from Internet display advertising amounts due in the ordinary course of business as well as amounts due to the Company for property listings, other products purchased on account or amounts due from partners. Accounts receivable from Internet display advertising revenue and products purchased on account are recorded at the invoiced amount and are non-interest bearing. Accounts receivable outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance for doubtful accounts by estimating losses on receivables based on known troubled accounts and historical experiences of losses incurred. | |||||||||||||||||
Property and Equipment | ' | ||||||||||||||||
Property and Equipment | |||||||||||||||||
Property and equipment are recorded at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Computer equipment and purchased software are generally depreciated over three years. Furniture and fixtures are generally depreciated over five to ten years. Leasehold improvements are depreciated on a straight-line basis over the shorter of the contractual lease period or their estimated useful life. Upon disposal, property and equipment and the related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statements of operations. Ordinary maintenance and repairs are charged to expense, while expenditures that extend the physical or economic life of the assets are capitalized. | |||||||||||||||||
The Company capitalizes certain internally developed software and website development costs. These capitalized costs were approximately $32,345,000 and $30,523,000 at March 31, 2014 and December 31, 2013, respectively, and are included in property and equipment, net, in the consolidated balance sheets. Internally developed software costs are generally depreciated over five years. | |||||||||||||||||
The Company recorded depreciation expense on internally developed software and website development costs as follows for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Depreciation expense on internally developed software and website development costs | $ | 1,294 | $ | 732 | |||||||||||||
Goodwill and Intangible Assets | ' | ||||||||||||||||
Goodwill and Intangible Assets | |||||||||||||||||
Goodwill arises from business combinations and is measured as the excess of the purchase consideration over the sum of the acquisition-date fair values of tangible and identifiable intangible assets acquired, less any liabilities assumed. While the Company uses the best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, adjustments to the assets acquired and liabilities assumed are recorded with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. | |||||||||||||||||
Goodwill and intangible assets deemed to have indefinite useful lives, such as certain trade names, are not amortized. Tests for impairment of goodwill and indefinite-lived intangible assets are performed on an annual basis or when events or circumstances indicate that the carrying amount may not be recoverable. | |||||||||||||||||
Circumstances that could trigger an impairment test outside of the annual test include but are not limited to: a significant adverse change in the business climate or legal factors; adverse cash flow trends; an adverse action or assessment by a regulator; unanticipated competition; loss of key personnel; decline in stock price; and the results of tests for recoverability of a significant asset group. The Company determined that no triggering event occurred during any of the periods presented. | |||||||||||||||||
For goodwill and indefinite lived intangible assets, the Company completes what is referred to as the “Step 0” analysis, which involves evaluating qualitative factors, including macroeconomic conditions, industry and market considerations, cost factors, and overall financial performance related to its goodwill and its indefinite lived intangible assets. If the Company’s “Step 0” analysis indicates that it is more likely than not that the fair value of a reporting unit or of an indefinite lived intangible asset is less than its carrying amount, then the Company would perform a quantitative two-step impairment test. The quantitative analysis compares the fair value of the Company’s reporting unit or indefinite-lived intangible assets to its carrying amount, and an impairment loss is recognized equivalent to the excess of the carrying amount over fair value. If, after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of a reporting unit or indefinite lived intangible asset exceeds its carrying amount, then the quantitative impairment tests are unnecessary. | |||||||||||||||||
The Company performs an evaluation of goodwill and indefinite-lived intangible assets for impairment annually in October. | |||||||||||||||||
The determination of whether or not goodwill or indefinite-lived intangible assets have become impaired involves a significant level of judgment. Changes in the Company’s strategy and/or market conditions could significantly impact these judgments and require adjustments to recorded amounts of goodwill or intangible assets. | |||||||||||||||||
No impairment of goodwill or indefinite-lived intangible assets was identified in any of the periods presented. | |||||||||||||||||
Identifiable intangible assets consist of trade names, customer listings, technology, domain names and contractual non-competition agreements associated with acquired businesses. Intangible assets with finite lives are amortized over their estimated useful lives on a straight-line basis and reviewed for impairment whenever events or changes in circumstances indicate that an asset’s carrying value may not be recoverable (see Note 4). The straight-line method of amortization represents the Company’s best estimate of the distribution of the economic value of the identifiable intangible assets. | |||||||||||||||||
Impairment of Long-lived Assets | ' | ||||||||||||||||
Impairment of Long-lived Assets | |||||||||||||||||
The Company evaluates long-lived assets held for use, such as property and equipment, for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. An impairment loss is recognized when estimated future undiscounted cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When an impairment loss is recognized, the carrying amount of the asset is reduced to its estimated fair value in the period in which the determination is made. No impairments of long-lived assets have been recorded during any of the periods presented. | |||||||||||||||||
Leases | ' | ||||||||||||||||
Leases | |||||||||||||||||
The Company leases facilities in several countries around the world and certain equipment under non-cancelable lease agreements. The terms of certain lease agreements provide for rental payments on a graduated basis. Rent expense is recognized on a straight-line basis over the lease period and accrued as rent expense incurred but not paid. | |||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||
Revenue Recognition | |||||||||||||||||
The Company recognizes revenue when persuasive evidence of an agreement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. | |||||||||||||||||
The Company generates a significant portion of its revenue from customers purchasing online advertising services related to the listing of their properties for rent, primarily on a subscription basis over a fixed-term. The Company also generates revenue based on the number of traveler inquiries and reservation bookings for property listings on the Company’s websites, local and national Internet display advertisers, license of property management software and ancillary products and services. | |||||||||||||||||
Payments for term-based subscriptions received in advance of services being rendered are recorded as deferred revenue and recognized on a straight-line basis over the listing period. Revenue for inquiry-based contracts are determined on a fixed fee-per-inquiry as stated in the arrangement and recognized when the service has been performed. | |||||||||||||||||
The Company earns commission revenue for reservations made online through its websites, which is calculated as a percentage of the value of the reservation. This revenue is earned as the services are performed or as the customers’ refund privileges lapse and is included in listing revenue in the consolidated statement of operations. | |||||||||||||||||
Internet display advertising revenue is generated primarily from advertisements appearing on the Company’s websites. There are several types of Internet advertisements, and the way in which advertising revenue is earned varies among them. Depending upon the terms, revenue might be earned each time an impression is delivered, each time a user clicks on an ad, each time a graphic ad is displayed, or each time a user clicks-through on the ad and takes a specified action on the destination site. | |||||||||||||||||
The Company sells gift cards with no expiration date to travelers and does not charge administrative fees on unused cards. There is a portion of the gift card obligation that, based on historical redemption patterns, will not be used by the Company’s customers and is not required to be remitted to relevant jurisdictions, or breakage. At the point of sale, the Company recognizes breakage as deferred revenue and amortizes it over 48 months based on historical redemption patterns. The Company also records commission revenue for each gift card sale over the same 48-month redemption period. | |||||||||||||||||
Through its professional software for bed and breakfasts and professional property managers, the Company makes selected, online bookable properties available to online travel agencies and channel partners. The Company receives a percentage of the transaction value or a fee from the property manager for making this inventory available, which is recognized when earned. This revenue is included in other revenue in the consolidated statement of operations. | |||||||||||||||||
The Company generates revenue from the licensing of software products, the sale of maintenance agreements and the sale of hosted software solutions. For software license sales, one year of maintenance is typically included as part of the initial purchase price of the bundled offering with annual renewals of the maintenance component of the agreement following in subsequent years. | |||||||||||||||||
The Company recognizes revenue from the sale of perpetual licenses upon delivery, which generally occurs upon electronic transfer of the license key that makes the product available to the purchaser. | |||||||||||||||||
As software is usually sold with maintenance, the amount of revenue allocated to the software license is determined by estimating the fair value of the maintenance and subtracting it from the total invoice or contract amount. Vendor-specific objective evidence, or VSOE, of the fair value of maintenance services is determined by the standard published list pricing for maintenance renewals, as the Company generally charges list prices for maintenance renewals. In determining VSOE, the Company requires that a substantial majority of the selling price for maintenance services fall within a reasonably narrow pricing range. Maintenance and support revenue is recognized ratably over the term of the agreement beginning on the activation date. Amounts that have been invoiced are recorded in accounts receivable and in deferred revenue or revenue, depending on whether the revenue recognition criteria have been met. | |||||||||||||||||
Sales of hosted software solutions are generally for a one-year period. Revenue is recognized on a straight-line basis over the contract term. Certain implementation services related to the hosting services are essential to the customer’s use of the hosting services. For sales of these hosting services where the Company is responsible for implementation, the Company recognizes implementation revenue ratably over the estimated period of the hosting relationship, which the Company considers to be three years. Recognition starts once the product has been made available to the customer. | |||||||||||||||||
Training and consulting revenue is recognized upon delivery of the training or consulting services to the end customer. | |||||||||||||||||
The Company accounts for sales incentives to customers as a reduction of revenue at the time that the revenue is recognized from the related product sale. The Company also reports revenue net of any sales tax collected. | |||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
Stock-Based Compensation | |||||||||||||||||
The cost of stock-based compensation is recognized in the financial statements based upon the estimated grant date fair value of the awards measured using the Black–Scholes valuation model. The fair value of restricted stock awards and units is determined based on the number of shares granted and the fair value of the Company’s common stock as of the grant date. Fair value is generally recognized as an expense on a straight-line basis, net of estimated forfeitures, over the employee requisite service period. When estimating forfeitures, the Company considers voluntary termination behaviors as well as trends of actual option forfeitures. | |||||||||||||||||
The Company uses the “with and without” approach in determining the order in which tax attributes are utilized. As a result, the Company only recognizes a tax benefit from stock-based awards in additional paid-in capital if an incremental tax benefit is realized after all other tax attributes currently available to the Company have been utilized. When tax deductions from stock-based awards are less than the cumulative book compensation expense, the tax effect of the resulting difference (“shortfall”) is charged first to additional paid-in capital to the extent of the Company’s pool of windfall tax benefits with any remainder recognized in income tax expense. The Company has determined that it has a sufficient windfall pool available and therefore no amounts have been recognized in income tax expense. In addition, the Company accounts for the indirect effects of stock-based awards on other tax attributes through the consolidated statements of operations. | |||||||||||||||||
The benefits of tax deductions in excess of recognized compensation costs are reported as financing cash inflows, but only when such excess tax benefits are realized by a reduction to current taxes payable. | |||||||||||||||||
The following table summarizes the excess tax benefit that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Excess tax benefit from stock-based compensation | $ | 3,579 | $ | 1,358 | |||||||||||||
This tax benefit has been recorded as additional paid-in capital on the Company’s consolidated balance sheets. | |||||||||||||||||
Income Taxes | ' | ||||||||||||||||
Income Taxes | |||||||||||||||||
The Company recognizes income taxes using an asset and liability approach. This approach requires the recognition of deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the Company’s consolidated financial statements or tax returns. The measurement of deferred taxes is based on provisions of the enacted tax law and the effects of future changes in tax laws or rates are not anticipated. A valuation allowance is recognized if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax asset will not be realized. Evaluating the need for an amount of a valuation allowance for deferred tax assets requires significant judgment and analysis of the positive and negative evidence available, including past operating results, estimates of future taxable income, reversals of existing taxable temporary differences and the feasibility of tax planning in order to determine whether all or some portion of the deferred tax assets will not be realized. Based on the available evidence and judgment, the Company has determined that it is more likely than not that certain loss carryforwards will not be realized; therefore, the Company has established a valuation allowance for such deferred tax assets to reduce the loss carryforward assets to amounts expected to be utilized. | |||||||||||||||||
The Company may be subject to income tax audits by the respective tax authorities in any or all of the jurisdictions in which the Company operates. The Company is currently undergoing an audit at its subsidiary in the United Kingdom. Significant judgment is required in determining uncertain tax positions. The Company recognizes the benefit of uncertain income tax positions only if these positions are more likely than not to be sustained. Also, the recognized income tax benefit is measured at the largest amount that is more than 50% likely of being realized. The Company adjusts these reserves in light of changing facts and circumstances, such as the closing of an audit or the refinement of an estimate. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as a component of income tax expense. The countries in which the Company may be subject to potential examination by tax authorities include the United States, Australia, Brazil, Colombia, France, Germany, Italy, the Netherlands, New Zealand, Singapore, Spain, Switzerland, Thailand and the United Kingdom. | |||||||||||||||||
The calculation of the Company’s tax liabilities involves the inherent uncertainty associated with the application of complex tax laws. As a multinational corporation, the Company conducts its business in many countries and is subject to taxation in many jurisdictions. The taxation of the Company’s business is subject to the application of various and sometimes conflicting tax laws and regulations as well as multinational tax conventions. The Company’s effective tax rate is highly dependent upon the geographic distribution of its worldwide earnings or losses, the tax regulations and tax rates in each geographic region, the availability of tax credits and carryforwards, and the effectiveness of its tax planning strategies. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws themselves are subject to change as a result of changes in fiscal policy, changes in legislation, and the evolution of regulations and court rulings. Consequently, taxing authorities may impose tax assessments or judgments against the Company that could materially impact its tax liability and/or its effective income tax rate. The Company believes it has adequately provided in its financial statements for additional taxes that it estimates may be assessed by the various taxing authorities. While the Company believes that it has adequately provided for all uncertain tax positions, amounts asserted by tax authorities could be greater or less than the Company’s accrued position. These tax liabilities, including the interest and penalties, are adjusted pursuant to a settlement with tax authorities, completion of audit, refinement of estimates or expiration of various statutes of limitation. | |||||||||||||||||
Foreign Currency Translation | ' | ||||||||||||||||
Foreign Currency Translation | |||||||||||||||||
The functional currency of the Company’s foreign subsidiaries is generally their respective local currency. The financial statements of the Company’s international operations are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities, the historical exchange rate for stockholders’ equity, and a weighted average exchange rate for each period for revenue, expenses, and gains and losses. Foreign currency translation adjustments are recorded as a separate component of stockholders’ equity. Gains and losses from foreign currency denominated transactions are recorded in other income (expense) in the Company’s consolidated statements of operations. | |||||||||||||||||
The following table summarizes the foreign exchange loss that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Foreign exchange loss | $ | (2,526 | ) | $ | (1,535 | ) | |||||||||||
Derivative Financial Instruments | ' | ||||||||||||||||
Derivative Financial Instruments | |||||||||||||||||
As a result of the Company’s international operations, it is exposed to various market risks that may affect its consolidated results of operations, cash flows and financial position. These market risks include, but are not limited to, fluctuations in currency exchange rates. The Company’s primary foreign currency exposures are in Euros, British Pound Sterling and Australian Dollars. As a result, the Company faces exposure to adverse movements in currency exchange rates as the financial results of its operations are translated from local currency into U.S. dollars upon consolidation. Additionally, foreign exchange rate fluctuations on transactions denominated in currencies other than the functional currency result in gains and losses that are reflected in other income (expense) in the Company’s consolidated statements of operations. | |||||||||||||||||
The Company may enter into derivative instruments to hedge certain net exposures of nonfunctional currency denominated assets and liabilities, primarily related to intercompany loans, even though it does not elect to apply hedge accounting or hedge accounting does not apply. Gains and losses resulting from a change in fair value for these derivatives are reflected in the period in which the change occurs and are recognized on the consolidated statement of operations in other income (expense). Cash flows from these contracts are classified within cash flows from investing activities on the consolidated statements of cash flows. | |||||||||||||||||
The Company does not use financial instruments for trading or speculative purposes. The Company recognizes all derivative instruments on the balance sheet at fair value and its derivative instruments are generally short-term in duration. The Company is exposed to the risk that counterparties to derivative contracts may fail to meet their contractual obligations. | |||||||||||||||||
The following tables show the fair value and notional principal amounts of our outstanding or unsettled derivative instruments that are not designated as hedging instruments at March 31, 2014 and December 31, 2013 (in thousands). In addition to the notional amounts listed below, the Company also had $275,000,000 of derivatives entered into on March 31, 2014 that had a fair value of zero on March 31, 2014. | |||||||||||||||||
Balance Sheet Caption | March 31, 2014 | ||||||||||||||||
Significant Other | U.S. Dollar | ||||||||||||||||
Observable Inputs | Notional | ||||||||||||||||
(Level 2) | |||||||||||||||||
Foreign exchange-forward contracts (current) | Prepaid expenses and other current assets | $ | 48 | $ | 6,983 | ||||||||||||
Foreign exchange-forward contracts (current) | Accrued expenses | (7,380 | ) | 268,670 | |||||||||||||
Total | $ | (7,332 | ) | $ | 275,653 | ||||||||||||
Balance Sheet Caption | December 31, 2013 | ||||||||||||||||
Significant Other | U.S. Dollar | ||||||||||||||||
Observable Inputs | Notional | ||||||||||||||||
(Level 2) | |||||||||||||||||
Foreign exchange-forward contracts (current) | Prepaid expenses and other current assets | $ | 363 | $ | 20,520 | ||||||||||||
Foreign exchange-forward contracts (current) | Accrued expenses | (979 | ) | 84,292 | |||||||||||||
Total | $ | (616 | ) | $ | 104,812 | ||||||||||||
Net Income Per Share | ' | ||||||||||||||||
Net Income Per Share Attributable to HomeAway, Inc. | |||||||||||||||||
Basic net income per share is computed by dividing net income attributable to HomeAway, Inc. by the weighted average number of common shares outstanding during the period. Diluted income per share is computed by dividing net income attributable to HomeAway, Inc. by the weighted average common shares outstanding plus potentially dilutive common shares. The dilutive effect of outstanding options and awards is reflected in diluted earnings per share by application of the treasury stock method. | |||||||||||||||||
Restricted stock awards provide the holder of unvested shares the right to participate in dividends declared on the Company’s common stock. Accordingly, these shares are included in the weighted average shares outstanding for the computation of basic earnings per share in periods of undistributed earnings. Restricted stock awards are excluded from the basic earnings per share in periods of undistributed losses as the holders are not contractually obligated to participate in the losses of the Company. Unvested restricted stock units do not provide the holder the right to participate in dividends declared on the Company’s common stock. Accordingly, these shares are excluded in the weighted average shares outstanding for the computation of basic earnings per share in periods of undistributed earnings or losses. | |||||||||||||||||
Comprehensive Income (Loss) | ' | ||||||||||||||||
Comprehensive Income (Loss) Attributable to HomeAway, Inc. | |||||||||||||||||
Comprehensive income (loss) attributable to HomeAway, Inc. consists of net income (loss), cumulative foreign currency translation adjustments, unrealized gain (loss) on available-for-sale securities and comprehensive income (loss) attributable to noncontrolling interests. | |||||||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||
In April 2014, the Financial Accounting Standards Board (“FASB”) issued amended guidance for reporting discontinued operations and disposals of components of an entity. The amended guidance requires that a disposal representing a strategic shift that has or will have a major effect on an entity’s financial results, or a business activity classified as held for sale, should be reported as discontinued operations. This new guidance also expands the disclosure requirements for discontinued operations and adds new disclosures for individually significant dispositions that do not qualify as discontinued operations. The amendments are effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014. Early adoption is permitted only for disposals that have not been previously reported. This guidance is not expected to have a material impact on our consolidated financial position or results of operations. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Fair Value of Financial Assets and Liabilities Measured on Recurring Basis | ' | ||||||||||||||||
The following table summarizes the basis used to measure certain financial assets at fair value on a recurring basis in the Company’s consolidated balance sheets at March 31, 2014 (in thousands): | |||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | ||||||||||||||
March 31, | Active Markets | Observable | Unobservable | ||||||||||||||
2014 | for Identical | Inputs (Level 2) | Inputs | ||||||||||||||
Assets (Level 1) | (Level 3) | ||||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Money market funds | $ | 46,801 | $ | 46,801 | $ | — | $ | — | |||||||||
Total cash equivalents | 46,801 | 46,801 | — | — | |||||||||||||
Restricted cash | |||||||||||||||||
Money market funds | 770 | 770 | — | — | |||||||||||||
Total restricted cash | 770 | 770 | — | — | |||||||||||||
Short-term investments | |||||||||||||||||
Certificates of deposit | 2,053 | — | 2,053 | — | |||||||||||||
Corporate bonds | 75,903 | — | 75,903 | — | |||||||||||||
Municipal bonds | 35,933 | — | 35,933 | — | |||||||||||||
Total short-term investments | 113,889 | — | 113,889 | — | |||||||||||||
Total financial assets | $ | 161,460 | $ | 47,571 | $ | 113,889 | $ | — | |||||||||
The following table summarizes the basis used to measure certain financial assets at fair value on a recurring basis in the Company’s consolidated balance sheets at December 31, 2013 (in thousands): | |||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | ||||||||||||||
December 31, | Active Markets | Observable | Unobservable | ||||||||||||||
2013 | for Identical | Inputs (Level 2) | Inputs | ||||||||||||||
Assets (Level 1) | (Level 3) | ||||||||||||||||
Assets | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Money market funds | $ | 26,451 | $ | 26,451 | $ | — | $ | — | |||||||||
Total cash equivalents | 26,451 | 26,451 | — | — | |||||||||||||
Restricted cash | |||||||||||||||||
Money market funds | 758 | 758 | — | — | |||||||||||||
Total restricted cash | 758 | 758 | — | — | |||||||||||||
Short-term investments | |||||||||||||||||
Certificates of deposit | 2,054 | — | 2,054 | — | |||||||||||||
Corporate bonds | 33,257 | — | 33,257 | — | |||||||||||||
Municipal bonds | 31,487 | — | 31,487 | — | |||||||||||||
Total short-term investments | 66,798 | — | 66,798 | — | |||||||||||||
Total financial assets | $ | 94,007 | $ | 27,209 | $ | 66,798 | $ | — | |||||||||
Schedule of Cash and Cash Equivalents | ' | ||||||||||||||||
Cash and cash equivalents consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Demand deposit accounts | $ | 609,800 | $ | 298,157 | |||||||||||||
Money market funds | 46,801 | 26,451 | |||||||||||||||
Total | $ | 656,601 | $ | 324,608 | |||||||||||||
Short-Term Investments | ' | ||||||||||||||||
Short-term investments consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Gross | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair | ||||||||||||||
Gains | Losses | Value | |||||||||||||||
Certificates of deposit | $ | 2,055 | $ | — | $ | (2 | ) | $ | 2,053 | ||||||||
Corporate bonds | 76,062 | 35 | (194 | ) | 75,903 | ||||||||||||
Municipal bonds | 35,935 | 33 | (35 | ) | 35,933 | ||||||||||||
Total short-term investments | $ | 114,052 | $ | 68 | $ | (231 | ) | $ | 113,889 | ||||||||
December 31, 2013 | |||||||||||||||||
Gross | Gross | Gross | Estimated | ||||||||||||||
Cost | Unrealized | Unrealized | Fair | ||||||||||||||
Gains | Losses | Value | |||||||||||||||
Certificates of deposit | $ | 2,055 | $ | — | $ | (1 | ) | $ | 2,054 | ||||||||
Corporate bonds | 33,274 | 33 | (50 | ) | 33,257 | ||||||||||||
Municipal bonds | 31,486 | 16 | (15 | ) | 31,487 | ||||||||||||
Total short-term investments | $ | 66,815 | $ | 49 | $ | (66 | ) | $ | 66,798 | ||||||||
Summary of Contractual Underlying Maturities of Short-Term Investments | ' | ||||||||||||||||
The following table summarizes the contractual underlying maturities of the Company’s short-term investments at March 31, 2014 and December 31, 2013 (in thousands): | |||||||||||||||||
March 31, 2014 | |||||||||||||||||
Less than 12 | 12 Months or | Total | |||||||||||||||
Months | Greater | ||||||||||||||||
Certificates of deposit | $ | 1,499 | $ | 554 | $ | 2,053 | |||||||||||
Corporate bonds | 10,834 | 65,069 | 75,903 | ||||||||||||||
Municipal bonds | 7,746 | 28,187 | 35,933 | ||||||||||||||
Total short-term investments | $ | 20,079 | $ | 93,810 | $ | 113,889 | |||||||||||
December 31, 2013 | |||||||||||||||||
Less than 12 | 12 Months or | Total | |||||||||||||||
Months | Greater | ||||||||||||||||
Certificates of deposit | $ | 500 | $ | 1,554 | $ | 2,054 | |||||||||||
Corporate bonds | 11,164 | 22,093 | 33,257 | ||||||||||||||
Municipal bonds | 3,031 | 28,456 | 31,487 | ||||||||||||||
Total short-term investments | $ | 14,695 | $ | 52,103 | $ | 66,798 | |||||||||||
Summary of Depreciation Expenses on Internally Developed Software and Website Development Costs | ' | ||||||||||||||||
The Company recorded depreciation expense on internally developed software and website development costs as follows for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Depreciation expense on internally developed software and website development costs | $ | 1,294 | $ | 732 | |||||||||||||
Summary of Excess Tax Benefit | ' | ||||||||||||||||
The following table summarizes the excess tax benefit that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Excess tax benefit from stock-based compensation | $ | 3,579 | $ | 1,358 | |||||||||||||
Schedule of Fair Value and Notional Principal Amounts of Outstanding or Unsettled Derivative Instruments | ' | ||||||||||||||||
The following tables show the fair value and notional principal amounts of our outstanding or unsettled derivative instruments that are not designated as hedging instruments at March 31, 2014 and December 31, 2013 (in thousands). In addition to the notional amounts listed below, the Company also had $275,000,000 of derivatives entered into on March 31, 2014 that had a fair value of zero on March 31, 2014. | |||||||||||||||||
Balance Sheet Caption | March 31, 2014 | ||||||||||||||||
Significant Other | U.S. Dollar | ||||||||||||||||
Observable Inputs | Notional | ||||||||||||||||
(Level 2) | |||||||||||||||||
Foreign exchange-forward contracts (current) | Prepaid expenses and other current assets | $ | 48 | $ | 6,983 | ||||||||||||
Foreign exchange-forward contracts (current) | Accrued expenses | (7,380 | ) | 268,670 | |||||||||||||
Total | $ | (7,332 | ) | $ | 275,653 | ||||||||||||
Balance Sheet Caption | December 31, 2013 | ||||||||||||||||
Significant Other | U.S. Dollar | ||||||||||||||||
Observable Inputs | Notional | ||||||||||||||||
(Level 2) | |||||||||||||||||
Foreign exchange-forward contracts (current) | Prepaid expenses and other current assets | $ | 363 | $ | 20,520 | ||||||||||||
Foreign exchange-forward contracts (current) | Accrued expenses | (979 | ) | 84,292 | |||||||||||||
Total | $ | (616 | ) | $ | 104,812 | ||||||||||||
Business_Combinations_Tables
Business Combinations (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Business Combinations [Abstract] | ' | ||||||||
Fair Value of Acquisition Amounts at Acquisition Date | ' | ||||||||
The following table summarizes the Company’s acquisition during the three months ended March 31, 2014, with amounts shown below as fair values at the acquisition date (in thousands): | |||||||||
Glad to Have You, Inc. | |||||||||
Net tangible assets (liabilities) acquired | |||||||||
Cash | $ | 25 | |||||||
Deferred revenue | (65 | ) | |||||||
Other | 17 | ||||||||
Total net tangible assets (liabilities) acquired | (23 | ) | |||||||
Deferred tax liabilities | (1,653 | ) | |||||||
Trade name | 1,177 | ||||||||
Developed technology | 3,760 | ||||||||
Customer relationships | 1,643 | ||||||||
Goodwill | 11,647 | ||||||||
Non-competition agreements | 240 | ||||||||
Purchase price | 16,791 | ||||||||
Less: Cash acquired | (25 | ) | |||||||
Net purchase price | $ | 16,766 | |||||||
Pro Forma Results | ' | ||||||||
The unaudited pro forma supplemental information prepared by the Company is not necessarily indicative of the results expected in future periods or the results that actually would have been realized had the acquired business and the Company been a combined company during the specified periods. | |||||||||
Three Months Ended | Year Ended | ||||||||
March 31, 2013 | December 31, 2013 | ||||||||
Pro forma total revenue | $ | 87,359 | $ | 370,620 | |||||
Pro forma net income | 6,964 | 28,687 |
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||
Changes in Goodwill Balance | ' | ||||||||||||||||||||||||||||
Changes in the Company’s goodwill balance for the year ended December 31, 2013 and the three months ended March 31, 2014 are summarized in the table below (in thousands): | |||||||||||||||||||||||||||||
Balance at December 31, 2012 | $ | 312,412 | |||||||||||||||||||||||||||
Acquired in business combinations | 198,124 | ||||||||||||||||||||||||||||
Foreign currency translation adjustment | (2,925 | ) | |||||||||||||||||||||||||||
Balance at December 31, 2013 | 507,611 | ||||||||||||||||||||||||||||
Acquired in business combinations | 11,647 | ||||||||||||||||||||||||||||
Foreign currency translation adjustment | 8,511 | ||||||||||||||||||||||||||||
Post-acquisition goodwill adjustment for the Stayz acquisition | 566 | ||||||||||||||||||||||||||||
Balance at March 31, 2014 | $ | 528,335 | |||||||||||||||||||||||||||
Amortized Finite-Lived Intangible Assets | ' | ||||||||||||||||||||||||||||
The finite-lived intangible assets that are being amortized are summarized in the table below (in thousands): | |||||||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||||||
Useful Life | Gross | Accumulated | Net | Gross | Accumulated | Net | |||||||||||||||||||||||
(Years) | Carrying | Amortization | Carrying | Carrying | Amortization | Carrying | |||||||||||||||||||||||
Amount | Amount | Amount | Amount | ||||||||||||||||||||||||||
Trade names and trademarks | 10 | $ | 31,768 | $ | (5,864 | ) | $ | 25,904 | $ | 30,066 | $ | (5,050 | ) | $ | 25,016 | ||||||||||||||
Developed technology | 8-Feb | 35,404 | (24,441 | ) | 10,963 | 31,513 | (23,646 | ) | 7,867 | ||||||||||||||||||||
Customer relationships | 14-Jun | 83,106 | (43,360 | ) | 39,746 | 80,510 | (41,739 | ) | 38,771 | ||||||||||||||||||||
Noncompete agreements and domain names | 5-Feb | 5,478 | (3,456 | ) | 2,022 | 5,163 | (3,181 | ) | 1,982 | ||||||||||||||||||||
Total | $ | 155,756 | $ | (77,121 | ) | $ | 78,635 | $ | 147,252 | $ | (73,616 | ) | $ | 73,636 | |||||||||||||||
Summary of Amortization Expenses | ' | ||||||||||||||||||||||||||||
The following table summarizes the amortization expense that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Amortization expense | $ | 3,274 | $ | 3,180 | |||||||||||||||||||||||||
Indefinite-Lived Intangible Assets | ' | ||||||||||||||||||||||||||||
The Company has the following indefinite-lived intangible assets recorded in its consolidated balance sheet as of March 31, 2014 and December 31, 2013, respectively (in thousands): | |||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||
Trademarks, trade names and other | $ | 7,029 | $ | 7,029 |
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Payables And Accruals [Abstract] | ' | ||||||||
Accrued Expenses | ' | ||||||||
The Company’s accrued expenses are comprised of the following at March 31, 2014, and December 31, 2013 (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Compensation and related benefits | $ | 15,430 | $ | 21,700 | |||||
Gift cards | 5,546 | 6,090 | |||||||
Contracting, consulting and professional fees | 2,616 | 4,494 | |||||||
Taxes | 7,698 | 3,425 | |||||||
Advertising | 5,914 | 3,197 | |||||||
Foreign exchange – forward contracts | 7,380 | 979 | |||||||
Traveler guarantee liability | 1,431 | 956 | |||||||
Other | 10,880 | 13,784 | |||||||
Total | $ | 56,895 | $ | 54,625 | |||||
Convertible_Senior_Notes_Table
Convertible Senior Notes (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Summary of Convertible Senior Notes | ' | ||||||||||||||||
(In thousands) | Par Value | Equity | Liability Component of Par | ||||||||||||||
Component | Value as of | ||||||||||||||||
Recorded | |||||||||||||||||
at Issuance | March 31, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
0.125% Convertible Senior Notes due April 1, 2019 | $ | 402,500 | $ | 90,887 | -1 | $ | 303,044 | $ | — | ||||||||
-1 | This amount represents the equity component recorded at the initial issuance of the 0.125% convertible senior notes. | ||||||||||||||||
Schedule of Conversion of Senior Notes to Common Stock | ' | ||||||||||||||||
Conversion | Initial | Free | |||||||||||||||
Rate per $1,000 | Conversion | Convertibility Date | |||||||||||||||
Par Value | Price per | ||||||||||||||||
Share | |||||||||||||||||
0.125% Senior Notes | 19.1703 | $ | 52.16 | October 1, 2018 | |||||||||||||
Schedule of Convertible Senior Notes | ' | ||||||||||||||||
The Notes consisted of the following (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Liability component : | |||||||||||||||||
Principal: | |||||||||||||||||
0.125% Senior Notes | $ | 402,500 | $ | — | |||||||||||||
Less: debt discount, net | |||||||||||||||||
0.125% Senior Notes | (99,456 | ) | — | ||||||||||||||
Net carrying amount | $ | 303,044 | $ | — | |||||||||||||
Summary of Hedge Notes | ' | ||||||||||||||||
Date | Purchase | Shares | |||||||||||||||
(in thousands) | underlying Note | ||||||||||||||||
Hedges | |||||||||||||||||
Note Hedges | March 2014 | $ | 85,853 | 7,716,049 | |||||||||||||
Components of Warrants | ' | ||||||||||||||||
Date | Proceeds | Shares | Strike | ||||||||||||||
(in thousands) | Price | ||||||||||||||||
Warrants | March 2014 | $ | 38,278 | 7,716,049 | $ | 81.14 |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||||||
Summary of Rental Expense | ' | ||||||||
The following table summarizes the total rental expense that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Rental expense | $ | 1,440 | $ | 1,231 | |||||
Changes for Traveler Guarantees | ' | ||||||||
Expected future claims for traveler guarantees, which are presented as a current liability in the Company’s consolidated balance sheets, and changes for the guarantees are as follows (in thousands): | |||||||||
Traveler guarantee liability at December 31, 2012 | $ | 566 | |||||||
Costs accrued for new vacation rentals | 2,230 | ||||||||
Guarantee obligations honored | (1,840 | ) | |||||||
Traveler guarantee liability at December 31, 2013 | $ | 956 | |||||||
Costs accrued for new vacation rentals | 1,114 | ||||||||
Guarantee obligations honored | (639 | ) | |||||||
Traveler guarantee liability at March 31, 2014 | $ | 1,431 | |||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||
Total Stock-Based Compensation Expense | ' | ||||||||
The following table summarizes the total stock-based compensation expense that the Company recorded for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Cost of revenue | $ | 701 | $ | 845 | |||||
Product development | 2,714 | 1,727 | |||||||
Sales and marketing | 2,172 | 1,608 | |||||||
General and administrative | 4,634 | 3,276 | |||||||
Total | $ | 10,221 | $ | 7,456 | |||||
Redeemable_Noncontrolling_Inte1
Redeemable Noncontrolling Interests (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Noncontrolling Interest [Abstract] | ' | ||||
Schedule of Changes of Redeemable Noncontrolling Interests | ' | ||||
Changes in the Company’s redeemable noncontrolling interests for the year ended December 31, 2013 and the three months ended March 31, 2014 are summarized in the table below (in thousands): | |||||
Balance at December 31, 2012 | $ | — | |||
Fair value at acquisition | 10,966 | ||||
Net loss attributable to noncontrolling interests | (395 | ) | |||
Currency translation adjustments | 13 | ||||
Balance at December 31, 2013 | $ | 10,584 | |||
Net loss attributable to noncontrolling interests | (287 | ) | |||
Currency translation adjustments | 5 | ||||
Balance at March 31, 2014 | $ | 10,302 | |||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Equity [Abstract] | ' | ||||||||
Accumulated Other Comprehensive Loss | ' | ||||||||
Accumulated other comprehensive income (loss) consists of the following at March 31, 2014 and December 31, 2013, respectively (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Foreign currency translation | $ | (1,693 | ) | $ | (6,728 | ) | |||
Unrealized gains (losses) on short-term investments | (164 | ) | (19 | ) | |||||
Total | $ | (1,857 | ) | $ | (6,747 | ) | |||
Income_Taxes_Tables
Income Taxes (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||
Summary of Income Tax Expenses | ' | ||||||||
The following table summarizes the total income tax expense that the Company recorded, and the related effective tax rate, for the three months ended March 31, 2014 and 2013 (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Income tax expense | $ | 2,388 | $ | 1,545 | |||||
Effective tax rate | 36.5 | % | 22.6 | % |
Net_Income_Per_Share_Attributa1
Net Income Per Share Attributable to HomeAway, Inc. (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Computation of Basic and Diluted Net Income Per Share of Common Stock | ' | ||||||||
The following table sets forth the computation of basic and diluted net income per share of common stock (in thousands, except per share amounts): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator | |||||||||
Net income attributable to HomeAway, Inc. | $ | 4,443 | $ | 5,295 | |||||
Denominator | |||||||||
Weighted average common shares outstanding-basic | 92,699 | 83,940 | |||||||
Dilutive effect of stock options, warrants and restricted stock units | 3,596 | 2,552 | |||||||
Weighted average common shares outstanding-diluted | 96,295 | 86,492 | |||||||
Net income per share – basic and diluted | $ | 0.05 | $ | 0.06 | |||||
Common Equivalent Shares Excluded from Calculation of Net Income Per Share as their Inclusion Would have been Anti-Dilutive | ' | ||||||||
The following common equivalent shares were excluded from the calculation of net income per share as their inclusion would have been anti-dilutive (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Stock options | 301 | 2,990 | |||||||
Restricted stock units | 18 | 61 | |||||||
Warrants | 7,716 | — | |||||||
Total common equivalent shares excluded | 8,035 | 3,051 | |||||||
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Fair Value of Financial Assets and Liabilities Measured on Recurring Basis (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | $113,889 | $66,798 |
Certificates of deposit [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 2,053 | 2,054 |
Corporate bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 75,903 | 33,257 |
Municipal bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 35,933 | 31,487 |
Fair Value, Measurements, Recurring [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | 46,801 | 26,451 |
Restricted cash | 770 | 758 |
Short-term investments | 113,889 | 66,798 |
Total financial assets | 161,460 | 94,007 |
Fair Value, Measurements, Recurring [Member] | Money market funds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | 46,801 | 26,451 |
Restricted cash | 770 | 758 |
Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 2,053 | 2,054 |
Fair Value, Measurements, Recurring [Member] | Corporate bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 75,903 | 33,257 |
Fair Value, Measurements, Recurring [Member] | Municipal bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 35,933 | 31,487 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | 46,801 | 26,451 |
Restricted cash | 770 | 758 |
Short-term investments | ' | ' |
Total financial assets | 47,571 | 27,209 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | Money market funds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | 46,801 | 26,451 |
Restricted cash | 770 | 758 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | Corporate bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | Municipal bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | ' | ' |
Restricted cash | ' | ' |
Short-term investments | 113,889 | 66,798 |
Total financial assets | 113,889 | 66,798 |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | Money market funds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | ' | ' |
Restricted cash | ' | ' |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 2,053 | 2,054 |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | Corporate bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 75,903 | 33,257 |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | Municipal bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 35,933 | 31,487 |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | ' | ' |
Restricted cash | ' | ' |
Short-term investments | ' | ' |
Total financial assets | ' | ' |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member] | Money market funds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | ' | ' |
Restricted cash | ' | ' |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member] | Corporate bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member] | Municipal bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | |
Segment | |||
Significant Accounting Policies [Line Items] | ' | ' | ' |
Number of operating segment | 1 | ' | ' |
Available for sales securities, premium | $1,740,000 | ' | $4,048,000 |
Total carrying value of company investments | 10,113,000 | ' | ' |
Primary sources of accounts receivable | 3 | ' | ' |
Capitalized certain internally developed software | 32,345,000 | 30,523,000 | ' |
Recognized income tax positions, percentage | 50.00% | ' | ' |
Derivatives amount | 275,653,000 | 104,812,000 | ' |
Amount of unsettled derivative instruments | 0 | 0 | ' |
Amount of Fair value | 0 | ' | ' |
Breakage Revenue [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Revenue recognition period | '48 months | ' | ' |
Commission Revenue [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Revenue recognition period | '48 months | ' | ' |
Money market funds [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Restricted cash | $1,384,000 | $2,180,000 | ' |
Equipment, computer hardware and purchased computer software [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, plant and equipment useful life | '3 years | ' | ' |
Furniture and fixtures [Member] | Minimum [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, plant and equipment useful life | '5 years | ' | ' |
Furniture and fixtures [Member] | Maximum [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, plant and equipment useful life | '10 years | ' | ' |
Leasehold Improvements [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, plant and equipment useful life description | 'Shorter of the contractual lease period or their useful life. | ' | ' |
Internally Developed Software and Website Development Costs [Member] | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, plant and equipment useful life | '5 years | ' | ' |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Demand deposit accounts | $656,601 | $324,608 | $187,246 | $189,478 |
Demand Deposits [Member] | ' | ' | ' | ' |
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Demand deposit accounts | 609,800 | 298,157 | ' | ' |
Money market funds [Member] | ' | ' | ' | ' |
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Demand deposit accounts | $46,801 | $26,451 | ' | ' |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies - Short-Term Investments (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Gross Cost | $114,052 | $66,815 |
Gross Unrealized Gains | 68 | 49 |
Gross Unrealized Losses | -231 | -66 |
Estimated Fair Value | 113,889 | 66,798 |
Certificates of deposit [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Gross Cost | 2,055 | 2,055 |
Gross Unrealized Gains | ' | ' |
Gross Unrealized Losses | -2 | -1 |
Estimated Fair Value | 2,053 | 2,054 |
Corporate bonds [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Gross Cost | 76,062 | 33,274 |
Gross Unrealized Gains | 35 | 33 |
Gross Unrealized Losses | -194 | -50 |
Estimated Fair Value | 75,903 | 33,257 |
Municipal bonds [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Gross Cost | 35,935 | 31,486 |
Gross Unrealized Gains | 33 | 16 |
Gross Unrealized Losses | -35 | -15 |
Estimated Fair Value | $35,933 | $31,487 |
Summary_of_Significant_Account7
Summary of Significant Accounting Policies - Summary of Contractual Underlying Maturities of Short-Term Investments (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Short-term Investments, Less than 12 Months | $20,079 | $14,695 |
Short-term Investments, 12 Months or Greater | 93,810 | 52,103 |
Estimated Fair Value | 113,889 | 66,798 |
Certificates of deposit [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Short-term Investments, Less than 12 Months | 1,499 | 500 |
Short-term Investments, 12 Months or Greater | 554 | 1,554 |
Estimated Fair Value | 2,053 | 2,054 |
Corporate bonds [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Short-term Investments, Less than 12 Months | 10,834 | 11,164 |
Short-term Investments, 12 Months or Greater | 65,069 | 22,093 |
Estimated Fair Value | 75,903 | 33,257 |
Municipal bonds [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Short-term Investments, Less than 12 Months | 7,746 | 3,031 |
Short-term Investments, 12 Months or Greater | 28,187 | 28,456 |
Estimated Fair Value | $35,933 | $31,487 |
Summary_of_Significant_Account8
Summary of Significant Accounting Policies - Summary of Depreciation Expenses on Internally Developed Software and Website Development Costs (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 |
Internally Developed Software and Website Development Costs [Member] | Internally Developed Software and Website Development Costs [Member] | |||
Depreciation and Other Amortization Expenses [Line Items] | ' | ' | ' | ' |
Depreciation expense on internally developed software and website development costs | $3,763 | $3,044 | $1,294 | $732 |
Summary_of_Significant_Account9
Summary of Significant Accounting Policies - Summary of Excess Tax Benefit (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | ' | ' |
Excess tax benefit from stock-based compensation | $3,579 | $1,358 |
Recovered_Sheet1
Summary of Significant Accounting Policies - Summary of Foreign Exchange Expense (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | ' | ' |
Foreign exchange loss | ($2,526) | ($1,535) |
Recovered_Sheet2
Summary of Significant Accounting Policies - Schedule of Fair Value and Notional Principal Amounts of Outstanding or Unsettled Derivative Instruments (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Derivatives, Fair Value [Line Items] | ' | ' |
Net Derivatives, Notional Amount | ($7,332) | ($616) |
Net Derivatives, Notional Amount | 275,653 | 104,812 |
Foreign exchange-forward contracts (current) [Member] | Accrued expenses [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative Liability, Notional Amount | -7,380 | -979 |
Derivative Liability, Notional Amount | 268,670 | 84,292 |
Foreign exchange-forward contracts (current) [Member] | Prepaid expenses and other current assets [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Derivative Asset, Notional Amount | 48 | 363 |
Derivative Asset, Notional Amount | $6,983 | $20,520 |
Business_Combinations_Glad_to_
Business Combinations - Glad to Have You, Inc. - Additional Information (Detail) (Glad To Have You Inc [Member], USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Business Acquisition [Line Items] | ' |
Business acquisition aggregate purchase price | $16,791,000 |
Seller obligations release description | 'Two business days following the first anniversary date of the acquisition. |
Business acquisition, cash consideration purchase price deposited in escrow | 250,000 |
Business acquisition, cash consideration deposited in escrow and pending purchase price adjustments | $250,000 |
Period of payment of cash consideration | '120 days |
Finite-lived intangible asset, weighted-average amortization period | '7 years |
Trade names [Member] | ' |
Business Acquisition [Line Items] | ' |
Finite-lived intangible asset, weighted-average amortization period | '10 years |
Developed technology [Member] | ' |
Business Acquisition [Line Items] | ' |
Finite-lived intangible asset, weighted-average amortization period | '5 years |
Customer relationships [Member] | ' |
Business Acquisition [Line Items] | ' |
Finite-lived intangible asset, weighted-average amortization period | '10 years |
Non-competition agreements [Member] | ' |
Business Acquisition [Line Items] | ' |
Finite-lived intangible asset, weighted-average amortization period | '3 years |
Business_Combinations_Fair_Val
Business Combinations - Fair Value of Acquisition Amounts at Acquisition Date (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Net tangible assets (liabilities) acquired | ' | ' | ' |
Goodwill | $528,335,000 | $507,611,000 | $312,412,000 |
Glad To Have You Inc [Member] | ' | ' | ' |
Net tangible assets (liabilities) acquired | ' | ' | ' |
Cash | 25,000 | ' | ' |
Deferred revenue | -65,000 | ' | ' |
Other | 17,000 | ' | ' |
Total net tangible assets (liabilities) acquired | -23,000 | ' | ' |
Deferred tax liabilities | -1,653,000 | ' | ' |
Goodwill | 11,647,000 | ' | ' |
Purchase price | 16,791,000 | ' | ' |
Less: Cash acquired | -25,000 | ' | ' |
Net purchase price | 16,766,000 | ' | ' |
Glad To Have You Inc [Member] | Developed technology [Member] | ' | ' | ' |
Net tangible assets (liabilities) acquired | ' | ' | ' |
Amortizable intangible assets | 3,760,000 | ' | ' |
Glad To Have You Inc [Member] | Customer relationships [Member] | ' | ' | ' |
Net tangible assets (liabilities) acquired | ' | ' | ' |
Amortizable intangible assets | 1,643,000 | ' | ' |
Glad To Have You Inc [Member] | Non-competition agreements [Member] | ' | ' | ' |
Net tangible assets (liabilities) acquired | ' | ' | ' |
Amortizable intangible assets | 240,000 | ' | ' |
Glad To Have You Inc [Member] | Trade names [Member] | ' | ' | ' |
Net tangible assets (liabilities) acquired | ' | ' | ' |
Non-amortizable intangible assets | $1,177,000 | ' | ' |
Business_Combinations_Addition
Business Combinations - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Minimum [Member] | ' |
Business Acquisition [Line Items] | ' |
Identifiable intangible assets, estimated useful lives | '3 years |
Maximum [Member] | ' |
Business Acquisition [Line Items] | ' |
Identifiable intangible assets, estimated useful lives | '10 years |
Business_Combinations_Stayz_Ad
Business Combinations - Stayz - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Business Acquisition [Line Items] | ' | ' |
Payment made to acquire business, net of cash acquired | $16,766,000 | ' |
Stayz [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Percentage of ownership interest | 100.00% | ' |
Payment made to acquire business, net of cash acquired | 197,820,000 | ' |
Business acquisition transaction costs | 3,802,000 | ' |
Business acquisition aggregate purchase price | 196,739,000 | ' |
Business acquisition amount due to sellers | 1,081,000 | ' |
Decrease in proforma revenue based on adjustments | ' | 1,900,000 |
Decrease in proforma net income based on adjustments | ' | $1,300,000 |
Business_Combinations_Pro_Form
Business Combinations - Pro Forma Results (Detail) (Stayz [Member], USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2013 | Dec. 31, 2013 |
Stayz [Member] | ' | ' |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ' | ' |
Pro forma total revenue | $87,359 | $370,620 |
Pro forma net income | $6,964 | $28,687 |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets - Changes in Goodwill Balance (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ' |
Beginning balance | $507,611 | $312,412 |
Acquired in business combinations | 11,647 | 198,124 |
Foreign currency translation adjustment | 8,511 | -2,925 |
Post-acquisition goodwill adjustment for the Stayz acquisition | 566 | ' |
Ending balance | $528,335 | $507,611 |
Goodwill_and_Other_Intangible_3
Goodwill and Other Intangible Assets - Additional Information (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2014 |
Stayz [Member] | ||||
Goodwill [Line Items] | ' | ' | ' | ' |
Increase in Goodwill | ' | ' | ' | $566,000 |
Goodwill | $528,335,000 | $507,611,000 | $312,412,000 | $178,343,000 |
Goodwill_and_Other_Intangible_4
Goodwill and Other Intangible Assets - Amortized Finite-Lived Intangible Assets (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross Carrying Amount | $155,756 | $147,252 |
Accumulated Amortization | -77,121 | -73,616 |
Net Carrying Amount | 78,635 | 73,636 |
Minimum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '3 years | ' |
Maximum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '10 years | ' |
Trade names and trademarks [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '10 years | ' |
Gross Carrying Amount | 31,768 | 30,066 |
Accumulated Amortization | -5,864 | -5,050 |
Net Carrying Amount | 25,904 | 25,016 |
Developed technology [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross Carrying Amount | 35,404 | 31,513 |
Accumulated Amortization | -24,441 | -23,646 |
Net Carrying Amount | 10,963 | 7,867 |
Developed technology [Member] | Minimum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '2 years | ' |
Developed technology [Member] | Maximum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '8 years | ' |
Customer relationships [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross Carrying Amount | 83,106 | 80,510 |
Accumulated Amortization | -43,360 | -41,739 |
Net Carrying Amount | 39,746 | 38,771 |
Customer relationships [Member] | Minimum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '6 years | ' |
Customer relationships [Member] | Maximum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '14 years | ' |
Noncompete agreements and domain names [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross Carrying Amount | 5,478 | 5,163 |
Accumulated Amortization | -3,456 | -3,181 |
Net Carrying Amount | $2,022 | $1,982 |
Noncompete agreements and domain names [Member] | Minimum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '2 years | ' |
Noncompete agreements and domain names [Member] | Maximum [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-lived intangible asset useful life | '5 years | ' |
Goodwill_and_Other_Intangible_5
Goodwill and Other Intangible Assets - Summary of Amortization Expense (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ' |
Amortization expense | $3,274 | $3,180 |
Goodwill_and_Other_Intangible_6
Goodwill and Other Intangible Assets - Indefinite-Lived Intangible Assets (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ' |
Trademarks, trade names and other | $7,029 | $7,029 |
Accrued_Expenses_Accrued_Expen
Accrued Expenses - Accrued Expenses (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Payables And Accruals [Abstract] | ' | ' | ' |
Compensation and related benefits | $15,430 | $21,700 | ' |
Gift cards | 5,546 | 6,090 | ' |
Contracting, consulting and professional fees | 2,616 | 4,494 | ' |
Taxes | 7,698 | 3,425 | ' |
Advertising | 5,914 | 3,197 | ' |
Foreign exchange - forward contracts | 7,380 | 979 | ' |
Traveler guarantee liability | 1,431 | 956 | 566 |
Other | 10,880 | 13,784 | ' |
Total | $56,895 | $54,625 | ' |
Convertible_Senior_Notes_Summa
Convertible Senior Notes - Summary of Convertible Senior Notes (Detail) (Convertible Senior Notes 0.125% due April 1, 2019 [Member], USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Convertible Senior Notes 0.125% due April 1, 2019 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Par Value | $402,500 | ' |
Equity Component Recorded at Issuance | 90,887 | ' |
Liability Component of Par Value | $303,044 | ' |
Convertible_Senior_Notes_Summa1
Convertible Senior Notes - Summary of Convertible Senior Notes (Parenthetical) (Detail) (Convertible Senior Notes 0.125% due April 1, 2019 [Member]) | 3 Months Ended |
Mar. 31, 2014 | |
Convertible Senior Notes 0.125% due April 1, 2019 [Member] | ' |
Debt Instrument [Line Items] | ' |
Senior notes, Interest rate | 0.13% |
Senior notes, Maturity date | 1-Apr-19 |
Convertible_Senior_Notes_Addit
Convertible Senior Notes - Additional Information (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Debt Instrument [Line Items] | ' |
Closing price of common stock | $37.67 |
Warrants price per unit | 81.14 |
Term issuance of warrants | '5 years |
Convertible Senior Notes 0.125% due April 1, 2019 [Member] | ' |
Debt Instrument [Line Items] | ' |
Interest rate | 0.13% |
Debt par value | $402,500,000 |
Semi-annual first interest is payable | '--04-01 |
Semi-annual second interest is payable | '--10-01 |
Interest is payable start date | 1-Oct-14 |
Debt conversion description | 'During any fiscal quarter, if, for at least 20 trading days during the 30 consecutive trading day period ending on the last trading day of the immediately preceding fiscal quarter, the last reported sales price of the Company's common stock for such trading day is greater than or equal to 130% of the applicable conversion price on such trading day share of common stock on such last trading day |
Debt instrument convertible threshold trading days | 20 |
Common stock closing sales price percentage | 130.00% |
Percentage of trading price for conversion of note | 98.00% |
Consecutive trading period | '5 days |
Principal amount | 1,000 |
Percentage of principal amount of notes | 100.00% |
Fair value of debt instrument | 311,600,000 |
0.125% Senior Notes [Member] | ' |
Debt Instrument [Line Items] | ' |
Deferred tax liability | $800,000 |
Convertible_of_Senior_Notes_Sc
Convertible of Senior Notes - Schedule of Conversion of Senior Notes to Common Stock (Detail) (0.125% Senior Notes [Member], USD $) | 3 Months Ended |
Mar. 31, 2014 | |
0.125% Senior Notes [Member] | ' |
Debt Instrument [Line Items] | ' |
Debt instrument conversion rate | 19.1703 |
Initial conversion price per share | $52.16 |
Free Convertibility Date | 1-Oct-18 |
Convertible_of_Senior_Notes_Sc1
Convertible of Senior Notes - Schedule of Conversion of Senior Notes (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Debt Instrument [Line Items] | ' | ' |
Net carrying amount | $303,044 | ' |
0.125% Senior Notes [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Principal: 0.125% Senior Notes | 402,500 | ' |
Less: debt discount, net | ' | ' |
0.125% Senior Notes | -99,456 | ' |
Net carrying amount | $303,044 | ' |
Convertible_of_Senior_Notes_Su
Convertible of Senior Notes - Summary of Hedge Notes (Detail) (USD $) | 3 Months Ended |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 |
Derivatives, Fair Value [Line Items] | ' |
Note Hedges, Purchases | $85,853 |
Note Hedges [Member] | ' |
Derivatives, Fair Value [Line Items] | ' |
Note Hedges, Contract Date | '2014-03 |
Note Hedges, Purchases | $85,853 |
Underlying Note Hedges, Shares | 7,716,049 |
Convertible_of_Senior_Notes_Co
Convertible of Senior Notes - Components of Warrants (Detail) (USD $) | 3 Months Ended |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 |
Class of Warrant or Right [Line Items] | ' |
Warrants, proceed amount | $38,278 |
Warrants, strike price | 81.14 |
Warrant [Member] | ' |
Class of Warrant or Right [Line Items] | ' |
Warrants, proceed amount | $38,278 |
Warrants, shares | 7,716,049 |
Warrants, strike price | 81.14 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Summary of Rental Expenses (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Leases [Abstract] | ' | ' |
Rental expense | $1,440 | $1,231 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Additional Information (Detail) | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 |
Basic Rental Guarantee [Member] | Carefree Rental Guarantee [Member] | Subsidiary's Bank Credit, United Kingdom [Member] | Subsidiary's Bank Credit, United Kingdom [Member] | |
USD ($) | USD ($) | United Kingdom [Member] | United Kingdom [Member] | |
USD ($) | GBP (£) | |||
Commitments and Contingencies [Line Items] | ' | ' | ' | ' |
Guarantee maximum exposure, percentage | 50.00% | 100.00% | ' | ' |
Guarantee maximum exposure amount | $1,000 | $10,000 | $8,339,000 | £ 5,000,000 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Changes for Traveler Guarantees (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Commitments And Contingencies Disclosure [Abstract] | ' | ' |
Traveler guarantee liability, beginning balance | $956 | $566 |
Costs accrued for new vacation rentals | 1,114 | 2,230 |
Guarantee obligations honored | -639 | -1,840 |
Traveler guarantee liability, ending balance | $1,431 | $956 |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (Stock Incentive Plan 2011 [Member], USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Restricted stock units [Member] | ' |
Stock Based Compensation And Stockholders Equity [Line Items] | ' |
Share based compensation, Number of shares issued | 119,088 |
Restricted stock units issued, aggregate fair value | $5,069,000 |
Stock options [Member] | ' |
Stock Based Compensation And Stockholders Equity [Line Items] | ' |
Share based compensation, Number of shares issued | 58,571 |
Common stock issued pursuant to stock awards, aggregate fair value | $977,000 |
StockBased_Compensation_Total_
Stock-Based Compensation - Total Stock-Based Compensation Expense (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | $10,221 | $7,456 |
Cost of revenue [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | 701 | 845 |
Product development [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | 2,714 | 1,727 |
Sales and marketing [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | 2,172 | 1,608 |
General and administrative [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Stock-based compensation expense | $4,634 | $3,276 |
Redeemable_Noncontrolling_Inte2
Redeemable Noncontrolling Interests - Schedule of Changes of Redeemable Noncontrolling Interests (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Business Combinations [Abstract] | ' | ' |
Beginning balance | $10,584 | ' |
Fair value at acquisition | ' | 10,966 |
Net loss attributable to noncontrolling interests | -287 | -395 |
Currency translation adjustments | 5 | 13 |
Ending balance | $10,302 | $10,584 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss - Accumulated Other Comprehensive Loss (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Accumulated Other Comprehensive Income Loss [Abstract] | ' | ' |
Foreign currency translation | ($1,693) | ($6,728) |
Unrealized gains (losses) on short-term investments | -164 | -19 |
Total | ($1,857) | ($6,747) |
Income_Taxes_Summary_of_Income
Income Taxes - Summary of Income Tax Expenses (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Tax Disclosure [Abstract] | ' | ' |
Income tax expense | $2,388 | $1,545 |
Effective tax rate | 36.50% | 22.60% |
Net_Income_Per_Share_Attributa2
Net Income Per Share Attributable to HomeAway, Inc. - Computation of Basic and Diluted Net Income Per Share of Common Stock (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Numerator | ' | ' |
Net income attributable to HomeAway, Inc. | $4,443 | $5,295 |
Denominator | ' | ' |
Weighted average common shares outstanding-basic | 92,699 | 83,940 |
Dilutive effect of stock options, warrants and restricted stock units | 3,596 | 2,552 |
Weighted average common shares outstanding-diluted | 96,295 | 86,492 |
Net income per share - basic and diluted | $0.05 | $0.06 |
Net_Income_Per_Share_Attributa3
Net Income Per Share Attributable to HomeAway, Inc. - Common Equivalent Shares Excluded from Calculation of Net Income Per Share as their Inclusion Would have been Anti-Dilutive (Detail) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Common equivalent shares excluded from the calculation of net income per share | 8,035 | 3,051 |
Stock options and warrants [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Common equivalent shares excluded from the calculation of net income per share | 301 | 2,990 |
Restricted stock units [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Common equivalent shares excluded from the calculation of net income per share | 18 | 61 |
Warrant [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Common equivalent shares excluded from the calculation of net income per share | 7,716 | ' |