Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2016shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | SERVICENOW, INC. |
Trading Symbol | NOW |
Entity Central Index Key | 1,373,715 |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2016 |
Amendment Flag | false |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q2 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 164,496,689 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 289,113 | $ 412,305 |
Short-term investments | 517,601 | 388,945 |
Accounts receivable, net | 197,296 | 203,333 |
Current portion of deferred commissions | 57,232 | 51,976 |
Prepaid expenses and other current assets | 36,647 | 29,076 |
Total current assets | 1,097,889 | 1,085,635 |
Deferred commissions, less current portion | 39,716 | 33,016 |
Long-term investments | 224,439 | 422,667 |
Property and equipment, net | 166,551 | 144,714 |
Intangible assets, net | 64,873 | 43,005 |
Goodwill | 83,115 | 55,669 |
Other assets | 37,755 | 22,346 |
Total assets | 1,714,338 | 1,807,052 |
Current liabilities: | ||
Accounts payable | 41,095 | 37,369 |
Accrued expenses and other current liabilities | 113,131 | 101,264 |
Current portion of deferred revenue | 697,855 | 593,003 |
Total current liabilities | 852,081 | 731,636 |
Deferred revenue, less current portion | 15,130 | 10,751 |
Convertible senior notes, net | 490,891 | 474,534 |
Other long-term liabilities | 31,954 | 23,317 |
Total liabilities | 1,390,056 | 1,240,238 |
Stockholders’ equity: | ||
Common stock | 164 | 160 |
Additional paid-in capital | 1,268,714 | 1,140,545 |
Accumulated other comprehensive loss | (16,053) | (16,882) |
Accumulated deficit | (928,543) | (557,009) |
Total stockholders’ equity | 324,282 | 566,814 |
Total liabilities and stockholders’ equity | $ 1,714,338 | $ 1,807,052 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Revenues: | |||||
Subscription | $ 290,679 | $ 200,461 | $ 558,101 | $ 380,368 | |
Professional services and other | 50,633 | 46,255 | 89,090 | 78,312 | |
Total revenues | 341,312 | 246,716 | 647,191 | 458,680 | |
Cost of revenues(1): | |||||
Subscription | [1] | 56,360 | 45,392 | 109,141 | 87,836 |
Professional services and other | [1] | 40,289 | 34,325 | 81,768 | 68,780 |
Total cost of revenues | [1] | 96,649 | 79,717 | 190,909 | 156,616 |
Gross profit | 244,663 | 166,999 | 456,282 | 302,064 | |
Operating expenses(1): | |||||
Sales and marketing | [1] | 186,506 | 136,574 | 345,116 | 246,631 |
Research and development | [1] | 70,364 | 53,276 | 136,288 | 103,124 |
General and administrative | [1] | 36,071 | 30,384 | 77,308 | 59,776 |
Legal settlements | [1] | 0 | 0 | 270,000 | 0 |
Total operating expenses | [1] | 292,941 | 220,234 | 828,712 | 409,531 |
Loss from operations | (48,278) | (53,235) | (372,430) | (107,467) | |
Interest expense | (8,248) | (7,707) | (16,357) | (15,285) | |
Interest and other income (expense), net | 2,260 | 521 | 2,962 | 5,225 | |
Loss before income taxes | (54,266) | (60,421) | (385,825) | (117,527) | |
Provision for (benefit from) income taxes | (4,641) | 1,504 | (2,868) | 2,491 | |
Net loss | $ (49,625) | $ (61,925) | $ (382,957) | $ (120,018) | |
Net loss per share, basic and diluted (in USD per share) | $ (0.30) | $ (0.40) | $ (2.35) | $ (0.78) | |
Weighted-average shares used to compute net loss per share - basic and diluted | 163,838,755 | 154,465,367 | 162,952,721 | 153,041,433 | |
Other comprehensive gain (loss): | |||||
Foreign currency translation adjustments | $ (1,989) | $ 3,720 | $ (1,309) | $ (339) | |
Unrealized gain (loss) on investments, net of tax | 505 | (314) | 2,138 | 180 | |
Other comprehensive gain (loss), net of tax | (1,484) | 3,406 | 829 | (159) | |
Comprehensive loss | $ (51,109) | $ (58,519) | $ (382,128) | $ (120,177) | |
[1] | Includes stock-based compensation as follows: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015Cost of revenues: Subscription$6,951 $6,067 $13,558 $11,232Professional services and other6,136 5,771 12,895 10,984Sales and marketing32,861 26,105 63,859 48,679Research and development21,047 17,935 41,580 33,573General and administrative11,070 10,468 21,481 19,952Total stock-based compensation$78,065 $66,346 $153,373 $124,420 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Stock-based compensation | $ 78,065 | $ 66,346 | $ 153,373 | $ 124,420 |
Cost of revenues - subscription | ||||
Stock-based compensation | 6,951 | 6,067 | 13,558 | 11,232 |
Cost of revenues - professional services and other | ||||
Stock-based compensation | 6,136 | 5,771 | 12,895 | 10,984 |
Sales and Marketing | ||||
Stock-based compensation | 32,861 | 26,105 | 63,859 | 48,679 |
Research And Development | ||||
Stock-based compensation | 21,047 | 17,935 | 41,580 | 33,573 |
General and Administrative Expense | ||||
Stock-based compensation | $ 11,070 | $ 10,468 | $ 21,481 | $ 19,952 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | ||
Cash flows from operating activities: | |||
Net loss | $ (382,957) | $ (120,018) | |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 37,452 | 28,857 | |
Amortization of premiums on investments | 2,799 | 3,612 | |
Amortization of deferred commissions | 36,957 | 31,281 | |
Amortization of debt discount and issuance costs | 16,357 | 15,285 | |
Stock-based compensation | 153,373 | 124,420 | |
Deferred income tax | (6,426) | 0 | |
Other | 532 | (4,240) | |
Changes in operating assets and liabilities, net of effect of acquisitions: | |||
Accounts receivable | 6,967 | 11,339 | |
Deferred commissions | (48,397) | (32,832) | |
Prepaid expenses and other assets | (10,001) | (8,026) | |
Accounts payable | (272) | 1,634 | |
Deferred revenue | 104,399 | 90,557 | |
Accrued expenses and other liabilities | 19,733 | 5,682 | |
Net cash (used in) provided by operating activities(1) | (69,484) | 147,551 | [1] |
Cash flows from investing activities: | |||
Purchases of property and equipment | (52,929) | (41,820) | |
Business combinations, net of cash acquired | (34,297) | (1,100) | |
Purchases of other intangibles | (14,850) | 0 | |
Purchases of investments | (180,365) | (331,496) | |
Purchase of strategic investment | 0 | 10,000 | |
Sales of investments | 92,885 | 138,362 | |
Maturities of investments | 158,520 | 146,660 | |
Restricted cash | (611) | 66 | |
Net cash used in investing activities | (31,647) | (99,328) | |
Cash flows from financing activities: | |||
Deferred payments on purchase of other intangibles | 4,100 | 0 | |
Proceeds from employee stock plans | 34,151 | 41,684 | |
Taxes paid related to net share settlement of equity awards | (59,786) | (12,446) | |
Payments on financing obligation | (223) | 0 | |
Net cash (used in) provided by financing activities(1) | (21,758) | 29,238 | [1] |
Foreign currency effect on cash and cash equivalents | (303) | (4,562) | |
Net (decrease) increase in cash and cash equivalents | (123,192) | 72,899 | |
Cash and cash equivalents at beginning of period | 412,305 | 252,455 | |
Cash and cash equivalents at end of period | 289,113 | 325,354 | |
Supplemental disclosures of non-cash investing activities: | |||
Property and equipment included in accounts payable and accrued expenses | $ 14,058 | 13,382 | |
New Accounting Pronouncement, Early Adoption, Effect [Member] | |||
New Accounting Pronouncement, Early Adoption [Line Items] | |||
Net cash (used in) provided by operating activities(1) | 600 | ||
Net cash (used in) provided by financing activities(1) | $ 600 | ||
[1] | (1)During the six months ended June 30, 2016, we early adopted Accounting Standards Update 2016-09, "Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting." Refer to Note 2 Recent Accounting Pronouncements for further details. This resulted in a $0.6 million increase in net cash provided by operating activities and a corresponding $0.6 million decrease in net cash provided by financing activities for the six months ended June 30, 2015. |
Description of the Business
Description of the Business | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the Business | Description of the Business ServiceNow is a leading provider of enterprise cloud computing solutions that define, structure, manage and automate services across the global enterprise. Our mission is to help the modern enterprise operate faster and be more scalable by applying a service-oriented lens to the activities, tasks and processes that comprise day-to-day work life. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements and condensed footnotes have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for fair statement of results for the interim periods presented have been included. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for the year ended December 31, 2016 or for other interim periods or for future years. The condensed consolidated balance sheet as of December 31, 2015 is derived from audited financial statements as of that date, however, it does not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Form 10-K for the year ended December 31, 2015 , which was filed with the Securities and Exchange Commission on February 25, 2016. Principles of Consolidation The condensed consolidated financial statements have been prepared in conformity with GAAP and include our accounts and the accounts of our wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated upon consolidation. Prior Period Reclassification Certain reclassifications of prior period amounts have been made to conform to the current period presentation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Warranties and Indemnification Our cloud computing solutions are typically warranted to perform in material conformance with their specifications. We include service level commitments to our customers that permit those customers to receive credits in the event we fail to meet those service levels. We establish an accrual based on an evaluation of the known service disruptions. Service level credit accrual charges are recorded against revenue and were not material for all periods presented. We have also agreed to indemnify our directors and executive officers for costs associated with any fees, expenses, judgments, fines and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by us, arising out of that person’s services as a director or officer of our company or that person’s services provided to any other company or enterprise at our request. We maintain director and officer insurance coverage that may enable us to recover a portion of any future amounts paid. The fair values of these obligations are not material as of each balance sheet date. Our agreements include provisions indemnifying customers against intellectual property and other third-party claims. We have not incurred any costs as a result of such indemnification obligations and have not recorded any liabilities related to such obligations in the condensed consolidated financial statements. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which requires a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. Credit losses relating to available-for-sale debt securities should be recorded through an allowance for credit losses. This standard is effective for our interim and annual reporting periods beginning after December 15, 2019. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, "Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. This standard is effective for our interim and annual reporting periods beginning January 1, 2017, and early adoption is permitted. We elected to early adopt this standard in the quarter ended June 30, 2016. The impact of the early adoption was as follows: • The standard eliminates additional paid in capital (APIC) pools and requires excess tax benefits and tax deficiencies to be recorded in the income statement as a discrete item when the awards vest or are settled. The adoption of this guidance on a prospective basis resulted in the recognition of excess tax benefits in our provision for income taxes of $1.7 million for the three and six months ended June 30, 2016 . • The standard requires excess tax benefits to be recognized regardless of whether the benefit reduces taxes payable. The adoption of this guidance on a modified retrospective basis resulted in the recognition of a cumulative-effect adjustment of $11.4 million that reduced our accumulated deficit and increased our foreign long-term deferred income tax as of January 1, 2016. The previously unrecognized U.S. excess tax effects were recorded as a deferred tax asset net of a valuation allowance. • We have elected to continue to estimate forfeitures expected to occur to determine the amount of stock-based compensation cost to be recognized in each period. As such, the guidance relating to forfeitures did not have an impact on our accumulated deficit as of January 1, 2016. • We elected to apply the statement of cash flows guidance that cash flows related to excess tax benefits be presented as an operating activity retrospectively, which resulted in a $0.6 million increase to net cash provided by operating activities and a corresponding decrease to net cash provided by financing activities in the accompanying condensed consolidated statement of cash flows for the six months ended June 30, 2015 , as compared to the amounts previously reported. • The statement of cash flows guidance that cash flows related to employee taxes paid for withheld shares be presented as a financing activity had no impact on our condensed consolidated financial statements as we have historically presented such cash flows as a financing activity. In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires lessees to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets, and to recognize on the income statement the expenses in a manner similar to current practice. This new standard is effective for our interim and annual periods beginning January 1, 2019 and early adoption is permitted. While we are currently evaluating the impact of this standard on our condensed consolidated financial statements, we anticipate this standard will have a material impact on our condensed consolidated balance sheets given that we have operating lease commitments of approximately $280 million as of June 30, 2016. However, we do not anticipate this standard will have a material impact on our condensed consolidated statements of comprehensive loss since the expense recognition under this new standard will be similar to current practice. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. This new standard is effective for our interim and annual periods beginning January 1, 2018 and early adoption is not permitted. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments (Topic 805),” which eliminates the requirement to restate prior period financial statements for measurement period adjustments in business combinations. This new standard requires that the cumulative impact of a measurement period adjustment (including the impact on prior periods) be recognized in the reporting period in which the adjustment is identified. We adopted this standard during the three months ended March 31, 2016 on a prospective basis and the adoption had no material impact on our condensed consolidated financial statements. In April 2015, the FASB issued ASU 2015-05, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement." ASU 2015-05 provides guidance to customers about whether a cloud computing arrangement includes software. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. We adopted this standard during the three months ended March 31, 2016 on a prospective basis and the adoption had no material impact on our condensed consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)," which will supersede virtually all existing revenue guidance. Under this standard, an entity is required to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration received in exchange for those goods or services. As such, an entity will need to use more judgment and make more estimates than under the current guidance. This standard should be applied retrospectively either to each prior reporting period presented in the financial statements, or only to the most current reporting period presented in the financial statements with a cumulative effect adjustment recorded in the retained earnings. In March 2016, the FASB issued ASU 2016-08, "Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)," which clarifies the principal versus agent guidance in the new revenue recognition standard. In April 2016, the FASB issued ASU 2016-10, "Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing," which clarifies the guidance on accounting for licenses of intellectual property (IP) and identifying performance obligations in the new revenue recognition standard. In May 2016, the FASB issued ASU 2016-12, "Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients," which amended the revenue recognition guidance regarding collectability, non-cash consideration, presentation of sales tax and transition. These new standards are effective for our interim and annual periods beginning January 1, 2018 and early adoption beginning January 1, 2017 is permitted. We are currently evaluating the impact of these standards on our condensed consolidated financial statements. |
Investments
Investments | 6 Months Ended |
Jun. 30, 2016 | |
Available-for-sale Securities [Abstract] | |
Investments | Investments Marketable Securities The following is a summary of our available-for-sale investment securities, excluding those securities classified within cash and cash equivalents on the consolidated balance sheets (in thousands): June 30, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities: Commercial paper $ 30,000 $ — $ — $ 30,000 Corporate notes and bonds 613,680 1,014 (131 ) 614,563 Certificates of deposit 14,467 — — 14,467 U.S. government agency securities 82,945 67 (2 ) 83,010 Total available-for-sale securities $ 741,092 $ 1,081 $ (133 ) $ 742,040 December 31, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities: Commercial paper $ 32,430 $ 2 $ (38 ) $ 32,394 Corporate notes and bonds 617,054 7 (2,027 ) 615,034 Certificates of deposit 29,610 2 (17 ) 29,595 U.S. government agency securities 134,962 1 (374 ) 134,589 Total available-for-sale securities $ 814,056 $ 12 $ (2,456 ) $ 811,612 As of June 30, 2016 , the contractual maturities of our investments did not exceed 24 months. The fair values of available-for-sale investments, by remaining contractual maturity, are as follows (in thousands): June 30, 2016 Due in 1 year or less $ 517,601 Due in 1 year through 2 years 224,439 Total $ 742,040 We had certain available-for-sale securities in a gross unrealized loss position, substantially all of which had been in such position for less than 12 months . There were no impairments considered "other-than-temporary" as it is more likely than not we will hold the securities until maturity or a recovery of the cost basis. The following table shows the fair values and the gross unrealized losses of these securities, classified by the length of time that the securities have been in a continuous unrealized loss position, and aggregated by investment types (in thousands): June 30, 2016 Less than 12 Months 12 Months or Greater Total Fair Value Gross Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Corporate notes and bonds $ 201,213 $ (130 ) $ 1,099 $ (1 ) $ 202,312 $ (131 ) U.S. government agency securities 13,058 (2 ) — — 13,058 (2 ) Total $ 214,271 $ (132 ) $ 1,099 $ (1 ) $ 215,370 $ (133 ) December 31, 2015 Less than 12 Months 12 Months or Greater Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Commercial paper $ 24,913 $ (38 ) $ — $ — $ 24,913 $ (38 ) Corporate notes and bonds 539,586 (1,897 ) 60,099 (130 ) 599,685 (2,027 ) Certificates of deposit 19,750 (17 ) — — 19,750 (17 ) U.S. government agency securities 132,581 (374 ) — — 132,581 (374 ) Total $ 716,830 $ (2,326 ) $ 60,099 $ (130 ) $ 776,929 $ (2,456 ) Strategic Investments We account for our investments in non-marketable equity securities of certain privately-held companies under the cost method, as we have less than a 20% ownership interest and we do not have the ability to exercise significant influence over the operations of these companies. The carrying value of these investments was $10.5 million as of June 30, 2016 and December 31, 2015 , which is included in "Other assets" on the condensed consolidated balance sheets. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value, Assets, Liabilities and Stockholders' Equity Measured on Recurring Basis [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following table presents our fair value hierarchy for our assets measured at fair value on a recurring basis at June 30, 2016 (in thousands): Level 1 Level 2 Total Cash equivalents: Money market funds $ 100,329 $ — $ 100,329 Short-term investments: Commercial paper — 30,000 30,000 Corporate notes and bonds — 416,099 416,099 Certificates of deposit — 9,362 9,362 U.S. government agency securities — 62,140 62,140 Long-term investments: Corporate notes and bonds — 198,464 198,464 Certificates of deposit — 5,105 5,105 U.S. government agency securities — 20,870 20,870 Total $ 100,329 $ 742,040 $ 842,369 The following table presents our fair value hierarchy for our assets measured at fair value on a recurring basis at December 31, 2015 (in thousands): Level 1 Level 2 Total Cash equivalents: Money market funds $ 263,515 $ — $ 263,515 Commercial paper — 2,000 2,000 Corporate notes and bonds — 1,119 1,119 Short-term investments: Commercial paper — 32,394 32,394 Corporate notes and bonds — 303,567 303,567 Certificates of deposit — 23,736 23,736 U.S. government agency securities — 29,248 29,248 Long-term investments: Corporate notes and bonds — 311,467 311,467 Certificates of deposit — 5,859 5,859 U.S. government agency securities — 105,341 105,341 Total $ 263,515 $ 814,731 $ 1,078,246 We determine the fair value of our security holdings based on pricing from our service provider and market prices from industry-standard independent data providers. Such market prices may be quoted prices in active markets for identical assets (Level 1 inputs) or pricing determined using inputs other than quoted prices that are observable either directly or indirectly (Level 2 inputs), such as yield curve, volatility factors, credit spreads, default rates, loss severity, current market and contractual prices for the underlying instruments or debt, broker and dealer quotes, as well as other relevant economic measures. See Note 9 for the fair value measurement of our convertible senior notes. |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations BrightPoint Security On June 3, 2016, we completed the acquisition of a privately-held company, BrightPoint Security, Inc. (BrightPoint), by acquiring all issued and outstanding common shares of BrightPoint for approximately $19.6 million in an all-cash transaction to expand our security operations solutions. The following table summarizes the allocation of the purchase price to the fair value of the tangible and intangible assets acquired and liabilities assumed as of the acquisition date: Purchase Price Allocation (in thousands) Useful Life (in years) Intangible assets: Developed technology $ 8,100 6 Customer contracts and related relationships 500 1.5 Goodwill 15,258 Net tangible liabilities acquired (1,339 ) Net deferred tax liabilities (1) (2,890 ) Total purchase price $ 19,629 (1) Deferred tax liabilities, net primarily relates to purchased identifiable intangible assets and is shown net of deferred tax assets. ITapp On April 8, 2016, we completed the acquisition of a privately-held company, ITapp Inc. (ITapp), by acquiring all issued and outstanding common shares of ITapp for approximately $14.5 million in an all-cash transaction to expand our IT operations management solutions. The following table summarizes the allocation of the purchase price to the fair value of the tangible and intangible assets acquired and liabilities assumed as of the acquisition date: Purchase Price Allocation (in thousands) Useful Life (in years) Net tangible assets acquired $ 140 Intangible assets: Developed technology 4,700 5 Customer contracts and related relationships 200 1.5 Goodwill 11,437 Net deferred tax liabilities (2,015 ) Total purchase price $ 14,462 For both business combinations, the excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. We believe the goodwill represents the synergies expected from expanded market opportunities when integrating the acquired technologies with our offerings. The goodwill balance for both business combinations is not deductible for income tax purposes. Acquisition-related costs of $0.9 million are included in general and administrative expenses in our consolidated statements of comprehensive loss. The results of operations of both BrightPoint and ITapp have been included in our condensed consolidated financial statements from their respective dates of purchase. These business combinations did not have a material impact on our condensed consolidated financial statements, and therefore historical and pro forma disclosures have not been presented. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill balances are presented below (in thousands): Carrying Amount Balance as of December 31, 2015 $ 55,669 Goodwill acquired 26,695 Foreign currency translation adjustments 751 Balance as of June 30, 2016 $ 83,115 Intangible assets consist of the following (in thousands): June 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 80,265 $ (23,665 ) $ 56,600 Other 9,275 (1,002 ) 8,273 Total intangible assets $ 89,540 $ (24,667 ) $ 64,873 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 58,144 $ (17,463 ) $ 40,681 Other 3,695 (1,371 ) 2,324 Total intangible assets $ 61,839 $ (18,834 ) $ 43,005 Amortization expense for intangible assets for the three months ended June 30, 2016 and 2015 was approximately $3.7 million and $2.9 million , respectively, and for the six months ended June 30, 2016 and 2015 was approximately $6.6 million and $5.9 million , respectively. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment, net consists of the following (in thousands): June 30, December 31, 2016 2015 Computer equipment and software $ 221,631 $ 180,197 Leasehold improvements 33,853 31,659 Furniture and fixtures 28,972 26,017 Building 6,404 6,318 Construction in progress 2,626 1,886 293,486 246,077 Less: Accumulated depreciation (126,935 ) (101,363 ) Total property and equipment, net $ 166,551 $ 144,714 Construction in progress consists primarily of leasehold improvements and in-process software development costs. Depreciation expense for the three months ended June 30, 2016 and 2015 was $16.3 million and $12.1 million , respectively, and for the six months ended June 30, 2016 and 2015 was $30.8 million and $22.9 million , respectively. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Summary Of Accrued Expenses And Other Current Liabilities [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following (in thousands): June 30, December 31, 2016 2015 Taxes payable $ 9,840 $ 9,080 Bonuses and commissions 37,678 33,124 Accrued compensation 19,442 17,089 Other employee related liabilities 22,086 21,529 Other 24,085 20,442 Total accrued expenses and other current liabilities $ 113,131 $ 101,264 |
Convertible Senior Notes
Convertible Senior Notes | 6 Months Ended |
Jun. 30, 2016 | |
Convertible Notes Payable [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes In November 2013 , we issued 0% convertible senior notes due November 1, 2018 with an aggregate principal amount of $575 million , or the Notes. The Notes will not bear interest. The Notes mature on November 1, 2018 unless converted or repurchased in accordance with their terms prior to such date. We cannot redeem the Notes prior to maturity. The Notes are unsecured obligations and do not contain any financial covenants or restrictions on the payments of dividends, the incurrence of indebtedness or the issuance or repurchase of securities by us or any of our subsidiaries. Upon conversion, we may choose to pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock. We intend to settle the principal amount of the Notes with cash. The Notes are convertible up to 7.8 million shares of our common stock at an initial conversion rate of approximately 13.54 shares of common stock per $1,000 principal amount, which is equal to an initial conversion price of approximately $73.88 per share of common stock, subject to adjustment. Holders of the Notes may convert their Notes at their option at any time prior to the close of business on the business day immediately preceding July 1, 2018 , only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on March 31, 2014 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or • upon the occurrence of specified corporate events. On or after July 1, 2018 , a holder may convert all or any portion of its notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date regardless of the foregoing conditions. Upon conversion, we will pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. The conversion price will be subject to adjustment in some events. Holders of the Notes who convert their notes in connection with certain corporate events that constitute a “make-whole fundamental change” are, under certain circumstances, entitled to an increase in the conversion rate. Additionally, in the event of a corporate event that constitutes a “fundamental change,” holders of the Notes may require us to purchase with cash all or a portion of the Notes upon the occurrence of a fundamental change, at a purchase price equal to 100% of the principal amount of the Notes plus any accrued and unpaid interest. In accounting for the issuance of the Notes, we separated the Notes into liability and equity components. The carrying cost 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. The difference between the principal amount of the Notes and the proceeds allocated to the liability component, or the debt discount, is amortized to interest expense using the effective interest method 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 issuance of the Notes, we allocated the total amount incurred to the liability and equity components based on their relative fair values. Transaction costs attributable to the liability component are being amortized to interest expense over the term of the Notes, and transaction costs attributable to the equity component were netted with the equity component of the Notes in stockholders’ equity. The Notes consisted of the following (in thousands): June 30, 2016 December 31, 2015 Liability: Principal $ 575,000 $ 575,000 Less: debt issuance cost and debt discount, net of amortization (84,109 ) (100,466 ) Net carrying amount $ 490,891 $ 474,534 We consider the fair value of the Notes at June 30, 2016 and December 31, 2015 to be a Level 2 measurement. The estimated fair values of the Notes were $640.6 million and $741.8 million at June 30, 2016 and December 31, 2015 , respectively (based on the closing trading price per $100 of the Notes on June 30, 2016 and December 31, 2015 , respectively). The Notes were not convertible as of June 30, 2016 and December 31, 2015 . As of June 30, 2016 , the remaining life of the Notes is 28 months. The following table sets forth total interest expense recognized related to the Notes (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Amortization of debt issuance cost $ 442 $ 413 $ 877 $ 820 Amortization of debt discount 7,806 7,294 15,480 14,465 Total $ 8,248 $ 7,707 $ 16,357 $ 15,285 Effective interest rate of the liability component 6.5% Note Hedge To minimize the impact of potential economic dilution upon conversion of the Notes, we entered into convertible note hedge transactions, or the Note Hedge, with respect to our common stock concurrent with the issuance of the Notes. The Note Hedge covers approximately 7.8 million shares of our common stock at a strike price per share that corresponds to the initial conversion price of the Notes, subject to adjustment, and is exercisable upon conversion of the Notes. We paid an aggregate amount of $135.8 million for the Note Hedge. The Note Hedge will expire upon maturity of the Notes. The Note Hedge is intended to reduce the potential economic dilution upon conversion of the Notes in the event that the fair value per share of our common stock at the time of exercise is greater than the conversion price of the Notes. The Note Hedge is a separate transaction and is not part of the terms of the Notes. The Note Hedge does not impact earnings per share, as it was entered into to offset any dilution from the Notes. Warrants Separately, we entered into warrant transactions, or the Warrants, whereby we sold warrants to acquire up to 7.8 million shares of our common stock, at a strike price of $107.46 per share, subject to adjustment. We received aggregate proceeds of $84.5 million from the sale of the Warrants. If the average market value per share of our common stock for the reporting period, as measured under the Warrants, exceeds the strike price of the Warrants, the Warrants will have a dilutive effect on our earnings per share. The Warrants are separate transactions and are not remeasured through earnings each reporting period. The Warrants are not part of the Notes or the Note Hedge, and have been accounted for as part of additional paid-in capital. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 6 Months Ended |
Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss, net of tax, consist of the following (in thousands): June 30, December 31, 2016 2015 Foreign currency translation adjustment $ (15,747 ) $ (14,438 ) Net unrealized loss on investments, net of tax (306 ) (2,444 ) Accumulated other comprehensive loss $ (16,053 ) $ (16,882 ) Reclassification adjustments out of accumulated other comprehensive loss into net loss were immaterial for all periods presented. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Common Stock Outstanding And Reserved Shares Of Common Stock For Future Issuance [Abstract] | |
Stockholders' Equity | Stockholders' Equity Common Stock We were authorized to issue 600,000,000 shares of common stock as of June 30, 2016 . Holders of our common stock are not entitled to receive dividends unless declared by our board of directors. As of June 30, 2016 , we had 164,496,689 shares of common stock outstanding and had reserved shares of common stock for future issuance as follows: June 30, 2016 Stock option plans: Options outstanding 6,902,902 RSUs 13,274,438 Stock awards available for future grants: 2012 Equity Incentive Plan (1) 21,414,823 2012 Employee Stock Purchase Plan (1) 8,850,836 Total reserved shares of common stock for future issuance 50,442,999 (1) Refer to Note 12 for a description of these plans. During the six months ended June 30, 2016 and 2015 , we issued a total of 3,710,925 shares and 6,034,044 shares, respectively, from stock option exercises, vesting of restricted stock units, or RSUs, and purchases from the employee stock purchase plan, or ESPP. |
Stock Awards
Stock Awards | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Awards | Stock Awards We have a 2005 Stock Option Plan, or 2005 Plan, which provides for grants of stock awards, including options to purchase shares of common stock, stock purchase rights and RSUs to certain employees, officers, directors and consultants. Our 2012 Equity Incentive Plan, or 2012 Plan, provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, RSUs, performance-based stock awards and other forms of equity compensation, or collectively, stock awards. In addition, the 2012 Plan provides for the grant of performance cash awards. Incentive stock options may be granted only to employees. All other awards may be granted to employees, including officers, as well as directors and consultants. The share reserve may increase to the extent outstanding stock options under the 2005 Plan expire or terminate unexercised. The share reserve also automatically increases on January 1 of each year until January 1, 2022, by up to 5% of the total number of shares of common stock outstanding on December 31 of the preceding year as determined by the board of directors. On January 1, 2016 , 8,039,288 shares of common stock were automatically added to the 2012 Plan pursuant to the provision described in the preceding sentence. Our 2012 Employee Stock Purchase Plan, or 2012 ESPP, authorizes the issuance of shares of common stock pursuant to purchase rights granted to our employees. The price at which common stock is purchased under the 2012 ESPP is equal to 85% of the fair market value of the common stock on the first or last day of the offering period, whichever is lower. Offering periods are six months long and begin on February 1 and August 1 of each year. The number of shares of common stock reserved for issuance automatically increases on January 1 of each year until January 1, 2022, by up to 1% of the total number of shares of common stock outstanding on December 31 of the preceding year as determined by the board of directors. On January 1, 2016 , 1,607,858 shares of common stock were automatically added to the 2012 ESPP pursuant to the provision described in the preceding sentence. Stock Options A summary of the stock option activity for the six months ended June 30, 2016 is as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2015 8,255,554 $ 16.65 Granted 169,400 65.92 Exercised (579,504 ) 5.28 $ 35,876 Canceled (126,735 ) 58.05 Outstanding at March 31, 2016 7,718,715 17.90 Granted 131,835 68.36 Exercised (828,327 ) 17.18 $ 43,757 Canceled (119,321 ) 52.26 Outstanding at June 30, 2016 6,902,902 $ 18.36 5.73 $ 335,012 Vested and expected to vest as of June 30, 2016 6,802,214 $ 17.66 5.68 $ 334,577 Vested and exercisable as of June 30, 2016 5,863,745 $ 11.27 5.25 $ 323,962 Aggregate intrinsic value represents the difference between the estimated fair value of our common stock and the exercise price of outstanding, in-the-money options. The weighted-average grant date fair value per share of options granted was $27.06 for the six months ended June 30, 2016 . The total fair value of stock options vested during the six months ended June 30, 2016 was $10.7 million . As of June 30, 2016 , total unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested stock options was approximately $22.3 million . The weighted-average remaining vesting period of unvested stock options at June 30, 2016 was 2.54 years . RSUs A summary of RSU activity for the six months ended June 30, 2016 is as follows: Number of Shares Weighted Average Grant Date Fair Value (Per Share) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2015 12,417,805 $ 63.38 Granted 3,822,832 51.11 Vested (1,708,179 ) 58.42 $ 89,516 Forfeited (370,545 ) 64.43 Outstanding at March 31, 2016 14,161,913 60.64 Granted 805,680 67.75 Vested (1,285,704 ) 53.70 $ 86,693 Forfeited (407,451 ) 63.31 Non-vested and outstanding at June 30, 2016 13,274,438 $ 61.66 $ 881,423 Expected to vest as of June 30, 2016 11,055,763 $ 734,103 RSUs granted under the 2005 Plan and the 2012 Plan to employees generally vest over a four -year period. As of June 30, 2016 , total unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested RSUs was approximately $605.1 million and the weighted-average remaining vesting period was 2.87 years . |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share The following table presents the calculation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Numerator: Net loss $ (49,625 ) $ (61,925 ) $ (382,957 ) $ (120,018 ) Denominator: Weighted-average shares outstanding—basic and diluted 163,838,755 154,465,367 162,952,721 153,041,433 Net loss per share—basic and diluted: $ (0.30 ) $ (0.40 ) $ (2.35 ) $ (0.78 ) Potentially dilutive securities that are not included in the calculation of diluted net loss per share because doing so would be antidilutive are as follows: June 30, 2016 2015 Common stock options 6,902,902 12,017,564 Restricted stock units 13,274,438 13,079,988 Common stock subject to repurchase — 21 ESPP obligations 288,467 196,836 Convertible senior notes 7,783,023 7,783,023 Warrants related to the issuance of convertible senior notes 7,783,023 7,783,023 Total potentially dilutive securities 36,031,853 40,860,455 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We compute our provision for income taxes by applying the estimated annual effective tax rate to year-to-date income (loss) from recurring operations and adjust the provision for discrete tax items recorded in the period. Our effective tax rate was 9% and 1% for the three and six months ended June 30, 2016 , respectively, which was lower than the U.S. federal statutory tax rate of 34% . The lower tax rate was primarily attributable to our loss from operations, the foreign tax rate differential, a release of the valuation allowance in connection with acquisitions and tax effects of stock option excess tax benefits from the early adoption of ASU 2016-09. Our effective tax rate was (2)% for the three and six months ended June 30, 2015 , which was lower than the U.S. federal statutory tax rate of 34% . The lower tax rate was primarily attributable to our loss from operations, the foreign tax rate differential, non-deductible expenses arising from stock-based compensation and the tax effects of unrealized gains in investment securities. As described in Note 2 "Summary of Significant Accounting Policies," we adopted ASU 2016-09 in the quarter ended June 30, 2016. See Note 2 for further discussion. We are subject to taxation in the United States and foreign jurisdictions. As of June 30, 2016 , our tax years 2005 to 2015 remain subject to examination in most jurisdictions. There are differing interpretations of tax laws and regulations, and as a result, disputes may arise with tax authorities involving issues of the timing and amount of deductions and allocations of income among various tax jurisdictions. We periodically evaluate our exposures associated with our tax filing positions. We believe that adequate amounts have been reserved for any adjustments that may ultimately result from these examinations, and we do not anticipate a significant impact to our gross unrecognized tax benefits within the next 12 months related to these years. Although the timing of the resolution, settlement, and closure of any audit is highly uncertain, it is reasonably possible that the balance of gross unrecognized tax benefits could significantly change in the next 12 months. However, given the number of years that remain subject to examination, we are unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax benefits. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases We lease facilities for data center capacity and office space under non-cancelable operating lease agreements with various expiration dates. Legal Proceedings From time to time, we are party to litigation and other legal proceedings in the ordinary course of business. While the results of any litigation or other legal proceedings are uncertain, management does not believe the ultimate resolution of any pending legal matters is likely to have a material adverse effect on our financial position, results of operations or cash flows, except as discussed below and for those matters for which we have recorded a loss contingency. We accrue for loss contingencies when it is both probable that we will incur the loss and when we can reasonably estimate the amount of the loss or range of loss. Generally, our subscription agreements require us to defend our customers for third-party intellectual property infringement and other claims. Any adverse determination related to intellectual property claims or other litigation could prevent us from offering our services and adversely affect our financial condition and results of operations. On February 6, 2014, Hewlett-Packard Company (Hewlett-Packard) filed a lawsuit against us in the U.S. District Court for the Northern District of California. The lawsuit alleged patent infringement and sought damages and an injunction. On or about November 1, 2015, Hewlett Packard Enterprise Company (HPE) separated from Hewlett-Packard as an independent company, and Hewlett-Packard assigned to HPE all right, title, and interest in the eight Hewlett-Packard patents in the lawsuit and HPE was substituted as plaintiff in the litigation. On March 4, 2016, we entered into a confidential settlement agreement resolving the lawsuit with HPE (HPE Settlement). As a result, on March 9, 2016, the lawsuit was dismissed. BMC Software, Inc. (BMC) filed lawsuits against us in the U.S. District Court for the Eastern District of Texas on September 23, 2014 and February 12, 2016, and in the Dusseldorf (Germany) Regional Court, Patent Division, on March 2, 2016. Each of the lawsuits alleged patent infringement and sought damages and an injunction. On April 8, 2016, we entered into a confidential settlement agreement resolving all the lawsuits with BMC (BMC Settlement). As a result, the second Texas lawsuit was dismissed on April 14, 2016, and each of the initial Texas lawsuit and the German lawsuit was dismissed on April 25, 2016. These settlements are considered multiple element arrangements for accounting purposes. We evaluated the accounting treatment of these settlements by identifying each element of the arrangements, which included amongst other elements, a release of past infringement claims and a covenant not to sue for a specified term of years. The primary benefit we received from the arrangements was the settlement and termination of all existing litigation, the avoidance of future litigation expenses and the avoidance of future management and customer disruptions. We determined that none of the elements of the settlement agreements have identifiable future benefits. Accordingly, we recorded charges for aggregate legal settlements of $270.0 million in our condensed consolidated statement of comprehensive loss for the six months ended June 30, 2016. The charge covers the fulfillment by us of all financial obligations under both the BMC Settlement and HPE Settlement with no remaining financial obligations under either settlement. Apart from the $267.5 million cash paid for aggregate legal settlements during the six months ended June 30, 2016 , there have been no material changes in our commitments under contractual obligations, as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2015 . |
Information about Geographic Ar
Information about Geographic Areas and Products | 6 Months Ended |
Jun. 30, 2016 | |
Segments, Geographical Areas [Abstract] | |
Information about Geographic Areas and Products | Information about Geographic Areas and Products Revenues by geographic area, based on the location of our users, were as follows for the periods presented (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 North America (1) $ 234,009 $ 174,387 $ 444,526 $ 323,033 EMEA (2) 82,065 55,803 156,346 104,333 Asia Pacific and other 25,238 16,526 46,319 31,314 Total revenues $ 341,312 $ 246,716 $ 647,191 $ 458,680 Property and equipment, net by geographic area were as follows (in thousands): June 30, December 31, 2016 2015 North America (3) $ 120,909 $ 104,085 EMEA (2) 33,665 32,027 Asia Pacific and other 11,977 8,602 Total property and equipment, net $ 166,551 $ 144,714 (1) Revenues attributed to the United States were approximately 95% of North America revenues for the three months ended June 30, 2016 and 2015 , and 95% and 94% for the six months ended June 30, 2016 and 2015 , respectively. (2) Europe, the Middle East and Africa (3) Property and equipment, net attributed to the United States were approximately 97% and 98% of property and equipment, net attributable to North America as of June 30, 2016 and December 31, 2015 , respectively. Subscription revenues consist of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Enterprise Service Management solutions $ 264,667 $ 186,082 $ 510,529 $ 353,286 IT Operations Management solutions 26,012 14,379 47,572 27,082 Total subscription revenues $ 290,679 $ 200,461 $ 558,101 $ 380,368 Our Enterprise Service Management solutions include Service Management, Business Management and ServiceNow Platform, which have similar features and functions, and are generally priced on a per user basis. Our IT Operations Management solutions, which improve visibility, availability and agility of enterprise services, are generally priced on a per node basis. |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements and condensed footnotes have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for fair statement of results for the interim periods presented have been included. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for the year ended December 31, 2016 or for other interim periods or for future years. The condensed consolidated balance sheet as of December 31, 2015 is derived from audited financial statements as of that date, however, it does not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Form 10-K for the year ended December 31, 2015 , which was filed with the Securities and Exchange Commission on February 25, 2016. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements have been prepared in conformity with GAAP and include our accounts and the accounts of our wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated upon consolidation. |
Reclassification, Policy [Policy Text Block] | Prior Period Reclassification Certain reclassifications of prior period amounts have been made to conform to the current period presentation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Warranties and Indemnification | Warranties and Indemnification Our cloud computing solutions are typically warranted to perform in material conformance with their specifications. We include service level commitments to our customers that permit those customers to receive credits in the event we fail to meet those service levels. We establish an accrual based on an evaluation of the known service disruptions. Service level credit accrual charges are recorded against revenue and were not material for all periods presented. We have also agreed to indemnify our directors and executive officers for costs associated with any fees, expenses, judgments, fines and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by us, arising out of that person’s services as a director or officer of our company or that person’s services provided to any other company or enterprise at our request. We maintain director and officer insurance coverage that may enable us to recover a portion of any future amounts paid. The fair values of these obligations are not material as of each balance sheet date. Our agreements include provisions indemnifying customers against intellectual property and other third-party claims. We have not incurred any costs as a result of such indemnification obligations and have not recorded any liabilities related to such obligations in the condensed consolidated financial statements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which requires a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. Credit losses relating to available-for-sale debt securities should be recorded through an allowance for credit losses. This standard is effective for our interim and annual reporting periods beginning after December 15, 2019. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, "Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. This standard is effective for our interim and annual reporting periods beginning January 1, 2017, and early adoption is permitted. We elected to early adopt this standard in the quarter ended June 30, 2016. The impact of the early adoption was as follows: • The standard eliminates additional paid in capital (APIC) pools and requires excess tax benefits and tax deficiencies to be recorded in the income statement as a discrete item when the awards vest or are settled. The adoption of this guidance on a prospective basis resulted in the recognition of excess tax benefits in our provision for income taxes of $1.7 million for the three and six months ended June 30, 2016 . • The standard requires excess tax benefits to be recognized regardless of whether the benefit reduces taxes payable. The adoption of this guidance on a modified retrospective basis resulted in the recognition of a cumulative-effect adjustment of $11.4 million that reduced our accumulated deficit and increased our foreign long-term deferred income tax as of January 1, 2016. The previously unrecognized U.S. excess tax effects were recorded as a deferred tax asset net of a valuation allowance. • We have elected to continue to estimate forfeitures expected to occur to determine the amount of stock-based compensation cost to be recognized in each period. As such, the guidance relating to forfeitures did not have an impact on our accumulated deficit as of January 1, 2016. • We elected to apply the statement of cash flows guidance that cash flows related to excess tax benefits be presented as an operating activity retrospectively, which resulted in a $0.6 million increase to net cash provided by operating activities and a corresponding decrease to net cash provided by financing activities in the accompanying condensed consolidated statement of cash flows for the six months ended June 30, 2015 , as compared to the amounts previously reported. • The statement of cash flows guidance that cash flows related to employee taxes paid for withheld shares be presented as a financing activity had no impact on our condensed consolidated financial statements as we have historically presented such cash flows as a financing activity. In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires lessees to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets, and to recognize on the income statement the expenses in a manner similar to current practice. This new standard is effective for our interim and annual periods beginning January 1, 2019 and early adoption is permitted. While we are currently evaluating the impact of this standard on our condensed consolidated financial statements, we anticipate this standard will have a material impact on our condensed consolidated balance sheets given that we have operating lease commitments of approximately $280 million as of June 30, 2016. However, we do not anticipate this standard will have a material impact on our condensed consolidated statements of comprehensive loss since the expense recognition under this new standard will be similar to current practice. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. This new standard is effective for our interim and annual periods beginning January 1, 2018 and early adoption is not permitted. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments (Topic 805),” which eliminates the requirement to restate prior period financial statements for measurement period adjustments in business combinations. This new standard requires that the cumulative impact of a measurement period adjustment (including the impact on prior periods) be recognized in the reporting period in which the adjustment is identified. We adopted this standard during the three months ended March 31, 2016 on a prospective basis and the adoption had no material impact on our condensed consolidated financial statements. In April 2015, the FASB issued ASU 2015-05, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement." ASU 2015-05 provides guidance to customers about whether a cloud computing arrangement includes software. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. We adopted this standard during the three months ended March 31, 2016 on a prospective basis and the adoption had no material impact on our condensed consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)," which will supersede virtually all existing revenue guidance. Under this standard, an entity is required to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration received in exchange for those goods or services. As such, an entity will need to use more judgment and make more estimates than under the current guidance. This standard should be applied retrospectively either to each prior reporting period presented in the financial statements, or only to the most current reporting period presented in the financial statements with a cumulative effect adjustment recorded in the retained earnings. In March 2016, the FASB issued ASU 2016-08, "Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)," which clarifies the principal versus agent guidance in the new revenue recognition standard. In April 2016, the FASB issued ASU 2016-10, "Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing," which clarifies the guidance on accounting for licenses of intellectual property (IP) and identifying performance obligations in the new revenue recognition standard. In May 2016, the FASB issued ASU 2016-12, "Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients," which amended the revenue recognition guidance regarding collectability, non-cash consideration, presentation of sales tax and transition. These new standards are effective for our interim and annual periods beginning January 1, 2018 and early adoption beginning January 1, 2017 is permitted. We are currently evaluating the impact of these standards on our condensed consolidated financial statements. |
Legal Proceedings | Legal Proceedings From time to time, we are party to litigation and other legal proceedings in the ordinary course of business. While the results of any litigation or other legal proceedings are uncertain, management does not believe the ultimate resolution of any pending legal matters is likely to have a material adverse effect on our financial position, results of operations or cash flows, except as discussed below and for those matters for which we have recorded a loss contingency. We accrue for loss contingencies when it is both probable that we will incur the loss and when we can reasonably estimate the amount of the loss or range of loss. |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Available-for-sale Securities [Abstract] | |
Summary of Investments | The following is a summary of our available-for-sale investment securities, excluding those securities classified within cash and cash equivalents on the consolidated balance sheets (in thousands): June 30, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities: Commercial paper $ 30,000 $ — $ — $ 30,000 Corporate notes and bonds 613,680 1,014 (131 ) 614,563 Certificates of deposit 14,467 — — 14,467 U.S. government agency securities 82,945 67 (2 ) 83,010 Total available-for-sale securities $ 741,092 $ 1,081 $ (133 ) $ 742,040 December 31, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities: Commercial paper $ 32,430 $ 2 $ (38 ) $ 32,394 Corporate notes and bonds 617,054 7 (2,027 ) 615,034 Certificates of deposit 29,610 2 (17 ) 29,595 U.S. government agency securities 134,962 1 (374 ) 134,589 Total available-for-sale securities $ 814,056 $ 12 $ (2,456 ) $ 811,612 |
Investments Classified by Contractual Maturity Date | The fair values of available-for-sale investments, by remaining contractual maturity, are as follows (in thousands): June 30, 2016 Due in 1 year or less $ 517,601 Due in 1 year through 2 years 224,439 Total $ 742,040 |
Fair Values and Gross Unrealized Losses of Available-for-Sale Securities Aggregated by Investment Category | The following table shows the fair values and the gross unrealized losses of these securities, classified by the length of time that the securities have been in a continuous unrealized loss position, and aggregated by investment types (in thousands): June 30, 2016 Less than 12 Months 12 Months or Greater Total Fair Value Gross Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Corporate notes and bonds $ 201,213 $ (130 ) $ 1,099 $ (1 ) $ 202,312 $ (131 ) U.S. government agency securities 13,058 (2 ) — — 13,058 (2 ) Total $ 214,271 $ (132 ) $ 1,099 $ (1 ) $ 215,370 $ (133 ) December 31, 2015 Less than 12 Months 12 Months or Greater Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Commercial paper $ 24,913 $ (38 ) $ — $ — $ 24,913 $ (38 ) Corporate notes and bonds 539,586 (1,897 ) 60,099 (130 ) 599,685 (2,027 ) Certificates of deposit 19,750 (17 ) — — 19,750 (17 ) U.S. government agency securities 132,581 (374 ) — — 132,581 (374 ) Total $ 716,830 $ (2,326 ) $ 60,099 $ (130 ) $ 776,929 $ (2,456 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value, Assets, Liabilities and Stockholders' Equity Measured on Recurring Basis [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents our fair value hierarchy for our assets measured at fair value on a recurring basis at June 30, 2016 (in thousands): Level 1 Level 2 Total Cash equivalents: Money market funds $ 100,329 $ — $ 100,329 Short-term investments: Commercial paper — 30,000 30,000 Corporate notes and bonds — 416,099 416,099 Certificates of deposit — 9,362 9,362 U.S. government agency securities — 62,140 62,140 Long-term investments: Corporate notes and bonds — 198,464 198,464 Certificates of deposit — 5,105 5,105 U.S. government agency securities — 20,870 20,870 Total $ 100,329 $ 742,040 $ 842,369 The following table presents our fair value hierarchy for our assets measured at fair value on a recurring basis at December 31, 2015 (in thousands): Level 1 Level 2 Total Cash equivalents: Money market funds $ 263,515 $ — $ 263,515 Commercial paper — 2,000 2,000 Corporate notes and bonds — 1,119 1,119 Short-term investments: Commercial paper — 32,394 32,394 Corporate notes and bonds — 303,567 303,567 Certificates of deposit — 23,736 23,736 U.S. government agency securities — 29,248 29,248 Long-term investments: Corporate notes and bonds — 311,467 311,467 Certificates of deposit — 5,859 5,859 U.S. government agency securities — 105,341 105,341 Total $ 263,515 $ 814,731 $ 1,078,246 |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the allocation of the purchase price to the fair value of the tangible and intangible assets acquired and liabilities assumed as of the acquisition date: Purchase Price Allocation (in thousands) Useful Life (in years) Net tangible assets acquired $ 140 Intangible assets: Developed technology 4,700 5 Customer contracts and related relationships 200 1.5 Goodwill 11,437 Net deferred tax liabilities (2,015 ) Total purchase price $ 14,462 The following table summarizes the allocation of the purchase price to the fair value of the tangible and intangible assets acquired and liabilities assumed as of the acquisition date: Purchase Price Allocation (in thousands) Useful Life (in years) Intangible assets: Developed technology $ 8,100 6 Customer contracts and related relationships 500 1.5 Goodwill 15,258 Net tangible liabilities acquired (1,339 ) Net deferred tax liabilities (1) (2,890 ) Total purchase price $ 19,629 (1) Deferred tax liabilities, net primarily relates to purchased identifiable intangible assets and is shown net of deferred tax assets. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill balances are presented below (in thousands): Carrying Amount Balance as of December 31, 2015 $ 55,669 Goodwill acquired 26,695 Foreign currency translation adjustments 751 Balance as of June 30, 2016 $ 83,115 |
Schedule of Intangible Assets | Intangible assets consist of the following (in thousands): June 30, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 80,265 $ (23,665 ) $ 56,600 Other 9,275 (1,002 ) 8,273 Total intangible assets $ 89,540 $ (24,667 ) $ 64,873 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 58,144 $ (17,463 ) $ 40,681 Other 3,695 (1,371 ) 2,324 Total intangible assets $ 61,839 $ (18,834 ) $ 43,005 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment, Net | Property and equipment, net consists of the following (in thousands): June 30, December 31, 2016 2015 Computer equipment and software $ 221,631 $ 180,197 Leasehold improvements 33,853 31,659 Furniture and fixtures 28,972 26,017 Building 6,404 6,318 Construction in progress 2,626 1,886 293,486 246,077 Less: Accumulated depreciation (126,935 ) (101,363 ) Total property and equipment, net $ 166,551 $ 144,714 |
Accrued Expenses and Other Cu28
Accrued Expenses and Other Current Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Summary Of Accrued Expenses And Other Current Liabilities [Abstract] | |
Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following (in thousands): June 30, December 31, 2016 2015 Taxes payable $ 9,840 $ 9,080 Bonuses and commissions 37,678 33,124 Accrued compensation 19,442 17,089 Other employee related liabilities 22,086 21,529 Other 24,085 20,442 Total accrued expenses and other current liabilities $ 113,131 $ 101,264 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Convertible Notes Payable [Abstract] | |
Schedule of Convertible Notes | The Notes consisted of the following (in thousands): June 30, 2016 December 31, 2015 Liability: Principal $ 575,000 $ 575,000 Less: debt issuance cost and debt discount, net of amortization (84,109 ) (100,466 ) Net carrying amount $ 490,891 $ 474,534 |
Interest Expense Recognized Related to the Notes | The following table sets forth total interest expense recognized related to the Notes (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Amortization of debt issuance cost $ 442 $ 413 $ 877 $ 820 Amortization of debt discount 7,806 7,294 15,480 14,465 Total $ 8,248 $ 7,707 $ 16,357 $ 15,285 Effective interest rate of the liability component 6.5% |
Accumulated Other Comprehensi30
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of accumulated other comprehensive loss, net of tax, consist of the following (in thousands): June 30, December 31, 2016 2015 Foreign currency translation adjustment $ (15,747 ) $ (14,438 ) Net unrealized loss on investments, net of tax (306 ) (2,444 ) Accumulated other comprehensive loss $ (16,053 ) $ (16,882 ) |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Common Stock Outstanding And Reserved Shares Of Common Stock For Future Issuance [Abstract] | |
Common Stock Outstanding and Reserved Shares of Common Stock for Future Issuance | As of June 30, 2016 , we had 164,496,689 shares of common stock outstanding and had reserved shares of common stock for future issuance as follows: June 30, 2016 Stock option plans: Options outstanding 6,902,902 RSUs 13,274,438 Stock awards available for future grants: 2012 Equity Incentive Plan (1) 21,414,823 2012 Employee Stock Purchase Plan (1) 8,850,836 Total reserved shares of common stock for future issuance 50,442,999 (1) Refer to Note 12 for a description of these plans. |
Stock Awards (Tables)
Stock Awards (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Option Activity | A summary of the stock option activity for the six months ended June 30, 2016 is as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2015 8,255,554 $ 16.65 Granted 169,400 65.92 Exercised (579,504 ) 5.28 $ 35,876 Canceled (126,735 ) 58.05 Outstanding at March 31, 2016 7,718,715 17.90 Granted 131,835 68.36 Exercised (828,327 ) 17.18 $ 43,757 Canceled (119,321 ) 52.26 Outstanding at June 30, 2016 6,902,902 $ 18.36 5.73 $ 335,012 Vested and expected to vest as of June 30, 2016 6,802,214 $ 17.66 5.68 $ 334,577 Vested and exercisable as of June 30, 2016 5,863,745 $ 11.27 5.25 $ 323,962 |
Schedule of Restricted Stock Unit Activity | A summary of RSU activity for the six months ended June 30, 2016 is as follows: Number of Shares Weighted Average Grant Date Fair Value (Per Share) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2015 12,417,805 $ 63.38 Granted 3,822,832 51.11 Vested (1,708,179 ) 58.42 $ 89,516 Forfeited (370,545 ) 64.43 Outstanding at March 31, 2016 14,161,913 60.64 Granted 805,680 67.75 Vested (1,285,704 ) 53.70 $ 86,693 Forfeited (407,451 ) 63.31 Non-vested and outstanding at June 30, 2016 13,274,438 $ 61.66 $ 881,423 Expected to vest as of June 30, 2016 11,055,763 $ 734,103 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders | The following table presents the calculation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Numerator: Net loss $ (49,625 ) $ (61,925 ) $ (382,957 ) $ (120,018 ) Denominator: Weighted-average shares outstanding—basic and diluted 163,838,755 154,465,367 162,952,721 153,041,433 Net loss per share—basic and diluted: $ (0.30 ) $ (0.40 ) $ (2.35 ) $ (0.78 ) |
Summary of Potentially Dilutive Securities | Potentially dilutive securities that are not included in the calculation of diluted net loss per share because doing so would be antidilutive are as follows: June 30, 2016 2015 Common stock options 6,902,902 12,017,564 Restricted stock units 13,274,438 13,079,988 Common stock subject to repurchase — 21 ESPP obligations 288,467 196,836 Convertible senior notes 7,783,023 7,783,023 Warrants related to the issuance of convertible senior notes 7,783,023 7,783,023 Total potentially dilutive securities 36,031,853 40,860,455 |
Information about Geographic 34
Information about Geographic Areas and Products (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Segments, Geographical Areas [Abstract] | |
Revenues by Geographic Area, Based on Billing Location of Customer | Revenues by geographic area, based on the location of our users, were as follows for the periods presented (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 North America (1) $ 234,009 $ 174,387 $ 444,526 $ 323,033 EMEA (2) 82,065 55,803 156,346 104,333 Asia Pacific and other 25,238 16,526 46,319 31,314 Total revenues $ 341,312 $ 246,716 $ 647,191 $ 458,680 |
Schedule of Property and Equipment, Net by Geographic Area | Property and equipment, net by geographic area were as follows (in thousands): June 30, December 31, 2016 2015 North America (3) $ 120,909 $ 104,085 EMEA (2) 33,665 32,027 Asia Pacific and other 11,977 8,602 Total property and equipment, net $ 166,551 $ 144,714 (1) Revenues attributed to the United States were approximately 95% of North America revenues for the three months ended June 30, 2016 and 2015 , and 95% and 94% for the six months ended June 30, 2016 and 2015 , respectively. (2) Europe, the Middle East and Africa (3) Property and equipment, net attributed to the United States were approximately 97% and 98% of property and equipment, net attributable to North America as of June 30, 2016 and December 31, 2015 , respectively. |
Schedule Of Subscription Revenue By Product | Subscription revenues consist of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Enterprise Service Management solutions $ 264,667 $ 186,082 $ 510,529 $ 353,286 IT Operations Management solutions 26,012 14,379 47,572 27,082 Total subscription revenues $ 290,679 $ 200,461 $ 558,101 $ 380,368 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies New Accounting Pronouncements (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2016 | |
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Operating Leases, Future Minimum Payments Due | $ 280,000 | |
New Accounting Pronouncement, Early Adoption, Effect [Member] | ||
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Deferred income tax assets, net | 1,700 | |
Cumulative effect of change on equity | $ 11,400 | |
Net cash (used in) provided by operating activities(1) | $ 600 | |
Net cash (used in) provided by financing activities(1) | $ 600 |
Investments - Summary of Invest
Investments - Summary of Investments (Detail) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | $ 741,092 | $ 814,056 |
Available-for-sale securities, accumulated gross unrealized gain, before tax | 1,081 | 12 |
Available-for-sale securities, accumulated gross unrealized loss, before tax | (133) | (2,456) |
Estimated fair value | 742,040 | 811,612 |
Short-term investments | 517,601 | 388,945 |
Long-term investments | 224,439 | 422,667 |
Commercial paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 30,000 | 32,430 |
Available-for-sale securities, accumulated gross unrealized gain, before tax | 0 | 2 |
Available-for-sale securities, accumulated gross unrealized loss, before tax | 0 | (38) |
Estimated fair value | 30,000 | 32,394 |
Corporate notes and bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 613,680 | 617,054 |
Available-for-sale securities, accumulated gross unrealized gain, before tax | 1,014 | 7 |
Available-for-sale securities, accumulated gross unrealized loss, before tax | (131) | (2,027) |
Estimated fair value | 614,563 | 615,034 |
Certificates of deposit [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 14,467 | 29,610 |
Available-for-sale securities, accumulated gross unrealized gain, before tax | 0 | 2 |
Available-for-sale securities, accumulated gross unrealized loss, before tax | 0 | (17) |
Estimated fair value | 14,467 | 29,595 |
US government agency securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized cost | 82,945 | 134,962 |
Available-for-sale securities, accumulated gross unrealized gain, before tax | 67 | 1 |
Available-for-sale securities, accumulated gross unrealized loss, before tax | (2) | (374) |
Estimated fair value | $ 83,010 | $ 134,589 |
Investments - Fair Values and G
Investments - Fair Values and Gross Unrealized Losses of Available-for-Sale Securities Aggregated by Investment Category (Detail) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | $ 214,271 | $ 716,830 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | (132) | (2,326) |
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value | 1,099 | 60,099 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | (1) | (130) |
Fair value | 215,370 | 776,929 |
Available-for-sale securities, continuous unrealized loss position, accumulated loss | 133 | 2,456 |
Commercial paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 24,913 | |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | (38) | |
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value | 0 | |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0 | |
Fair value | 24,913 | |
Available-for-sale securities, continuous unrealized loss position, accumulated loss | 38 | |
Corporate notes and bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 201,213 | 539,586 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | (130) | (1,897) |
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value | 1,099 | 60,099 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | (1) | (130) |
Fair value | 202,312 | 599,685 |
Available-for-sale securities, continuous unrealized loss position, accumulated loss | 131 | 2,027 |
Certificates of deposit [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 19,750 | |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | (17) | |
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value | 0 | |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0 | |
Fair value | 19,750 | |
Available-for-sale securities, continuous unrealized loss position, accumulated loss | 17 | |
US government agency securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than twelve months, fair value | 13,058 | 132,581 |
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss | (2) | (374) |
Available-for-sale securities, continuous unrealized loss position, twelve months or longer, fair value | 0 | 0 |
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss | 0 | 0 |
Fair value | 13,058 | 132,581 |
Available-for-sale securities, continuous unrealized loss position, accumulated loss | $ 2 | $ 374 |
Investments - Additional Inform
Investments - Additional Information (Detail) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Available-for-sale Securities [Abstract] | ||
Available for sale securities maturities term maximum | 24 months | |
Available for sale, gross unrealized term held | 12 months | |
Other than temporary impairment losses, investments, available-for-sale securities | $ 0 | |
Cost method investments | $ 10,500,000 | $ 10,500,000 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | $ 742,040 | $ 811,612 |
Total | 842,369 | 1,078,246 |
Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 30,000 | 32,394 |
Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 614,563 | 615,034 |
Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 14,467 | 29,595 |
US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 83,010 | 134,589 |
Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | 100,329 | 263,515 |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | 742,040 | 814,731 |
Cash Equivalents [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 100,329 | 263,515 |
Cash Equivalents [Member] | Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 2,000 | |
Cash Equivalents [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,119 | |
Cash Equivalents [Member] | Level 1 [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 100,329 | 263,515 |
Cash Equivalents [Member] | Level 1 [Member] | Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | |
Cash Equivalents [Member] | Level 1 [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | |
Cash Equivalents [Member] | Level 2 [Member] | Money Market Funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Cash Equivalents [Member] | Level 2 [Member] | Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 2,000 | |
Cash Equivalents [Member] | Level 2 [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,119 | |
Short-term Investments [Member] | Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 30,000 | 32,394 |
Short-term Investments [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 416,099 | 303,567 |
Short-term Investments [Member] | Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 9,362 | 23,736 |
Short-term Investments [Member] | US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 62,140 | 29,248 |
Short-term Investments [Member] | Level 1 [Member] | Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Short-term Investments [Member] | Level 1 [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Short-term Investments [Member] | Level 1 [Member] | Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Short-term Investments [Member] | Level 1 [Member] | US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Short-term Investments [Member] | Level 2 [Member] | Commercial paper [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 30,000 | 32,394 |
Short-term Investments [Member] | Level 2 [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 416,099 | 303,567 |
Short-term Investments [Member] | Level 2 [Member] | Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 9,362 | 23,736 |
Short-term Investments [Member] | Level 2 [Member] | US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 62,140 | 29,248 |
Other Long-term Investments [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 198,464 | 311,467 |
Other Long-term Investments [Member] | Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 5,105 | 5,859 |
Other Long-term Investments [Member] | US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 20,870 | 105,341 |
Other Long-term Investments [Member] | Level 1 [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Other Long-term Investments [Member] | Level 1 [Member] | Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Other Long-term Investments [Member] | Level 1 [Member] | US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Other Long-term Investments [Member] | Level 2 [Member] | Corporate notes and bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 198,464 | 311,467 |
Other Long-term Investments [Member] | Level 2 [Member] | Certificates of deposit [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 5,105 | 5,859 |
Other Long-term Investments [Member] | Level 2 [Member] | US government agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | $ 20,870 | $ 105,341 |
Business Combinations BrightPoi
Business Combinations BrightPoint Security (Details) - USD ($) $ in Thousands | Jun. 03, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 83,115 | $ 55,669 | ||
BrightPoint Security [Member] | ||||
Business Acquisition [Line Items] | ||||
Business combination, consideration transferred | $ 19,629 | |||
Goodwill | 15,258 | |||
Net tangible liabilities acquired | (1,339) | |||
Net deferred tax liabilities(1) | [1] | (2,890) | ||
Developed technology [Member] | BrightPoint Security [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-lived intangibles | $ 8,100 | |||
Finite-lived intangible asset, useful life | 6 years | |||
Customer contracts and related relationships [Member] | BrightPoint Security [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-lived intangibles | $ 500 | |||
Finite-lived intangible asset, useful life | 1 year 6 months | |||
[1] | (1)Deferred tax liabilities, net primarily relates to purchased identifiable intangible assets and is shown net of deferred tax assets. |
Business Combinations ITapp (De
Business Combinations ITapp (Details) - USD ($) $ in Thousands | Apr. 08, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||
Goodwill | $ 83,115 | $ 55,669 | |
General and Administrative Expense [Member] | |||
Business Acquisition [Line Items] | |||
Business acquisition, transaction costs | $ 900 | ||
ITapp [Member] | |||
Business Acquisition [Line Items] | |||
Net tangible assets acquired | $ 140 | ||
Goodwill | 11,437 | ||
Net deferred tax liabilities(1) | (2,015) | ||
Business combination, consideration transferred | 14,462 | ||
Developed technology [Member] | ITapp [Member] | |||
Business Acquisition [Line Items] | |||
Finite-lived intangibles | $ 4,700 | ||
Finite-lived intangible asset, useful life | 5 years | ||
Customer contracts and related relationships [Member] | ITapp [Member] | |||
Business Acquisition [Line Items] | |||
Finite-lived intangibles | $ 200 | ||
Finite-lived intangible asset, useful life | 1 year 6 months |
Goodwill and Intangible Asset42
Goodwill and Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning of period | $ 55,669 |
Goodwill acquired | 26,695 |
Foreign currency translation adjustments | 751 |
Goodwill, end of period | $ 83,115 |
Goodwill and Intangible Asset43
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | $ 89,540 | $ 89,540 | $ 61,839 | ||
Accumulated Amortization | (24,667) | (24,667) | (18,834) | ||
Net Carrying Amount | 64,873 | 64,873 | 43,005 | ||
Amortization expense | 3,700 | $ 2,900 | 6,600 | $ 5,900 | |
Developed technology [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | 80,265 | 80,265 | 58,144 | ||
Accumulated Amortization | (23,665) | (23,665) | (17,463) | ||
Net Carrying Amount | 56,600 | 56,600 | 40,681 | ||
Other acquisition-related intangible assets [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | 9,275 | 9,275 | 3,695 | ||
Accumulated Amortization | (1,002) | (1,002) | (1,371) | ||
Net Carrying Amount | $ 8,273 | $ 8,273 | $ 2,324 |
Property and Equipment (Detail)
Property and Equipment (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 293,486 | $ 293,486 | $ 246,077 | ||
Less: accumulated depreciation | (126,935) | (126,935) | (101,363) | ||
Total property and equipment, net | 166,551 | 166,551 | 144,714 | ||
Depreciation | 16,300 | $ 12,100 | 30,800 | $ 22,900 | |
Computer Equipment And Software [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 221,631 | 221,631 | 180,197 | ||
Leasehold Improvements [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 33,853 | 33,853 | 31,659 | ||
Furniture and Fixtures [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 28,972 | 28,972 | 26,017 | ||
Building [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 6,404 | 6,404 | 6,318 | ||
Construction in Progress [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 2,626 | $ 2,626 | $ 1,886 |
Accrued Expenses and Other Cu45
Accrued Expenses and Other Current Liabilities - (Detail) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Disclosure Summary Of Accrued Expenses And Other Current Liabilities [Abstract] | ||
Taxes payable | $ 9,840 | $ 9,080 |
Bonuses and commissions | 37,678 | 33,124 |
Accrued compensation | 19,442 | 17,089 |
Other employee related liabilities | 22,086 | 21,529 |
Other | 24,085 | 20,442 |
Total accrued expenses and other current liabilities | $ 113,131 | $ 101,264 |
Convertible Senior Notes (Detai
Convertible Senior Notes (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Nov. 30, 2013 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Debt Conversion [Line Items] | ||||||
Convertible debt, fair value disclosures | $ 640,600,000 | $ 640,600,000 | $ 741,800,000 | |||
Amortization of debt discount | 7,806,000 | $ 7,294,000 | $ 15,480,000 | $ 14,465,000 | ||
Notes face amount | $ 1,000 | |||||
Contractual interest rate - Notes | 0.00% | |||||
Notes maturity date | Nov. 1, 2018 | |||||
Principal | $ 575,000,000 | 575,000,000 | $ 575,000,000 | $ 575,000,000 | ||
Converted number of shares | 7,800,000 | |||||
Conversion rate | 13.54 | |||||
Initial conversion price, per share, (in USD per share) | $ 73.88 | |||||
Terms of conversion feature | July 1, 2018 | |||||
Earliest date of conversion | Mar. 31, 2014 | |||||
Percentage of purchase price of Notes which should be paid upon fundamental change | 100.00% | |||||
Remaining life of the Notes | 28 months | |||||
Amortization of debt discount and issuance costs | $ 8,248,000 | $ 7,707,000 | $ 16,357,000 | $ 15,285,000 | ||
Noted Hedged shares of common stock covered | 7,800,000 | |||||
Purchase of convertible note hedge | $ 135,800,000 | |||||
Issuance of warrants (in shares) | 7,800,000 | |||||
Exercise price of warrants issued (USD per share) | $ 107.46 | |||||
Proceeds from issuance of warrants | $ 84,500,000 | |||||
Calendar Quarter End [Member] | ||||||
Debt Conversion [Line Items] | ||||||
Number of days out of 30 that common stock price exceeded conversion price, days | 20 days | |||||
Number of consecutive trading days in a period | 30 days | |||||
Calendar Quarter End [Member] | Minimum [Member] | ||||||
Debt Conversion [Line Items] | ||||||
Threshold percentage of stock price trigger | 130.00% | |||||
Measurement Period [Member] | ||||||
Debt Conversion [Line Items] | ||||||
Number of days out of 30 that common stock price exceeded conversion price, days | 5 days | |||||
Number of consecutive trading days in a period | 5 days | |||||
Notes face amount | $ 1,000 | |||||
Measurement Period [Member] | Maximum [Member] | ||||||
Debt Conversion [Line Items] | ||||||
Threshold percentage of stock price trigger | 98.00% |
Convertible Senior Notes - Sche
Convertible Senior Notes - Schedule of Notes Payable (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 | Nov. 30, 2013 |
Convertible Notes Payable [Abstract] | |||
Principal | $ 575,000,000 | $ 575,000,000 | $ 575,000,000 |
Less: debt issuance cost and debt discount, net of amortization | (84,109,000) | (100,466,000) | |
Net carrying amount | $ 490,891,000 | $ 474,534,000 |
Convertible Senior Notes - Sc48
Convertible Senior Notes - Schedule of Interest Expense Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Convertible Notes Payable [Abstract] | ||||
Amortization of debt issuance cost | $ 442 | $ 413 | $ 877 | $ 820 |
Amortization of debt discount | 7,806 | 7,294 | 15,480 | 14,465 |
Amortization of debt discount and issuance costs | $ 8,248 | $ 7,707 | $ 16,357 | $ 15,285 |
Effective interest rate of the liability component | 6.50% | 6.50% | 6.50% | 6.50% |
Accumulated Other Comprehensi49
Accumulated Other Comprehensive Loss - (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation adjustment | $ (15,747) | $ (14,438) |
Net unrealized loss on investments | (306) | (2,444) |
Accumulated other comprehensive loss, net of tax | $ (16,053) | $ (16,882) |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - shares | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Stockholders' Equity Note [Abstract] | ||
Shares of common stock, authorized (shares) | 600,000,000 | |
Shares of common stock, issued and sold (shares) | 164,496,689 | |
Stock issued during period, shares, new issues | 3,710,925 | 6,034,044 |
Stockholders' Equity - Outstand
Stockholders' Equity - Outstanding and Reserved Shares of Common Stock for Future Issuance (Detail) - shares | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Common stock outstanding and reserved shares of common stock for future issuance | ||||
Options outstanding (in shares) | 6,902,902 | 7,718,715 | 8,255,554 | |
Total reserved shares of common stock for future issuance | 50,442,999 | |||
2012 Equity Incentive Plan [Member] | ||||
Common stock outstanding and reserved shares of common stock for future issuance | ||||
Total reserved shares of common stock for future issuance | [1] | 21,414,823 | ||
2012 Employee Stock Purchase Plan [Member] | ||||
Common stock outstanding and reserved shares of common stock for future issuance | ||||
Total reserved shares of common stock for future issuance | [1] | 8,850,836 | ||
Stock Options [Member] | ||||
Common stock outstanding and reserved shares of common stock for future issuance | ||||
Options outstanding (in shares) | 6,902,902 | |||
Restricted Stock Units (RSUs) [Member] | ||||
Common stock outstanding and reserved shares of common stock for future issuance | ||||
RSUs (in shares) | 13,274,438 | 14,161,913 | 12,417,805 | |
[1] | Refer to Note 12 for a description of these plans. |
Stock Awards - Additional Infor
Stock Awards - Additional Information (Detail) $ / shares in Units, $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted-average grant date fair value of options granted (usd per share) | $ / shares | $ 27.06 |
Fair value of stock options vested | $ 10.7 |
Total unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested stock options | $ 22.3 |
Remaining weighted-average period (in years) | 2 years 6 months 16 days |
Restricted Stock Units (RSUs) [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Compensation expense recognized, vesting term (in years) | 4 years |
Unrecognized compensation expense expected to be recognized | $ 605.1 |
Remaining weighted-average period (in years) | 2 years 10 months 14 days |
2012 Equity Incentive Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares of common stock outstanding, increase, percentage | 5.00% |
Number of additional shares authorized | shares | 8,039,288 |
2012 Employee Stock Purchase Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares of common stock outstanding, increase, percentage | 1.00% |
Number of additional shares authorized | shares | 1,607,858 |
Common stock purchase price percentage | 85.00% |
Award offering period (in months) | 6 months |
Stock Awards - Summary of Stock
Stock Awards - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2016 | |
Summary of stock option activity | |||
Number of Shares, Outstanding, Beginning Balance | 7,718,715 | 8,255,554 | 8,255,554 |
Number of Shares, Granted | 131,835 | 169,400 | |
Number of Shares, Exercised | (828,327) | (579,504) | |
Number of shares, Cancelled | (119,321) | (126,735) | |
Number of Shares, Outstanding, Ending Balance | 6,902,902 | 7,718,715 | 6,902,902 |
Number of Shares, Vested and expected to vest | 6,802,214 | 6,802,214 | |
Number of Shares, Vested and exercisable | 5,863,745 | 5,863,745 | |
Weighted-Average Exercise Price | |||
Weighted-Average Exercise Price, Outstanding, Beginning Balance, usd per share | $ 17.90 | $ 16.65 | $ 16.65 |
Weighted-Average Exercise Price, Granted, usd per share | 68.36 | 65.92 | |
Weighted-Average Exercise Price, Exercised, usd per share | 17.18 | 5.28 | |
Weighted-Average Exercise Price Cancelled, usd per share | 52.26 | 58.05 | |
Weighted-Average Exercise Price, Outstanding, Ending Balance, usd per share | 18.36 | $ 17.90 | 18.36 |
Weighted-Average Exercise Price, Vested and expected to vest, usd per share | 17.66 | 17.66 | |
Weighted-Average Exercise Price, Vested and exercisable, usd per share | $ 11.27 | $ 11.27 | |
Weighted-Average Remaining Contractual Life (in years) | 5 years 8 months 23 days | ||
Weighted-Average Remaining Contractual Term, Vested and expected to vest (in years) | 5 years 8 months 5 days | ||
Weighted-Average Remaining Contractual Term, Vested and exercisable (in years) | 5 years 3 months | ||
Aggregate Intrinsic Value, Exercised | $ 43,757 | $ 35,876 | |
Aggregate Intrinsic Value, Outstanding | 335,012 | $ 335,012 | |
Aggregate Intrinsic Value, Vested and expected to vest | 334,577 | 334,577 | |
Aggregate Intrinsic Value, Vested and exercisable | $ 323,962 | $ 323,962 |
Stock Awards Stock Awards - Res
Stock Awards Stock Awards - Restricted Stock Unit Table (Details) - Restricted Stock Units (RSUs) [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Shares Outstanding | |||
Number of shares, granted | 805,680 | 3,822,832 | |
Number of shares, vested | (1,285,704) | (1,708,179) | |
Number of shares, forfeited | (407,451) | (370,545) | |
Number of shares, non-vested and outstanding | 13,274,438 | 14,161,913 | 12,417,805 |
Number of shares, expected to vest | 11,055,763 | ||
Weighted-Average Grant Date Fair Value | |||
Weighted-average grant date fair value, outstanding, beginning balance, usd per share | $ 60.64 | $ 63.38 | |
Weighted average grant date fair value, granted, usd per share | 67.75 | 51.11 | |
Weighted-average grant date fair value, vested, usd per share | 53.70 | 58.42 | |
Weighted-average grant date fair value, forfeited, usd per share | 63.31 | 64.43 | |
Weighted-average grant date fair value, outstanding, ending balance, usd per share | $ 61.66 | $ 60.64 | |
Aggregate intrinsic value, vested | $ 86,693 | $ 89,516 | |
Aggregate intrinsic value, non-vested | 881,423 | ||
Aggregated intrinsic value, expected to vest | $ 734,103 |
Net Loss Per Share - Calculatio
Net Loss Per Share - Calculation of Basic and Diluted Net Income (Loss) Per Share Attributable to Common Stockholders (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Numerator: | ||||
Net loss | $ (49,625) | $ (61,925) | $ (382,957) | $ (120,018) |
Denominator: | ||||
Weighted-average shares used to compute net loss per share - basic and diluted | 163,838,755 | 154,465,367 | 162,952,721 | 153,041,433 |
Net loss per share attributable to common stockholders: | ||||
Net loss per share, basic and diluted (in USD per share) | $ (0.30) | $ (0.40) | $ (2.35) | $ (0.78) |
Net Loss Per Share- Summary of
Net Loss Per Share- Summary of Potentially Dilutive Securities (Detail) - shares | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 36,031,853 | 40,860,455 |
Common stock options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 6,902,902 | 12,017,564 |
Restricted Stock Units (RSUs) [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 13,274,438 | 13,079,988 |
Common stock subject to repurchase [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 0 | 21 |
ESPP obligations [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 288,467 | 196,836 |
Convertible senior notes [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 7,783,023 | 7,783,023 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 7,783,023 | 7,783,023 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 9.00% | (2.00%) | 1.00% | (2.00%) |
Federal statutory rate | 34.00% | 34.00% | 34.00% | 34.00% |
Commitments and Contingencies -
Commitments and Contingencies - (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Payments for Legal Settlements | $ 267.5 |
Legal settlements | $ 270 |
Information about Geographic 59
Information about Geographic Areas and Products - Revenues by Geographic Area, Based on Billing Location of Customer (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Revenues by geography | |||||
Revenues | $ 341,312 | $ 246,716 | $ 647,191 | $ 458,680 | |
Percentage of U.S. Revenues in North America | 95.00% | 95.00% | 95.00% | 94.00% | |
North America [Member] | |||||
Revenues by geography | |||||
Revenues | [1] | $ 234,009 | $ 174,387 | $ 444,526 | $ 323,033 |
EMEA [Member] | |||||
Revenues by geography | |||||
Revenues | [2] | 82,065 | 55,803 | 156,346 | 104,333 |
Asia Pacific and other [Member] | |||||
Revenues by geography | |||||
Revenues | $ 25,238 | $ 16,526 | $ 46,319 | $ 31,314 | |
[1] | Revenues attributed to the United States were approximately 95% of North America revenues for the three months ended June 30, 2016 and 2015, and 95% and 94% for the six months ended June 30, 2016 and 2015, respectively. | ||||
[2] | Europe, the Middle East and Africa |
Information about Geographic 60
Information about Geographic Areas and Products - Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||
Property and equipment, net | $ 166,551 | $ 144,714 | |
Percentage of U.S. net property and equipment in North America | 97.00% | 98.00% | |
North America [Member] | |||
Segment Reporting Information [Line Items] | |||
Property and equipment, net | [1] | $ 120,909 | $ 104,085 |
EMEA [Member] | |||
Segment Reporting Information [Line Items] | |||
Property and equipment, net | [2] | 33,665 | 32,027 |
Asia Pacific and other [Member] | |||
Segment Reporting Information [Line Items] | |||
Property and equipment, net | $ 11,977 | $ 8,602 | |
[1] | attributed to the United States were approximately 97% and 98% of property and equipment, net attributable to North America as of June 30, 2016 and December 31, 2015, respectively. | ||
[2] | Europe, the Middle East and Africa |
Information about Geographic 61
Information about Geographic Areas and Products - Subscription Revenues (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Segment Reporting Information [Line Items] | ||||
Enterprise Service Management solutions | $ 264,667 | $ 186,082 | $ 510,529 | $ 353,286 |
IT Operations Management solutions | 26,012 | 14,379 | 47,572 | 27,082 |
Subscription | $ 290,679 | $ 200,461 | $ 558,101 | $ 380,368 |