RingCentral (RNG) 10-Q 7 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 01, 2016
Document And Entity Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3
Trading Symbol	RNG
Entity Registrant Name	RingCentral Inc
Entity Central Index Key	1,384,905
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Class A common stock
Document And Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		60,474,474
Class B common stock
Document And Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		13,109,918

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets
Cash and cash equivalents	$ 152,390	$ 137,588
Accounts receivable, net	23,583	19,163
Inventory	84	2,317
Prepaid expenses and other current assets	16,644	11,978
Total current assets	192,701	171,046
Property and equipment, net	31,139	28,160
Goodwill	9,393	9,393
Acquired intangibles, net	2,500	3,266
Other assets	3,064	2,948
Total assets	238,797	214,813
Current liabilities
Accounts payable	4,701	5,196
Accrued liabilities	46,368	34,702
Current portion of capital lease obligation	181	269
Current portion of long-term debt	14,528	3,750
Deferred revenue	42,738	36,657
Total current liabilities	108,516	80,574
Long-term debt	1,250	14,840
Sales tax liability	3,527	3,670
Capital lease obligation		181
Other long-term liabilities	3,402	5,416
Total liabilities	116,695	104,681
Commitments and contingencies (Note 8)
Stockholders' equity
Common stock	7	7
Additional paid-in capital	351,784	319,792
Accumulated other comprehensive income	2,868	527
Accumulated deficit	(232,557)	(210,194)
Total stockholders' equity	122,102	110,132
Total liabilities and stockholders' equity	$ 238,797	$ 214,813

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues
Software subscriptions	$ 91,853	$ 70,321	$ 257,898	$ 194,713
Other	4,986	6,459	17,323	18,076
Total revenues	96,839	76,780	275,221	212,789
Cost of revenues
Software subscriptions	19,211	17,084	54,107	49,503
Other	4,244	5,249	13,452	14,906
Total cost of revenues	23,455	22,333	67,559	64,409
Gross profit	73,384	54,447	207,662	148,380
Operating expenses
Research and development	16,490	13,475	48,097	37,612
Sales and marketing	50,306	34,878	137,796	101,473
General and administrative	13,649	11,922	41,114	34,231
Total operating expenses	80,445	60,275	227,007	173,316
Loss from operations	(7,061)	(5,828)	(19,345)	(24,936)
Other income (expense), net
Interest expense	(176)	(245)	(585)	(927)
Other income (expense), net	(696)	(319)	(2,280)	(637)
Other income (expense), net	(872)	(564)	(2,865)	(1,564)
Loss before provision (benefit) for income taxes	(7,933)	(6,392)	(22,210)	(26,500)
Provision (benefit) for income taxes	46	(56)	153	(1,342)
Net loss	$ (7,979)	$ (6,336)	$ (22,363)	$ (25,158)
Net loss per common share
Basic and diluted	$ (0.11)	$ (0.09)	$ (0.31)	$ (0.36)
Weighted-average number of shares used in computing net loss per share
Basic and diluted	73,285	70,580	72,669	69,614

CONDENSED CONSOLIDATED STATEME4

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Statement Of Income And Comprehensive Income [Abstract]
Net loss	$ (7,979)	$ (6,336)	$ (22,363)	$ (25,158)
Other comprehensive income/(loss)
Foreign currency translation adjustments	665	159	2,341	146
Unrealized loss on available-for-sale securities		94		190
Comprehensive loss	$ (7,314)	$ (6,083)	$ (20,022)	$ (24,822)

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities
Net loss	$ (22,363)	$ (25,158)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	10,749	9,935
Share-based compensation	22,603	15,790
Foreign currency remeasurement loss	2,450	315
Tax benefit from release of valuation allowance		(1,411)
Non-cash interest expense and other expenses related to debt		156
Net accretion of discount and amortization of premium on available-for-sale securities		602
Provision for bad debt	458	152
Deferred income taxes	(4)	5
Others	464	220
Changes in assets and liabilities:
Accounts receivable	(4,878)	(7,688)
Inventory	2,233	(577)
Prepaid expenses and other current assets	(4,667)	(3,907)
Other assets	201	173
Accounts payable	(2,470)	(61)
Accrued liabilities	13,737	4,758
Deferred revenue	6,080	8,700
Other liabilities	(2,157)	204
Net cash provided by operating activities	22,436	2,208
Cash flows from investing activities
Purchases of property and equipment	(9,634)	(11,106)
Capitalized internal-use software	(1,515)	(1,836)
Cash paid in business combination, net of cash acquired		(4,670)
Proceeds from the maturity of available-for-sale securities		25,760
Proceeds from the maturity of restricted investments		100
Net cash provided by (used in) investing activities	(11,149)	8,248
Cash flows from financing activities
Proceeds from issuance of stock in connection with stock plans	8,268	12,040
Taxes paid related to net share settlement of equity awards	(131)	(105)
Payment of holdback from Glip acquisition	(1,500)
Repayment of debt	(2,813)	(5,205)
Repayment of capital lease obligations	(269)	(509)
Net cash provided by financing activities	3,555	6,221
Effect of exchange rate changes on cash and cash equivalents	(40)	145
Net increase in cash and cash equivalents	14,802	16,822
Cash and cash equivalents
Beginning of period	137,588	113,182
End of period	152,390	130,004
Supplemental disclosure of cash flow data
Cash paid for interest	568	1,697
Cash paid for income taxes	190	71
Non-cash investing and financing activities
Issuance of common stock for business combination		3,447
Change in liability for unvested exercised options	3	28
Equipment and capitalized internal-use software purchased and unpaid at period end	2,617	1,617
Change in unrealized gain (loss) on available-for-sale securities		$ 190
Glip, Inc.
Non-cash investing and financing activities
Issuance of common stock for business combination	$ 1,080

Description of Business and Sum

Description of Business and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Description of Business and Summary of Significant Accounting Policies	Note 1. Description of Business and Summary of Significant Accounting Policies Description of Business RingCentral, Inc. (the Company) is a provider of software-as-a-service (SaaS) solutions for business communications and collaboration. The Company was incorporated in California in 1999 and was reincorporated in Delaware on September 26, 2013. Basis of Presentation and Consolidation The unaudited condensed consolidated financial statements and accompanying notes of the Company reflect all adjustments (all of which are normal, recurring in nature and those discussed in these notes) that are, in the opinion of management, necessary for a fair presentation of the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2016. Certain information and note disclosures normally included in annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) have been condensed or omitted under the rules and regulations of the Securities and Exchange Commission (SEC). The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported results of operations during the reporting period. The significant estimates made by management affect revenues, accounts receivable, allowance for doubtful accounts, inventory reserves, intangibles, goodwill, share-based compensation, deferred revenue, return reserves, provision for income taxes, uncertain tax positions, loss contingencies, sales tax liabilities, and accrued liabilities. Management periodically evaluates such estimates, which are adjusted prospectively based upon such periodic evaluation. Actual results could differ from these estimates and such differences may be material to the accompanying condensed consolidated financial statements. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606) In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), 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) In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718) In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing (Topic 606) In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory Reclassification Cer tain immaterial items previously reported have been reclassified to conform to the current year’s reporting presentation.

Agency Agreement with Westcon G

Agency Agreement with Westcon Group	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Agency Agreement with Westcon Group	Note 2. Agency Agreement with Westcon Group In January 2016, the Company entered into a sales agency agreement with Westcon Group, Inc. (Westcon), a global distributor of communications devices, to provide the phones purchased by customers. Under this agreement, the Company is an agent of Westcon and receives a commission for its services, which primarily include referring phone sales to Westcon. Westcon will provide phones directly to the Company’s customers instead of the Company purchasing phones from third-party vendors and reselling the phones to the Company’s customers. Commission revenues from the arrangement are recorded as the Company is the agent for these sales based on the following criteria: • the Company is not the primary obligor in the arrangement and the customer contracts for the sales of phones are entered into with Westcon; • the Company does not have latitude to establish pricing with customers as the sales agency agreement restricts the prices at which phones may be sold by the Company; • the Company does not have collection risk for phones sold under this model since it is entitled to a sales commission regardless of whether the customer pays Westcon; • the Company does not carry inventory and does not have general inventory risk; and • warranty responsibility and services are provided by Westcon. The Company completed its transition of direct phone sales to Westcon during the three months ended June 30, 2016. The transition excludes the Company’s carriers’ phone sales from the agency model. The Company does not plan to transition the carrier partners to the agency model as the billing relationships to these customers are through the carriers. The Company’s sales of phones that are provided free or significantly discounted to customers are not part of the sales agency agreement with Westcon. The Company recognizes revenues and cost from these sales as the Company is the primary obligor and has latitude in pricing.

Change in Presentation

Change in Presentation	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Change in Presentation	Note 3. Change in Presentation As a result of the new sales agency model, the Company replaced the product revenues line in its consolidated statements of operations with a line called other revenues, which includes the commission revenues earned as an agent of Westcon, product revenues from sales of phones not sold under the sales agency agreement with Westcon, phone sales to carrier partners, phone rentals, and professional implementation services. Correspondingly, costs of other revenues include the costs for all the above items. For the three and nine months ended September 30, 2016 and 2015, the majority of other revenues were product revenues from sales of phones that fell outside the sales agency agreement with Westcon. Accordingly, to provide a comparison of product revenues and product cost of revenues prior to and subsequent to the change in presentation, product revenues were $2.2 million and $6.0 million for the three months ended September 30, 2016 and 2015, respectively, and $10.0 million and $16.9 million for the nine months ended September 30, 2016 and 2015, respectively. Product cost of revenues were $3.4 million and $5.1 million for the three months ended September 30, 2016 and 2015, respectively, and $11.6 million and $14.5 million for the nine months ended September 30, 2016 and 2015, respectively.

Financial Statement Components

Financial Statement Components	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Financial Statement Components	Note 4. Financial Statement Components Cash and cash equivalents consisted of the following (in thousands): September 30, December 31, 2016 2015 Cash $ 33,045 $ 18,522 Money market funds 119,345 119,066 Total cash and cash equivalents $ 152,390 $ 137,588 Accounts receivable, net consisted of the following (in thousands): September 30, December 31, 2016 2015 Accounts receivable $ 20,811 $ 15,509 Unbilled accounts receivable 3,177 4,031 Allowance for doubtful accounts (405 ) (377 ) Accounts receivable, net $ 23,583 $ 19,163 Property and equipment, net consisted of the following (in thousands): September 30, December 31, 2016 2015 Computer hardware and software $ 58,394 $ 49,774 Internal-use software development costs 9,174 7,432 Furniture and fixtures 4,391 3,610 Leasehold improvements 2,480 2,412 Total property and equipment 74,439 63,228 Less: accumulated depreciation and amortization (43,300 ) (35,068 ) Property and equipment, net $ 31,139 $ 28,160 Accrued liabilities consisted of the following (in thousands): September 30, December 31, 2016 2015 Accrued compensation and benefits $ 14,937 $ 10,128 Accrued sales, use and telecom related taxes 7,241 5,243 Accrued marketing 6,385 3,930 Other accrued expenses 17,805 15,401 Total accrued liabilities $ 46,368 $ 34,702

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Note 5. Fair Value of Financial Instruments Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company measures and reports certain cash equivalents, including money market funds and certificates of deposit, at fair value in accordance with the provisions of the authoritative accounting guidance that addresses fair value measurements. This guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The hierarchy is broken down into three levels based on the reliability of the inputs as follows: Level 1: Valuations based on observable inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Valuations based on observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. Level 3: Valuations based on unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined by using pricing models, discounted cash flow methodologies or similar techniques. The financial assets carried at fair value were determined using the following inputs (in thousands): Balance at September 30, 2016 (Level 1) (Level 2) (Level 3) Cash equivalents: Money market funds $ 119,345 $ 119,345 $ — $ — Other assets: Certificates of deposit $ 530 $ — $ 530 $ — Balance at December 31, 2015 (Level 1) (Level 2) (Level 3) Cash equivalents: Money market funds $ 119,066 $ 119,066 $ — $ — Other assets: Certificates of deposit $ 530 $ — $ 530 $ — The At September 30, 2016 and December 31, 2015, the Company estimated the fair value of its debt using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities. The estimated fair value of the Company’s current and non-current debt obligations was $15.8 million at September 30, 2016, compared to its carrying amount of $15.8 million at that date. The estimated fair value of the Company’s current and non-current debt obligations was $19.0 million at December 31, 2015, compared to its carrying amount of $18.6 million at that date. If the debt was measured at fair value in th

Business Combinations

Business Combinations	9 Months Ended
	Sep. 30, 2016
Business Combinations [Abstract]
Business Combinations	Note 6. Business Combinations On June 4, 2015, the Company acquired Glip, Inc. (Glip), a cloud messaging and collaboration company based in Boca Raton, Florida. Glip is a provider of team messaging services, integrated with project management, group calendars, notes, annotations, and file sharing. The consideration for this acquisition, net of cash acquired and including the fair value of contingent consideration payable in cash upon achievement of certain earn out milestones and the fair value of common stock issuable to the former stockholders of Glip was $11.9 million. Of this total consideration, $1.5 million of cash was held back by the Company upon closing as security for certain indemnification obligations of such stockholders. In June 2016, the Company paid the $1.5 million in full. The initial fair value of the milestone based earn out liability was determined to be $2.3 million using various estimates, including probabilities of achievement and discount rates. During the three months ended September 30, 2016, the Company issued 45,893 shares of the Company’s Class A common stock to settle certain milestones achieved. Based on the completion of milestones for the quarter ended September 30, 2016 and the estimated probability of completing the remaining milestones, the estimated fair value of the milestones based earn out liability was $1.9 million at September 30, 2016, which is classified as a current liability in the condensed consolidated balance sheets. Additionally, under the terms of the acquisition, the Company may also pay up to $2.0 million in payments at the end of a two-year period to certain Glip employees, who continue to be employees of the Company, which are accounted for as a post-combination expense. At September 30, 2016, the contingent payment liability was $1.2 million and classified as a current liability in the consolidated balance sheets. The carrying values of intangible assets are as follows (in thousands): September 30, 2016 December 31, 2015 Estimated Lives Cost Accumulated Amortization Acquired Intangibles, Net Accumulated Amortization Acquired Intangibles, Net Customer relationships 2 years $ 840 $ 555 $ 285 $ 240 $ 600 Developed technology 5 years 3,010 796 2,214 344 2,666 Total acquired intangible assets $ 3,850 $ 1,351 $ 2,499 $ 584 $ 3,266 Amortization expense from acquired intangible assets for the three months ended September 30, 2016 and 2015 was $0.3 million for both periods. Amortization expense from acquired intangible assets for the nine months ended September 30, 2016 and 2015 was $0.8 million and $0.3 million, respectively. Amortization of developed technology is included in cost of revenues and amortization of customer relationships is included in sales and marketing expenses in the condensed consolidated statements of operations. At September 30, 2016, the weighted average amortization periods for customer relationship and developed technology approximate 0.7 years and 3.7 years, respectively. Estimated amortization expense for acquired intangible assets for the following five fiscal years and thereafter is as follows (in thousands): 2016 (remaining) $ 255 2017 782 2018 602 2019 602 2020 258 Total estimated amortization expense $ 2,499

Debt

Debt	9 Months Ended
	Sep. 30, 2016
Debt Disclosure [Abstract]
Debt	Note 7. Debt As of September 30, 2016, the Company’s debt was comprised of borrowings under the Third Amended and Restated Loan and Security Agreement dated March 30, 2015 (SVB Agreement), as amended, with Silicon Valley Bank (SVB). The 2013 Term Loan was borrowed on December 31, 2013 with a principal amount of $15.0 million, which is being repaid in 48 equal monthly installments of principal, plus accrued and unpaid interest. Interest is due monthly and accrues at a floating rate based on the Company’s option of an annual rate of either the (i) prime rate plus a margin of 0.75% or 1.00% or (ii) adjusted LIBOR rate (based on one, two, three or six-month interest periods) plus a margin of 3.75% or 4.00%, in each case such margin being determined based on cash balances maintained with SVB. The Company elected the prime rate option. In May 2016, the terms of the SVB Agreement were amended to reduce the margin on the annual rate of the 2013 Term Loan to either (i) prime rate plus a margin of 0.25% or 0.50% or (ii) adjusted LIBOR rate (based on one, two, three, or six-month interest periods) plus a margin of 3.25% or 3.50%, resulting in a current interest rate of 3.75% based on the prime rate option and cash balance maintained with SVB. As of September 30, 2016, the outstanding principal balance of the 2013 Term Loan was $5.0 million, of which $1.3 million is payable subsequent to September 30, 2017 and is classified as a non-current liability in the accompanying condensed consolidated balance sheet. The revolving line of credit provides for a maximum borrowing of up to $15.0 million in principal amount, subject to limits based on recurring software subscription revenue amounts as defined in the SVB Agreement. The recurring software subscription revenue requirement is not expected to limit the amount of borrowings available under the line of credit. Under the line of credit, interest is paid monthly and accrues at a floating rate based on the Company’s option of an annual rate of either the (i) prime rate plus a margin of 0.25% or 0.50% or (ii) adjusted LIBOR rate (based on one, two, three or six-month interest periods) plus a margin of 3.25% or 3.50%, in each case such margin being determined based on cash balances maintained with SVB. The Company elected the prime rate option. In August 2015, the terms of the SVB Agreement were amended to extend the maturity of the revolving line of credit from August 13, 2015 to August 14, 2017. In May 2016, the terms of the SVB Agreement were amended to reduce the margin on the annual rate of the revolving line of credit to either the (i) prime rate plus a margin of 0% or 0.25% or (ii) adjusted LIBOR rate (based on one, two, three, or six-month interest periods) plus a margin of 3.0% to 3.25%, resulting in a current interest rate of 3.50% based on the prime rate option and cash balance maintained with SVB. As of September 30, 2016, the outstanding principal balance and the available borrowing capacity of the line of credit were $10.8 million and $4.2 million, respectively. The outstanding principal balance is classified as a current liability in the condensed consolidated balance sheet as the principal balance is due in August 2017. The Company has pledged substantially all of its assets, excluding intellectual property, as collateral to secure its obligations under the SVB Agreement. The SVB Agreement contains customary negative covenants that limit the Company’s ability to, among other things, incur additional indebtedness, grant liens, make investments, repurchase stock, pay dividends, transfer assets and merge or consolidate. The SVB Agreement, as amended, also contains customary affirmative covenants, as well as financial covenants that require the Company to (i) maintain minimum cash balances of $10.0 million, as defined in the agreement, and (ii) maintain minimum EBITDA levels, as determined in accordance with the agreement. In March 2015, the Company adjusted certain financial covenants to expand its ability to invest in certain foreign subsidiaries and property and equipment. The Company was in compliance with all covenants under its credit agreement with SVB as of September 30, 2016.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments And Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 8. Commitments and Contingencies Leases The Company leases facilities for office space under non-cancelable operating leases for its U.S. and international locations and has entered into capital lease arrangements to obtain property and equipment for its operations. In addition, the Company leases space from third party datacenter hosting facilities under co-location agreements to support its cloud infrastructure. The Company leases space for its corporate headquarters in Belmont, California through July 2021. Sales Tax Liability The Company regularly increases its sales and marketing activities in various states within the U.S., which may create nexus in those states to collect sales taxes on sales to customers. Although the Company is diligent in collecting and remitting such taxes, there is uncertainty as to what constitutes sufficient in state presence for a state to levy taxes, fees, and surcharges for sales made over the Internet. As of September 30, 2016 and December 31, 2015, the Company had a long-term sales tax liability of $3.5 million and $3.7 million, respectively, based on its best estimate of the probable liability for the loss contingency incurred as of those dates. The Company’s estimate of a probable outcome under the loss contingency is based on analysis of its sales and marketing activities, revenues subject to sales tax, and applicable regulations in each state in each period. No significant adjustments to the long-term sales tax liability have been recognized in the accompanying condensed consolidated financial statements for changes to the assumptions underlying the estimate. However, changes in management’s assumptions may occur in the future as the Company obtains new information which can result in adjustments to the recorded liability. Increases and decreases to the long-term sales tax liability are recorded as general and administrative expense. The Company recorded a current sales tax liability for non-contingent amounts expected to be remitted in the next twelve months of $4.7 million and $4.4 million as of September 30, 2016 and December 31, 2015, respectively, which is included in accrued liabilities. Legal Matters The Company determines whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. The Company assesses its potential liability by analyzing specific litigation and regulatory matters using reasonably available information. The Company develops its views on estimated losses in consultation with inside and outside counsel, which involves a subjective analysis of potential results and outcomes, assuming various combinations of appropriate litigation and settlement strategies. Legal fees are expensed in the period in which they are incurred. TCPA Matter On April 21, 2016, Supply Pro Sorbents, LLC (SPS) filed a putative class action against the Company in the United States District Court for the Northern District of California (Court), alleging common law conversion and violations of the federal Telephone Consumer Protection Act (TCPA) arising from fax cover sheets used by the Company’s customers when sending facsimile transmissions over the Company’s system (Lawsuit). SPS sought statutory damages, costs, attorneys’ fees and an injunction in connection with its TCPA claim, and unspecified damages and punitive damages in connection with its conversion claim. On July 6, 2016, the Company filed a Petition for Expedited Declaratory Ruling before the Federal Communications Commission (FCC), requesting that the FCC issue a ruling clarifying certain portions of its regulations promulgated under TCPA at issue in the Lawsuit (Petition). On July 8, 2016, the Company filed a motion to dismiss the Lawsuit in its entirety, along with a collateral motion to dismiss or stay the Lawsuit pending a ruling by the FCC on the Company’s Petition. On October 7, 2016, the Court granted the Company’s motion to dismiss and gave SPS 20 days to amend its complaint. The Court concurrently dismissed the Company’s motion to dismiss or stay as moot. SPS filed its amended complaint on October 27, 2016, alleging the same theories and claims. The Company intends to vigorously defend itself and anticipates filing another motion to dismiss and a collateral motion to dismiss or stay the case pending resolution of the FCC Petition. Litigation is inherently uncertain, however, and it is too early in this proceeding to predict the outcome of this Lawsuit. Based on the information known by the Company as of the date of this filing and the rules and regulations applicable to the preparation of the Company’s condensed consolidated financial statements, it is not possible to provide an estimated amount of any such loss or range of loss that may occur. As of December 31, 2015, there were no significant ongoing legal matters and the Company did not have any accrued liabilities recorded for such loss contingencies.

Share-Based Compensation

Share-Based Compensation	9 Months Ended
	Sep. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Share-Based Compensation	Note 9. Share-Based Compensation A summary of share-based compensation expense recognized in the Company’s condensed consolidated statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Cost of revenues $ 859 $ 535 $ 2,324 $ 1,468 Research and development 1,996 1,351 5,491 3,745 Sales and marketing 3,023 1,797 7,791 5,333 General and administrative 2,511 2,069 6,997 5,244 Total share-based compensation expense $ 8,389 $ 5,752 $ 22,603 $ 15,790 A summary of share-based compensation expense by award type is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Options $ 2,382 $ 2,744 $ 7,366 $ 8,357 Employee stock purchase plan rights 527 287 1,375 854 Restricted stock units 5,480 2,721 13,862 6,579 Total share-based compensation expense $ 8,389 $ 5,752 $ 22,603 $ 15,790 Equity Incentive Plans As of September 30, 2016, a total of 8,775,309 shares remained available for grant under the 2013 Equity Incentive Plan (2013 Plan). A summary of option activity under all of the Company’s equity incentive plans at September 30, 2016 and changes during the period then ended is presented in the following table: Weighted- Number of Weighted- Average Aggregate Options Average Contractual Intrinsic Outstanding Exercise Price Term Value (in thousands) Per Share (in Years) (in thousands) Outstanding at December 31, 2015 8,048 $ 10.27 6.2 $ 107,091 Granted 539 16.46 Exercised (601 ) 9.07 Canceled/Forfeited (236 ) 15.53 Outstanding at September 30, 2016 7,750 $ 10.64 5.5 $ 101,047 Vested and expected to vest as of September 30, 2016 7,379 $ 10.37 5.5 $ 98,134 Exercisable as of September 30, 2016 5,389 $ 8.53 5.4 $ 81,557 The weighted average grant date fair value of options granted and the total intrinsic value of options exercised were as follows (in thousands, except weighted average grant date fair value): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Weighted average grant date fair value per share $ 9.22 $ 7.48 $ 6.70 $ 6.76 Total intrinsic value of options exercised $ 2,561 $ 7,135 $ 6,956 $ 16,964 The Company estimated the fair values of each option awarded on the date of grant using the Black-Scholes-Merton option pricing model, which requires inputs including the fair value of common stock, expected term, expected volatility, risk-free interest rate, and dividend yield. The weighted-average assumptions used in the option pricing model in the periods presented were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Expected term for employees (in years) 4.7 4.7 4.7 4.8 Expected term for non-employees (in years) 5.8 7.2 6.1 7.1 Risk-free interest rate 1.1 % 1.5 % 1.1 % 1.2 % Expected volatility 46.4 % 47.0 % 47.2 % 48.0 % Expected dividend yield 0 % 0 % 0 % 0 % As of September 30, 2016, there was approximately $12.7 million of unrecognized share-based compensation expense, net of estimated forfeitures, related to non-vested stock option grants, which will be recognized on a straight-line basis over the remaining weighted-average vesting period of approximately 2.2 years. Employee Stock Purchase Plan The 2013 Employee Stock Purchase Plan (ESPP) allows eligible employees to purchase shares of the Class A common stock at a discounted price, through payroll deductions of up to the lesser of 15% of their eligible compensation or the IRS allowable limit per calendar year. A participant may purchase a maximum of 3,000 shares during an offering period. The offering periods start on the first trading day on or after May 11th and November 11th of each year. At the end of the offering period, the discounted purchase price is set at the lower of: (i) 90% of the fair value of the Company’s Class A common stock at the beginning of the six month offering period and (ii) 90% of the fair value of the Company’s Class A common stock at the end of the six month offering period. As of September 30, 2016, there was a total of $0.2 million of unrecognized share-based compensation expense, net of estimated forfeitures, related to ESPP, which will be recognized on a straight-line basis over the remaining weighted-average vesting period of approximately 0.1 years. At September 30, 2016, a total of 2,450,266 shares were available for issuance under the ESPP. Restricted Stock Units The 2013 Plan provides for the issuance of restricted stock units (RSUs) to employees, directors, and consultants. RSUs issued under the 2013 Plan generally vest and are released over four years. A summary of activity of RSUs under the 2013 Plan at September 30, 2016 and changes during the period then ended is presented in the following table: Number of Weighted- RSUs Average Aggregate Outstanding Grant Date Fair Intrinsic Value (in thousands) Value Per Share (in thousands) Outstanding at December 31, 2015 2,288 $ 16.63 $ 53,972 Granted 2,597 18.48 Released (803 ) 16.59 Canceled/Forfeited (326 ) 17.69 Outstanding at September 30, 2016 3,756 $ 17.82 $ 89,068 As of September 30, 2016, there was a total of $49.1 million of unrecognized share-based compensation expense, net of estimated forfeitures, related to restricted stock units, which will be recognized on a straight-line basis over the remaining weighted-average vesting period of approximately 3.0 years.

Segment Reporting

Segment Reporting	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Segment Reporting	Note 10. Segment Reporting The Company has determined the chief executive officer is the chief operating decision maker. The Company’s chief executive officer reviews financial information presented on a consolidated basis for purposes of assessing performance and making decisions on how to allocate resources. Accordingly, the Company has determined that it operates in a single reporting segment. Concentrations Revenue by geographic location is based on the billing address of the customer. More than 90% of the Company’s revenues were derived from the U.S. during the three and nine months ended September 30, 2016 and 2015. Generally, 77% of the Company’s billings, including carrier partner billings, are collected through credit card payments, resulting in a minimal accounts receivable balance. The Company’s accounts receivable balance primarily consists of receivables due from larger customers and carriers who are billed on invoices at customary payment terms. As the Company moves up-market and acquires larger customers, the Company expects the accounts receivable balance to increase. At September 30, 2016 and December 31, 2015, one of the Company’s carriers accounted for 37% and 39% of the Company’s total accounts receivable, respectively. Long-lived assets by geographic location is based on the location of the legal entity that owns the asset. At September 30, 2016 and December 31, 2015, more than 89% of the Company’s consolidated long-lived assets were located in the U.S. with no single country outside of the U. S. representing more than 10% of the Company’s consolidated long-lived assets.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2016
Income Tax Disclosure [Abstract]
Income Taxes	Note 11. Income Taxes The provision for income taxes for the three and nine months ended September 30, 2016, was $46,000 and $153,000, respectively, and consisted primarily of state minimum taxes and foreign income taxes. For the three and nine months ended September 30, 2015, the Company recorded a benefit for income taxes of $56,000 and $1.3 million, respectively, which was due to partially releasing its valuation allowance. During June 2015, the Company recorded a deferred tax liability for the book-tax basis difference for the intangibles acquired as part of the Glip acquisition. As this deferred tax liability provided an additional source of income to support the realizability of the Company’s pre-existing deferred tax asset, the Company released $1.4 million of its valuation allowance in June 2015. For the three and nine months ended September 30, 2016 and September 30, 2015, the provision for income taxes differed from the U.S federal statutory rate primarily due to state and foreign taxes currently payable. Additionally, the Company realized no benefit for current year losses due to a full valuation allowance against the U.S. and the foreign net deferred tax assets. The realization of tax benefits of net deferred tax assets is dependent upon future levels of taxable income, of an appropriate character, in the periods the items are expected to be deductible or taxable. Based on the available objective evidence, the Company does not believe it is more likely than not that the net deferred tax assets will be realizable. Accordingly, the Company has provided a full valuation allowance against the entire domestic and the majority of the foreign net deferred tax assets as of September 30, 2016 and December 31, 2015. The Company intends to maintain the full valuation allowance on the U.S. net deferred tax assets until sufficient positive evidence exists to support a reversal of, or decrease in, the valuation allowance. During the three and nine months ended September 30, 2016, there have been no significant changes to the total amount of unrecognized tax benefits.

Basic and Diluted Net Loss Per

Basic and Diluted Net Loss Per Share	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Basic and Diluted Net Loss Per Share	Note 12. Basic and Diluted Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less the weighted-average unvested shares of common stock subject to repurchase or forfeiture as they are not deemed to be issued for accounting purposes. Diluted net loss per share is computed by giving effect to all potential shares of common stock, stock options, restricted stock units, ESPP, stock options related to the non-vested early exercises, and stock related to non-vested restricted stock awards, to the extent they are dilutive. For the three and nine months ended September 30, 2016 and 2015, all such common stock equivalents have been excluded from diluted net loss per share as the effect to net loss per share would be anti-dilutive. The following table sets forth the computation of the Company’s basic and diluted net loss per share of common stock (in thousands, except per share data): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator Net loss $ (7,979 ) $ (6,336 ) $ (22,363 ) $ (25,158 ) Denominator Weighted-average common shares for basic and diluted net loss per share 73,285 70,580 72,669 69,614 Basic and diluted net loss per share $ (0.11 ) $ (0.09 ) $ (0.31 ) $ (0.36 ) The following table presents the weighted-average potential shares that were excluded from the computation of weighted-average common shares in computing the diluted net loss per common share for the periods presented because including them would have had an anti-dilutive effect (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Shares of unvested common stock subject to repurchase — 5 — 5 Shares of common stock issuable under equity incentive awards outstanding 11,990 11,519 11,784 11,598 Potential common shares excluded from diluted net loss per share 11,990 11,524 11,784 11,603

Related Party Transactions

Related Party Transactions	9 Months Ended
	Sep. 30, 2016
Related Party Transactions [Abstract]
Related Party Transactions	Note 13. Related Party Transactions In the ordinary course of business, the Company made purchases from Alphabet Inc., the parent company of Google Inc., at which one of the Company’s directors serves as a Vice President of Google, Inc. Total payables to Alphabet at September 30, 2016 and December 31, 2015 were $1.5 million and $2.0 million, respectively. Total expenses incurred from Alphabet were $3.8 million and $9.8 million in the three and nine months ended September 30, 2016, respectively, and $2.8 million and $8.9 million for the three and nine months ended September 30, 2015, respectively.

Description of Business and S19

Description of Business and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation The unaudited condensed consolidated financial statements and accompanying notes of the Company reflect all adjustments (all of which are normal, recurring in nature and those discussed in these notes) that are, in the opinion of management, necessary for a fair presentation of the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2016. Certain information and note disclosures normally included in annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) have been condensed or omitted under the rules and regulations of the Securities and Exchange Commission (SEC). The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported results of operations during the reporting period. The significant estimates made by management affect revenues, accounts receivable, allowance for doubtful accounts, inventory reserves, intangibles, goodwill, share-based compensation, deferred revenue, return reserves, provision for income taxes, uncertain tax positions, loss contingencies, sales tax liabilities, and accrued liabilities. Management periodically evaluates such estimates, which are adjusted prospectively based upon such periodic evaluation. Actual results could differ from these estimates and such differences may be material to the accompanying condensed consolidated financial statements.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606) In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), 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) In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718) In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing (Topic 606) In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory
Reclassification	Reclassification Cer tain immaterial items previously reported have been reclassified to conform to the current year’s reporting presentation.

Financial Statement Components

Financial Statement Components (Tables)	9 Months Ended
	Sep. 30, 2016
Statement Of Financial Position [Abstract]
Components of Cash and Cash Equivalents	Cash and cash equivalents consisted of the following (in thousands): September 30, December 31, 2016 2015 Cash $ 33,045 $ 18,522 Money market funds 119,345 119,066 Total cash and cash equivalents $ 152,390 $ 137,588
Components of Accounts Receivable, Net	Accounts receivable, net consisted of the following (in thousands): September 30, December 31, 2016 2015 Accounts receivable $ 20,811 $ 15,509 Unbilled accounts receivable 3,177 4,031 Allowance for doubtful accounts (405 ) (377 ) Accounts receivable, net $ 23,583 $ 19,163
Components of Property and Equipment, Net	Property and equipment, net consisted of the following (in thousands): September 30, December 31, 2016 2015 Computer hardware and software $ 58,394 $ 49,774 Internal-use software development costs 9,174 7,432 Furniture and fixtures 4,391 3,610 Leasehold improvements 2,480 2,412 Total property and equipment 74,439 63,228 Less: accumulated depreciation and amortization (43,300 ) (35,068 ) Property and equipment, net $ 31,139 $ 28,160
Components of Accrued Liabilities	Accrued liabilities consisted of the following (in thousands): September 30, December 31, 2016 2015 Accrued compensation and benefits $ 14,937 $ 10,128 Accrued sales, use and telecom related taxes 7,241 5,243 Accrued marketing 6,385 3,930 Other accrued expenses 17,805 15,401 Total accrued liabilities $ 46,368 $ 34,702

Fair Value of Financial Instr21

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Financial Assets Carried at Fair Value	The financial assets carried at fair value were determined using the following inputs (in thousands): Balance at September 30, 2016 (Level 1) (Level 2) (Level 3) Cash equivalents: Money market funds $ 119,345 $ 119,345 $ — $ — Other assets: Certificates of deposit $ 530 $ — $ 530 $ — Balance at December 31, 2015 (Level 1) (Level 2) (Level 3) Cash equivalents: Money market funds $ 119,066 $ 119,066 $ — $ — Other assets: Certificates of deposit $ 530 $ — $ 530 $ —

Business Combinations (Tables)

Business Combinations (Tables)	9 Months Ended
	Sep. 30, 2016
Summary of Carrying Values of Intangible Assets	The carrying values of intangible assets are as follows (in thousands): September 30, 2016 December 31, 2015 Estimated Lives Cost Accumulated Amortization Acquired Intangibles, Net Accumulated Amortization Acquired Intangibles, Net Customer relationships 2 years $ 840 $ 555 $ 285 $ 240 $ 600 Developed technology 5 years 3,010 796 2,214 344 2,666 Total acquired intangible assets $ 3,850 $ 1,351 $ 2,499 $ 584 $ 3,266
Glip, Inc.
Summary of Estimated Amortization Expense for Acquired Intangible Assets	Estimated amortization expense for acquired intangible assets for the following five fiscal years and thereafter is as follows (in thousands): 2016 (remaining) $ 255 2017 782 2018 602 2019 602 2020 258 Total estimated amortization expense $ 2,499

Share-Based Compensation (Table

Share-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Summary of Share-Based Compensation Expense Recognized to Statements of Operations	A summary of share-based compensation expense recognized in the Company’s condensed consolidated statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Cost of revenues $ 859 $ 535 $ 2,324 $ 1,468 Research and development 1,996 1,351 5,491 3,745 Sales and marketing 3,023 1,797 7,791 5,333 General and administrative 2,511 2,069 6,997 5,244 Total share-based compensation expense $ 8,389 $ 5,752 $ 22,603 $ 15,790
Summary of Share-Based Compensation Expense by Award Type	A summary of share-based compensation expense by award type is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Options $ 2,382 $ 2,744 $ 7,366 $ 8,357 Employee stock purchase plan rights 527 287 1,375 854 Restricted stock units 5,480 2,721 13,862 6,579 Total share-based compensation expense $ 8,389 $ 5,752 $ 22,603 $ 15,790
Summary of Stock Option Activity Plans	A summary of option activity under all of the Company’s equity incentive plans at September 30, 2016 and changes during the period then ended is presented in the following table: Weighted- Number of Weighted- Average Aggregate Options Average Contractual Intrinsic Outstanding Exercise Price Term Value (in thousands) Per Share (in Years) (in thousands) Outstanding at December 31, 2015 8,048 $ 10.27 6.2 $ 107,091 Granted 539 16.46 Exercised (601 ) 9.07 Canceled/Forfeited (236 ) 15.53 Outstanding at September 30, 2016 7,750 $ 10.64 5.5 $ 101,047 Vested and expected to vest as of September 30, 2016 7,379 $ 10.37 5.5 $ 98,134 Exercisable as of September 30, 2016 5,389 $ 8.53 5.4 $ 81,557
Weighted Average Grant Date Fair Value of Options Granted and Total Intrinsic Value of Options Exercised	The weighted average grant date fair value of options granted and the total intrinsic value of options exercised were as follows (in thousands, except weighted average grant date fair value): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Weighted average grant date fair value per share $ 9.22 $ 7.48 $ 6.70 $ 6.76 Total intrinsic value of options exercised $ 2,561 $ 7,135 $ 6,956 $ 16,964
Weighted Average Assumptions Used to Fair Value of Stock Options Granted	The weighted-average assumptions used in the option pricing model in the periods presented were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Expected term for employees (in years) 4.7 4.7 4.7 4.8 Expected term for non-employees (in years) 5.8 7.2 6.1 7.1 Risk-free interest rate 1.1 % 1.5 % 1.1 % 1.2 % Expected volatility 46.4 % 47.0 % 47.2 % 48.0 % Expected dividend yield 0 % 0 % 0 % 0 %
Summary of RSUs Activity	The 2013 Plan provides for the issuance of restricted stock units (RSUs) to employees, directors, and consultants. RSUs issued under the 2013 Plan generally vest and are released over four years. A summary of activity of RSUs under the 2013 Plan at September 30, 2016 and changes during the period then ended is presented in the following table: Number of Weighted- RSUs Average Aggregate Outstanding Grant Date Fair Intrinsic Value (in thousands) Value Per Share (in thousands) Outstanding at December 31, 2015 2,288 $ 16.63 $ 53,972 Granted 2,597 18.48 Released (803 ) 16.59 Canceled/Forfeited (326 ) 17.69 Outstanding at September 30, 2016 3,756 $ 17.82 $ 89,068

Basic and Diluted Net Loss Pe24

Basic and Diluted Net Loss Per Share (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Computation of Company's Basic and Diluted Net Loss Per Share of Common Stock	The following table sets forth the computation of the Company’s basic and diluted net loss per share of common stock (in thousands, except per share data): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator Net loss $ (7,979 ) $ (6,336 ) $ (22,363 ) $ (25,158 ) Denominator Weighted-average common shares for basic and diluted net loss per share 73,285 70,580 72,669 69,614 Basic and diluted net loss per share $ (0.11 ) $ (0.09 ) $ (0.31 ) $ (0.36 )
Weighted Average Potential Common Shares Excluded from Computation of Diluted Net Loss Per Common Share	The following table presents the weighted-average potential shares that were excluded from the computation of weighted-average common shares in computing the diluted net loss per common share for the periods presented because including them would have had an anti-dilutive effect (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Shares of unvested common stock subject to repurchase — 5 — 5 Shares of common stock issuable under equity incentive awards outstanding 11,990 11,519 11,784 11,598 Potential common shares excluded from diluted net loss per share 11,990 11,524 11,784 11,603

Change in Presentation - Additi

Change in Presentation - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Product revenues	$ 2.2	$ 6	$ 10	$ 16.9
Product cost of revenues	$ 3.4	$ 5.1	$ 11.6	$ 14.5

Financial Statement Component26

Financial Statement Components - Components of Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2015	Dec. 31, 2014
Cash And Cash Equivalents [Abstract]
Cash	$ 33,045	$ 18,522
Money market funds	119,345	119,066
Total cash and cash equivalents	$ 152,390	$ 137,588	$ 130,004	$ 113,182

Financial Statement Component27

Financial Statement Components - Components of Accounts Receivable, Net (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Receivables [Abstract]
Accounts receivable	$ 20,811	$ 15,509
Unbilled accounts receivable	3,177	4,031
Allowance for doubtful accounts	(405)	(377)
Accounts receivable, net	$ 23,583	$ 19,163

Financial Statement Component28

Financial Statement Components - Components of Property and Equipment, Net (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Property Plant And Equipment [Line Items]
Total property and equipment	$ 74,439	$ 63,228
Less: accumulated depreciation and amortization	(43,300)	(35,068)
Property and equipment, net	31,139	28,160
Computer hardware and software
Property Plant And Equipment [Line Items]
Total property and equipment	58,394	49,774
Internal-use software development costs
Property Plant And Equipment [Line Items]
Total property and equipment	9,174	7,432
Furniture and fixtures
Property Plant And Equipment [Line Items]
Total property and equipment	4,391	3,610
Leasehold improvements
Property Plant And Equipment [Line Items]
Total property and equipment	$ 2,480	$ 2,412

Financial Statement Component29

Financial Statement Components - Components of Accrued Liabilities (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Payables And Accruals [Abstract]
Accrued compensation and benefits	$ 14,937	$ 10,128
Accrued sales, use and telecom related taxes	7,241	5,243
Accrued marketing	6,385	3,930
Other accrued expenses	17,805	15,401
Total accrued liabilities	$ 46,368	$ 34,702

Fair Value of Financial Instr30

Fair Value of Financial Instruments - Financial Assets Carried at Fair Value (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Money market funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Money market funds	$ 119,345	$ 119,066
Money market funds | Level 1
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Money market funds	119,345	119,066
Certificates of deposit
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Certificates of deposit	530	530
Certificates of deposit | Level 2
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Certificates of deposit	$ 530	$ 530

Fair Value of Financial Instr31

Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions	Sep. 30, 2016	Dec. 31, 2015
Fair Value Disclosures [Abstract]
Fair value of debt obligation	$ 15.8	$ 19
Carrying value of debt obligation	$ 15.8	$ 18.6

Business Combinations - Additio

Business Combinations - Additional Information (Detail) - USD ($)	Jun. 04, 2015	Jun. 30, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Business Acquisition [Line Items]
Business combination, contingent consideration paid in full					$ 1,500,000
Glip, Inc.
Business Acquisition [Line Items]
Business combination, consideration payable in combination of cash and common stock	$ 11,900,000
Business combination, fair value of milestone based earn out liability	2,300,000
Business combination, fair value of milestone based earn out liability, current			$ 1,900,000		1,900,000
Business combination contingent consideration maximum potential cash payment			2,000,000		$ 2,000,000
Business combination earn out period of contingent consideration					2 years
Business combination, contingent payment liability			1,200,000		$ 1,200,000
Amortization expense of Intangible Assets			$ 300,000	$ 300,000	$ 800,000	$ 300,000
Glip, Inc. | Customer Relationships
Business Acquisition [Line Items]
Weighted average amortization periods					8 months 12 days
Glip, Inc. | Developed Technology
Business Acquisition [Line Items]
Weighted average amortization periods					3 years 8 months 12 days
Asset purchase agreement | Glip, Inc.
Business Acquisition [Line Items]
Business combination, contingent consideration paid in full		$ 1,500,000
Business combination, fair value of milestone based earn out liability	$ 1,500,000
Class A common stock | Glip, Inc.
Business Acquisition [Line Items]
Business combination, shares issued to settle certain milestones achieved			45,893

Business Combinations - Summary

Business Combinations - Summary of Carrying Values of Intangible Assets (Detail) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Business Acquisition [Line Items]
Acquired Intangibles, Net	$ 2,500	$ 3,266
Glip, Inc.
Business Acquisition [Line Items]
Cost	3,850	3,850
Accumulated Amortization	1,351	584
Acquired Intangibles, Net	2,499	3,266
Glip, Inc. | Customer Relationships
Business Acquisition [Line Items]
Cost	840	840
Accumulated Amortization	555	240
Acquired Intangibles, Net	$ 285	$ 600
Estimated Lives	2 years	2 years
Glip, Inc. | Developed Technology
Business Acquisition [Line Items]
Cost	$ 3,010	$ 3,010
Accumulated Amortization	796	344
Acquired Intangibles, Net	$ 2,214	$ 2,666
Estimated Lives	5 years	5 years

Business Combinations - Summa34

Business Combinations - Summary of Estimated Amortization Expense for Acquired Intangible Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Acquired Indefinite Lived Intangible Assets [Line Items]
Acquired Intangibles, Net	$ 2,500	$ 3,266
Glip, Inc.
Acquired Indefinite Lived Intangible Assets [Line Items]
2016 (remaining)	255
2,017	782
2,018	602
2,019	602
2,020	258
Acquired Intangibles, Net	$ 2,499	$ 3,266

Debt - Additional Information (

Debt - Additional Information (Detail)	Apr. 30, 2016	Dec. 31, 2013USD ($)Installment	May 31, 2016	Sep. 30, 2016USD ($)	Dec. 31, 2015USD ($)
Debt Instrument [Line Items]
Long-term debt				$ 1,250,000	$ 14,840,000
Required Cash Balances Maintained With Silicon Valley Bank | Prime Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin	0.25%
Required Cash Balances Maintained With Silicon Valley Bank | LIBOR Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin	3.25%
Required Cash Balances Not Maintained With Silicon Valley Bank | Prime Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin	0.50%
Required Cash Balances Not Maintained With Silicon Valley Bank | LIBOR Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin	3.50%
SVB Agreement | Minimum
Debt Instrument [Line Items]
Debt covenant requirement				$ 10,000,000
SVB Agreement | Revolving Credit Facility
Debt Instrument [Line Items]
Interest rate on debt				3.50%
Debt instrument, maturity, description				due in August 2017
Revolving line of credit, maximum borrowing amount				$ 15,000,000
Line of credit facility, expiration date prior to amendment				Aug. 13, 2015
Debt instrument maturity date				Aug. 14, 2017
Borrowing under the revolving line of credit facility				$ 10,800,000
Line of credit, available borrowing capacity				$ 4,200,000
SVB Agreement | 2013 Capital Growth Term Loan
Debt Instrument [Line Items]
Term loan		$ 15,000,000
Number of monthly installments for principal and interest payment | Installment		48
Interest rate on debt				3.75%
Outstanding balance of term loan				$ 5,000,000
Long-term debt				$ 1,300,000
Debt instrument, maturity, description				payable subsequent to September 30, 2017
SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Maintained With Silicon Valley Bank | Prime Rate
Debt Instrument [Line Items]
Percentage of margin	0.75%
SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Maintained With Silicon Valley Bank | LIBOR Rate
Debt Instrument [Line Items]
Percentage of margin	3.75%
SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Not Maintained With Silicon Valley Bank | Prime Rate
Debt Instrument [Line Items]
Percentage of margin	1.00%
SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Not Maintained With Silicon Valley Bank | LIBOR Rate
Debt Instrument [Line Items]
Percentage of margin	4.00%
Amended SVB Agreement | Required Cash Balances Maintained With Silicon Valley Bank | Prime Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin			0.00%
Amended SVB Agreement | Required Cash Balances Maintained With Silicon Valley Bank | LIBOR Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin			3.00%
Amended SVB Agreement | Required Cash Balances Not Maintained With Silicon Valley Bank | Prime Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin			0.25%
Amended SVB Agreement | Required Cash Balances Not Maintained With Silicon Valley Bank | LIBOR Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Percentage of margin			3.25%
Amended SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Maintained With Silicon Valley Bank | Prime Rate
Debt Instrument [Line Items]
Percentage of margin			0.25%
Amended SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Maintained With Silicon Valley Bank | LIBOR Rate
Debt Instrument [Line Items]
Percentage of margin			3.25%
Amended SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Not Maintained With Silicon Valley Bank | Prime Rate
Debt Instrument [Line Items]
Percentage of margin			0.50%
Amended SVB Agreement | 2013 Capital Growth Term Loan | Required Cash Balances Not Maintained With Silicon Valley Bank | LIBOR Rate
Debt Instrument [Line Items]
Percentage of margin			3.50%

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail)	Sep. 30, 2016USD ($)	Dec. 31, 2015USD ($)Legal_Matter
Commitments And Contingencies Disclosure [Abstract]
Long-term sales tax liability	$ 3,527,000	$ 3,670,000
Current sales tax liability for non-contingent amounts	$ 4,700,000	4,400,000
Accrued liabilities recorded for loss contingencies		$ 0
Number of ongoing legal matters | Legal_Matter		0

Share-Based Compensation - Summ

Share-Based Compensation - Summary of Share-Based Compensation Expense Recognized to Statements of Operations (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 8,389	$ 5,752	$ 22,603	$ 15,790
Cost of Revenues
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	859	535	2,324	1,468
Research and Development
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	1,996	1,351	5,491	3,745
Sales and Marketing
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	3,023	1,797	7,791	5,333
General and Administrative
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 2,511	$ 2,069	$ 6,997	$ 5,244

Share-Based Compensation - Su38

Share-Based Compensation - Summary of Share-Based Compensation Expense by Award Type (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based compensation expense	$ 8,389	$ 5,752	$ 22,603	$ 15,790
Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based compensation expense	2,382	2,744	7,366	8,357
Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based compensation expense	5,480	2,721	13,862	6,579
Employee Stock Purchase Plan Rights
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based compensation expense	$ 527	$ 287	$ 1,375	$ 854

Share-Based Compensation - Addi

Share-Based Compensation - Additional Information (Detail) $ in Millions	9 Months Ended
	Sep. 30, 2016USD ($)shares
2013 Employee stock purchase plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Available for future grants | shares	2,450,266
Unrecognized share-based compensation expense, remaining weighted-average vesting periods	1 month 6 days
Eligible compensation under the Employee Stock Purchase Plan	15.00%
Purchase of maximum shares by employees under Employee Stock Purchase Plan | shares	3,000
Unrecognized share-based compensation expense | $	$ 0.2
Class A common stock | 2013 Employee stock purchase plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Discounted purchase price of Employee Stock Purchase Plan as a percentage of fair value	90.00%
Employee Stock Option
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized share-based compensation expense | $	$ 12.7
Unrecognized share-based compensation expense, remaining weighted-average vesting periods	2 years 2 months 12 days
Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting period contractual term	4 years
RSUs
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized share-based compensation expense, remaining weighted-average vesting periods	3 years
Unrecognized share-based compensation expense | $	$ 49.1
2013 Equity Incentive Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Available for future grants | shares	8,775,309

Share-Based Compensation - Su40

Share-Based Compensation - Summary of Stock Option Activity Plans (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Number of Options Outstanding
Number of Options Outstanding, Beginning Balance	8,048
Number of Options Outstanding, Granted	539
Number of Options Outstanding, Exercised	(601)
Number of Options Outstanding, Canceled/Forfeited	(236)
Number of Options Outstanding, Ending Balance	7,750	8,048
Number of Options Outstanding, Vested and expected to vest	7,379
Number of Options Outstanding, Exercisable	5,389
Weighted-Average Exercise Price Per Share
Weighted-Average Exercise Price Per Share, Beginning Balance	$ 10.27
Weighted-Average Exercise Price Per Share, Granted	16.46
Weighted-Average Exercise Price Per Share, Exercised	9.07
Weighted-Average Exercise Price Per Share, Canceled/Forfeited	15.53
Weighted-Average Exercise Price Per Share, Ending Balance	10.64	$ 10.27
Weighted-Average Exercise Price Per Share, Vested and expected to vest	10.37
Weighted-Average Exercise Price Per Share, Exercisable	$ 8.53
Weighted-Average Contractual Term
Weighted-Average Contractual Term	5 years 6 months	6 years 2 months 12 days
Weighted-Average Contractual Term, Vested and expected to vest	5 years 6 months
Weighted-Average Contractual Term, Exercisable	5 years 4 months 24 days
Aggregate Intrinsic Value
Aggregate Intrinsic Value, Outstanding	$ 101,047	$ 107,091
Aggregate Intrinsic Value, Vested and expected to vest	98,134
Aggregate Intrinsic Value, Exercisable	$ 81,557

Share-Based Compensation - Weig

Share-Based Compensation - Weighted Average Grant Date Fair Value of Options Granted and Total Intrinsic Value of Options Exercised (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Weighted average grant date fair value per share	$ 9.22	$ 7.48	$ 6.70	$ 6.76
Total intrinsic value of options exercised	$ 2,561	$ 7,135	$ 6,956	$ 16,964

Share-Based Compensation - We42

Share-Based Compensation - Weighted Average Assumptions Used to Fair Value of Stock Options Granted (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Risk-free interest rate	1.10%	1.50%	1.10%	1.20%
Expected volatility	46.40%	47.00%	47.20%	48.00%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term (in years)	4 years 8 months 12 days	4 years 8 months 12 days	4 years 8 months 12 days	4 years 9 months 18 days
Non Employee Stock Option
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term (in years)	5 years 9 months 18 days	7 years 2 months 12 days	6 years 1 month 6 days	7 years 1 month 6 days

Share-Based Compensation - Su43

Share-Based Compensation - Summary of RSUs Activity (Detail) - Restricted Stock Units - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of RSUs Outstanding, Beginning Balance	2,288
Number of RSUs Outstanding, Granted	2,597
Number of RSUs Outstanding, Released	(803)
Number of RSUs Outstanding, Canceled/Forfeited	(326)
Number of RSUs Outstanding, Ending Balance	3,756
Weighted-Average Grant Date Fair Value Per Share, Beginning Balance	$ 16.63
Weighted-Average Grant Date Fair Value Per Share, Granted	18.48
Weighted-Average Grant Date Fair Value Per Share, Released	16.59
Weighted-Average Grant Date Fair Value Per Share, Canceled/Forfeited	17.69
Weighted-Average Grant Date Fair Value Per Share, Ending Balance	$ 17.82
Aggregate Intrinsic Value, Outstanding	$ 89,068	$ 53,972

Segment Reporting - Additional

Segment Reporting - Additional Information (Detail)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016Country	Sep. 30, 2015	Sep. 30, 2016SegmentCountry	Sep. 30, 2015	Dec. 31, 2015Country
Concentration Risk [Line Items]
Number of reporting segment | Segment			1
Percentage of billings including carrier partner billings collected through credit cards, resulting in minimal accounts receivable balance			77.00%
Accounts Receivable | Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk			37.00%		39.00%
Non-US [Member] | Long-lived Assets | Geographic Concentration Risk
Concentration Risk [Line Items]
Number of foreign countries representing more than ten percent | Country	0		0		0
Minimum | U.S. | Sales Revenue, Segment | Geographic Concentration Risk
Concentration Risk [Line Items]
Concentration risk	90.00%	90.00%	90.00%	90.00%
Minimum | U.S. | Long-lived Assets | Geographic Concentration Risk
Concentration Risk [Line Items]
Concentration risk			89.00%		89.00%

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Jun. 30, 2015
Income Tax Disclosure [Abstract]
Provision (benefit) for income taxes	$ 46,000	$ (56,000)	$ 153,000	$ (1,342,000)
Deferred tax assets, valuation allowance					$ 1,400,000
Unrecognized tax benefits	$ 0		$ 0

Basic and Diluted Net Loss Pe46

Basic and Diluted Net Loss Per Share - Computation of Company's Basic and Diluted Net Loss Per Share of Common Stock (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Numerator
Net loss	$ (7,979)	$ (6,336)	$ (22,363)	$ (25,158)
Denominator
Weighted-average common shares for basic and diluted net loss per share	73,285	70,580	72,669	69,614
Basic and diluted net loss per share	$ (0.11)	$ (0.09)	$ (0.31)	$ (0.36)

Basic and Diluted Net Loss Pe47

Basic and Diluted Net Loss Per Share - Weighted Average Potential Common Shares Excluded from Computation of Diluted Net Loss Per Common Share (Detail) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potential common shares excluded from diluted net loss per share	11,990	11,524	11,784	11,603
Repurchase Unvested Common Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potential common shares excluded from diluted net loss per share		5		5
Equity Incentive Awards
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potential common shares excluded from diluted net loss per share	11,990	11,519	11,784	11,598

Related Party Transactions - Ad

Related Party Transactions - Additional Information (Detail) - Alphabet Inc. - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Related Party Transaction [Line Items]
Total payables to related party	$ 1.5		$ 1.5		$ 2
Total expenses incurred from related party	$ 3.8	$ 2.8	$ 9.8	$ 8.9