Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 01, 2016 | Jun. 30, 2015 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | LIMELIGHT NETWORKS, INC. | ||
Entity Central Index Key | 1,391,127 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 102,359,517 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 256.2 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 44,680 | $ 57,767 |
Marketable securities | 28,322 | 35,317 |
Accounts receivable, net | 26,795 | 22,622 |
Income taxes receivable | 170 | 237 |
Deferred income taxes | 89 | 78 |
Prepaid expenses and other current assets | 9,578 | 9,625 |
Total current assets | 109,634 | 125,646 |
Property and equipment, net | 36,143 | 32,636 |
Marketable securities, less current portion | 40 | 40 |
Deferred income taxes, less current portion | 1,252 | 1,364 |
Goodwill | 76,143 | 76,133 |
Other intangible assets, net | 15 | 1,071 |
Other assets | 2,400 | 4,451 |
Total assets | 225,627 | 241,341 |
Current liabilities: | ||
Accounts payable | 9,137 | 7,065 |
Deferred revenue | 2,890 | 3,509 |
Capital lease obligations | 466 | 223 |
Income taxes payable | 204 | 248 |
Other current liabilities | 10,857 | 14,383 |
Total current liabilities | 23,554 | 25,428 |
Capital lease obligations, less current portion | 1,436 | 135 |
Deferred income taxes | 137 | 170 |
Deferred revenue, less current portion | 92 | 405 |
Other long-term liabilities | 2,311 | 3,040 |
Total liabilities | $ 27,530 | $ 29,178 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Convertible preferred stock, $0.001 par value; 7,500 shares authorized; 0 shares issued and outstanding | $ 0 | $ 0 |
Common stock, $0.001 par value; 300,000 shares authorized; 102,299 and 98,409 shares issued and outstanding at December 31, 2015 and 2014, respectively | 102 | 98 |
Additional paid-in capital | 477,202 | 464,294 |
Accumulated other comprehensive loss | (10,812) | (7,786) |
Accumulated deficit | (268,395) | (244,443) |
Total stockholders’ equity | 198,097 | 212,163 |
Total liabilities and stockholders’ equity | $ 225,627 | $ 241,341 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Convertible Preferred Stock, Par Value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible Preferred Stock, Shares Authorized | 7,500,000 | 7,500,000 |
Convertible Preferred Stock, Shares Issued | 0 | 0 |
Convertible Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par Value (in dollars per share) | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 300,000,000 | 300,000,000 |
Common Stock, Shares Issued | 102,299,000 | 98,409,000 |
Common Stock, Shares Outstanding | 102,299,000 | 98,409,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Income Statement [Abstract] | ||||
Revenues | $ 170,912 | $ 162,259 | $ 173,433 | |
Cost of revenue: | ||||
Cost of services (1) | [1] | 84,818 | 82,176 | 88,783 |
Depreciation — network | 17,975 | 16,673 | 22,942 | |
Total cost of revenue | 102,793 | 98,849 | 111,725 | |
Gross profit | 68,119 | 63,410 | 61,708 | |
Operating expenses: | ||||
General and administrative | 25,027 | 28,176 | 31,904 | |
Sales and marketing | 37,868 | 37,458 | 41,474 | |
Research and development | 28,016 | 20,965 | 22,003 | |
Depreciation and amortization | 2,929 | 3,529 | 5,804 | |
Total operating expenses | 93,840 | 90,128 | 101,185 | |
Operating loss | (25,721) | (26,718) | (39,477) | |
Other income (expense): | ||||
Interest expense | (29) | (32) | (76) | |
Interest income | 317 | 276 | 321 | |
Other, net | 1,748 | 1,821 | 4,643 | |
Total other income (expense) | 2,036 | 2,065 | 4,888 | |
Loss from continuing operations before income taxes | (23,685) | (24,653) | (34,589) | |
Income tax provision | 267 | 203 | 387 | |
Loss from continuing operations | (23,952) | (24,856) | (34,976) | |
Discontinued operations: | ||||
Income (loss) from discontinued operations, net of income taxes | 0 | 265 | (426) | |
Net loss | $ (23,952) | $ (24,591) | $ (35,402) | |
Net loss per basic and diluted share: | ||||
Basic and diluted net loss per share, Continuing operations (in dollars per share) | $ (0.24) | $ (0.25) | $ (0.36) | |
Basic and diluted net loss per share, Discontinued operations (in dollars per share) | 0 | 0 | (0.01) | |
Total Basic and diluted net loss per share (in dollars per share) | $ (0.24) | $ (0.25) | $ (0.37) | |
Weighted average shares used in per share calculation | ||||
Basic and diluted weighted average outstanding shares of common stock (in shares) | 100,105 | 98,365 | 96,851 | |
[1] | Cost of services excludes amortization related to intangibles, including existing technologies, customer relationships, and trade names and trademarks, which are included in depreciation and amortization |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (23,952) | $ (24,591) | $ (35,402) |
Other comprehensive loss, net of tax: | |||
Unrealized loss on marketable securities | (1) | (68) | (13) |
Foreign exchange translation | (3,025) | (6,055) | (941) |
Other comprehensive loss, net of tax | (3,026) | (6,123) | (954) |
Comprehensive loss | $ (26,978) | $ (30,714) | $ (36,356) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Contingent Consideration | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning balance, Shares at Dec. 31, 2012 | 98,038 | |||||
Beginning balance at Dec. 31, 2012 | $ 267,230 | $ 98 | $ 452,258 | $ 33 | $ (709) | $ (184,450) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (35,402) | (35,402) | ||||
Change in unrealized loss on available-for-sale investments, net of taxes | (13) | (13) | ||||
Foreign currency translation adjustment, net of taxes | (941) | (941) | ||||
Exercise of common stock options, Shares | 143 | |||||
Exercise of common stock options | 38 | 38 | ||||
Vesting of restricted stock units, Shares | 2,032 | |||||
Vesting of restricted stock units | 0 | $ 2 | (2) | |||
Restricted stock units surrendered in lieu of withholding taxes, Shares | (593) | |||||
Restricted stock units surrendered in lieu of withholding taxes | (1,304) | $ 0 | (1,304) | |||
Issuance of common stock for contingent consideration, Shares | 11 | |||||
Issuance of common stock for contingent consideration | 0 | 33 | (33) | |||
Issuance of common stock under employee stock purchase plan, Shares | 135 | |||||
Issuance of common stock under employee stock purchase plan | 225 | 225 | ||||
Purchase of common stock, Shares | (2,089) | |||||
Purchases of common stock | (4,847) | $ (2) | (4,845) | |||
Share-based compensation - continuing operations | 12,345 | 12,345 | ||||
Ending balance, Shares at Dec. 31, 2013 | 97,677 | |||||
Ending balance at Dec. 31, 2013 | 237,331 | $ 98 | 458,748 | 0 | (1,663) | (219,852) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (24,591) | (24,591) | ||||
Change in unrealized loss on available-for-sale investments, net of taxes | (68) | (68) | ||||
Foreign currency translation adjustment, net of taxes | (6,055) | (6,055) | ||||
Exercise of common stock options, Shares | 522 | |||||
Exercise of common stock options | 894 | $ 1 | 893 | |||
Vesting of restricted stock units, Shares | 2,385 | |||||
Vesting of restricted stock units | 0 | $ 2 | (2) | |||
Restricted stock units surrendered in lieu of withholding taxes, Shares | (725) | |||||
Restricted stock units surrendered in lieu of withholding taxes | (1,644) | $ (1) | (1,643) | |||
Issuance of common stock under employee stock purchase plan, Shares | 269 | |||||
Issuance of common stock under employee stock purchase plan | 488 | 488 | ||||
Purchase of common stock, Shares | (1,719) | |||||
Purchases of common stock | (4,683) | $ (2) | (4,681) | |||
Share-based compensation - continuing operations | $ 10,491 | 10,491 | ||||
Ending balance, Shares at Dec. 31, 2014 | 98,409 | 98,409 | ||||
Ending balance at Dec. 31, 2014 | $ 212,163 | $ 98 | 464,294 | 0 | (7,786) | (244,443) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (23,952) | (23,952) | ||||
Change in unrealized loss on available-for-sale investments, net of taxes | (1) | (1) | ||||
Foreign currency translation adjustment, net of taxes | (3,025) | (3,025) | ||||
Exercise of common stock options, Shares | 607 | |||||
Exercise of common stock options | 1,053 | $ 1 | 1,052 | |||
Vesting of restricted stock units, Shares | 3,069 | |||||
Vesting of restricted stock units | 0 | $ 3 | (3) | |||
Restricted stock units surrendered in lieu of withholding taxes, Shares | (876) | |||||
Restricted stock units surrendered in lieu of withholding taxes | (2,628) | $ (1) | (2,627) | |||
Issuance of common stock under employee stock purchase plan, Shares | 1,383 | |||||
Issuance of common stock under employee stock purchase plan | 2,966 | $ 1 | 2,965 | |||
Purchase of common stock, Shares | (293) | |||||
Purchases of common stock | (817) | $ 0 | (817) | |||
Share-based compensation | $ 12,338 | 12,338 | ||||
Ending balance, Shares at Dec. 31, 2015 | 102,299 | 102,299 | ||||
Ending balance at Dec. 31, 2015 | $ 198,097 | $ 102 | $ 477,202 | $ 0 | $ (10,812) | $ (268,395) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities | |||
Net loss | $ (23,952) | $ (24,591) | $ (35,402) |
Income (loss) from discontinued operations | 0 | 265 | (426) |
Net loss from continuing operations | (23,952) | (24,856) | (34,976) |
Adjustments to reconcile net loss from continuing operations to net cash provided by operating activities of continuing operations: | |||
Depreciation and amortization | 20,904 | 20,202 | 28,746 |
Share-based compensation | 12,338 | 10,491 | 12,345 |
Foreign currency remeasurement gain | (1,591) | (2,167) | (531) |
Deferred income taxes | 46 | (359) | (328) |
Loss on disposal of property and equipment | 0 | 0 | 442 |
Accounts receivable charges | 1,037 | 408 | 965 |
Amortization of premium on marketable securities | 194 | 459 | 639 |
Non cash tax benefit associated with sale of discontinued operations | 0 | (59) | 0 |
Gain on sale of the Web Content Management business | 0 | 0 | (3,836) |
Changes in operating assets and liabilities: | |||
Accounts receivable | (5,210) | (1,600) | 2,581 |
Prepaid expenses and other current assets | (194) | (1,792) | 1,222 |
Income taxes receivable | 44 | 150 | 105 |
Other assets | 3,064 | 1,607 | 519 |
Accounts payable and other current liabilities | 85 | 122 | (1,808) |
Deferred revenue | (932) | (1,109) | 4 |
Income taxes payable | (80) | (233) | 305 |
Other long term liabilities | 688 | (796) | (798) |
Net cash provided by operating activities of continuing operations | 6,441 | 468 | 5,596 |
Investing activities | |||
Purchases of marketable securities | (16,821) | (25,482) | (59,047) |
Maturities of marketable securities | 22,620 | 22,150 | 44,901 |
Purchases of property and equipment | (24,714) | (18,581) | (18,575) |
Proceeds from the sale of cost basis investment | 0 | 0 | 1,237 |
Proceeds from sale of the Web Content Management business | 0 | 0 | 12,341 |
Proceeds from the sale of discontinued operations | 0 | 414 | 124 |
Net cash used in investing activities of continuing operations | (18,915) | (21,499) | (19,019) |
Financing activities | |||
Payments on capital lease obligations | (453) | (466) | (1,301) |
Payment of employee tax withholdings related to restricted stock vesting | (2,627) | (1,795) | (2,372) |
Cash paid for purchase of common stock | (957) | (4,542) | (5,512) |
Proceeds from employee stock plans | 4,018 | 1,381 | 263 |
Net cash used in financing activities of continuing operations | (19) | (5,422) | (8,922) |
Effect of exchange rate changes on cash and cash equivalents | (594) | (1,732) | (606) |
Discontinued operations | |||
Cash used in operating activities of discontinued operations | 0 | (4) | (8) |
Net decrease in cash and cash equivalents | (13,087) | (28,189) | (22,959) |
Cash and cash equivalents, beginning of year | 57,767 | 85,956 | 108,915 |
Cash and cash equivalents, end of year | 44,680 | 57,767 | 85,956 |
Supplement disclosure of cash flow information | |||
Cash paid during the year for interest | 29 | 32 | 76 |
Cash paid during the year for income taxes, net of refunds | 379 | 647 | 321 |
Property and equipment acquired through leasehold incentives | 0 | 0 | 386 |
Contingent consideration common stock issued in connection with acquisition of businesses | 0 | 0 | 33 |
Property acquired due to vendor concession | 0 | 0 | 250 |
Property and equipment acquired through capital lease | $ 2,035 | $ 0 | $ 0 |
Nature of Business
Nature of Business | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business | Nature of Business Limelight operates a globally distributed, high-performance network and provides a suite of integrated services marketed under the Orchestrate Platform which include content delivery, video content management, website and web application acceleration, website and content security, and cloud storage services. We were incorporated in Delaware in 2003, and have operated in the Phoenix metropolitan area since 2001 and elsewhere throughout the United States since 2003. We began international operations in 2004. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). The consolidated financial statements include accounts of Limelight and our wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated. In addition, certain other reclassifications have been made to prior period amounts to conform to the current period presentation. All information is presented in thousands, except per share amounts and where specifically noted. Use of Estimates The preparation of the consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make judgments, assumptions, and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results and outcomes may differ from those estimates. The results of operations presented in this annual report on Form 10-K are not necessarily indicative of the results that may be expected for the year ending December 31, 2016, or for any future periods. Foreign Currency Translation The functional currency of our international subsidiaries is the local currency. Due to changes in exchange rates between reporting periods and changes in certain account balances, the foreign currency translation adjustment will change from period to period. During the years ended December 31, 2015, 2014, and 2013, we recorded foreign currency translation losses of $3,025 , $6,055 , and $941 , respectively, in our statements of comprehensive loss. During the years ended December 31, 2015, 2014, and 2013, we recorded a foreign currency re-measurement gain of approximately $1,341 , $1,489 , and $92 , respectively, in other income (expense) in the consolidated statements of operations. Recent Accounting Standards Recently Adopted Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-03, which requires that all costs incurred to issue debt be presented in the balance sheet as a direct deduction from the carrying value of the debt, similar to the presentation of debt discounts. We adopted this guidance effective December 31, 2015. We had no outstanding debt agreements as of December 31, 2014 and the adoption of this guidance had no impact on our prior presented financial statements. In August 2015, the FASB issued ASU No. 2015-15, which clarifies the treatment of debt issuance costs from line-of-credit arrangements after the adoption of ASU 2015-03. In particular, ASU 2015-15 clarifies that the SEC staff would not object to an entity deferring and presenting debt issuance costs related to a line-of-credit arrangement as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of such arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We adopted this guidance effective December 31, 2015. Recently Issued Accounting Pronouncements In April 2015, the FASB issued ASU 2015-05, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then 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. The guidance will not change U.S. GAAP for a customer's accounting for service contracts. We will adopt this guidance effective January 1, 2016. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, which provides guidance for revenue recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under today’s guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2014-09 for all entities by one year. Accordingly, public business entities should apply the guidance in ASU 2014-09 to annual reporting periods (including interim periods within those periods) beginning after December 15, 2017. Early adoption is permitted but not before annual periods beginning after December 15, 2016. The standard permits the use of the retrospective or the modified approach method. We have not yet selected a transition method, and are currently in the process of evaluating the impact of adoption of this ASU on our consolidated financial statements and disclosures. In August 2014, the FASB issued ASU 2014-15, which provides guidance for disclosure of uncertainties about an entity’s ability to continue as a going concern. ASU 2014-15 defines management's responsibility to assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. This guidance will be effective for us in the first annual period ending after December 15, 2016, and interim periods within such year; however, early adoption is permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16 which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period for a business combination in the reporting period in which the adjustment amounts are determined. Prior to the issuance of the standard, entities were required to retrospectively apply adjustments made to provisional amounts recognized in a business combination. We will adopt this guidance effective January 1, 2016. We do not expect that the adoption of this standards update will have a material impact on our consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, which will require entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as noncurrent in a classified balance sheet. The ASU simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current and noncurrent in a classified balance sheet. ASU 2015-17 is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. Revenue Recognition We derive revenue primarily from the sale of services that comprise components of our Orchestrate Platform. Our customers generally execute contracts with terms of one year or longer, which are referred to as recurring revenue contracts or long-term contracts. These contracts generally commit the customer to a minimum monthly level of usage with additional charges applicable for actual usage above the monthly minimum commitment, or are entirely usage based. We define usage as customer data sent or received using our content delivery service, or content that is hosted or cached by us at the request or direction of our customers. We recognize the monthly minimum as revenue each month provided that an enforceable contract has been signed by both parties, the service has been delivered to the customer, the fee for the service is fixed or determinable, and collection is reasonably assured. Should a customer’s usage of our services exceed the monthly minimum commitment, we recognize revenue for such excess in the period of the usage. For annual or other non-monthly period revenue commitments, we recognize revenue monthly based upon the customer’s actual usage each month of the commitment period and only recognize any remaining committed amount for the applicable period in the last month thereof. Certain of our revenue arrangements consist of multi-element arrangements. Revenue arrangements with multiple deliverables are divided into separate units of accounting if each deliverable has stand-alone value to the customer. Our multiple-element arrangements may include a combination of some or all of the following: content delivery services, video content management services, performance services for website and web application acceleration and security, professional services, and cloud storage. Each of these products has stand-alone value and is sold separately. In the absence of vendor specific objective evidence (VSOE) or third-party evidence of selling prices, consideration would be allocated based on management’s best estimate of such prices. The deliverables within multiple-element arrangements are provided over the same contract period, and therefore, revenue is recognized over the same period. We may charge the customer an installation fee when the services are first activated. We do not charge installation fees for contract renewals. Installation fees are recorded as deferred revenue and recognized as revenue ratably over the estimated life of the customer arrangement as installation fees do not have standalone value. We also derive revenue from services and events sold as discrete, non-recurring events or based solely on usage. For these services, we recognize revenue after an enforceable contract has been signed by both parties, the fee is fixed or determinable, the event or usage has occurred, and collection is reasonably assured. At the inception of a customer contract for service, we make an assessment as to that customer’s ability to pay for the services provided. If we subsequently determine that collection from the customer is not reasonably assured, we record an allowance for doubtful accounts and bad debt expense or deferred revenue for all of that customer’s unpaid invoices and cease recognizing revenue for continued services provided until cash is received. Deferred revenue represents amounts billed to customers for which revenue has not been recognized. Deferred revenue primarily consists of the unearned portion of monthly billed service fees; prepayments made by customers for future periods and deferred installation fees. Cash and Cash Equivalents We hold our cash and cash equivalents in checking, money market, and highly-liquid investments. We consider all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. Cash and cash equivalents are deposited in or managed by major financial institutions and at times exceed Federal Deposit Insurance Corporation insurance limits. Investments in Marketable Securities Management determines the appropriate classification of its marketable securities at the time of purchase and reevaluates such classification as of each balance sheet date. We have classified our investments in marketable securities as available-for-sale and as current, as our marketable securities are available to fund current operations. Available-for-sale investments are initially recorded at cost with temporary changes in fair value periodically recorded through comprehensive income. Realized gains and losses and declines in value judged to be other than temporary are determined based on the specific identification method and are reported in the statements of operations. We periodically review our investments for other-than-temporary declines in fair value based on the specific identification method and would write down investments to their fair value if and when an other-than-temporary decline has occurred. Accounts Receivable Trade accounts receivable are recorded at the invoiced amounts and do not bear interest. We record reserves against our accounts receivable balance for service credits and for doubtful accounts. Estimates are used in determining both of these reserves. The allowance for doubtful accounts charges are included as a component of general and administrative expenses. The allowance for doubtful accounts is based upon a calculation that uses our aging of accounts receivable and applies a reserve percentage to the specific age of the receivable to estimate the allowance for doubtful accounts. The reserve percentages are determined based on our historical write-off experience. These estimates could change significantly if our customers’ financial condition changes or if the economy in general deteriorates. In the event such conditions become known, we specifically identify balances for necessary reserves. Our reserve for service credits relates to credits that are expected to be issued to customers during the ordinary course of business. These credits typically relate to customer disputes and billing adjustments and are estimated at the time the revenue is recognized and recorded as a reduction of revenues. Estimates for service credits are based on an analysis of credits issued in previous periods. Property and Equipment Property and equipment are carried at cost less accumulated depreciation or amortization. Depreciation and amortization are computed using the straight-line method over the assets’ estimated useful lives of the applicable asset. Network equipment 3 years Computer equipment and software 3 years Furniture and fixtures 3 years Other equipment 3-5 years Leasehold improvements are amortized over the shorter of the asset’s estimated useful life or the respective lease term. Repairs and maintenance are charged to expense as incurred. Goodwill and Other Intangible Assets Goodwill represents costs in excess of fair values assigned to the underlying net assets of the acquired company. Goodwill is not amortized but instead is tested for impairment annually or more frequently if events or changes in circumstances indicate goodwill might be impaired. We have concluded that we have one reporting unit and assigned the entire balance of goodwill to this reporting unit. The estimated fair value of the reporting unit is determined using a market approach. Our market capitalization is adjusted for a control premium based on the estimated average and median control premiums of transactions involving companies comparable to us. As of the annual impairment testing date of October 31, 2015, and in an interim impairment test performed at December 31, 2015, management determined that goodwill was not impaired. Management determined that the estimated fair value of its reporting unit exceeded carrying value by approximately $90,135 or 45% , and $11,002 or 6% , using our market capitalization plus an estimated control premium of 40% on October 31, 2015, and December 31, 2015, respectively. Our other intangible assets represent existing technologies and customer relationship intangibles. Other intangible assets are amortized over their respective estimated lives, ranging from less than one year to six years . In the event that facts and circumstances indicate intangibles or other long-lived assets may be impaired, we evaluate the recoverability and estimated useful lives of such assets. Amortization of other intangible assets is included in depreciation and amortization in the accompanying consolidated statements of operations. Contingencies We record contingent liabilities resulting from asserted and unasserted claims when it is probable that a loss has been incurred and the amount of the loss is reasonably estimable. We disclose contingent liabilities when there is a reasonable possibility that the ultimate loss will exceed the recorded liability. Additionally, estimating the loss, or range of loss, associated with a contingency requires analysis of multiple factors, and changes in law or other developments may ultimately cause our judgments to change. Therefore, actual losses in any future period are inherently uncertain and may be materially different from our estimate. Long-Lived Assets We review our long-lived assets for impairment annually, or whenever events or circumstances indicate that the carrying amount of an asset may not be fully recoverable. We recognize an impairment loss if the sum of the expected long-term undiscounted cash flows that the long-lived asset is expected to generate is less than the carrying amount of the long-lived asset being evaluated. We treat any write-downs as permanent reductions in the carrying amounts of the assets. We believe the carrying amounts of our long-lived assets at December 31, 2015 , and 2014 , are fully realizable and have not recorded any impairment losses. Deferred Rent and Lease Accounting We lease bandwidth, co-location and office space in various locations. At the inception of each lease, we evaluate the lease terms to determine whether the lease will be accounted for as an operating or a capital lease. The term of the lease used for this evaluation includes renewal option periods only in instances where the exercise of the renewal option can be reasonably assured and failure to exercise the option would result in an economic penalty. We record tenant improvement allowances granted under the lease agreements as leasehold improvements within property and equipment and within deferred rent. For leases that contain rent escalation provisions, we record the total rent payable during the lease term on a straight-line basis over the term of the lease (including any “rent free” period beginning upon possession of the premises), and record any difference between the actual rent paid and the straight-line rent expense recorded as increases or decreases in deferred rent. Cost of Revenue Cost of revenues consists primarily of fees paid to network providers for bandwidth and backbone, costs incurred for non-settlement free peering and connection to Internet service provider networks and fees paid to data center operators for housing network equipment in third party network data centers, also known as co-location costs. Cost of revenues also includes leased warehouse space and utilities, depreciation of network equipment used to deliver our content delivery services, payroll and related costs, and share-based compensation for our network operations and professional services personnel. We enter into contracts for bandwidth with third party network providers with terms typically ranging from several months to five years . These contracts generally commit us to pay minimum monthly fees plus additional fees for bandwidth usage above contracted minimums. A portion of the global computing platform traffic delivery is completed through direct connection to ISP networks, called peering. Research and Development Research and development costs consist primarily of payroll and related personnel costs for the design, development, deployment, testing, operation, and enhancement of our services, and network. Costs incurred in the development of our services are expensed as incurred. Advertising Costs Costs associated with advertising are expensed as incurred. Advertising expenses, which are comprised of Internet, trade show, and publications advertising, were approximately $1,669 , $1,409 , and $2,754 for the years ended December 31, 2015 , 2014 , and 2013 , respectively. Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such determination, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and recent financial performance. In the event we were to determine that we would be able to realize our deferred income tax assets in the future in excess of their net recorded amount, we would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. We recognize uncertain income tax positions in our financial statements when it is more-likely-than-not the position will be sustained upon examination. Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents approximate fair value due to the nature and short maturity of those instruments. The respective fair values of marketable securities are determined based on quoted market prices, which approximate fair values. The carrying amounts of accounts receivable, accounts payable, and accrued liabilities reported in the consolidated balance sheets approximate their respective fair values due to the immediate or short-term maturity of these financial instruments. Share-Based Compensation We measure all employee share-based compensation awards using the fair-value method. The grant date fair value was determined using the Black-Scholes-Merton pricing model. The Black-Scholes-Merton valuation calculation requires us to make key assumptions such as future stock price volatility, expected terms, risk-free rates, and dividend yield. Our expected volatility is derived from our own volatility rate as a publicly traded company. The expected term is based on our historical experience. The risk-free interest factor is based on the United States Treasury yield curve in effect at the time of the grant for zero coupon United States Treasury notes with maturities of approximately equal to each grant’s expected term. We have never paid cash dividends and do not currently intend to pay cash dividends, and therefore, have assumed a 0% dividend yield. We develop an estimate of the number of share-based awards that will be forfeited due to employee turnover. We will continue to use judgment in evaluating the expected term, volatility, and forfeiture rate related to our own share-based awards on a prospective basis, and in incorporating these factors into the model. We apply the straight-line attribution method to recognize compensation costs associated with awards that are not subject to graded vesting. For awards that are subject to graded vesting and performance based awards, we recognize compensation costs separately for each vesting tranche. We also estimate when and if performance-based awards will be earned. If an award is not considered probable of being earned, no amount of share-based compensation is recognized. If the award is deemed probable of being earned, related compensation expense is recorded over the estimated service period. To the extent our estimate of awards considered probable of being earned changes, the amount of share-based compensation recognized will also change. |
Investments in Marketable Secur
Investments in Marketable Securities | 12 Months Ended |
Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in Marketable Securities | Investments in Marketable Securities The following is a summary of marketable securities (designated as available-for-sale) at December 31, 2015 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposit $ 12,480 $ 1 $ 17 $ 12,464 Corporate notes and bonds 15,940 2 44 15,898 Total marketable securities $ 28,420 $ 3 $ 61 $ 28,362 At December 31, 2015, we evaluated our marketable securities and determined unrealized losses were due to fluctuations in interest rates. We do not believe any of the unrealized losses represented an other-than-temporary impairment based on our evaluation of available evidence as of December 31, 2015. Our intent is to hold these investments to such time as these assets are no longer impaired. The amortized cost and estimated fair value of the marketable debt securities at December 31, 2015 , by maturity, are shown below: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities Due in one year or less $ 18,075 $ 2 $ 12 $ 18,065 Due after one year and through five years 10,345 1 49 10,297 $ 28,420 $ 3 $ 61 $ 28,362 The following is a summary of marketable securities (designated as available-for-sale) at December 31, 2014 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposit $ 11,040 $ 2 $ 32 $ 11,010 Commercial paper 1,498 — 1 1,497 Corporate notes and bonds 21,876 7 33 21,850 Convertible debt security 1,000 — — 1,000 Total marketable securities $ 35,414 $ 9 $ 66 $ 35,357 The amortized cost and estimated fair value of the marketable debt securities at December 31, 2014 , by maturity, are shown below: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities Due in one year or less $ 19,798 $ 5 $ 9 $ 19,794 Due after one year and through five years 15,616 4 57 15,563 $ 35,414 $ 9 $ 66 $ 35,357 |
Business Disposition
Business Disposition | 12 Months Ended |
Dec. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Business Disposition | Business Disposition On December 23, 2013, we sold 100% of the outstanding common stock of our Web Content Management (WCM) business for $12,341 in cash, net of preliminary working capital adjustments. After allocating goodwill of $3,799 to WCM, the sale resulted in a gain of $3,836 , which was included in Other, net in the consolidated statement of operations for the year ended December 31, 2013. During the year ended December 31, 2014, we recorded a working capital adjustment of $ (62) (expense), related to new information subsequent to the closing of the acquisition, which is included in Other, net in the consolidated statement of operations for the year ended December 31, 2014. This sale was not treated as a discontinued operation because the operations and cash flows of the WCM business cannot be clearly distinguished, operationally or for financial reporting purposes, from the rest of the Company. |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable Accounts receivable include: December 31, 2015 2014 Accounts receivable $ 28,599 $ 24,456 Less: credit allowance (460 ) (380 ) Less: allowance for doubtful accounts (1,344 ) (1,454 ) Total accounts receivable, net $ 26,795 $ 22,622 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill We have recorded goodwill as a result of past business acquisitions. Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. In each of our acquisitions, the objective of the acquisition was to expand our product offerings and customer base and to achieve synergies related to cross selling opportunities, all of which contributed to the recognition of goodwill. We test goodwill for impairment on an annual basis or more frequently if events or changes in circumstances indicate that goodwill might be impaired. We concluded that we have one reporting unit and assigned the entire balance of goodwill to this reporting unit. The estimated fair value of the reporting unit is determined using our market capitalization as of our annual impairment assessment date or each reporting date if circumstances indicate the goodwill might be impaired. Items that could reasonably be expected to negatively affect key assumptions used in estimating fair value include but are not limited to: • sustained decline in our stock price due to a decline in our financial performance due to the loss of key customers, loss of key personnel, emergence of new technologies or new competitors and/or unfavorable outcomes of intellectual property disputes; • decline in overall market or economic conditions leading to a decline in our stock price; and • decline in observed control premiums paid in business combinations involving comparable companies. The changes in the carrying amount of goodwill for the years ended December 31, 2015 , and 2014, were as follows: Balance, December 31, 2013 $ 77,035 Foreign currency translation adjustment (902 ) Balance, December 31, 2014 $ 76,133 Foreign currency translation adjustment 10 Balance, December 31, 2015 $ 76,143 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment include: December 31, 2015 2014 Network equipment $ 129,172 $ 127,962 Computer equipment and software 11,408 9,079 Furniture and fixtures 2,472 2,498 Leasehold improvements 4,976 5,262 Other equipment 166 186 148,194 144,987 Less: accumulated depreciation (112,051 ) (112,351 ) Total property and equipment, net $ 36,143 $ 32,636 Cost of revenue depreciation expense related to property and equipment was approximately $17,975 , $16,673 , and $22,942 , respectively, for the years ended December 31, 2015 , 2014 , and 2013 , respectively. Operating expense depreciation and amortization expense related to property and equipment was approximately $1,866 , $2,391 , and $2,961 , respectively, for the years ended December 31, 2015 , 2014 , and 2013 , respectively. |
Line of Credit Line of Credit
Line of Credit Line of Credit | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt Disclosure | Line of Credit On November 2, 2015, we entered into a Loan and Security Agreement (the Agreement) with Silicon Valley Bank (SVB). The Agreement provides for revolving credit borrowings up to a maximum principal amount of $25,000 . We are subject to a borrowing base calculation to determine the amount available to us. Our borrowing capacity is the lesser of the commitment amount or 80% of eligible accounts receivable. All outstanding borrowings owed under the Agreement become due and payable no later than the final maturity date of November 2, 2017. As of December 31, 2015, there were no outstanding borrowings against the line of credit. As of December 31, 2015, we had approximately $18,000 availability under the line of credit. Borrowings under the Agreement bear interest at our option of one, two, three or six-month LIBOR plus a margin of 2.75% or an Alternative Base Rate (ABR), which is defined as the higher of (a) Wall Street Journal prime rate or (b) Federal Funds Rate plus 0.50% , plus a margin of 0.50% or 1.50% depending on our minimum liquidity, as defined in the Agreement. If we fall below a minimum liquidity of $17,500 , we are required to use the ABR interest rate. We incurred a commitment fee (issuance costs) of 0.25% upon entering into the Agreement and 0.20% to be paid on the one year anniversary of closing. In addition, there is an unused line fee of 0.375% if our minimum liquidity is greater than $17,500 . If our minimum liquidity falls below $17,500 , the unused line fee is 0.250% . Commitment fees are included in prepaid expenses and other current assets, are charged to interest expense and were not material in the year ended December 31, 2015. Any borrowings are secured by essentially all of our domestic personal property, with a negative pledge on intellectual property. SVB’s security interest in our foreign subsidiaries is limited to 65% of voting stock of each such foreign subsidiary. The Agreement contains a covenant that requires us to maintain a minimum tangible net worth of $100,000 . Tangible net worth is defined as total shareholders’ equity less cash held by our foreign subsidiaries, goodwill and other intangible assets. The tangible net worth requirement is adjusted by up to $52,500 in the event we record a provision for or make a payment related to the Akamai ‘703 Litigation. We are also subject to certain customary limitations on our ability to, among other things, incur debt, grant liens, make acquisitions and other investments, make certain restricted payments such as dividends, dispose of assets or undergo a change in control. In addition, we have a maximum unfinanced capital expenditures amount of $30,000 for 2015 and $25,000 per annum thereafter. As of December 31, 2015, we were in compliance with all covenants under the Agreement. |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Other Liabilities, Current [Abstract] | |
Other Current Liabilities | Other Current Liabilities Other current liabilities include: December 31, 2015 2014 Accrued compensation and benefits $ 4,786 $ 5,266 Accrued cost of revenue 2,698 2,031 Accrued legal fees 143 1,292 Deferred rent 782 1,277 Other accrued expenses 2,448 4,517 Total other current liabilities $ 10,857 $ 14,383 |
Other Long Term Liabilities
Other Long Term Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Other Liabilities, Noncurrent [Abstract] | |
Other Long Term Liabilities | Other Long Term Liabilities Other long term liabilities include: December 31, 2015 2014 Deferred rent $ 1,907 $ 2,511 Income taxes payable 404 529 Total other long term liabilities $ 2,311 $ 3,040 |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Loss Contingency, Information about Litigation Matters [Abstract] | |
Contingencies | Contingencies Legal Matters Akamai ‘703 Litigation In June 2006, Akamai Technologies, Inc., or Akamai, and the Massachusetts Institute of Technology, or MIT, filed a lawsuit against us in the United States District Court for the District of Massachusetts alleging that we were infringing two patents assigned to MIT and exclusively licensed by MIT to Akamai, United States Patent No. 6,553,413 (the ’413 patent) and United States Patent No. 6,108,703 (the ’703 patent). In September 2006, Akamai and MIT expanded their claims to assert infringement of a third patent United States Patent No. 7,103,645 (the ’645 patent). Before trial, Akamai waived by stipulation its claims of indirect or induced infringement and proceeded to trial only on the theory of direct infringement. In February 2008, a jury returned a verdict in this lawsuit, finding that we infringed four claims of the ’703 patent at issue and rejecting our invalidity defenses. The jury awarded an aggregate of approximately $45,500 which included lost profits, reasonable royalties and price erosion damages for the period April 2005 through December 31, 2007. In addition, the jury awarded prejudgment interest which we estimated to be $2,600 at December 31, 2007. We recorded an aggregate $48,100 as a provision for litigation as of December 31, 2007. During 2008, we recorded a potential additional provision of approximately $17,500 for potential additional infringement damages and interest. The total provision for litigation at December 31, 2008 was $65,600 . On July 1, 2008, the court denied our Motions for Judgment as a Matter of Law (JMOL), Obviousness, and a New Trial. The court also denied Akamai’s Motion for Permanent Injunction as premature and its Motions for Summary Judgment regarding our equitable defenses. The court conducted a bench trial in November 2008 regarding our equitable defenses. We also filed a motion for reconsideration of the court’s earlier denial of our motion for JMOL. Our motion for JMOL was based largely upon a clarification in the standard for a finding of joint infringement articulated by the Federal Circuit in the case of Muniauction, Inc. v. Thomson Corp., released after the court denied our initial motion for JMOL. On April 24, 2009, the court issued its order and memorandum setting aside the adverse jury verdict and ruling that we did not infringe Akamai’s ’703 patent and that we were entitled to JMOL. Based upon the court’s April 24, 2009 order, we reversed the $65,600 provision for litigation previously recorded for this lawsuit as we no longer believed that payment of any amounts represented by the litigation provision was probable. The court entered final judgment in favor of us on May 22, 2009, and Akamai filed its notice of appeal of the court’s decision on May 26, 2009. On December 20, 2010, the Court of Appeals for the Federal Circuit issued its opinion affirming the trial court’s entry of judgment in our favor. On February 18, 2011, Akamai filed a motion with the Court of Appeals for the Federal Circuit seeking a rehearing and rehearing en banc. On April 21, 2011, the Court of Appeals for the Federal Circuit issued an order denying the petition for rehearing, granting the petition for rehearing en banc, vacating the December 20, 2010 opinion affirming the trial court’s entry of judgment in our favor, and reinstated the appeal. On August 31, 2012, the Court of Appeals for the Federal Circuit, sitting en banc, issued its opinion in the case. A slim majority in this three-way divided opinion also announced a revised legal theory of induced infringement, remanded the case to the trial court, and gave Akamai an opportunity for a new trial to attempt to prove that we induced our customers to infringe Akamai’s patent under the Federal Circuit's new legal standard. On December 28, 2012, we filed a petition for writ of certiorari to the United States Supreme Court to appeal this sharply divided Federal Circuit decision. Akamai then filed a cross petition for consideration of the Federal Circuit standard for direct infringement followed by an opposition to our petition. On January 10, 2014, the Supreme Court granted our petition for writ of certiorari and did not act on Akamai's cross petition. On April 30, 2014, the Supreme Court heard oral argument in our case. On June 2, 2014, the Supreme Court issued its decision and reversed the Federal Circuit's decision, remanding the case back to that court. On July 24, 2014, the Federal Circuit issued an order vacating its prior judgment, reinstating the appeals, dissolving its en banc status, and referring the case back to the original three-judge appellate panel for further proceedings. The three-judge panel heard arguments on September 11, 2014, and on May 13, 2015, the Federal Circuit issued its opinion in the case, holding that we did not infringe Akamai's '703 patent. On June 12, 2015, Akamai filed a motion with the Federal Circuit seeking a rehearing en banc. On August 13, 2015, the Federal Circuit sitting en banc issued an opinion reversing its previous decision that we were not liable for direct infringement of the '703 patent, reinstating the 2008 jury verdict holding us liable for direct infringement and remanding the case back to the three-judge panel for a resolution of our 2009 cross-appeal, which was now ripe for the first time. On September 3, 2015, we filed an updated briefing with respect to our December 2009 cross-appeal challenging the original jury verdict in the event the JMOL was later overturned. On November 16, 2015, the three-judge appellate panel at the Federal Circuit filed its opinion affirming the $45,500 jury award from 2008. On December 23, 2015, the Federal Circuit mandated the case back to District Court for the District of Massachusetts. On that same date, Akamai filed a series of motions with the district court seeking an entry of final judgment on the original jury award, accounting of post-suit damages, damages for willful infringement and pre-judgment interest, which Akamai estimated to be approximately $99,000 in the aggregate, and a permanent injunction against us. On January 26, 2016, we petitioned the Supreme Court seeking review of our claim that the Federal Circuit committed reversible error by changing the standard for direct infringement in a divided actor scenario in a manner inconsistent with controlling legal precedent. On January 27, 2016, we filed an opposition to Akamai’s motion in the district court, and also filed a motion for a stay of all district court proceedings pending the outcome of our Supreme Court petition. In light of the status of the litigation, we believe that there is a reasonable possibility that we have incurred a loss related to the Akamai ‘703 Litigation, but we do not believe that an ultimate loss is probable. We believe Akamai's recent motion for accounting requesting approximately $99,000 in total damages and interest represents the upper end of our range of potential loss. We will continue to vigorously defend against the allegation. Legal and other expenses associated with this case have been significant. We include these litigation expenses in general and administrative expenses as incurred, as reported in the consolidated statement of operations. Akamai and XO Litigation On November 30, 2015, we filed a lawsuit against Akamai and XO Communications in the District Court for the Eastern District of Virginia alleging the infringement of our patents covering a broad range of inventions that we believe are critical to the effective and efficient delivery of bytes by a content delivery network. We intend to vigorously protect our intellectual property rights in this matter. Other Matters We are subject to various other legal proceedings and claims, either asserted or unasserted, arising in the ordinary course of business. While the outcome of these claims cannot be predicted with certainty, management does not believe the outcome of any of these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows. Litigation relating to the content delivery services industry is not uncommon, and we are, and from time to time have been, subject to such litigation. No assurances can be given with respect to the extent or outcome of any such litigation in the future. Taxes We are subject to indirect taxation in various states and foreign jurisdictions. Laws and regulations that apply to communications and commerce conducted over the Internet are becoming more prevalent, both in the United States and internationally, and may impose additional burdens on us conducting business online or providing Internet-related services. Increased regulation could negatively affect our business directly, as well as the businesses of our customers, which could reduce their demand for our services. For example, tax authorities in various states and abroad may impose taxes on the Internet-related revenue we generate based on regulations currently being applied to similar but not directly comparable industries. There are many transactions and calculations where the ultimate tax determination is uncertain. In addition, domestic and international taxation laws are subject to change. In the future, we may come under audit, which could result in changes to our tax estimates. We believe we maintain adequate tax reserves to offset potential liabilities that may arise upon audit. Although we believe our tax estimates and associated reserves are reasonable, the final determination of tax audits and any related litigation could be materially different than the amounts established for tax contingencies. To the extent these estimates ultimately prove to be inaccurate, the associated reserves would be adjusted, resulting in the recording of a benefit or expense in the period in which a change in estimate or a final determination is made. |
Net Loss per Share
Net Loss per Share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Net Loss per Share We calculate basic and diluted loss per weighted average share based. We use the weighted-average number of shares of common stock outstanding during the period for the computation of basic earnings per share. Diluted earnings per share include the dilutive effect of all potentially dilutive common stock, including awards granted under our equity incentive compensation plans in the weighted-average number of shares of common stock outstanding. The following table sets forth the components used in the computation of basic and diluted net loss per share for the periods indicated: Years Ended December 31, 2015 2014 2013 Loss from continuing operations $ (23,952 ) $ (24,856 ) $ (34,976 ) Income (loss) from discontinued operations — 265 (426 ) Net loss $ (23,952 ) $ (24,591 ) $ (35,402 ) Basic and diluted weighted average outstanding shares of common stock 100,105 98,365 96,851 Basic and diluted loss per share: Continuing operations $ (0.24 ) $ (0.25 ) $ (0.36 ) Discontinued operations — — (0.01 ) Basic and diluted net loss per share $ (0.24 ) $ (0.25 ) $ (0.37 ) For the years ended December 31, 2015 , 2014 and 2013 , the following potentially dilutive common stock, including awards granted under our equity incentive compensation plans were excluded from the computation of diluted net loss per share because including them would have been anti-dilutive. Years Ended December 31, 2015 2014 2013 Employee stock purchase plan 134 40 — Stock options 1,245 664 561 Restricted stock units 2,420 1,764 1,425 3,799 2,468 1,986 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock On February 12, 2014, our board of directors authorized a $15,000 share repurchase program. Under this program, we may repurchase shares periodically in the open market or through privately negotiated transactions, in accordance with applicable securities rules regarding issuer repurchases. During the year ended December 31, 2015, we purchased and canceled 293 shares for $817 , including commissions and expenses. All repurchased shares were canceled and returned to authorized but unissued status. During the year ended December 31, 2014, we purchased and canceled 1,719 shares for $4,683 , including commissions and expenses. All repurchased shares were canceled and returned to authorized but unissued status. Employee Stock Purchase Plan In June 2013, our stockholders approved our 2013 Employee Stock Purchase Plan (ESPP). The ESPP allows participants to purchase our common stock at a 15% discount of the lower of the beginning or end of the offering period using the closing price on that day. During the years ended December 31, 2015, 2014, and 2013, we issued 954 , 269 , and 135 shares, respectively, under the ESPP. Total cash proceeds from the purchase of shares under the ESPP were approximately $1,511 , $487 , and $225 , respectively for the years ended December 31, 2015, 2014, and 2013. As of December 31, 2015, shares reserved for issuance to employees under this plan totaled 2,642 and we held employee contributions of approximately $166 (included in other current liabilities) for future purchases under the ESPP. We have reserved approximately 8,759 unissued shares of common stock for future options and restricted stock units under the incentive compensation plan. Preferred Stock Our board of directors have authorized the issuance of up to 7,500 shares of preferred stock at December 31, 2015. The preferred stock may be issued in one or more series pursuant to a resolution or resolutions providing for such issuance duly adopted by the board of directors. As of December 31, 2015, the Board had not adopted any resolutions for the issuance of preferred stock. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Changes in the components of accumulated other comprehensive loss, net of tax, for the year ended December 31, 2015, was as follows: Unrealized Gains (Losses) on Foreign Available for Currency Sale Securities Total Balance, December 31, 2014 $ (7,743 ) $ (43 ) $ (7,786 ) Other comprehensive loss before reclassifications (3,025 ) (1 ) (3,026 ) Amounts reclassified from accumulated other comprehensive loss — — — Net current period other comprehensive loss (3,025 ) (1 ) (3,026 ) Balance, December 31, 2015 $ (10,768 ) $ (44 ) $ (10,812 ) |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | |
Share-Based Compensation | Share-Based Compensation Incentive Compensation Plans We maintain Incentive Compensation Plans (the Plans) to attract, motivate, retain, and reward high quality executives and other employees, officers, directors, and consultants by enabling such persons to acquire or increase a proprietary interest in the Company. The Plans are intended to be qualified plans under the Internal Revenue Code. The Plans allow us to award stock option grants and restricted stock units (RSUs) to employees, directors and consultants of the Company. During 2015, we granted awards to employees, directors and consultants. The exercise price of incentive stock options granted under the Plan may not be granted at less than 100% of the fair market value of our common stock on the date of the grant. Data pertaining to stock option activity under the Plans are as follows: Number of Shares Weighted Average Exercise Price (In thousands) Balance at December 31, 2012 14,310 $ 4.58 Granted 4,902 2.19 Exercised (143 ) 0.26 Cancelled (3,087 ) 3.87 Balance at December 31, 2013 15,982 4.00 Granted 4,215 2.40 Exercised (522 ) 1.71 Cancelled (2,803 ) 4.15 Balance at December 31, 2014 16,872 3.66 Granted 3,649 2.64 Exercised (607 ) 1.73 Cancelled (5,247 ) 4.08 Balance at December 31, 2015 14,667 3.33 The following table summarizes the information about stock options outstanding and exercisable at December 31, 2015 : Options Outstanding Options Exercisable Exercise Price Number of Options Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number of Options Exercisable Weighted Average Exercise Price (In thousands) (In thousands) $ 0.00 — $ 1.50 304 0.4 $ 0.45 304 $ 0.45 $ 1.51 — $ 3.00 9,707 7.5 2.25 5,311 2.25 $ 3.01 — $ 4.50 2,175 6.7 3.75 1,131 3.85 $ 4.51 — $ 6.00 1,269 4.3 5.15 1,269 5.15 $ 6.01 — $ 7.50 441 2.3 6.37 441 6.37 $ 7.51 — $ 15.00 771 2.3 12.17 771 12.17 14,667 9,227 The weighted-average grant-date fair value of options granted during the years ended December 31, 2015 , 2014 , and 2013 on a per-share basis was approximately $1.38 , $1.45 , and $1.48 , respectively. The total intrinsic value of the options exercised during the years ended December 31, 2015 , 2014 , and 2013 was approximately $621 , $449 , and $265 , respectively. The aggregate intrinsic value of options outstanding at December 31, 2015 is approximately $307 . The weighted average remaining contractual term of options currently exercisable at December 31, 2015 was 5.1 years. The fair value of options awarded were estimated on the grant date using the following weighted average assumptions: Years Ended December 31, 2015 2014 2013 Expected volatility 54.53 % 66.05 % 77.96 % Expected term, years 5.99 5.99 6.05 Risk-free interest 1.80 % 1.83 % 1.31 % Expected dividends — % — % — % Unrecognized share-based compensation related to stock options totaled $6,889 at December 31, 2015 . We expect to amortize unvested stock compensation related to stock options over a weighted average period of approximately 2.3 years at December 31, 2015. The following table summarizes the RSUs outstanding (in thousands): Years Ended December 31, 2015 2014 2013 RSUs with service-based vesting conditions 6,265 6,820 5,286 Each RSU represents the right to receive one share of our common stock upon vesting. The fair value of these RSUs was calculated based upon our closing stock price on the date of grant. Data pertaining to RSUs activity under the Plans is as follows: Number of Units Weighted Average Fair Value (In thousands) Balance at December 31, 2012 4,581 $ 2.74 Granted 4,970 2.15 Vested (2,032 ) 2.53 Cancelled (2,233 ) 2.78 Balance at December 31, 2013 5,286 2.24 Granted 5,542 2.33 Vested (2,385 ) 2.28 Cancelled (1,623 ) 2.22 Balance at December 31, 2014 6,820 2.30 Granted 4,156 3.00 Vested (3,069 ) 2.31 Cancelled (1,642 ) 2.54 Balance at December 31, 2015 6,265 2.70 The weighted-average grant-date fair value of RSUs granted during the years ended December 31, 2015 , 2014 , and 2013 was approximately $3.00 , $2.33 , and $2.15 , respectively. The total intrinsic value of the units vested during the years ended December 31, 2015 , 2014 , and 2013 was approximately $7,088 , $5,469 , and $5,117 , respectively. The aggregate intrinsic value of RSUs outstanding at December 31, 2015 is $9,148 . At December 31, 2015 there was approximately $13,860 of total unrecognized compensation costs related to RSUs. That cost is expected to be recognized over a weighted-average period of approximately 2.32 years as of December 31, 2015 . Unrecognized aggregate share-based compensation expense totaled approximately $20,749 at December 31, 2015 , which is expected to be recognized over a weighted average period of approximately 2.31 years. The following table summarizes the components of share-based compensation expense included in our consolidated statement of operations: Years Ended December 31, 2015 2014 2013 Share-based compensation expense by type: Stock options $ 4,131 $ 4,704 $ 6,617 Restricted stock units 7,620 5,609 5,671 ESPP 587 178 57 Total share-based compensation expense $ 12,338 $ 10,491 $ 12,345 Share-based compensation expense included in the consolidated statements of operations: Cost of services $ 2,047 $ 1,956 $ 1,873 General and administrative expense 5,398 4,741 5,971 Sales and marketing expense 2,657 2,317 2,245 Research and development expense 2,236 1,477 2,256 Total share-based compensation expense $ 12,338 $ 10,491 $ 12,345 On September 18, 2015, the compensation committee of our board of directors approved a stock for salary program and a stock for bonus program, wherein eligible participants may elect to receive payment of his or her base salary and/or bonus in shares of our common stock beginning on January 1, 2016. The shares of common stock will be issued under our 2007 Equity Incentive Plan. Eligible program participants include our Chief Executive Officer and his direct reports. The stock for salary program permits eligible participants to receive 0 , 25 , 50 , 75 , or 100% of his or her 2016 salary (including any increases that may occur during the year) in shares of our common stock. On the last trading day of each calendar month, each participant will receive the number of shares of our common stock determined by dividing (i) 1/12th of his or her enrolled salary by (ii) the trailing 30-day closing average of our common stock, rounded up to the nearest whole share. Once an election is made, it runs for the full year 2016 and is irrevocable. Participation levels may not be changed after the close of the enrollment period. Once purchased, there is no vesting period for the shares. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions In July 2006, an aggregate of 39,869,960 shares of Series B Preferred Stock was issued at a purchase price of $3.26 per share to certain accredited investors in a private placement transaction. As a result of this transaction, entities affiliated with Goldman, Sachs & Co., one of the lead underwriters of our initial public offering (IPO), became holders of more than 10% of our common stock. On June 14, 2007, upon the closing of our IPO, all outstanding shares of our Series B Preferred Stock automatically converted into shares of common stock on a 1-for-1 share basis . As of December 31, 2015 , Goldman, Sachs & Co. owned approximately 30% of our outstanding common stock. As of December 31, 2014 , and 2013 , respectively, Goldman, Sachs & Co. owned approximately 31% of our outstanding common stock. We sold services to entities owned, in whole or in part, by certain of our executive officers and previous directors. Revenue derived from related parties was less than 1% of total revenue for the year ended December 31, 2014. Revenue derived from related parties was approximately 1% for the year ended December 31, 2013. Total outstanding accounts receivable from all related parties as of December 31, 2014 and 2013 was not material. We had no material related party transactions during the year ended December 31, 2015. During 2013, we entered into an agreement for services with an entity in which a current member of our board of directors was an officer. During 2013, we incurred approximately $ 154 in expense for services rendered. We did not incur similar expenses in 2014 or 2015. |
Leases and Commitments
Leases and Commitments | 12 Months Ended |
Dec. 31, 2015 | |
Leases and Commitments [Abstract] | |
Leases and Commitments | Leases and Commitments Operating Leases We are committed to various non-cancellable operating leases for office space and office equipment which expire through 2022. Certain leases contain provisions for renewal options and rent escalations upon expiration of the initial lease terms. Approximate future minimum lease payments over the remaining lease periods as of December 31, 2015 are as follows: 2016 $ 3,902 2017 3,051 2018 2,835 2019 1,301 2020 356 Thereafter 269 Total minimum payments $ 11,714 Purchase Commitments We have long-term commitments for bandwidth usage and co-location with various networks and Internet service providers or ISPs. The following summarizes minimum commitments as of December 31, 2015 : 2016 $ 26,365 2017 6,517 2018 2,633 2019 715 2020 70 Thereafter 8 Total minimum payments $ 36,308 Rent and operating expense relating to these operating lease agreements and bandwidth and co-location agreements was approximately $61,571 , $58,288 , and $61,693 , respectively, for the years ended December 31, 2015 , 2014 , and 2013 . Capital Leases We lease equipment under capital lease agreements which extend through 2020. As of December 31, 2015 and 2014 , the outstanding balance for capital leases was approximately $1,902 and $358 , respectively. We have recorded assets under capital lease obligations of approximately $1,679 and $2,224 , respectively, as of December 31, 2015 and 2014 . Related accumulated amortization totaled approximately $210 and $2,209 , respectively as of December 31, 2015 and 2014 . The assets acquired under capital leases and related accumulated amortization are included in property and equipment, net in the consolidated balance sheets. The related amortization is included in depreciation and amortization expense (operating expenses) in the consolidated statements of operations. The average interest rate on our outstanding capital leases at December 31, 2015 was approximately six percent. Interest expense related to capital leases was approximately $14 , $32 , and $76 , respectively, for the years ended December 31, 2015 , 2014 , and 2013 . Future minimum capital lease payments at December 31, 2015 were as follows: 2016 $ 571 2017 571 2018 570 2019 427 2020 — Thereafter — Total 2,139 Amounts representing interest (237 ) Present value of minimum lease payments $ 1,902 |
Concentrations
Concentrations | 12 Months Ended |
Dec. 31, 2015 | |
Concentrations [Abstract] | |
Concentrations | Concentrations During the years ended December 31, 2015 and 2014, we had no customer who represented 10% or more of total revenue. For the years ended December 31, 2013, Netflix, Inc. represented approximately 11% of our total revenue. Revenue from customers located within the United States, our country of domicile, was approximately $96,469 , $93,678 , and $110,824 , respectively, for the years ended December 31, 2015 , 2014 , and 2013 . During the years ended December 31, 2015 and 2014, we had two countries, Japan and the United States, which accounted for 10% or more of our total revenues. During the year ended December 31, 2013, we had no single country outside of the United States that accounted for 10% or more of our total revenues. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income Taxes Our loss from continuing operations before income taxes consists of the following: Years Ended December 31, 2015 2014 2013 (Loss) income from continuing operations before income taxes: United States $ (24,105 ) $ (25,025 ) $ (34,789 ) Foreign 420 372 200 $ (23,685 ) $ (24,653 ) $ (34,589 ) The components of the provision for income taxes are as follows: Years Ended December 31, 2015 2014 2013 Current: Federal $ — $ (143 ) $ — State 103 26 80 Foreign 210 680 442 Total current 313 563 522 Deferred: Federal 17 15 16 State — — — Foreign (63 ) (375 ) (151 ) Total deferred (46 ) (360 ) (135 ) Total provision $ 267 $ 203 $ 387 A reconciliation of the U.S. federal statutory rate to our effective income tax rate is shown in the table below: Years Ended December 31, 2015 2014 2013 Amount Percent Amount Percent Amount Percent U.S. federal statutory tax rate $ (8,290 ) 35 % $ (8,629 ) 35 % $ (12,106 ) 35 % Valuation allowance 3,821 (16 )% 7,424 (30 )% 12,958 (37 )% Foreign income taxes 86 (0.5 )% (26 ) — % 221 (1 )% State income taxes 92 (0.5 )% 26 — % 80 — % Non-deductible expenses 552 (2 )% 1,335 (6 )% (783 ) 2 % Uncertain tax positions (86 ) — % 201 (1 )% 14 — % Share-based compensation 4,064 (17 )% — — % — — % Other 28 — % (128 ) 1 % 3 — % Provision for income taxes $ 267 (1 )% $ 203 (1 )% $ 387 (1 )% Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purpose. Significant components of our deferred tax assets and liabilities are as follows: December 31, 2015 2014 Deferred tax assets: Share-based compensation $ 11,090 $ 13,613 Net operating loss and tax credit carry-forwards 43,600 33,519 Deferred revenue 1,306 2,089 Accounts receivable reserves 518 556 Fixed assets 3,172 4,813 Other 1,041 1,693 Total deferred tax assets 60,727 56,283 Deferred tax liabilities: Intangible assets — (177 ) Prepaid expenses (128 ) (144 ) Other (154 ) (36 ) Total deferred tax liabilities (282 ) (357 ) Valuation allowance (59,241 ) (54,654 ) Net deferred tax assets $ 1,204 $ 1,272 In addition to the deferred tax assets listed in the table above, we have unrecorded tax benefits of $13,660 and $10,750 at December 31, 2015 and December 31, 2014 , respectively, primarily attributable to the difference between the amount of the financial statement expense and the allowable tax deduction associated with employee stock options and RSUs, which, if subsequently realized will be recorded to contributed capital. As a result of net operating loss (NOL) carryforwards, we were not able to recognize the excess tax benefits of stock option deductions because the deductions did not reduce income tax payable. Although not recognized for financial reporting purposes, this unrecorded tax benefit is available to reduce future income and is incorporated into the disclosed amounts of our federal and state NOL carryforwards, discussed below. The federal and state NOL carryforwards relate to prior years’ NOLs, which may be used to reduce tax liabilities in future years. At December 31, 2015 , we had $127,200 federal and $83,500 state NOL carryforwards, including the NOLs discussed in the preceding paragraph. Our federal NOL will begin to expire in 2027 and the state NOL carryforwards will begin to expire in 2016. Pursuant to Sections 382 and 383 of the Internal Revenue Code, the utilization of NOLs and other tax attributes may be subject to substantial limitations if certain ownership changes occur during a three-year testing period (as defined by the Internal Revenue Code). At December 31, 2015 , we had state tax credit carryforwards of $15 , which will expire at various dates beginning in 2016. We reduce the carrying amounts of deferred tax assets by a valuation allowance if, based on the evidence available, it is more-likely-than-not that such assets will not be realized. In making the assessment under the more-likely-than-not standard, appropriate consideration must be given to all positive and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry-forward periods by jurisdiction, unitary versus stand-alone state tax filings, our experience with loss carryforwards not expiring unutilized, and all tax planning alternatives that may be available. A valuation allowance has been recorded against our deferred tax assets, with the exception of deferred tax assets at certain foreign subsidiaries as management cannot conclude that it is more-likely-than-not that these assets will be realized. As of December 31, 2015, no valuation allowance was provided on $ 1,600 of deferred tax assets associated with certain NOLs because it was believed that they will be used to offset our liabilities relating to our uncertain tax positions. Estimated liabilities for unrecognized tax benefits are included in “other liabilities” on the consolidated balance sheet. These contingent liabilities relate to various tax matters that result from uncertainties in the application of complex income tax regulations in the numerous jurisdictions in which we operate. As of December 31, 2015, unrecognized tax benefits were $1,968 , of which approximately $371 , if recognized, would favorably impact the effective tax rate and the remaining balance would be substantially offset by valuation allowances. A summary of the activities associated with our reserve for unrecognized tax benefits, interest and penalties follow: Unrecognized Tax Benefits Balance at January 1, 2014 $ 1,757 Additions for tax positions related to current year — Additions for tax positions related to prior years 312 Settlements — Adjustment related to foreign currency translation (4 ) Reductions related to the lapse of applicable statute of limitations (22 ) Reduction for tax positions of prior years — Balance at December 31, 2014 2,043 Additions for tax positions related to current year — Additions for tax positions related to prior years — Settlements (26 ) Adjustment related to foreign currency translation (18 ) Reductions related to the lapse of applicable statute of limitations (31 ) Reduction for tax positions of prior years — Balance at December 31, 2015 $ 1,968 We recognize interest and penalties related to unrecognized tax benefits in our tax provision. As of December 31, 2015 , we had an interest and penalties accrual related to unrecognized tax benefits of $23 , which decreased during 2015 by $56 . We anticipate our unrecognized tax benefits may increase or decrease within twelve months of the reporting date, as audits or reviews are initiated or settled and as a result of settled potential tax liabilities in certain foreign jurisdictions. It is not currently reasonably possible to estimate the range of change. We file income tax returns in jurisdictions with varying statues of limitations. Tax years 2012 through 2014 remain subject to examination by federal tax authorities. Tax years 2011 through 2014 generally remain subject to examination by state tax authorities. As of December 31, 2015 , our 2012 federal income tax return is under audit. As of December 31, 2015 , we are not under any state income tax examinations. Income taxes have not been provided on a portion of the undistributed earnings of our foreign subsidiaries over which we have sufficient influence to control the distribution of such earnings and have determined that substantially all of such earnings were reinvested indefinitely. The undistributed earnings of our foreign subsidiaries were approximately $1,500 at December 31, 2015 . These earnings could become subject to either or both federal income tax and foreign withholding tax if they are remitted as dividends, if foreign earnings are loaned to any of our domestic subsidiaries, or if we sell our investment in such subsidiaries. A hypothetical calculation of the deferred tax liability, assuming those earnings were remitted, is not practicable. |
401(k) Plan
401(k) Plan | 12 Months Ended |
Dec. 31, 2015 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
401(k) Plan | 401(k) Plan We manage the Limelight Networks 401(k) Plan covering effectively all of our employees. The plan is a 401(k) profit sharing plan in which participating employees are fully vested in any contributions they make. We will match employee deferrals as follows: a dollar-for-dollar match on eligible employee’s deferral that does not exceed 3% of compensation for the year and a 50% match on the next 2% of the employee deferrals. Our employees may elect to reduce their current compensation up to the statutory limit. We made matching contributions of approximately $1,434 , $1,225 , and $1,196 during the years ended December 31, 2015 , 2014 , and 2013 , respectively. |
Segment Reporting and Geographi
Segment Reporting and Geographic Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting and Geographic Information Our chief operating decision maker (whom is our Chief Executive Officer) reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating our financial performance. We operate in one industry segment — content delivery and related services and we operate in three geographic areas — Americas, Europe, Middle East and Africa (EMEA) and Asia Pacific. Revenue by geography is based on the location of the customer from which the revenue is earned. The following table sets forth revenue by geographic area: Years Ended December 31, 2015 2014 2013 Americas $ 102,505 60.0 % $ 101,302 62.5 % $ 119,020 68.6 % EMEA 32,505 19.0 % 33,630 20.7 % 30,793 17.8 % Asia Pacific 35,902 21.0 % 27,327 16.8 % 23,620 13.6 % Total revenue $ 170,912 100.0 % $ 162,259 100.0 % $ 173,433 100.0 % The following table sets forth long-lived assets by geographic area: Years Ended December 31, 2015 2014 2013 Long-lived Assets Americas $ 19,692 $ 22,505 $ 26,502 International 16,466 11,202 8,757 Total long-lived assets $ 36,158 $ 33,707 $ 35,259 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value, Assets, Liabilities and Stockholders' Equity Measured on Recurring Basis [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company evaluates certain of its financial instruments within the three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1 - defined as observable inputs such as quoted prices in active markets; Level 2 - defined as other than quoted prices in active markets that are either directly or indirectly observable; and Level 3 - defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. As of December 31, 2015, and 2014, we held certain assets and liabilities that were required to be measured at fair value on a recurring basis. The following is a summary of fair value measurements at December 31, 2015 : Fair Value Measurements at Reporting Date Using Description Total Quoted Prices In Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds (2) $ 725 $ 725 $ — $ — Corporate notes and bonds (1) 15,898 — 15,898 — Certificate of deposit (1) 12,464 — 12,464 — Total assets measured at fair value $ 29,087 $ 725 $ 28,362 $ — ___________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents The following is a summary of fair value measurements at December 31, 2014 : Fair Value Measurements at Reporting Date Using Description Total Quoted Prices In Active Markets for Identical Assets Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds (2) $ 57 $ 57 $ — $ — Corporate notes and bonds (1) 21,850 — 21,850 — Commercial paper (1) 1,497 — 1,497 — Certificate of deposit (1) 11,010 — 11,010 — Convertible debt security (1) 1,000 — — 1,000 Total assets measured at fair value $ 35,414 $ 57 $ 34,357 $ 1,000 ____________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents During the year ended December 31, 2015, a $1,000 convertible debt security, classified as Level 3 in the fair value hierarchy as of December 31, 2014, was converted into preferred shares of the issuing entity. As a result of the conversion, we recognized a gain of $275 , related to a beneficial conversion feature, which is included in other income (expense) in our statement of operations for the year ended December 31, 2015. After conversion, at December 31, 2015, the investment is carried at cost of $1,275 and is evaluated for impairment quarterly or when events or changes in circumstances indicate the carrying value of the investment may exceed its fair value. We did not estimate the fair value of the investment because we did not identify any events or circumstances that would have a significant effect on the fair value of the investment. Determining fair value is not practicable because the preferred shares are not publicly traded and information necessary to determine fair value is not available. The cost basis investment transferred out of a Level 3 marketable security to other assets in our consolidated balance sheet. The carrying amount of cash equivalents approximates fair value because their maturity is less than three months. The carrying amount of short-term and long-term marketable securities approximates fair value as the securities are marked to market as of each balance sheet date with any unrealized gains and losses reported in stockholders’ equity. The carrying amount of accounts receivable, accounts payable and accrued liabilities approximates fair value due to the short-term maturity of the amounts. |
Quarterly Financial Results (un
Quarterly Financial Results (unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data [Abstract] | |
Quarterly Financial Results (unaudited) | Quarterly Financial Results (unaudited) The following tables sets forth certain unaudited quarterly results of operations for the years ended December 31, 2015 and 2014 . Amounts may not foot due to rounding. In the opinion of management, this information has been prepared on the same basis as the audited consolidated financial statements and all necessary adjustments, consisting only of normal recurring adjustments, have been included in the amounts below for a fair statement of the quarterly information when read in conjunction with the audited consolidated financial statements and related notes included elsewhere in this annual report on Form 10-K: For the Three Months Ended March 31, 2015 June 30, 2015 Sept. 30, 2015 Dec. 31, 2015 Revenues $ 42,329 $ 43,795 $ 42,049 $ 42,739 Gross profit $ 16,519 $ 18,148 $ 15,911 $ 17,540 Loss from continuing operations $ (5,683 ) $ (6,362 ) $ (7,762 ) $ (4,145 ) Net loss $ (5,683 ) $ (6,362 ) $ (7,762 ) $ (4,145 ) Basic and diluted net loss per share from continuing operations $ (0.06 ) $ (0.06 ) $ (0.08 ) $ (0.04 ) Basic and diluted net loss per share $ (0.06 ) $ (0.06 ) $ (0.08 ) $ (0.04 ) Basic and diluted weighted average common shares outstanding 98,636 99,841 100,552 101,391 For the Three Months Ended March 31, 2014 June 30, 2014 Sept. 30, 2014 (a) Dec. 31, 2014 Revenues $ 41,170 $ 41,343 $ 39,020 $ 40,727 Gross profit $ 15,267 $ 15,873 $ 16,141 $ 16,129 Loss from continuing operations $ (7,640 ) $ (7,138 ) $ (5,071 ) $ (5,007 ) Income (loss) from discontinued operations $ — $ 269 $ (4 ) $ — Net loss $ (7,640 ) $ (6,869 ) $ (5,075 ) $ (5,007 ) Basic and diluted net loss per share from continuing operations $ (0.08 ) $ (0.07 ) $ (0.05 ) $ (0.05 ) Basic and diluted net loss per share from discontinued operations $ — $ — $ — $ — Basic and diluted net loss per share $ (0.08 ) $ (0.07 ) $ (0.05 ) $ (0.05 ) Basic and diluted weighted average common shares outstanding 97,946 98,419 98,458 98,637 (a) During the three months ended September 30, 2014, we recorded an immaterial error correction of approximately $1,100 relating to previous over-billings by a co-location provider. The correction was recorded as a reduction of costs of revenue. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2015 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS (In thousands) Additions Deductions Description Balance at Beginning of Period Charged to Costs and Expenses Charged Against Revenue Write-Offs Net of Recoveries Balance at End of Period Year ended December 31, 2013: Allowances deducted from asset accounts: Reserves for accounts receivable $ 4,070 965 (30 ) 2,995 $ 2,010 Deferred tax asset valuation allowance $ 46,215 951 — — $ 47,166 Year ended December 31, 2014: Allowances deducted from asset accounts: Reserves for accounts receivable $ 2,010 408 (230 ) 354 $ 1,834 Deferred tax asset valuation allowance $ 47,166 7,488 — — $ 54,654 Year ended December 31, 2015: Allowances deducted from asset accounts: Reserves for accounts receivable $ 1,834 1,037 81 1,148 $ 1,804 Deferred tax asset valuation allowance $ 54,654 4,587 — — $ 59,241 |
Summary of Significant Accoun32
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). The consolidated financial statements include accounts of Limelight and our wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated. In addition, certain other reclassifications have been made to prior period amounts to conform to the current period presentation. All information is presented in thousands, except per share amounts and where specifically noted. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make judgments, assumptions, and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results and outcomes may differ from those estimates. The results of operations presented in this annual report on Form 10-K are not necessarily indicative of the results that may be expected for the year ending December 31, 2016, or for any future periods. |
Foreign Currency Translation | Foreign Currency Translation The functional currency of our international subsidiaries is the local currency. Due to changes in exchange rates between reporting periods and changes in certain account balances, the foreign currency translation adjustment will change from period to period. |
Recent Accounting Standards | Recent Accounting Standards Recently Adopted Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-03, which requires that all costs incurred to issue debt be presented in the balance sheet as a direct deduction from the carrying value of the debt, similar to the presentation of debt discounts. We adopted this guidance effective December 31, 2015. We had no outstanding debt agreements as of December 31, 2014 and the adoption of this guidance had no impact on our prior presented financial statements. In August 2015, the FASB issued ASU No. 2015-15, which clarifies the treatment of debt issuance costs from line-of-credit arrangements after the adoption of ASU 2015-03. In particular, ASU 2015-15 clarifies that the SEC staff would not object to an entity deferring and presenting debt issuance costs related to a line-of-credit arrangement as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of such arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We adopted this guidance effective December 31, 2015. Recently Issued Accounting Pronouncements In April 2015, the FASB issued ASU 2015-05, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then 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. The guidance will not change U.S. GAAP for a customer's accounting for service contracts. We will adopt this guidance effective January 1, 2016. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, which provides guidance for revenue recognition. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under today’s guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2014-09 for all entities by one year. Accordingly, public business entities should apply the guidance in ASU 2014-09 to annual reporting periods (including interim periods within those periods) beginning after December 15, 2017. Early adoption is permitted but not before annual periods beginning after December 15, 2016. The standard permits the use of the retrospective or the modified approach method. We have not yet selected a transition method, and are currently in the process of evaluating the impact of adoption of this ASU on our consolidated financial statements and disclosures. In August 2014, the FASB issued ASU 2014-15, which provides guidance for disclosure of uncertainties about an entity’s ability to continue as a going concern. ASU 2014-15 defines management's responsibility to assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. This guidance will be effective for us in the first annual period ending after December 15, 2016, and interim periods within such year; however, early adoption is permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16 which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period for a business combination in the reporting period in which the adjustment amounts are determined. Prior to the issuance of the standard, entities were required to retrospectively apply adjustments made to provisional amounts recognized in a business combination. We will adopt this guidance effective January 1, 2016. We do not expect that the adoption of this standards update will have a material impact on our consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, which will require entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as noncurrent in a classified balance sheet. The ASU simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current and noncurrent in a classified balance sheet. ASU 2015-17 is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. |
Revenue Recognition | Revenue Recognition We derive revenue primarily from the sale of services that comprise components of our Orchestrate Platform. Our customers generally execute contracts with terms of one year or longer, which are referred to as recurring revenue contracts or long-term contracts. These contracts generally commit the customer to a minimum monthly level of usage with additional charges applicable for actual usage above the monthly minimum commitment, or are entirely usage based. We define usage as customer data sent or received using our content delivery service, or content that is hosted or cached by us at the request or direction of our customers. We recognize the monthly minimum as revenue each month provided that an enforceable contract has been signed by both parties, the service has been delivered to the customer, the fee for the service is fixed or determinable, and collection is reasonably assured. Should a customer’s usage of our services exceed the monthly minimum commitment, we recognize revenue for such excess in the period of the usage. For annual or other non-monthly period revenue commitments, we recognize revenue monthly based upon the customer’s actual usage each month of the commitment period and only recognize any remaining committed amount for the applicable period in the last month thereof. Certain of our revenue arrangements consist of multi-element arrangements. Revenue arrangements with multiple deliverables are divided into separate units of accounting if each deliverable has stand-alone value to the customer. Our multiple-element arrangements may include a combination of some or all of the following: content delivery services, video content management services, performance services for website and web application acceleration and security, professional services, and cloud storage. Each of these products has stand-alone value and is sold separately. In the absence of vendor specific objective evidence (VSOE) or third-party evidence of selling prices, consideration would be allocated based on management’s best estimate of such prices. The deliverables within multiple-element arrangements are provided over the same contract period, and therefore, revenue is recognized over the same period. We may charge the customer an installation fee when the services are first activated. We do not charge installation fees for contract renewals. Installation fees are recorded as deferred revenue and recognized as revenue ratably over the estimated life of the customer arrangement as installation fees do not have standalone value. We also derive revenue from services and events sold as discrete, non-recurring events or based solely on usage. For these services, we recognize revenue after an enforceable contract has been signed by both parties, the fee is fixed or determinable, the event or usage has occurred, and collection is reasonably assured. At the inception of a customer contract for service, we make an assessment as to that customer’s ability to pay for the services provided. If we subsequently determine that collection from the customer is not reasonably assured, we record an allowance for doubtful accounts and bad debt expense or deferred revenue for all of that customer’s unpaid invoices and cease recognizing revenue for continued services provided until cash is received. Deferred revenue represents amounts billed to customers for which revenue has not been recognized. Deferred revenue primarily consists of the unearned portion of monthly billed service fees; prepayments made by customers for future periods and deferred installation fees. |
Cash and Cash Equivalents | Cash and Cash Equivalents We hold our cash and cash equivalents in checking, money market, and highly-liquid investments. We consider all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. |
Investments in Marketable Securities | Investments in Marketable Securities Management determines the appropriate classification of its marketable securities at the time of purchase and reevaluates such classification as of each balance sheet date. We have classified our investments in marketable securities as available-for-sale and as current, as our marketable securities are available to fund current operations. Available-for-sale investments are initially recorded at cost with temporary changes in fair value periodically recorded through comprehensive income. Realized gains and losses and declines in value judged to be other than temporary are determined based on the specific identification method and are reported in the statements of operations. We periodically review our investments for other-than-temporary declines in fair value based on the specific identification method and would write down investments to their fair value if and when an other-than-temporary decline has occurred. |
Accounts Receivable | Accounts Receivable Trade accounts receivable are recorded at the invoiced amounts and do not bear interest. We record reserves against our accounts receivable balance for service credits and for doubtful accounts. Estimates are used in determining both of these reserves. The allowance for doubtful accounts charges are included as a component of general and administrative expenses. The allowance for doubtful accounts is based upon a calculation that uses our aging of accounts receivable and applies a reserve percentage to the specific age of the receivable to estimate the allowance for doubtful accounts. The reserve percentages are determined based on our historical write-off experience. These estimates could change significantly if our customers’ financial condition changes or if the economy in general deteriorates. In the event such conditions become known, we specifically identify balances for necessary reserves. Our reserve for service credits relates to credits that are expected to be issued to customers during the ordinary course of business. These credits typically relate to customer disputes and billing adjustments and are estimated at the time the revenue is recognized and recorded as a reduction of revenues. Estimates for service credits are based on an analysis of credits issued in previous periods. |
Property and Equipment | Property and Equipment Property and equipment are carried at cost less accumulated depreciation or amortization. Depreciation and amortization are computed using the straight-line method over the assets’ estimated useful lives of the applicable asset. Network equipment 3 years Computer equipment and software 3 years Furniture and fixtures 3 years Other equipment 3-5 years Leasehold improvements are amortized over the shorter of the asset’s estimated useful life or the respective lease term. Repairs and maintenance are charged to expense as incurred. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill represents costs in excess of fair values assigned to the underlying net assets of the acquired company. Goodwill is not amortized but instead is tested for impairment annually or more frequently if events or changes in circumstances indicate goodwill might be impaired. We have concluded that we have one reporting unit and assigned the entire balance of goodwill to this reporting unit. The estimated fair value of the reporting unit is determined using a market approach. Our market capitalization is adjusted for a control premium based on the estimated average and median control premiums of transactions involving companies comparable to us. As of the annual impairment testing date of October 31, 2015, and in an interim impairment test performed at December 31, 2015, management determined that goodwill was not impaired. Management determined that the estimated fair value of its reporting unit exceeded carrying value by approximately $90,135 or 45% , and $11,002 or 6% , using our market capitalization plus an estimated control premium of 40% on October 31, 2015, and December 31, 2015, respectively. Our other intangible assets represent existing technologies and customer relationship intangibles. Other intangible assets are amortized over their respective estimated lives, ranging from less than one year to six years . In the event that facts and circumstances indicate intangibles or other long-lived assets may be impaired, we evaluate the recoverability and estimated useful lives of such assets. Amortization of other intangible assets is included in depreciation and amortization in the accompanying consolidated statements of operations. |
Contingencies | Contingencies We record contingent liabilities resulting from asserted and unasserted claims when it is probable that a loss has been incurred and the amount of the loss is reasonably estimable. We disclose contingent liabilities when there is a reasonable possibility that the ultimate loss will exceed the recorded liability. Additionally, estimating the loss, or range of loss, associated with a contingency requires analysis of multiple factors, and changes in law or other developments may ultimately cause our judgments to change. Therefore, actual losses in any future period are inherently uncertain and may be materially different from our estimate. |
Long-Lived Assets | Long-Lived Assets We review our long-lived assets for impairment annually, or whenever events or circumstances indicate that the carrying amount of an asset may not be fully recoverable. We recognize an impairment loss if the sum of the expected long-term undiscounted cash flows that the long-lived asset is expected to generate is less than the carrying amount of the long-lived asset being evaluated. We treat any write-downs as permanent reductions in the carrying amounts of the assets. We believe the carrying amounts of our long-lived assets at December 31, 2015 , and 2014 , are fully realizable and have not recorded any impairment losses. |
Deferred Rent and Lease Accounting | Deferred Rent and Lease Accounting We lease bandwidth, co-location and office space in various locations. At the inception of each lease, we evaluate the lease terms to determine whether the lease will be accounted for as an operating or a capital lease. The term of the lease used for this evaluation includes renewal option periods only in instances where the exercise of the renewal option can be reasonably assured and failure to exercise the option would result in an economic penalty. We record tenant improvement allowances granted under the lease agreements as leasehold improvements within property and equipment and within deferred rent. For leases that contain rent escalation provisions, we record the total rent payable during the lease term on a straight-line basis over the term of the lease (including any “rent free” period beginning upon possession of the premises), and record any difference between the actual rent paid and the straight-line rent expense recorded as increases or decreases in deferred rent. |
Cost of Revenue | Cost of Revenue Cost of revenues consists primarily of fees paid to network providers for bandwidth and backbone, costs incurred for non-settlement free peering and connection to Internet service provider networks and fees paid to data center operators for housing network equipment in third party network data centers, also known as co-location costs. Cost of revenues also includes leased warehouse space and utilities, depreciation of network equipment used to deliver our content delivery services, payroll and related costs, and share-based compensation for our network operations and professional services personnel. We enter into contracts for bandwidth with third party network providers with terms typically ranging from several months to five years . These contracts generally commit us to pay minimum monthly fees plus additional fees for bandwidth usage above contracted minimums. A portion of the global computing platform traffic delivery is completed through direct connection to ISP networks, called peering. |
Research and Development | Research and Development Research and development costs consist primarily of payroll and related personnel costs for the design, development, deployment, testing, operation, and enhancement of our services, and network. Costs incurred in the development of our services are expensed as incurred. |
Advertising Costs | Advertising Costs Costs associated with advertising are expensed as incurred. |
Income Taxes | Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such determination, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and recent financial performance. In the event we were to determine that we would be able to realize our deferred income tax assets in the future in excess of their net recorded amount, we would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. We recognize uncertain income tax positions in our financial statements when it is more-likely-than-not the position will be sustained upon examination. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents approximate fair value due to the nature and short maturity of those instruments. The respective fair values of marketable securities are determined based on quoted market prices, which approximate fair values. The carrying amounts of accounts receivable, accounts payable, and accrued liabilities reported in the consolidated balance sheets approximate their respective fair values due to the immediate or short-term maturity of these financial instruments. |
Share-Based Compensation | Share-Based Compensation We measure all employee share-based compensation awards using the fair-value method. The grant date fair value was determined using the Black-Scholes-Merton pricing model. The Black-Scholes-Merton valuation calculation requires us to make key assumptions such as future stock price volatility, expected terms, risk-free rates, and dividend yield. Our expected volatility is derived from our own volatility rate as a publicly traded company. The expected term is based on our historical experience. The risk-free interest factor is based on the United States Treasury yield curve in effect at the time of the grant for zero coupon United States Treasury notes with maturities of approximately equal to each grant’s expected term. We have never paid cash dividends and do not currently intend to pay cash dividends, and therefore, have assumed a 0% dividend yield. We develop an estimate of the number of share-based awards that will be forfeited due to employee turnover. We will continue to use judgment in evaluating the expected term, volatility, and forfeiture rate related to our own share-based awards on a prospective basis, and in incorporating these factors into the model. We apply the straight-line attribution method to recognize compensation costs associated with awards that are not subject to graded vesting. For awards that are subject to graded vesting and performance based awards, we recognize compensation costs separately for each vesting tranche. We also estimate when and if performance-based awards will be earned. If an award is not considered probable of being earned, no amount of share-based compensation is recognized. If the award is deemed probable of being earned, related compensation expense is recorded over the estimated service period. To the extent our estimate of awards considered probable of being earned changes, the amount of share-based compensation recognized will also change. |
Summary of Significant Accoun33
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Estimated useful lives of assets | Depreciation and amortization are computed using the straight-line method over the assets’ estimated useful lives of the applicable asset. Network equipment 3 years Computer equipment and software 3 years Furniture and fixtures 3 years Other equipment 3-5 years |
Investments in Marketable Sec34
Investments in Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of marketable securities (designated as available-for-sale) | The following is a summary of marketable securities (designated as available-for-sale) at December 31, 2014 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposit $ 11,040 $ 2 $ 32 $ 11,010 Commercial paper 1,498 — 1 1,497 Corporate notes and bonds 21,876 7 33 21,850 Convertible debt security 1,000 — — 1,000 Total marketable securities $ 35,414 $ 9 $ 66 $ 35,357 The following is a summary of marketable securities (designated as available-for-sale) at December 31, 2015 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposit $ 12,480 $ 1 $ 17 $ 12,464 Corporate notes and bonds 15,940 2 44 15,898 Total marketable securities $ 28,420 $ 3 $ 61 $ 28,362 |
Amortized cost and estimated fair value of marketable securities (designated as available-for-sale) by maturity | The amortized cost and estimated fair value of the marketable debt securities at December 31, 2014 , by maturity, are shown below: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities Due in one year or less $ 19,798 $ 5 $ 9 $ 19,794 Due after one year and through five years 15,616 4 57 15,563 $ 35,414 $ 9 $ 66 $ 35,357 The amortized cost and estimated fair value of the marketable debt securities at December 31, 2015 , by maturity, are shown below: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale securities Due in one year or less $ 18,075 $ 2 $ 12 $ 18,065 Due after one year and through five years 10,345 1 49 10,297 $ 28,420 $ 3 $ 61 $ 28,362 |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Summary of accounts receivable, net | Accounts receivable include: December 31, 2015 2014 Accounts receivable $ 28,599 $ 24,456 Less: credit allowance (460 ) (380 ) Less: allowance for doubtful accounts (1,344 ) (1,454 ) Total accounts receivable, net $ 26,795 $ 22,622 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in the carrying amount of goodwill | The changes in the carrying amount of goodwill for the years ended December 31, 2015 , and 2014, were as follows: Balance, December 31, 2013 $ 77,035 Foreign currency translation adjustment (902 ) Balance, December 31, 2014 $ 76,133 Foreign currency translation adjustment 10 Balance, December 31, 2015 $ 76,143 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Property and equipment include: December 31, 2015 2014 Network equipment $ 129,172 $ 127,962 Computer equipment and software 11,408 9,079 Furniture and fixtures 2,472 2,498 Leasehold improvements 4,976 5,262 Other equipment 166 186 148,194 144,987 Less: accumulated depreciation (112,051 ) (112,351 ) Total property and equipment, net $ 36,143 $ 32,636 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Liabilities, Current [Abstract] | |
Other current liabilities | Other current liabilities include: December 31, 2015 2014 Accrued compensation and benefits $ 4,786 $ 5,266 Accrued cost of revenue 2,698 2,031 Accrued legal fees 143 1,292 Deferred rent 782 1,277 Other accrued expenses 2,448 4,517 Total other current liabilities $ 10,857 $ 14,383 |
Other Long Term Liabilities (Ta
Other Long Term Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Liabilities, Noncurrent [Abstract] | |
Other long term liabilities | Other long term liabilities include: December 31, 2015 2014 Deferred rent $ 1,907 $ 2,511 Income taxes payable 404 529 Total other long term liabilities $ 2,311 $ 3,040 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted net income (loss) per share | The following table sets forth the components used in the computation of basic and diluted net loss per share for the periods indicated: Years Ended December 31, 2015 2014 2013 Loss from continuing operations $ (23,952 ) $ (24,856 ) $ (34,976 ) Income (loss) from discontinued operations — 265 (426 ) Net loss $ (23,952 ) $ (24,591 ) $ (35,402 ) Basic and diluted weighted average outstanding shares of common stock 100,105 98,365 96,851 Basic and diluted loss per share: Continuing operations $ (0.24 ) $ (0.25 ) $ (0.36 ) Discontinued operations — — (0.01 ) Basic and diluted net loss per share $ (0.24 ) $ (0.25 ) $ (0.37 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | For the years ended December 31, 2015 , 2014 and 2013 , the following potentially dilutive common stock, including awards granted under our equity incentive compensation plans were excluded from the computation of diluted net loss per share because including them would have been anti-dilutive. Years Ended December 31, 2015 2014 2013 Employee stock purchase plan 134 40 — Stock options 1,245 664 561 Restricted stock units 2,420 1,764 1,425 3,799 2,468 1,986 |
Accumulated Other Comprehensi41
Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive loss | Changes in the components of accumulated other comprehensive loss, net of tax, for the year ended December 31, 2015, was as follows: Unrealized Gains (Losses) on Foreign Available for Currency Sale Securities Total Balance, December 31, 2014 $ (7,743 ) $ (43 ) $ (7,786 ) Other comprehensive loss before reclassifications (3,025 ) (1 ) (3,026 ) Amounts reclassified from accumulated other comprehensive loss — — — Net current period other comprehensive loss (3,025 ) (1 ) (3,026 ) Balance, December 31, 2015 $ (10,768 ) $ (44 ) $ (10,812 ) |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | |
Stock option activity | Data pertaining to stock option activity under the Plans are as follows: Number of Shares Weighted Average Exercise Price (In thousands) Balance at December 31, 2012 14,310 $ 4.58 Granted 4,902 2.19 Exercised (143 ) 0.26 Cancelled (3,087 ) 3.87 Balance at December 31, 2013 15,982 4.00 Granted 4,215 2.40 Exercised (522 ) 1.71 Cancelled (2,803 ) 4.15 Balance at December 31, 2014 16,872 3.66 Granted 3,649 2.64 Exercised (607 ) 1.73 Cancelled (5,247 ) 4.08 Balance at December 31, 2015 14,667 3.33 |
Outstanding stock options | The following table summarizes the information about stock options outstanding and exercisable at December 31, 2015 : Options Outstanding Options Exercisable Exercise Price Number of Options Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number of Options Exercisable Weighted Average Exercise Price (In thousands) (In thousands) $ 0.00 — $ 1.50 304 0.4 $ 0.45 304 $ 0.45 $ 1.51 — $ 3.00 9,707 7.5 2.25 5,311 2.25 $ 3.01 — $ 4.50 2,175 6.7 3.75 1,131 3.85 $ 4.51 — $ 6.00 1,269 4.3 5.15 1,269 5.15 $ 6.01 — $ 7.50 441 2.3 6.37 441 6.37 $ 7.51 — $ 15.00 771 2.3 12.17 771 12.17 14,667 9,227 |
Grant date fair value of option | The fair value of options awarded were estimated on the grant date using the following weighted average assumptions: Years Ended December 31, 2015 2014 2013 Expected volatility 54.53 % 66.05 % 77.96 % Expected term, years 5.99 5.99 6.05 Risk-free interest 1.80 % 1.83 % 1.31 % Expected dividends — % — % — % |
Different types of restricted stock units (RSUs) outstanding | The following table summarizes the RSUs outstanding (in thousands): Years Ended December 31, 2015 2014 2013 RSUs with service-based vesting conditions 6,265 6,820 5,286 |
Restricted stock units activity | Data pertaining to RSUs activity under the Plans is as follows: Number of Units Weighted Average Fair Value (In thousands) Balance at December 31, 2012 4,581 $ 2.74 Granted 4,970 2.15 Vested (2,032 ) 2.53 Cancelled (2,233 ) 2.78 Balance at December 31, 2013 5,286 2.24 Granted 5,542 2.33 Vested (2,385 ) 2.28 Cancelled (1,623 ) 2.22 Balance at December 31, 2014 6,820 2.30 Granted 4,156 3.00 Vested (3,069 ) 2.31 Cancelled (1,642 ) 2.54 Balance at December 31, 2015 6,265 2.70 |
Components of share-based compensation expense | The following table summarizes the components of share-based compensation expense included in our consolidated statement of operations: Years Ended December 31, 2015 2014 2013 Share-based compensation expense by type: Stock options $ 4,131 $ 4,704 $ 6,617 Restricted stock units 7,620 5,609 5,671 ESPP 587 178 57 Total share-based compensation expense $ 12,338 $ 10,491 $ 12,345 Share-based compensation expense included in the consolidated statements of operations: Cost of services $ 2,047 $ 1,956 $ 1,873 General and administrative expense 5,398 4,741 5,971 Sales and marketing expense 2,657 2,317 2,245 Research and development expense 2,236 1,477 2,256 Total share-based compensation expense $ 12,338 $ 10,491 $ 12,345 |
Leases and Commitments (Tables)
Leases and Commitments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Leases and Commitments [Abstract] | |
Future minimum lease payments over remaining lease periods | Approximate future minimum lease payments over the remaining lease periods as of December 31, 2015 are as follows: 2016 $ 3,902 2017 3,051 2018 2,835 2019 1,301 2020 356 Thereafter 269 Total minimum payments $ 11,714 |
Minimum Purchase commitments | The following summarizes minimum commitments as of December 31, 2015 : 2016 $ 26,365 2017 6,517 2018 2,633 2019 715 2020 70 Thereafter 8 Total minimum payments $ 36,308 |
Future minimum capital lease payments | Future minimum capital lease payments at December 31, 2015 were as follows: 2016 $ 571 2017 571 2018 570 2019 427 2020 — Thereafter — Total 2,139 Amounts representing interest (237 ) Present value of minimum lease payments $ 1,902 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
(Loss) income before taxes | Our loss from continuing operations before income taxes consists of the following: Years Ended December 31, 2015 2014 2013 (Loss) income from continuing operations before income taxes: United States $ (24,105 ) $ (25,025 ) $ (34,789 ) Foreign 420 372 200 $ (23,685 ) $ (24,653 ) $ (34,589 ) |
Components of provision (benefit) for income taxes | The components of the provision for income taxes are as follows: Years Ended December 31, 2015 2014 2013 Current: Federal $ — $ (143 ) $ — State 103 26 80 Foreign 210 680 442 Total current 313 563 522 Deferred: Federal 17 15 16 State — — — Foreign (63 ) (375 ) (151 ) Total deferred (46 ) (360 ) (135 ) Total provision $ 267 $ 203 $ 387 |
Reconciliation of the U.S. federal statutory rate to the Company's effective income tax rate | A reconciliation of the U.S. federal statutory rate to our effective income tax rate is shown in the table below: Years Ended December 31, 2015 2014 2013 Amount Percent Amount Percent Amount Percent U.S. federal statutory tax rate $ (8,290 ) 35 % $ (8,629 ) 35 % $ (12,106 ) 35 % Valuation allowance 3,821 (16 )% 7,424 (30 )% 12,958 (37 )% Foreign income taxes 86 (0.5 )% (26 ) — % 221 (1 )% State income taxes 92 (0.5 )% 26 — % 80 — % Non-deductible expenses 552 (2 )% 1,335 (6 )% (783 ) 2 % Uncertain tax positions (86 ) — % 201 (1 )% 14 — % Share-based compensation 4,064 (17 )% — — % — — % Other 28 — % (128 ) 1 % 3 — % Provision for income taxes $ 267 (1 )% $ 203 (1 )% $ 387 (1 )% |
Components of Company's deferred tax assets and liabilities | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purpose. Significant components of our deferred tax assets and liabilities are as follows: December 31, 2015 2014 Deferred tax assets: Share-based compensation $ 11,090 $ 13,613 Net operating loss and tax credit carry-forwards 43,600 33,519 Deferred revenue 1,306 2,089 Accounts receivable reserves 518 556 Fixed assets 3,172 4,813 Other 1,041 1,693 Total deferred tax assets 60,727 56,283 Deferred tax liabilities: Intangible assets — (177 ) Prepaid expenses (128 ) (144 ) Other (154 ) (36 ) Total deferred tax liabilities (282 ) (357 ) Valuation allowance (59,241 ) (54,654 ) Net deferred tax assets $ 1,204 $ 1,272 |
Summary of activities associated with Company's reserve for unrecognized tax benefits interest and penalties | A summary of the activities associated with our reserve for unrecognized tax benefits, interest and penalties follow: Unrecognized Tax Benefits Balance at January 1, 2014 $ 1,757 Additions for tax positions related to current year — Additions for tax positions related to prior years 312 Settlements — Adjustment related to foreign currency translation (4 ) Reductions related to the lapse of applicable statute of limitations (22 ) Reduction for tax positions of prior years — Balance at December 31, 2014 2,043 Additions for tax positions related to current year — Additions for tax positions related to prior years — Settlements (26 ) Adjustment related to foreign currency translation (18 ) Reductions related to the lapse of applicable statute of limitations (31 ) Reduction for tax positions of prior years — Balance at December 31, 2015 $ 1,968 |
Segment Reporting and Geograp45
Segment Reporting and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Revenue by geography | Revenue by geography is based on the location of the customer from which the revenue is earned. The following table sets forth revenue by geographic area: Years Ended December 31, 2015 2014 2013 Americas $ 102,505 60.0 % $ 101,302 62.5 % $ 119,020 68.6 % EMEA 32,505 19.0 % 33,630 20.7 % 30,793 17.8 % Asia Pacific 35,902 21.0 % 27,327 16.8 % 23,620 13.6 % Total revenue $ 170,912 100.0 % $ 162,259 100.0 % $ 173,433 100.0 % |
Long-lived assets by geography | The following table sets forth long-lived assets by geographic area: Years Ended December 31, 2015 2014 2013 Long-lived Assets Americas $ 19,692 $ 22,505 $ 26,502 International 16,466 11,202 8,757 Total long-lived assets $ 36,158 $ 33,707 $ 35,259 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value, Assets, Liabilities and Stockholders' Equity Measured on Recurring Basis [Abstract] | |
Summary of money market funds, marketable securities, other investment-related assets and current liabilities | The following is a summary of fair value measurements at December 31, 2015 : Fair Value Measurements at Reporting Date Using Description Total Quoted Prices In Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds (2) $ 725 $ 725 $ — $ — Corporate notes and bonds (1) 15,898 — 15,898 — Certificate of deposit (1) 12,464 — 12,464 — Total assets measured at fair value $ 29,087 $ 725 $ 28,362 $ — ___________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents The following is a summary of fair value measurements at December 31, 2014 : Fair Value Measurements at Reporting Date Using Description Total Quoted Prices In Active Markets for Identical Assets Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds (2) $ 57 $ 57 $ — $ — Corporate notes and bonds (1) 21,850 — 21,850 — Commercial paper (1) 1,497 — 1,497 — Certificate of deposit (1) 11,010 — 11,010 — Convertible debt security (1) 1,000 — — 1,000 Total assets measured at fair value $ 35,414 $ 57 $ 34,357 $ 1,000 ____________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents |
Quarterly Financial Results (47
Quarterly Financial Results (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data [Abstract] | |
Quarterly results of operations (unaudited) | The following tables sets forth certain unaudited quarterly results of operations for the years ended December 31, 2015 and 2014 . Amounts may not foot due to rounding. In the opinion of management, this information has been prepared on the same basis as the audited consolidated financial statements and all necessary adjustments, consisting only of normal recurring adjustments, have been included in the amounts below for a fair statement of the quarterly information when read in conjunction with the audited consolidated financial statements and related notes included elsewhere in this annual report on Form 10-K: For the Three Months Ended March 31, 2015 June 30, 2015 Sept. 30, 2015 Dec. 31, 2015 Revenues $ 42,329 $ 43,795 $ 42,049 $ 42,739 Gross profit $ 16,519 $ 18,148 $ 15,911 $ 17,540 Loss from continuing operations $ (5,683 ) $ (6,362 ) $ (7,762 ) $ (4,145 ) Net loss $ (5,683 ) $ (6,362 ) $ (7,762 ) $ (4,145 ) Basic and diluted net loss per share from continuing operations $ (0.06 ) $ (0.06 ) $ (0.08 ) $ (0.04 ) Basic and diluted net loss per share $ (0.06 ) $ (0.06 ) $ (0.08 ) $ (0.04 ) Basic and diluted weighted average common shares outstanding 98,636 99,841 100,552 101,391 For the Three Months Ended March 31, 2014 June 30, 2014 Sept. 30, 2014 (a) Dec. 31, 2014 Revenues $ 41,170 $ 41,343 $ 39,020 $ 40,727 Gross profit $ 15,267 $ 15,873 $ 16,141 $ 16,129 Loss from continuing operations $ (7,640 ) $ (7,138 ) $ (5,071 ) $ (5,007 ) Income (loss) from discontinued operations $ — $ 269 $ (4 ) $ — Net loss $ (7,640 ) $ (6,869 ) $ (5,075 ) $ (5,007 ) Basic and diluted net loss per share from continuing operations $ (0.08 ) $ (0.07 ) $ (0.05 ) $ (0.05 ) Basic and diluted net loss per share from discontinued operations $ — $ — $ — $ — Basic and diluted net loss per share $ (0.08 ) $ (0.07 ) $ (0.05 ) $ (0.05 ) Basic and diluted weighted average common shares outstanding 97,946 98,419 98,458 98,637 (a) During the three months ended September 30, 2014, we recorded an immaterial error correction of approximately $1,100 relating to previous over-billings by a co-location provider. The correction was recorded as a reduction of costs of revenue. |
Summary of Significant Accoun48
Summary of Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Oct. 31, 2015 | |
Summary of Significant Accounting Policies (Textual) [Abstract] | ||||
Foreign exchange translation | $ 3,025 | $ 6,055 | $ 941 | |
Foreign exchange translation gains (losses) | 1,341 | 1,489 | 92 | |
Advertising expenses | $ 1,669 | $ 1,409 | $ 2,754 | |
Expected dividend rate (percent) | 0.00% | 0.00% | 0.00% | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Estimated fair value in excess of carrying value of goodwill | $ 11,002 | $ 90,135 | ||
Percentage of estimated fair value of goodwill exceeding carrying value | 6.00% | 45.00% | ||
Control premium used to determine fair value of goodwill | 40.00% | |||
Maximum [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Estimated lives of other intangible assets | six years |
Summary of Significant Accoun49
Summary of Significant Accounting Policies (Details2) | 12 Months Ended |
Dec. 31, 2015 | |
Network equipment [Member] | |
Estimated useful lives of assets | |
Estimated useful lives of assets | 3 years |
Computer equipment and software [Member] | |
Estimated useful lives of assets | |
Estimated useful lives of assets | 3 years |
Furniture and fixtures [Member] | |
Estimated useful lives of assets | |
Estimated useful lives of assets | 3 years |
Other equipment [Member] | Minimum [Member] | |
Estimated useful lives of assets | |
Estimated useful lives of assets | 3 years |
Other equipment [Member] | Maximum [Member] | |
Estimated useful lives of assets | |
Estimated useful lives of assets | 5 years |
Summary of Significant Accoun50
Summary of Significant Accounting Policies 4 (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Maximum [Member] | |
Deferred Revenue Arrangement [Line Items] | |
Term of contract with third party | 5 years |
Investments in Marketable Sec51
Investments in Marketable Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Certificate of deposit [Member] | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | $ 12,480 | $ 11,040 |
Gross Unrealized Gains | 1 | 2 |
Gross Unrealized Losses | 17 | 32 |
Estimated Fair Value | 12,464 | 11,010 |
Corporate notes and bonds [Member] | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 15,940 | 21,876 |
Gross Unrealized Gains | 2 | 7 |
Gross Unrealized Losses | 44 | 33 |
Estimated Fair Value | 15,898 | 21,850 |
Commercial paper [Member] | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 1,498 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 1 | |
Estimated Fair Value | 1,497 | |
Convertible debt security [Member] | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 1,000 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | 1,000 | |
Debt securities [Member] | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 28,420 | 35,414 |
Gross Unrealized Gains | 3 | 9 |
Gross Unrealized Losses | 61 | 66 |
Estimated Fair Value | $ 28,362 | $ 35,357 |
Investments in Marketable Sec52
Investments in Marketable Securities (Details 1) - Debt Securities [Member] - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Amortized cost and estimated fair value of marketable securities (designated as available-for-sale) by maturity | ||
Amortized Cost, Due in one year or less | $ 18,075 | $ 19,798 |
Amortized Cost, Due after one year and through five years | 10,345 | 15,616 |
Amortized Cost | 28,420 | 35,414 |
Gross Unrealized Gains, Due in one year or less | 2 | 5 |
Gross Unrealized Gains, Due after one year and through five years | 1 | 4 |
Gross Unrealized Gains | 3 | 9 |
Gross Unrealized Losses, Due in one year or less | 12 | 9 |
Gross Unrealized Losses, Due after one year and through five years | 49 | 57 |
Gross Unrealized Losses | 61 | 66 |
Estimated Fair Value, Due in one year or less | 18,065 | 19,794 |
Estimated Fair Value, Due after one year and through five years | 10,297 | 15,563 |
Estimated Fair Value | $ 28,362 | $ 35,357 |
Business Disposition (Details)
Business Disposition (Details) - USD ($) $ in Thousands | Dec. 23, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from sale of business | $ 0 | $ 0 | $ 12,341 | |
Clickability, Inc. [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Percentage of stock sold | 100.00% | |||
Proceeds from sale of business | $ 12,341 | |||
Goodwill | $ 3,799 | |||
Gain (loss) on sale of business | $ 3,836 | |||
Clickability, Inc. [Member] | Other, net [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Gain (loss) on sale of business | $ (62) |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Summary of Accounts receivable, net | ||
Accounts receivable | $ 28,599 | $ 24,456 |
Less: credit allowance | (460) | (380) |
Less: allowance for doubtful accounts | (1,344) | (1,454) |
Total accounts receivable, net | $ 26,795 | $ 22,622 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule of changes in the carrying amount of goodwill | ||
Beginning Balance | $ 76,133 | $ 77,035 |
Foreign currency translation adjustment | 10 | (902) |
Ending Balance | $ 76,143 | $ 76,133 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Property and equipment, net | ||
Property and equipment, gross | $ 148,194 | $ 144,987 |
Less: accumulated depreciation | (112,051) | (112,351) |
Total property and equipment, net | 36,143 | 32,636 |
Network equipment [Member] | ||
Property and equipment, net | ||
Property and equipment, gross | 129,172 | 127,962 |
Computer equipment and software [Member] | ||
Property and equipment, net | ||
Property and equipment, gross | 11,408 | 9,079 |
Furniture and fixtures [Member] | ||
Property and equipment, net | ||
Property and equipment, gross | 2,472 | 2,498 |
Leasehold improvements [Member] | ||
Property and equipment, net | ||
Property and equipment, gross | 4,976 | 5,262 |
Other equipment [Member] | ||
Property and equipment, net | ||
Property and equipment, gross | $ 166 | $ 186 |
Property and Equipment (Detai57
Property and Equipment (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property and Equipment (Textual) [Abstract] | |||
Cost of services depreciation | $ 17,975 | $ 16,673 | $ 22,942 |
Operating expense depreciation | $ 1,866 | $ 2,391 | $ 2,961 |
Line of Credit Line of Credit (
Line of Credit Line of Credit (Details) - Revolving Credit Facility - Credit Agreement - USD ($) | Nov. 02, 2015 | Dec. 31, 2015 |
Line of Credit Facility [Line Items] | ||
Maximum borrowing amount | $ 25,000,000 | |
Borrowing capacity, Percent of accounts receivable | 80.00% | |
Current borrowing capacity | $ 18,000,000 | |
Minimum liquidity benchmark | $ 17,500,000 | |
Commitment fee paid at closing (percent) | 0.25% | |
Commitment fee to be paid at one year anniversary of closing (percent) | 0.20% | |
Minimum tangible net worth | $ 100,000,000 | |
Maximum adjustment if payment made on litigation | $ 52,500,000 | |
Maximum unfinanced capital expenditures in 2015 | 30,000,000 | |
Maximum unfinanced capital expenditures thereafter | $ 25,000,000 | |
Maximum | ||
Line of Credit Facility [Line Items] | ||
Unused line fee (percent) | 0.375% | |
Minimum | ||
Line of Credit Facility [Line Items] | ||
Unused line fee (percent) | 0.25% | |
LIBOR | ||
Line of Credit Facility [Line Items] | ||
Variable rate (percent) | 2.75% | |
Alternative Base Rate | ||
Line of Credit Facility [Line Items] | ||
Variable rate (percent) | 0.50% | |
Variable rate minimum (percent) | 0.50% | |
Variable rate maximum (percent) | 1.50% |
Other Current Liabilities (Deta
Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Other current liabilities | ||
Accrued compensation and benefits | $ 4,786 | $ 5,266 |
Accrued cost of revenue | 2,698 | 2,031 |
Accrued legal fees | 143 | 1,292 |
Deferred rent | 782 | 1,277 |
Other accrued expenses | 2,448 | 4,517 |
Total other current liabilities | $ 10,857 | $ 14,383 |
Other Long Term Liabilities (De
Other Long Term Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Other long term liabilities | ||
Deferred rent | $ 1,907 | $ 2,511 |
Income taxes payable | 404 | 529 |
Total other long term liabilities | $ 2,311 | $ 3,040 |
Contingencies (Details)
Contingencies (Details) $ in Thousands | Nov. 16, 2015USD ($) | Apr. 24, 2009USD ($) | Feb. 29, 2008USD ($)Claim | Dec. 31, 2008USD ($) | Dec. 23, 2015USD ($) | Dec. 31, 2007USD ($) | Sep. 30, 2006Patent | Jun. 30, 2006Patent |
Contingencies (Textual) [Abstract] | ||||||||
Number of patents Company was infringing | Patent | 3 | 2 | ||||||
Number of claims Company infringed | Claim | 4 | |||||||
Aggregate of lost profits, reasonable royalties and price erosion damages | $ 45,500 | $ 45,500 | ||||||
Prejudgment interest | $ 2,600 | |||||||
Provision for litigation | $ 65,600 | $ 48,100 | ||||||
Additional provision | $ 17,500 | |||||||
Period increase (decrease) in loss contingency accrual | $ (65,600) | |||||||
Estimated possible loss for damages and interest, maximum | $ 99,000 |
Net Loss per Share (Details)
Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | [1] | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Computation of basic and diluted net income (loss) per share | ||||||||||||
Net loss from continuing operations | $ (4,145) | $ (7,762) | $ (6,362) | $ (5,683) | $ (5,007) | $ (5,071) | $ (7,138) | $ (7,640) | $ (23,952) | $ (24,856) | $ (34,976) | |
Income (loss) from discontinued operations, net of income taxes | 0 | (4) | 269 | 0 | 0 | 265 | (426) | |||||
Net loss | $ (4,145) | $ (7,762) | $ (6,362) | $ (5,683) | $ (5,007) | $ (5,075) | $ (6,869) | $ (7,640) | $ (23,952) | $ (24,591) | $ (35,402) | |
Basic and diluted weighted average outstanding shares of common stock (in shares) | 101,391 | 100,552 | 99,841 | 98,636 | 98,637 | 98,458 | 98,419 | 97,946 | 100,105 | 98,365 | 96,851 | |
Basic and diluted loss per share: | ||||||||||||
Basic and diluted net loss per share, Continuing operations (in dollars per share) | $ (0.04) | $ (0.08) | $ (0.06) | $ (0.06) | $ (0.05) | $ (0.05) | $ (0.07) | $ (0.08) | $ (0.24) | $ (0.25) | $ (0.36) | |
Basic and diluted net loss per share, Discontinued operations (in dollars per share) | 0 | 0 | 0 | 0 | 0 | 0 | (0.01) | |||||
Total Basic and diluted net loss per share (in dollars per share) | $ (0.04) | $ (0.08) | $ (0.06) | $ (0.06) | $ (0.05) | $ (0.05) | $ (0.07) | $ (0.08) | $ (0.24) | $ (0.25) | $ (0.37) | |
[1] | During the three months ended September 30, 2014, we recorded an immaterial error correction of approximately $1,100 relating to previous over-billings by a co-location provider. The correction was recorded as a reduction of costs of revenue. |
Dilutive Common Stock (Details)
Dilutive Common Stock (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Excluded outstanding options and restricted stock units | 3,799 | 2,468 | 1,986 |
Employee stock purchase plan | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Excluded outstanding options and restricted stock units | 134 | 40 | 0 |
Stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Excluded outstanding options and restricted stock units | 1,245 | 664 | 561 |
Restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Excluded outstanding options and restricted stock units | 2,420 | 1,764 | 1,425 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Feb. 12, 2014 | |
Equity, Class of Treasury Stock [Line Items] | ||||
Payments for Repurchase of Common Stock | $ 957,000 | $ 4,542,000 | $ 5,512,000 | |
Number of shares authorized under plan | 8,759,000 | |||
Issuance of preferred stock authorized (shares) | 7,500,000 | 7,500,000 | ||
Employee stock purchase plan | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Discount from market price for employees (percent) | 15.00% | |||
Issuance of common stock under employee stock purchase plan (in shares) | 954,000 | 269,000 | 135,000 | |
Proceeds received for stock issued | $ 1,511,000 | $ 487,000 | $ 225,000 | |
Employee Stock [Member] | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Common Stock reserved for future options and restricted stock awards (shares) | 2,642,000 | |||
Employee funds held by Company for future purchase of shares | $ 166,000 | |||
Share Repurchase Program [Member] | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock repurchase program authorized amount | $ 15,000,000 | |||
Stock repurchased and retired during period (shares) | 293,000 | 1,719,000 | ||
Payments for Repurchase of Common Stock | $ 817,000 | $ 4,683,000 |
Accumulated Other Comprehensi65
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Decrease in Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning balance | $ (7,786) | ||
Other comprehensive loss before reclassifications | (3,026) | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||
Other comprehensive loss, net of tax | (3,026) | $ (6,123) | $ (954) |
Ending balance | (10,812) | (7,786) | |
Foreign Currency [Member] | |||
Decrease in Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning balance | (7,743) | ||
Other comprehensive loss before reclassifications | (3,025) | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||
Other comprehensive loss, net of tax | (3,025) | ||
Ending balance | (10,768) | (7,743) | |
Unrealized Gains (Losses) on Available for Sale Securities [Member] | |||
Decrease in Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning balance | (43) | ||
Other comprehensive loss before reclassifications | (1) | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||
Other comprehensive loss, net of tax | (1) | ||
Ending balance | $ (44) | $ (43) |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Stock option activity | |||
Number of Shares, Beginning Balance | 16,872 | 15,982 | 14,310 |
Number of Shares, Granted | 3,649 | 4,215 | 4,902 |
Number of Shares, Exercised | (607) | (522) | (143) |
Number of Shares, Cancelled | (5,247) | (2,803) | (3,087) |
Number of Shares, Ending Balance | 14,667 | 16,872 | 15,982 |
Weighted Average Exercise Price | |||
Weighted Average Exercise Price, Beginning Balance (in dollars per share) | $ 3.66 | $ 4 | $ 4.58 |
Weighted Average Exercise Price, Granted (in dollars per share) | 2.64 | 2.40 | 2.19 |
Weighted Average Exercise Price, Exercised (in dollars per share) | 1.73 | 1.71 | 0.26 |
Weighted Average Exercise Price, Canceled (in dollars per share) | 4.08 | 4.15 | 3.87 |
Weighted Average Exercise Price, Ending Balance (in dollars per share) | $ 3.33 | $ 3.66 | $ 4 |
Share-Based Compensation (Det67
Share-Based Compensation (Details 1) shares in Thousands | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Outstanding stock options | |
Options Outstanding, Number of Options Outstanding | shares | 14,667 |
Options Exercisable, Number of Options Exercisable | shares | 9,227 |
Stock options [Member] | $ 0.00 — $ 1.50 [Member] | |
Outstanding stock options | |
Exercise price range, lower range limit (in dollars per share) | $ 0 |
Exercise price range, upper range limit (in dollars per share) | $ 1.50 |
Options Outstanding, Number of Options Outstanding | shares | 304 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 4 months 24 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 0.45 |
Options Exercisable, Number of Options Exercisable | shares | 304 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 0.45 |
Stock options [Member] | $ 1.51 — $ 3.00 [Member] | |
Outstanding stock options | |
Exercise price range, lower range limit (in dollars per share) | 1.51 |
Exercise price range, upper range limit (in dollars per share) | $ 3 |
Options Outstanding, Number of Options Outstanding | shares | 9,707 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 7 years 6 months |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 2.25 |
Options Exercisable, Number of Options Exercisable | shares | 5,311 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 2.25 |
Stock options [Member] | $ 3.01 — $ 4.50 [Member] | |
Outstanding stock options | |
Exercise price range, lower range limit (in dollars per share) | 3.01 |
Exercise price range, upper range limit (in dollars per share) | $ 4.50 |
Options Outstanding, Number of Options Outstanding | shares | 2,175 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 6 years 8 months 12 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 3.75 |
Options Exercisable, Number of Options Exercisable | shares | 1,131 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 3.85 |
Stock options [Member] | $ 4.51 — $ 6.00 [Member] | |
Outstanding stock options | |
Exercise price range, lower range limit (in dollars per share) | 4.51 |
Exercise price range, upper range limit (in dollars per share) | $ 6 |
Options Outstanding, Number of Options Outstanding | shares | 1,269 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 4 years 3 months 18 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 5.15 |
Options Exercisable, Number of Options Exercisable | shares | 1,269 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 5.15 |
Stock options [Member] | $ 6.01 — $ 7.50 [Member] | |
Outstanding stock options | |
Exercise price range, lower range limit (in dollars per share) | 6.01 |
Exercise price range, upper range limit (in dollars per share) | $ 7.50 |
Options Outstanding, Number of Options Outstanding | shares | 441 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 2 years 3 months 18 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 6.37 |
Options Exercisable, Number of Options Exercisable | shares | 441 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 6.37 |
Stock options [Member] | $ 7.51 — $ 15.00 [Member] | |
Outstanding stock options | |
Exercise price range, lower range limit (in dollars per share) | 7.51 |
Exercise price range, upper range limit (in dollars per share) | $ 15 |
Options Outstanding, Number of Options Outstanding | shares | 771 |
Options Outstanding, Weighted Average Remaining Contractual Life (Years) | 2 years 3 months 18 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 12.17 |
Options Exercisable, Number of Options Exercisable | shares | 771 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 12.17 |
Share-Based Compensation (Det68
Share-Based Compensation (Details 2) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Grant date fair value of option | |||
Expected volatility | 54.53% | 66.05% | 77.96% |
Expected term, years | 5 years 11 months 27 days | 5 years 11 months 27 days | 6 years 18 days |
Risk-free interest | 1.80% | 1.83% | 1.31% |
Expected dividends | 0.00% | 0.00% | 0.00% |
Share-Based Compensation (Det69
Share-Based Compensation (Details 3) - shares shares in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
RSUs with service-based vesting conditions [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Units outstanding | 6,265 | 6,820 | 5,286 | |
Unvested RSUs [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Units outstanding | 6,265 | 6,820 | 5,286 | 4,581 |
Share-Based Compensation (Det70
Share-Based Compensation (Details 4) - Restricted stock units - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Restricted stock units (RSUs) outstanding | |||
Number of Units, Beginning Balance | 6,820 | 5,286 | 4,581 |
Number of Units, Granted | 4,156 | 5,542 | 4,970 |
Number of Units, Vested | (3,069) | (2,385) | (2,032) |
Number of Units, Cancelled | (1,642) | (1,623) | (2,233) |
Number of Units, Ending Balance | 6,265 | 6,820 | 5,286 |
Weighted Average Fair Value | |||
Weighted Average Fair Value, Beginning Balance (in dollars per share) | $ 2.30 | $ 2.24 | $ 2.74 |
Weighted Average Fair Value, Granted (in dollars per share) | 3 | 2.33 | 2.15 |
Weighted Average Fair Value, Vested (in dollars per share) | 2.31 | 2.28 | 2.53 |
Weighted Average Fair Value, Canceled (in dollars per share) | 2.54 | 2.22 | 2.78 |
Weighted Average Fair Value, Ending Balance (in dollars per share) | $ 2.70 | $ 2.30 | $ 2.24 |
Share-Based Compensation (Det71
Share-Based Compensation (Details 5) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Components of share-based compensation expense | |||
Share-based compensation | $ 12,338 | $ 10,491 | $ 12,345 |
Cost of services [Member] | |||
Components of share-based compensation expense | |||
Share-based compensation | 2,047 | 1,956 | 1,873 |
General and administrative expense [Member] | |||
Components of share-based compensation expense | |||
Share-based compensation | 5,398 | 4,741 | 5,971 |
Sales and marketing expense [Member] | |||
Components of share-based compensation expense | |||
Share-based compensation | 2,657 | 2,317 | 2,245 |
Research and development expense [Member] | |||
Components of share-based compensation expense | |||
Share-based compensation | 2,236 | 1,477 | 2,256 |
Stock options [Member] | |||
Components of share-based compensation expense | |||
Share-based compensation | 4,131 | 4,704 | 6,617 |
Restricted stock units | |||
Components of share-based compensation expense | |||
Share-based compensation | 7,620 | 5,609 | 5,671 |
ESPP [Member] | |||
Components of share-based compensation expense | |||
Share-based compensation | $ 587 | $ 178 | $ 57 |
Share-Based Compensation (Det72
Share-Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | Sep. 18, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Exercise price of incentive stock options granted under the Plan may not be granted | 100.00% | |||
Weighted average period of unvested stock compensation | 2 years 3 months 22 days | |||
Share-based compensation | $ 12,338 | $ 10,491 | $ 12,345 | |
Unrecognized share-based compensation expense total | $ 20,749 | |||
Stock for Compensation Program [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock for compensation program, percentage of compensation, election option one | 0.00% | |||
Stock for compensation program, percentage of compensation, election option two | 25.00% | |||
Stock for compensation program, percentage of compensation, election option three | 50.00% | |||
Stock for compensation program, percentage of compensation, election option four | 75.00% | |||
Stock for compensation program, percentage of compensation, election option five | 100.00% | |||
Stock options [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 1.38 | $ 1.45 | $ 1.48 | |
Total intrinsic value of the options exercised | $ 621 | $ 449 | $ 265 | |
Aggregate intrinsic value of options outstanding | $ 307 | |||
Weighted average remaining contractual options period exercisable | 5 years 1 month 6 days | |||
Unrecognized share-based compensation expense related to stock options | $ 6,889 | |||
Weighted average period of unvested stock compensation | 2 years 3 months 18 days | |||
Share-based compensation | $ 4,131 | $ 4,704 | $ 6,617 | |
Restricted stock units | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Weighted average period of unvested stock compensation | 2 years 3 months 25 days | |||
Weighted-average grant-date fair value of RSUs granted | $ 3 | $ 2.33 | $ 2.15 | |
Total intrinsic value of the units vested | $ 7,088 | $ 5,469 | $ 5,117 | |
Aggregate intrinsic value of restricted stock units outstanding | 9,148 | |||
Unrecognized share-based compensation expense related to restricted stock awards | 13,860 | |||
Share-based compensation | $ 7,620 | $ 5,609 | $ 5,671 |
Related Party Transactions (Det
Related Party Transactions (Details) $ / shares in Units, $ in Thousands | Jun. 14, 2007 | Jul. 31, 2006$ / sharesshares | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) |
Related Party Transaction [Line Items] | |||||
Preferred Stock Conversion Ratio | 1 | ||||
Ownership percentage | 30.00% | 31.00% | 31.00% | ||
Percentage of revenue derived from related parties | 1.00% | ||||
Invoiced for office space rental | $ | $ 0 | $ 0 | $ 154 | ||
Maximum [Member] | |||||
Related Party Transaction [Line Items] | |||||
Percentage of revenue derived from related parties | 1.00% | ||||
Series B Preferred Stock [Member] | |||||
Related Party Transaction [Line Items] | |||||
Aggregate issuance of Series B Preferred Stock (in shares) | shares | 39,869,960 | ||||
Aggregate issuance of Series B Preferred Stock, purchase price (in Dollars per share) | $ / shares | $ 3.26 | ||||
Basis of conversion of Series B Convertible Preferred Stock into shares of common stock | on a 1-for-1 share basis |
Leases and Commitments (Details
Leases and Commitments (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Future minimum lease payments over remaining lease periods | |
2,016 | $ 3,902 |
2,017 | 3,051 |
2,018 | 2,835 |
2,019 | 1,301 |
2,020 | 356 |
Thereafter | 269 |
Total minimum payments | $ 11,714 |
Leases and Commitments (Detai75
Leases and Commitments (Details 1) $ in Thousands | Dec. 31, 2015USD ($) |
Minimum purchase commitments | |
2,016 | $ 26,365 |
2,017 | 6,517 |
2,018 | 2,633 |
2,019 | 715 |
2,020 | 70 |
Thereafter | 8 |
Total minimum payments | $ 36,308 |
Leases and Commitments (Detai76
Leases and Commitments (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Leases and Commitments (Textual) [Abstract] | |||
Rent and operating expense relating to operating lease agreements and bandwidth and co-location agreements | $ 61,571 | $ 58,288 | $ 61,693 |
Outstanding balance for capital leases | 1,902 | 358 | |
Recorded assets under capital lease obligations | 1,679 | 2,224 | |
Related accumulated amortization total | $ 210 | 2,209 | |
Average interest rate on outstanding capital leases | 6.00% | ||
Interest expense related to capital leases | $ 14 | $ 32 | $ 76 |
Leases and Commitments (Detai77
Leases and Commitments (Details 2) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Future minimum capital lease payments | ||
2,016 | $ 571 | |
2,017 | 571 | |
2,018 | 570 | |
2,019 | 427 | |
2,020 | 0 | |
Thereafter | 0 | |
Total | 2,139 | |
Amounts representing interest | (237) | |
Present value of minimum lease payments | $ 1,902 | $ 358 |
Concentrations (Details)
Concentrations (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | [1] | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)countrycustomer | Dec. 31, 2014USD ($)countrycustomer | Dec. 31, 2013USD ($)country | |
Concentration Risk [Line Items] | ||||||||||||
Number of Customers Who Represented 10% or More of Total Revenue | customer | 0 | 0 | ||||||||||
Revenues | $ 42,739 | $ 42,049 | $ 43,795 | $ 42,329 | $ 40,727 | $ 39,020 | $ 41,343 | $ 41,170 | $ 170,912 | $ 162,259 | $ 173,433 | |
Foreign countries accounting specified percentage of revenue | Company had two countries, Japan and the United States that accounted for 10% or more of the Company's total revenues during those periods | Company had two countries, Japan and the United States that accounted for 10% or more of the Company's total revenues during those periods | No single country outside of the United States accounted for 10% or more of the Company 's total revenues during those periods | |||||||||
Sales Revenue, Net [Member] | ||||||||||||
Concentration Risk [Line Items] | ||||||||||||
Percentage of Company's total revenue from Netflix | 11.00% | |||||||||||
Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | ||||||||||||
Concentration Risk [Line Items] | ||||||||||||
Percentage of Company's total revenue from Netflix | 100.00% | 100.00% | 100.00% | |||||||||
Concentration Risk, Number of Countries | country | 2 | 2 | 0 | |||||||||
United States | Geographic Concentration Risk [Member] | Sales Revenue, Net [Member] | ||||||||||||
Concentration Risk [Line Items] | ||||||||||||
Revenues | $ 96,469 | $ 93,678 | $ 110,824 | |||||||||
[1] | During the three months ended September 30, 2014, we recorded an immaterial error correction of approximately $1,100 relating to previous over-billings by a co-location provider. The correction was recorded as a reduction of costs of revenue. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
(Loss) income from continuing operations before income taxes: | |||
United States | $ (24,105) | $ (25,025) | $ (34,789) |
Foreign | 420 | 372 | 200 |
Loss from continuing operations before income taxes | $ (23,685) | $ (24,653) | $ (34,589) |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | |||
Federal | $ 0 | $ (143) | $ 0 |
State | 103 | 26 | 80 |
Foreign | 210 | 680 | 442 |
Total current | 313 | 563 | 522 |
Deferred: | |||
Federal | 17 | 15 | 16 |
State | 0 | 0 | 0 |
Foreign | (63) | (375) | (151) |
Total deferred | (46) | (360) | (135) |
Total provision | $ 267 | $ 203 | $ 387 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
U.S. federal statutory tax rate | $ (8,290) | $ (8,629) | $ (12,106) |
Valuation allowance | 3,821 | 7,424 | 12,958 |
Foreign income taxes | 86 | (26) | 221 |
State income taxes | 92 | 26 | 80 |
Non-deductible expenses | 552 | 1,335 | (783) |
Uncertain tax positions | (86) | 201 | 14 |
Share-based compensation | 4,064 | 0 | 0 |
Other | 28 | (128) | 3 |
Total provision | $ 267 | $ 203 | $ 387 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
U.S. federal statutory tax rate | 35.00% | 35.00% | 35.00% |
Valuation allowance rate | (16.00%) | (30.00%) | (37.00%) |
Foreign income taxes rate | (0.50%) | (0.00%) | (1.00%) |
State income taxes rate | (0.50%) | (0.00%) | (0.00%) |
Non-deductible expenses, rate | (2.00%) | (6.00%) | 2.00% |
Uncertain tax positions rate | (0.00%) | (1.00%) | (0.00%) |
Share based compensation rate | (17.00%) | (0.00%) | (0.00%) |
Other rate | (0.00%) | 1.00% | (0.00%) |
Provision for (benefit from) income taxes rate | (1.00%) | (1.00%) | (1.00%) |
Income Taxes (Details 3)
Income Taxes (Details 3) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Share-based compensation | $ 11,090 | $ 13,613 |
Net operating loss and tax credit carry-forwards | 43,600 | 33,519 |
Deferred revenue | 1,306 | 2,089 |
Accounts receivable reserves | 518 | 556 |
Fixed assets | 3,172 | 4,813 |
Other | 1,041 | 1,693 |
Total deferred tax assets | 60,727 | 56,283 |
Deferred tax liabilities: | ||
Intangible assets | 0 | (177) |
Prepaid expenses | (128) | (144) |
Other | (154) | (36) |
Total deferred tax liabilities | (282) | (357) |
Valuation allowance | (59,241) | (54,654) |
Net deferred tax assets | $ 1,204 | $ 1,272 |
Income Taxes (Details 4)
Income Taxes (Details 4) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Beginning balance | $ 2,043 | $ 1,757 |
Additions for tax positions related to current year | 0 | 0 |
Additions for tax positions related to prior years | 0 | 312 |
Settlements | (26) | 0 |
Adjustment related to foreign currency translation | (18) | (4) |
Reductions related to the lapse of applicable statute of limitations | (31) | (22) |
Reduction for tax positions of prior years | 0 | 0 |
Ending balance | $ 1,968 | $ 2,043 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating Loss Carryforwards [Line Items] | |||
Valuation allowance of deferred tax assets | $ 1,600 | ||
Unrecognized tax benefits | 1,968 | $ 2,043 | $ 1,757 |
Unrecognized tax benefits that would impact effective tax rate | 371 | ||
Interest and penalties accrual related to unrecognized tax benefits | 23 | ||
Decrease in unrecognized tax benefits | 56 | ||
Undistributed earnings | 1,500 | ||
Federal [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 127,200 | ||
State [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 83,500 | ||
Tax Credit Carryforward, Amount | 15 | ||
Unrecorded Tax Benefits [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | $ 13,660 | $ 10,750 |
401(k) Plan (Details)
401(k) Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
401(k) Plan (Textual) [Abstract] | |||
Percentage of compensation for dollar-for-dollar match on eligible employee's deferral | 3.00% | ||
Percentage of match on next 2% of employee deferrals | 50.00% | ||
Percentage of employee compensation for 50% match on employees deferral | 2.00% | ||
Matching contributions | $ 1,434 | $ 1,225 | $ 1,196 |
Segment Reporting and Geograp86
Segment Reporting and Geographic Information (Details Textual) | 12 Months Ended |
Dec. 31, 2015SegmentLocation | |
Segment Reporting [Abstract] | |
Number of industry segment | Segment | 1 |
Number of geographic areas | Location | 3 |
Segment Reporting and Geograp87
Segment Reporting and Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | [1] | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenue earned by geographic area | ||||||||||||
Revenues | $ 42,739 | $ 42,049 | $ 43,795 | $ 42,329 | $ 40,727 | $ 39,020 | $ 41,343 | $ 41,170 | $ 170,912 | $ 162,259 | $ 173,433 | |
Americas [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Revenues | 102,505 | 101,302 | 119,020 | |||||||||
EMEA [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Revenues | 32,505 | 33,630 | 30,793 | |||||||||
Asia Pacific [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Revenues | $ 35,902 | $ 27,327 | $ 23,620 | |||||||||
Sales Revenue, Net [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Concentration Risk, Percentage | 11.00% | |||||||||||
Sales Revenue, Net [Member] | Geographic Concentration Risk [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Concentration Risk, Percentage | 100.00% | 100.00% | 100.00% | |||||||||
Sales Revenue, Net [Member] | Geographic Concentration Risk [Member] | Americas [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Concentration Risk, Percentage | 60.00% | 62.50% | 68.60% | |||||||||
Sales Revenue, Net [Member] | Geographic Concentration Risk [Member] | EMEA [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Concentration Risk, Percentage | 19.00% | 20.70% | 17.80% | |||||||||
Sales Revenue, Net [Member] | Geographic Concentration Risk [Member] | Asia Pacific [Member] | ||||||||||||
Revenue earned by geographic area | ||||||||||||
Concentration Risk, Percentage | 21.00% | 16.80% | 13.60% | |||||||||
[1] | During the three months ended September 30, 2014, we recorded an immaterial error correction of approximately $1,100 relating to previous over-billings by a co-location provider. The correction was recorded as a reduction of costs of revenue. |
Segment Reporting and Geograp88
Segment Reporting and Geographic Information (Details 1) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Long-lived assets by geographical area | |||
Long-lived Assets | $ 36,158 | $ 33,707 | $ 35,259 |
Americas [Member] | |||
Long-lived assets by geographical area | |||
Long-lived Assets | 19,692 | 22,505 | 26,502 |
International [Member] | |||
Long-lived assets by geographical area | |||
Long-lived Assets | $ 16,466 | $ 11,202 | $ 8,757 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | |||
Assets: | |||||
Total assets measured at fair value | $ 29,087 | $ 35,414 | |||
Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 725 | 57 | |||
Significant Other Observable Inputs (Level 2) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 28,362 | 34,357 | |||
Significant Unobservable Inputs (Level 3) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | 1,000 | |||
Money market funds [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 725 | [1] | 57 | [2] | |
Money market funds [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 725 | [1] | 57 | [2] | |
Money market funds [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | [1] | 0 | [2] | |
Money market funds [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | [1] | 0 | [2] | |
Corporate notes and bonds [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 15,898 | [3] | 21,850 | [4] | |
Corporate notes and bonds [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | [3] | 0 | [4] | |
Corporate notes and bonds [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 15,898 | [3] | 21,850 | [4] | |
Corporate notes and bonds [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | [3] | 0 | [4] | |
Commercial paper [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 1,497 | |||
Commercial paper [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 0 | |||
Commercial paper [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 1,497 | |||
Commercial paper [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 0 | |||
Certificate of deposit [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 12,464 | [3] | 11,010 | [4] | |
Certificate of deposit [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | [3] | 0 | [4] | |
Certificate of deposit [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 12,464 | [3] | 11,010 | [4] | |
Certificate of deposit [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | 0 | [3] | 0 | [4] | |
Convertible debt security [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 1,000 | |||
Convertible debt security [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 0 | |||
Convertible debt security [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | [4] | 0 | |||
Convertible debt security [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Assets: | |||||
Total assets measured at fair value | $ 1,000 | $ 1,000 | [4] | ||
[1] | Classified in cash and cash equivalents | ||||
[2] | Classified in cash and cash equivalents | ||||
[3] | Classified in marketable securities | ||||
[4] | Classified in marketable securities |
Fair Value Measurements (Deta90
Fair Value Measurements (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments fair value | $ 29,087 | $ 35,414 | ||
Cost method investments | $ 28,322 | 35,317 | ||
Cash equivalent maturity date | 3 months | |||
Fair Value, Inputs, Level 3 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments fair value | $ 0 | 1,000 | ||
Convertible Debt Securities [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments fair value | [1] | 1,000 | ||
Gain related from beneficial conversion feature | 275 | |||
Cost method investments | 1,275 | |||
Convertible Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments fair value | $ 1,000 | $ 1,000 | [1] | |
[1] | Classified in marketable securities |
Quarterly Financial Results (91
Quarterly Financial Results (unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Quarterly results of operations | ||||||||||||
Revenues | $ 42,739 | $ 42,049 | $ 43,795 | $ 42,329 | $ 40,727 | $ 39,020 | [1] | $ 41,343 | $ 41,170 | $ 170,912 | $ 162,259 | $ 173,433 |
Gross profit | 17,540 | 15,911 | 18,148 | 16,519 | 16,129 | 16,141 | [1] | 15,873 | 15,267 | 68,119 | 63,410 | 61,708 |
Net loss from continuing operations | (4,145) | (7,762) | (6,362) | (5,683) | (5,007) | (5,071) | [1] | (7,138) | (7,640) | (23,952) | (24,856) | (34,976) |
Income (loss) from discontinued operations, net of income taxes | 0 | (4) | [1] | 269 | 0 | 0 | 265 | (426) | ||||
Net loss | $ (4,145) | $ (7,762) | $ (6,362) | $ (5,683) | $ (5,007) | $ (5,075) | [1] | $ (6,869) | $ (7,640) | $ (23,952) | $ (24,591) | $ (35,402) |
Basic and diluted net loss per share, Continuing operations (in dollars per share) | $ (0.04) | $ (0.08) | $ (0.06) | $ (0.06) | $ (0.05) | $ (0.05) | [1] | $ (0.07) | $ (0.08) | $ (0.24) | $ (0.25) | $ (0.36) |
Basic and diluted net loss per share, Discontinued operations (in dollars per share) | 0 | 0 | [1] | 0 | 0 | 0 | 0 | (0.01) | ||||
Total Basic and diluted net loss per share (in dollars per share) | $ (0.04) | $ (0.08) | $ (0.06) | $ (0.06) | $ (0.05) | $ (0.05) | [1] | $ (0.07) | $ (0.08) | $ (0.24) | $ (0.25) | $ (0.37) |
Basic and diluted weighted average outstanding shares of common stock (in shares) | 101,391 | 100,552 | 99,841 | 98,636 | 98,637 | 98,458 | [1] | 98,419 | 97,946 | 100,105 | 98,365 | 96,851 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Cost of revenue | $ 102,793 | $ 98,849 | $ 111,725 | |||||||||
Reclassification [Member] | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Cost of revenue | $ 1,100 | |||||||||||
[1] | During the three months ended September 30, 2014, we recorded an immaterial error correction of approximately $1,100 relating to previous over-billings by a co-location provider. The correction was recorded as a reduction of costs of revenue. |
Schedule II - Valuation and Q92
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reserves for accounts receivable [Member] | |||
Valuation and Qualifying Accounts | |||
Balance at Beginning of Period | $ 1,834 | $ 2,010 | $ 4,070 |
Additions, Charged to Costs and Expenses | 1,037 | 408 | 965 |
Additions, Charged Against Revenue | (81) | 230 | 30 |
Deductions, Write-Offs Net of Recoveries | 1,148 | 354 | 2,995 |
Balance at End of Period | 1,804 | 1,834 | 2,010 |
Deferred tax asset valuation allowance [Member] | |||
Valuation and Qualifying Accounts | |||
Balance at Beginning of Period | 54,654 | 47,166 | 46,215 |
Additions, Charged to Costs and Expenses | 4,587 | 7,488 | 951 |
Additions, Charged Against Revenue | 0 | 0 | 0 |
Deductions, Write-Offs Net of Recoveries | 0 | 0 | 0 |
Balance at End of Period | $ 59,241 | $ 54,654 | $ 47,166 |