Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 12, 2017 | |
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-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 109,711,131 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 20,744 | $ 21,734 |
Marketable securities | 36,948 | 44,453 |
Accounts receivable, net | 28,712 | 27,418 |
Income taxes receivable | 102 | 125 |
Prepaid expenses and other current assets | 4,453 | 4,865 |
Total current assets | 90,959 | 98,595 |
Property and equipment, net | 29,835 | 30,352 |
Marketable securities, less current portion | 40 | 40 |
Deferred income taxes | 1,393 | 1,105 |
Goodwill | 76,925 | 76,243 |
Other assets | 1,794 | 1,794 |
Total assets | 200,946 | 208,129 |
Current liabilities: | ||
Accounts payable | 8,804 | 8,790 |
Deferred revenue | 1,694 | 2,138 |
Income taxes payable | 383 | 188 |
Provision for litigation | 18,000 | 18,000 |
Other current liabilities | 15,665 | 12,836 |
Total current liabilities | 44,546 | 41,952 |
Deferred income taxes | 146 | 152 |
Deferred revenue, less current portion | 15 | 22 |
Provision for litigation, less current portion | 13,500 | 27,000 |
Other long-term liabilities | 859 | 1,435 |
Total liabilities | 59,066 | 70,561 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Convertible preferred stock, $0.001 par value; 7,500 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value; 300,000 shares authorized; 109,638 and 107,059 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively | 110 | 107 |
Additional paid-in capital | 499,487 | 490,819 |
Accumulated other comprehensive loss | (8,679) | (11,038) |
Accumulated deficit | (349,038) | (342,320) |
Total stockholders’ equity | 141,880 | 137,568 |
Total liabilities and stockholders’ equity | $ 200,946 | $ 208,129 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Convertible Preferred Stock, Par Value (in usd 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 usd per share) | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 300,000,000 | 300,000,000 |
Common Stock, Shares Issued | 109,638,000 | 107,059,000 |
Common Stock, Shares Outstanding | 109,638,000 | 107,059,000 |
Unaudited Consolidated Statemen
Unaudited Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | ||
Income Statement [Abstract] | |||||
Revenues | $ 46,069 | $ 39,473 | $ 136,173 | $ 124,456 | |
Cost of revenue: | |||||
Cost of services (1) | [1] | 19,287 | 18,834 | 57,758 | 59,214 |
Depreciation — network | 4,506 | 4,401 | 13,594 | 13,558 | |
Total cost of revenue | 23,793 | 23,235 | 71,352 | 72,772 | |
Gross profit | 22,276 | 16,238 | 64,821 | 51,684 | |
Operating expenses: | |||||
General and administrative | 8,079 | 8,033 | 23,397 | 22,082 | |
Sales and marketing | 8,836 | 7,711 | 27,100 | 24,730 | |
Research and development | 6,443 | 5,626 | 19,377 | 18,241 | |
Depreciation and amortization | 603 | 613 | 1,789 | 1,862 | |
Provision for litigation | 0 | 0 | 0 | 54,000 | |
Total operating expenses | 23,961 | 21,983 | 71,663 | 120,915 | |
Operating loss | (1,685) | (5,745) | (6,842) | (69,231) | |
Other income (expense): | |||||
Interest expense | (18) | (406) | (42) | (865) | |
Interest income | 127 | 8 | 365 | 22 | |
Other, net | 8 | 151 | 249 | 472 | |
Total other income (expense) | 117 | (247) | 572 | (371) | |
Loss before income taxes | (1,568) | (5,992) | (6,270) | (69,602) | |
Income tax expense | 188 | 130 | 448 | 404 | |
Net loss | $ (1,756) | $ (6,122) | $ (6,718) | $ (70,006) | |
Net loss per share, Basic and diluted: | |||||
Basic and diluted (in usd per share) | $ (0.02) | $ (0.06) | $ (0.06) | $ (0.67) | |
Weighted average shares used in per share calculation: | |||||
Basic and diluted (in shares) | 109,342 | 104,860 | 108,376 | 103,819 | |
[1] | Cost of services excludes amortization related to intangibles, including existing technologies, and customer relationships, which are included in depreciation and amortization. |
Unaudited Consolidated Stateme5
Unaudited Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (1,756) | $ (6,122) | $ (6,718) | $ (70,006) |
Other comprehensive income, net of tax: | ||||
Unrealized gain on investments | 26 | 0 | 83 | 0 |
Foreign exchange translation gain | 340 | 403 | 2,276 | 867 |
Other comprehensive income | 366 | 403 | 2,359 | 867 |
Comprehensive loss | $ (1,390) | $ (5,719) | $ (4,359) | $ (69,139) |
Unaudited Consolidated Stateme6
Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net loss | $ (6,718) | $ (70,006) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 15,383 | 15,420 |
Share-based compensation | 9,442 | 9,776 |
Provision for litigation | 0 | 54,000 |
Foreign currency remeasurement loss | 658 | 509 |
Deferred income taxes | (217) | (25) |
Gain on sale of property and equipment | (94) | (296) |
Accounts receivable charges | 732 | 36 |
Amortization of premium on marketable securities | 228 | 19 |
Realized loss on sale of marketable securities | 0 | 32 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,026) | 3,901 |
Prepaid expenses and other current assets | 545 | 4,333 |
Income taxes receivable | 34 | 54 |
Other assets | 21 | 558 |
Accounts payable and other current liabilities | 4,749 | (670) |
Deferred revenue | (450) | (1,552) |
Income taxes payable | 180 | (76) |
Payments for provision for litigation | (13,500) | (4,500) |
Other long term liabilities | (584) | (550) |
Net cash provided by operating activities | 8,383 | 10,963 |
Investing activities | ||
Purchases of marketable securities | (10,383) | 0 |
Sale and maturities of marketable securities | 17,744 | 28,315 |
Purchases of property and equipment | (15,806) | (4,666) |
Proceeds from sale of property and equipment | 83 | 0 |
Net cash (used in) provided by investing activities | (8,362) | 23,649 |
Financing activities | ||
Principal payments on capital lease obligations | 0 | (4,685) |
Payments of employee tax withholdings related to restricted stock vesting | (2,571) | (1,306) |
Proceeds from employee stock plans | 1,200 | 904 |
Net cash used in financing activities | (1,371) | (5,087) |
Effect of exchange rate changes on cash and cash equivalents | 360 | 195 |
Net increase (decrease) in cash and cash equivalents | (990) | 29,720 |
Cash and cash equivalents, beginning of period | 21,734 | 44,680 |
Cash and cash equivalents, end of period | 20,744 | 74,400 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 11 | 682 |
Cash paid during the period for income taxes, net of refunds | 400 | 457 |
Property and equipment acquired through capital leases | $ 0 | $ 2,659 |
Nature of Business
Nature of Business | 9 Months Ended |
Sep. 30, 2017 | |
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 Limelight 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 | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. They do not include all of the information and footnotes required by U.S. generally accepted accounting principles (U.S. GAAP) for complete financial statements. Such interim financial information is unaudited but reflects all adjustments that are, in the opinion of management, necessary for the fair presentation of the interim periods presented and of a normal recurring nature. The results of operations presented in this quarterly report on Form 10-Q are not necessarily indicative of the results that may be expected for the year ending December 31, 2017, or for any future periods. This quarterly report on Form 10-Q should be read in conjunction with our audited financial statements and footnotes included in our annual report on Form 10-K for the fiscal year ended December 31, 2016. All information is presented in thousands, except per share amounts and where specifically noted. 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 year amounts to conform to the current year presentation. 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. Recent Accounting Standards Adopted Accounting Standards In November 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) 2015-17, which requires entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as 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 adopted this guidance effective January 1, 2017 on a retrospective basis. The impact of adoption of this ASU was that $88 of current DTAs in our consolidated balance sheet for the year ended December 31, 2016, has been reclassified to noncurrent DTAs. In March 2016, the FASB issued ASU 2016-09, which amends the existing accounting standards for share-based payments, including the accounting for income taxes and forfeitures, as well as the classifications on the statements of cash flows. We adopted this guidance effective January 1, 2017. Beginning January 1, 2017, stock-based compensation excess tax benefits or tax deficiencies are reflected in the Consolidated Statements of Operations as a component of the provision for taxes, whereas they previously were recognized as additional paid in capital in the stockholders’ deficit in the Consolidated Balance Sheets. We have elected to continue to estimate forfeitures expected to occur to determine stock-based compensation expense. Additionally, beginning with the three months ended March 31, 2017, and on a prospective basis, the Consolidated Statements of Cash Flows now requires excess tax benefits be presented as an operating activity rather than as a financing activity, while the payment of withholding taxes on the settlement of stock-based compensation awards continues to be presented as a financing activity. The implementation of this guidance did not have a material impact on the Consolidated Statements of Cash Flows for the nine months ended September 30, 2017. During the nine months ended September 30, 2017 there was no change to beginning retained earnings for previously unrecognized tax benefits. The increase of $5.2 million to the net operating loss carryforward deferred tax asset was fully offset by an increase to the valuation allowance. During the nine months ended September 30, 2017 we did not record excess tax benefits on stock options and restricted stock units as a result of the adoption of ASU 2016-09 because such amounts are fully offset by our valuation allowance. Recently Issued Accounting Pronouncements 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. 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. We currently believe that once we do adopt this standard, we will use the modified retrospective approach. We are utilizing a comprehensive approach to assess the impact of the guidance on our contract portfolio by reviewing our current accounting policies and practices to identify potential differences that would result from applying the new requirements to our revenue contracts, including evaluation of performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, allocating the transaction price to each separate performance obligation and accounting treatment of costs to obtain and fulfill contracts. We continue to make significant progress on the potential impact on our accounting policies and internal control processes including system readiness. In addition, we will update certain disclosures, as applicable, included in our filings pursuant to the Securities Exchange Act of 1934, as amended, to meet the requirements of the new guidance. We continue to review contracts with our customers and we currently believe that we will be required to record a cumulative effect adjustment to retained earnings upon adoption of the new revenue standard at the beginning of 2018. The cumulative adjustment is primarily related to incremental upfront contract acquisition costs (such as sales commissions) for customer contracts. The new standard requires these costs to be capitalized and amortized over the estimated life of the asset. Currently, these costs are expensed as incurred. For the nine months ended September 30, 2017, we paid approximately $800 in incremental upfront contract acquisition costs. We recognize revenue for most of our customers based on actual monthly usage at an agreed upon rate, where the impact of adoption is not expected to be material. We have entered into some contracts with annual minimum commitments. We are currently evaluating the impact of estimating variable consideration related to these types of contacts and how the new standard could impact revenue recognition. We do not know and cannot reasonably estimate quantitative information related to the impact of the new standard on our financial statements at this time. In February 2016, the FASB issued ASU No. 2016-02, which establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for most leases. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. We do not plan to early adopt this ASU. We are in the process of evaluating the potential impacts of this new guidance on our consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, which amends Accounting Standards Codification 230, to clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows. The FASB issued ASU 2016-15 with the intent of reducing diversity in practice with respect to eight types of cash flows. This guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. We are in the process of evaluating the adoption and potential impact of this new guidance on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, which simplifies the accounting for goodwill impairment. The updated guidance eliminates Step 2 of the impairment test, which requires entities to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value, determined in Step 1. This guidance will become effective for us in fiscal years beginning after December 15, 2019, including interim periods within that reporting period. We will adopt this guidance using a prospective approach. Earlier adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not plan to early adopt this ASU, and we are currently evaluating the impact of this guidance on our consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. ASU 2017-09 will reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications. Under ASU 2017-09, an entity will not apply modification accounting to a share-based payment award if the award's fair value, vesting conditions and classification as an equity or liability instrument are the same immediately before and after the change. ASU 2017-09 will be applied prospectively to awards modified on or after the adoption date. The guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. We do not expect this new guidance to have a material impact on our consolidated financial statements. |
Investments in Marketable Secur
Investments in Marketable Securities | 9 Months Ended |
Sep. 30, 2017 | |
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 September 30, 2017 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposits $ 40 $ — $ — $ 40 Commercial paper 998 — — 998 Corporate notes and bonds 35,993 — 43 35,950 Total marketable securities $ 37,031 $ — $ 43 $ 36,988 The amortized cost and estimated fair value of marketable securities at September 30, 2017 , 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 $ 33,481 $ — $ 36 $ 33,445 Due after one year and through five years 3,550 — 7 3,543 $ 37,031 $ — $ 43 $ 36,988 The following is a summary of marketable securities (designated as available-for-sale) at December 31, 2016 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposit $ 40 $ — $ — $ 40 Commercial paper 8,228 — 6 8,222 Corporate notes and bonds 36,353 — 122 36,231 Total marketable securities $ 44,621 $ — $ 128 $ 44,493 The amortized cost and estimated fair value of marketable securities at December 31, 2016 , 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 $ 27,920 $ — $ 52 $ 27,868 Due after one year and through five years 16,701 — 76 16,625 $ 44,621 $ — $ 128 $ 44,493 |
Accounts Receivable, net
Accounts Receivable, net | 9 Months Ended |
Sep. 30, 2017 | |
Receivables [Abstract] | |
Accounts Receivable, net | Accounts Receivable, net Accounts receivable, net include: September 30, December 31, 2017 2016 Accounts receivable $ 29,756 $ 28,260 Less: credit allowance (240 ) (225 ) Less: allowance for doubtful accounts (804 ) (617 ) Total accounts receivable, net $ 28,712 $ 27,418 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets include: September 30, December 31, 2017 2016 Prepaid bandwidth and backbone $ 1,036 $ 698 VAT receivable 1,041 1,296 Prepaid expenses and insurance 1,993 2,321 Vendor deposits and other 383 550 Total prepaid expenses and other current assets $ 4,453 $ 4,865 |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and Equipment, net Property and equipment, net include: September 30, December 31, 2017 2016 Network equipment $ 106,841 $ 108,416 Computer equipment and software 9,621 10,282 Furniture and fixtures 2,435 2,432 Leasehold improvements 5,485 5,127 Other equipment 183 182 Total property and equipment 124,565 126,439 Less: accumulated depreciation (94,730 ) (96,087 ) Total property and equipment, net $ 29,835 $ 30,352 Depreciation expense related to property and equipment classified in operating expense was $603 and $611 for the three months ended September 30, 2017 and 2016 , respectively and was $ 1,789 and $ 1,848 for the nine months ended September 30, 2017 and 2016, respectively. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | 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. No interim indicators of impairment were identified as of September 30, 2017. Foreign currency translation adjustments decreased the carrying amount of goodwill by $ 107 for the three months ended September 30, 2017 . For the nine months ended September 30, 2017, foreign currency translation adjustments increased the carrying value of goodwill by $ 682 . |
Other Current Liabilities
Other Current Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | Other Current Liabilities Other current liabilities include: September 30, December 31, 2017 2016 Accrued compensation and benefits $ 10,074 $ 5,061 Accrued cost of revenue 2,488 2,178 Deferred rent 790 730 Accrued legal fees 235 262 Other accrued expenses 2,078 4,605 Total other current liabilities $ 15,665 $ 12,836 |
Line of Credit
Line of Credit | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Line of Credit | Line of Credit In October 2016, we entered into a Loan Modification Agreement (the Modification) to the Loan and Security Agreement (the Credit Agreement) with Silicon Valley Bank (SVB) originally entered into in November 2015. Under the Modification, we have reduced the maximum principal commitment amount from $25,000 to $5,000 . Our borrowing capacity is the lesser of the commitment amount or 80% of eligible accounts receivable. The Modification extends the Credit Agreement one year. All outstanding borrowings owed under the Credit Agreement become due and payable no later than the final maturity date of November 2, 2018. As of September 30, 2017 and December 31, 2016, we had no outstanding borrowings, and we had availability under the Credit Agreement of $5,000 . As of September 30, 2017, borrowings under the Credit 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) the 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 Credit 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 0.45% upon entering into the Modification. In addition, there is an unused line fee of 0.375% under the Credit Agreement and 0.30% under the Modification. Commitment fees are included in prepaid expenses and other current assets and as amortized are charged to interest expense. During the three months ended September 30, 2017 and 2016, interest expense was $0 and $24 , respectively, and commitment fees expense and amortization was $18 and $127 , respectively. During the nine months ended September 30, 2017 and 2016, interest expense was $0 and $205 , respectively, and commitment fees expense and amortization was $42 and $267 , respectively. 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 Modification eliminated the financial covenants under the Credit Agreement. Under the Modification, we are required to maintain a minimum liquidity, defined as cash balance at SVB plus availability on the revolver, of $7,500 at all times, measured quarterly, with a minimum of $5,000 of the $7,500 in cash at SVB. 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. As of September 30, 2017, we were in compliance with all covenants under the Credit Agreement. In October 2017, we entered into a Third Amendment (Third Amendment) to the Credit Agreement. Under the Third Amendment, we have increased the maximum principal commitment amount from $5,000 to $10,000 . The interest rate on any borrowings will decrease from LIBOR plus a margin of 2.75% to LIBOR plus a margin of 2.50% or the Wall Street Journal prime rate. In addition, the unused line fee under the Third Amendment will decrease from 30 basis points to 20 basis points. Under the Third Amendment, we are required to maintain a minimum liquidity of $10,000 at all times, measured quarterly, with a minimum of $5,000 of the $10,000 in cash at SVB. We incurred a commitment fee of $25 related to the Third Amendment. |
Other Long Term Liabilities
Other Long Term Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Long Term Liabilities | Other Long Term Liabilities Other long term liabilities include: September 30, December 31, 2017 2016 Deferred rent $ 615 $ 1,186 Income taxes payable 244 249 Total other long term liabilities $ 859 $ 1,435 |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Legal Matters Akamai ‘703 Litigation In June 2006, Akamai Technologies, Inc. (Akamai) and the Massachusetts Institute of Technology (MIT) filed a lawsuit against us in the United States District Court for the District of Massachusetts alleging that we were infringing multiple patents assigned to MIT and exclusively licensed by MIT to Akamai. In February 2008, a jury returned a verdict in this lawsuit, finding that we infringed four claims of U.S. Patent No. 6,108,703 (the ’703 patent) and awarded Akamai damages of approximately $45,500 , which included lost profits, reasonable royalties and price erosion damages for the period April 2005 through December 31, 2007. We litigated this matter vigorously for years, during which time the jury verdict was overturned in 2009, and then, after more than six years of appeals by both Akamai and us in the Federal Circuit and the Supreme Court of the United States, the jury verdict was ultimately reinstated. A series of motions and hearings followed the reinstatement, and in July 2016, the District Court entered final judgment in the case. In August 2016, we entered into a settlement and license agreement with Akamai with respect to the ‘703 patent and certain other related patents, which settled all asserted and unasserted claims with respect to the licensed patents. The terms of the agreement require us to pay $54,000 over twelve equal quarterly installments, which began on August 1, 2016. We took a charge in the quarter ended June 30, 2016, for the full, undiscounted amount of $54,000 . As of September 30, 2017, there remained $31,500 due to Akamai under the terms of the settlement and license agreement. Akamai and XO Litigation In November 2015, we filed a lawsuit against Akamai and XO Communications in the District Court for the Eastern District of Virginia alleging the infringement of six 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 (the Akamai and XO Litigation). Akamai also filed counterclaims in April 2016, alleging the infringement of five of its patents. We filed an answer to Akamai’s counterclaims, denying each of the allegations of infringement in May 2016. At this time, we believe a loss is neither probable nor reasonably possible, and as such, no provision for this lawsuit has been recorded in the consolidated financial statements. We intend to vigorously protect and enforce our intellectual property rights as plaintiffs in this dispute and also vigorously defend against each of the counterclaims. 2016 Akamai Litigation In February 2016, Akamai filed a complaint against us in the District Court for the District of Massachusetts alleging infringement of three of its patents. In April 2016, Akamai amended its complaint by withdrawing one of the asserted patents. In April 2016, we filed our answer to the complaint, denying each of the allegations of infringement, and asserting two counterclaims alleging infringement of two of our patents. In December 2016, Akamai filed a second complaint against us in the District Court for the District of Massachusetts alleging infringement of three additional patents. In February 2017, we filed our answer to the complaint, denying each of the allegations of infringement. The two cases were then consolidated into a single action by the court. At this time, we believe a loss is neither probable nor reasonably possible in either pending matter in the District of Massachusetts, and as such, no provision for these lawsuits have been recorded in the consolidated financial statements. We intend to vigorously defend against Akamai’s claims and also vigorously protect and enforce our intellectual property rights via our counterclaims in this dispute. Legal and other expenses associated with litigation have been significant. We include these litigation expenses in general and administrative expenses as incurred, as reported in the consolidated statement of operations. 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 that are not material in amount, 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 | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Net Loss per Share We calculate basic and diluted loss per weighted average share. We use the weighted-average number of shares of common stock outstanding during the period for the computation of basic loss per share. Diluted loss 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: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Net loss $ (1,756 ) $ (6,122 ) $ (6,718 ) $ (70,006 ) Basic and diluted weighted average outstanding shares of common stock 109,342 104,860 108,376 103,819 Basic and diluted net loss per share: $ (0.02 ) $ (0.06 ) $ (0.06 ) $ (0.67 ) For the three and nine months ended September 30, 2017 and 2016 , 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. Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Employee stock purchase plan 276 567 276 567 Stock options 3,002 54 1,509 91 Restricted stock units 3,145 1,015 2,808 713 6,423 1,636 4,593 1,371 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock On March 14, 2017, our board of directors authorized a $25,000 share repurchase program. Any shares repurchased under this program will be canceled and returned to authorized but unissued status. This new share repurchase program replaces the $9,500 remaining from the previously announced $15,000 share repurchase program. During the three and nine months ended September 30, 2017 and 2016, respectively, we did not repurchase any shares under the repurchase programs. Amended and Restated Equity Incentive Plan We established the 2007 Equity Incentive Plan, or the 2007 Plan, which allows for the grant of equity, including stock options and restricted stock unit awards. In June 2016, our stockholders approved the Amended and Restated Equity Incentive Plan, or the Restated 2007 Plan, which amended and restated the 2007 Plan. Approval of the Restated 2007 Plan replaced the terms and conditions of the 2007 Plan with the terms and conditions of the Restated 2007 Plan, and extended the term of the plan to April 2026. There was no increase in the aggregate amount of shares available for issuance. The total number of shares authorized for issuance under the Restated 2007 Plan was approximately 8,435 as of September 30, 2017 . 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 three months ended September 30, 2017, we did not issue any shares under the ESPP. During the nine months ended September 30, 2017, we issued 432 shares under the ESPP. Total cash proceeds from the purchase of the shares under the ESPP was approximately $885 . As of September 30, 2017 , shares reserved for issuance to employees under this plan totaled 886 , and we held employee contributions of $744 (included in other current liabilities) for future purchases under the ESPP. Preferred Stock Our board of directors has authorized the issuance of up to 7,500 shares of preferred stock at September 30, 2017 . 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 September 30, 2017 , the board of directors had not adopted any resolutions for the issuance of preferred stock. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Changes in the components of accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2017 , was as follows: Unrealized Gains (Losses) on Foreign Available for Currency Sale Securities Total Balance, December 31, 2016 $ (10,910 ) $ (128 ) $ (11,038 ) Other comprehensive income before reclassifications 2,276 83 2,359 Amounts reclassified from accumulated other comprehensive loss — — — Net current period other comprehensive income 2,276 83 2,359 Balance, September 30, 2017 $ (8,634 ) $ (45 ) $ (8,679 ) |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation The following table summarizes the components of share-based compensation expense included in our consolidated statement of operations: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Share-based compensation expense by type: Stock options $ 917 $ 812 $ 2,776 $ 2,755 Restricted stock units 2,075 1,999 6,213 6,467 ESPP 120 176 453 554 Total share-based compensation expense $ 3,112 $ 2,987 $ 9,442 $ 9,776 Share-based compensation expense: Cost of services $ 352 $ 209 $ 1,075 $ 1,118 General and administrative expense 1,565 1,616 4,773 5,119 Sales and marketing expense 611 641 1,848 2,016 Research and development expense 584 521 1,746 1,523 Total share-based compensation expense $ 3,112 $ 2,987 $ 9,442 $ 9,776 Unrecognized share-based compensation expense totaled approximately $16,288 at September 30, 2017 , of which $5,049 related to stock options and $11,239 related to restricted stock units. We currently expect to recognize share-based compensation expense of $2,865 during the remainder of 2017, $8,392 in 2018 and the remainder thereafter based on scheduled vesting of the stock options and restricted stock units outstanding at September 30, 2017 . |
Leases and Purchase Commitments
Leases and Purchase Commitments | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Leases and Purchase Commitments | Leases and Purchase 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 September 30, 2017 , are as follows: Remainder of 2017 $ 945 2018 3,564 2019 1,618 2020 546 2021 359 Thereafter 55 Total minimum payments $ 7,087 Purchase Commitments We have long-term commitments for bandwidth usage and co-location with various networks and Internet service providers. The following summarizes minimum commitments as of September 30, 2017 : Remainder of 2017 $ 9,834 2018 23,799 2019 7,145 2020 442 2021 — Thereafter — Total minimum payments $ 41,220 |
Concentrations
Concentrations | 9 Months Ended |
Sep. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
Concentrations | Concentrations During the three months ended September 30, 2017 , we had two customers, Amazon and Apple, who each represented 10% or more of our total revenue. For the nine months ended September 30, 2017 , we had one customer, Amazon, who represented 10% or more of our total revenue. During the three and nine months ended September 30, 2016, we had no individual customer who represented 10% or more of our total revenue. Revenue from customers located within the United States, our country of domicile, was $28,630 for the three months ended September 30, 2017 , compared to $22,996 for the three months ended September 30, 2016 . For the nine months ended September 30, 2017, revenue from customers located within the United States was $ 83,021 , compared to $ 69,033 for the nine months ended September 30, 2016. During the three months ended September 30, 2017 , respectively, we had two countries, based on customer location, the United States, and the United Kingdom that accounted for 10% or more of our total revenues. For the nine months ended September 30, 2017 , we had three countries, based on customer location, the United States, Japan, and the United Kingdom that accounted for 10% or more of our total revenue. During the three and nine months ended September 30, 2016, respectively, we had two countries, based on customer location, the United States and Japan that accounted for 10% or more of our total revenues. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income taxes for the interim periods presented have been included in the accompanying consolidated financial statements on the basis of an estimated annual effective tax rate. Based on an estimated annual effective tax rate and discrete items, income tax expense for the three months ended September 30, 2017 and 2016, was $188 and $130 , respectively. For the nine months ended September 30, 2017 and 2016, income tax expense was $448 and $404 , respectively. Income tax expense was different than the statutory income tax rate primarily due to us providing for a valuation allowance on deferred tax assets in certain jurisdictions, and the recording of state and foreign tax expense for the three month periods. We file income tax returns in jurisdictions with varying statutes of limitations. Tax years 2014 through 2016 remain subject to examination by federal tax authorities. Tax years 2013 through 2016 generally remain subject to examination by state tax authorities. As of September 30, 2017 , we are not under any federal or state examination for income taxes. |
Segment Reporting and Geographi
Segment Reporting and Geographic Areas | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting and Geographic Areas | Segment Reporting and Geographic Areas Our chief operating decision maker (whom is our Chief Executive Officer) reviews our 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 our revenue by geographic area: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Americas $ 29,485 64.0 % $ 24,072 61.0 % $ 86,093 63.2 % $ 74,183 59.6 % EMEA 9,280 20.1 % 6,912 17.5 % 26,543 19.5 % 23,300 18.7 % Asia Pacific 7,304 15.9 % 8,489 21.5 % 23,537 17.3 % 26,973 21.7 % Total revenue $ 46,069 100.0 % $ 39,473 100.0 % $ 136,173 100.0 % $ 124,456 100.0 % The following table sets forth long-lived assets by geographic area in which the assets are located: September 30, December 31, 2017 2016 Americas $ 17,372 $ 18,665 International 12,463 11,687 Total long-lived assets $ 29,835 $ 30,352 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements As of September 30, 2017 , and December 31, 2016 , 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 September 30, 2017 : 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) $ 111 $ 111 $ — $ — Certificate of deposit (1) 40 — 40 — Commercial paper (1) 998 — 998 — Corporate notes and bonds (1) 35,950 — 35,950 — Total assets measured at fair value $ 37,099 $ 111 $ 36,988 $ — ____________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents The following is a summary of fair value measurements at December 31, 2016 : 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) $ 301 $ 301 $ — $ — Certificate of deposit (1) 40 — 40 — Commercial paper (1) 8,222 — 8,222 — Corporate notes and bonds (1) 36,231 — 36,231 — Total assets measured at fair value $ 44,794 $ 301 $ 44,493 $ — ____________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents 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. |
Summary of Significant Accoun27
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. They do not include all of the information and footnotes required by U.S. generally accepted accounting principles (U.S. GAAP) for complete financial statements. Such interim financial information is unaudited but reflects all adjustments that are, in the opinion of management, necessary for the fair presentation of the interim periods presented and of a normal recurring nature. The results of operations presented in this quarterly report on Form 10-Q are not necessarily indicative of the results that may be expected for the year ending December 31, 2017, or for any future periods. This quarterly report on Form 10-Q should be read in conjunction with our audited financial statements and footnotes included in our annual report on Form 10-K for the fiscal year ended December 31, 2016. All information is presented in thousands, except per share amounts and where specifically noted. 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 year amounts to conform to the current year presentation. |
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. |
Recent Accounting Standards | Recent Accounting Standards Adopted Accounting Standards In November 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) 2015-17, which requires entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as 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 adopted this guidance effective January 1, 2017 on a retrospective basis. The impact of adoption of this ASU was that $88 of current DTAs in our consolidated balance sheet for the year ended December 31, 2016, has been reclassified to noncurrent DTAs. In March 2016, the FASB issued ASU 2016-09, which amends the existing accounting standards for share-based payments, including the accounting for income taxes and forfeitures, as well as the classifications on the statements of cash flows. We adopted this guidance effective January 1, 2017. Beginning January 1, 2017, stock-based compensation excess tax benefits or tax deficiencies are reflected in the Consolidated Statements of Operations as a component of the provision for taxes, whereas they previously were recognized as additional paid in capital in the stockholders’ deficit in the Consolidated Balance Sheets. We have elected to continue to estimate forfeitures expected to occur to determine stock-based compensation expense. Additionally, beginning with the three months ended March 31, 2017, and on a prospective basis, the Consolidated Statements of Cash Flows now requires excess tax benefits be presented as an operating activity rather than as a financing activity, while the payment of withholding taxes on the settlement of stock-based compensation awards continues to be presented as a financing activity. The implementation of this guidance did not have a material impact on the Consolidated Statements of Cash Flows for the nine months ended September 30, 2017. During the nine months ended September 30, 2017 there was no change to beginning retained earnings for previously unrecognized tax benefits. The increase of $5.2 million to the net operating loss carryforward deferred tax asset was fully offset by an increase to the valuation allowance. During the nine months ended September 30, 2017 we did not record excess tax benefits on stock options and restricted stock units as a result of the adoption of ASU 2016-09 because such amounts are fully offset by our valuation allowance. Recently Issued Accounting Pronouncements 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. 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. We currently believe that once we do adopt this standard, we will use the modified retrospective approach. We are utilizing a comprehensive approach to assess the impact of the guidance on our contract portfolio by reviewing our current accounting policies and practices to identify potential differences that would result from applying the new requirements to our revenue contracts, including evaluation of performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, allocating the transaction price to each separate performance obligation and accounting treatment of costs to obtain and fulfill contracts. We continue to make significant progress on the potential impact on our accounting policies and internal control processes including system readiness. In addition, we will update certain disclosures, as applicable, included in our filings pursuant to the Securities Exchange Act of 1934, as amended, to meet the requirements of the new guidance. We continue to review contracts with our customers and we currently believe that we will be required to record a cumulative effect adjustment to retained earnings upon adoption of the new revenue standard at the beginning of 2018. The cumulative adjustment is primarily related to incremental upfront contract acquisition costs (such as sales commissions) for customer contracts. The new standard requires these costs to be capitalized and amortized over the estimated life of the asset. Currently, these costs are expensed as incurred. For the nine months ended September 30, 2017, we paid approximately $800 in incremental upfront contract acquisition costs. We recognize revenue for most of our customers based on actual monthly usage at an agreed upon rate, where the impact of adoption is not expected to be material. We have entered into some contracts with annual minimum commitments. We are currently evaluating the impact of estimating variable consideration related to these types of contacts and how the new standard could impact revenue recognition. We do not know and cannot reasonably estimate quantitative information related to the impact of the new standard on our financial statements at this time. In February 2016, the FASB issued ASU No. 2016-02, which establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for most leases. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. We do not plan to early adopt this ASU. We are in the process of evaluating the potential impacts of this new guidance on our consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU No. 2016-15, which amends Accounting Standards Codification 230, to clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows. The FASB issued ASU 2016-15 with the intent of reducing diversity in practice with respect to eight types of cash flows. This guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. We are in the process of evaluating the adoption and potential impact of this new guidance on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, which simplifies the accounting for goodwill impairment. The updated guidance eliminates Step 2 of the impairment test, which requires entities to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value, determined in Step 1. This guidance will become effective for us in fiscal years beginning after December 15, 2019, including interim periods within that reporting period. We will adopt this guidance using a prospective approach. Earlier adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not plan to early adopt this ASU, and we are currently evaluating the impact of this guidance on our consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. ASU 2017-09 will reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications. Under ASU 2017-09, an entity will not apply modification accounting to a share-based payment award if the award's fair value, vesting conditions and classification as an equity or liability instrument are the same immediately before and after the change. ASU 2017-09 will be applied prospectively to awards modified on or after the adoption date. The guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. We do not expect this new guidance to have a material impact on our consolidated financial statements. |
Investments in Marketable Sec28
Investments in Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
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 September 30, 2017 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposits $ 40 $ — $ — $ 40 Commercial paper 998 — — 998 Corporate notes and bonds 35,993 — 43 35,950 Total marketable securities $ 37,031 $ — $ 43 $ 36,988 The following is a summary of marketable securities (designated as available-for-sale) at December 31, 2016 : Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Certificate of deposit $ 40 $ — $ — $ 40 Commercial paper 8,228 — 6 8,222 Corporate notes and bonds 36,353 — 122 36,231 Total marketable securities $ 44,621 $ — $ 128 $ 44,493 |
Amortized Cost and Estimated Fair Value of Marketable Securities (designated as available-for-sale) by maturity | The amortized cost and estimated fair value of marketable securities at September 30, 2017 , 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 $ 33,481 $ — $ 36 $ 33,445 Due after one year and through five years 3,550 — 7 3,543 $ 37,031 $ — $ 43 $ 36,988 The amortized cost and estimated fair value of marketable securities at December 31, 2016 , 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 $ 27,920 $ — $ 52 $ 27,868 Due after one year and through five years 16,701 — 76 16,625 $ 44,621 $ — $ 128 $ 44,493 |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Receivables [Abstract] | |
Summary of Accounts Receivable, net | Accounts receivable, net include: September 30, December 31, 2017 2016 Accounts receivable $ 29,756 $ 28,260 Less: credit allowance (240 ) (225 ) Less: allowance for doubtful accounts (804 ) (617 ) Total accounts receivable, net $ 28,712 $ 27,418 |
Prepaid Expenses and Other Cu30
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets include: September 30, December 31, 2017 2016 Prepaid bandwidth and backbone $ 1,036 $ 698 VAT receivable 1,041 1,296 Prepaid expenses and insurance 1,993 2,321 Vendor deposits and other 383 550 Total prepaid expenses and other current assets $ 4,453 $ 4,865 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and equipment, net include: September 30, December 31, 2017 2016 Network equipment $ 106,841 $ 108,416 Computer equipment and software 9,621 10,282 Furniture and fixtures 2,435 2,432 Leasehold improvements 5,485 5,127 Other equipment 183 182 Total property and equipment 124,565 126,439 Less: accumulated depreciation (94,730 ) (96,087 ) Total property and equipment, net $ 29,835 $ 30,352 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | Other current liabilities include: September 30, December 31, 2017 2016 Accrued compensation and benefits $ 10,074 $ 5,061 Accrued cost of revenue 2,488 2,178 Deferred rent 790 730 Accrued legal fees 235 262 Other accrued expenses 2,078 4,605 Total other current liabilities $ 15,665 $ 12,836 |
Other Long Term Liabilities (Ta
Other Long Term Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Long Term Liabilities | Other long term liabilities include: September 30, December 31, 2017 2016 Deferred rent $ 615 $ 1,186 Income taxes payable 244 249 Total other long term liabilities $ 859 $ 1,435 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net 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: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Net loss $ (1,756 ) $ (6,122 ) $ (6,718 ) $ (70,006 ) Basic and diluted weighted average outstanding shares of common stock 109,342 104,860 108,376 103,819 Basic and diluted net loss per share: $ (0.02 ) $ (0.06 ) $ (0.06 ) $ (0.67 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | For the three and nine months ended September 30, 2017 and 2016 , 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. Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Employee stock purchase plan 276 567 276 567 Stock options 3,002 54 1,509 91 Restricted stock units 3,145 1,015 2,808 713 6,423 1,636 4,593 1,371 |
Accumulated Other Comprehensi35
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | Changes in the components of accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2017 , was as follows: Unrealized Gains (Losses) on Foreign Available for Currency Sale Securities Total Balance, December 31, 2016 $ (10,910 ) $ (128 ) $ (11,038 ) Other comprehensive income before reclassifications 2,276 83 2,359 Amounts reclassified from accumulated other comprehensive loss — — — Net current period other comprehensive income 2,276 83 2,359 Balance, September 30, 2017 $ (8,634 ) $ (45 ) $ (8,679 ) |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Components of Share-based Compensation Expense | The following table summarizes the components of share-based compensation expense included in our consolidated statement of operations: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Share-based compensation expense by type: Stock options $ 917 $ 812 $ 2,776 $ 2,755 Restricted stock units 2,075 1,999 6,213 6,467 ESPP 120 176 453 554 Total share-based compensation expense $ 3,112 $ 2,987 $ 9,442 $ 9,776 Share-based compensation expense: Cost of services $ 352 $ 209 $ 1,075 $ 1,118 General and administrative expense 1,565 1,616 4,773 5,119 Sales and marketing expense 611 641 1,848 2,016 Research and development expense 584 521 1,746 1,523 Total share-based compensation expense $ 3,112 $ 2,987 $ 9,442 $ 9,776 |
Leases and Purchase Commitmen37
Leases and Purchase Commitments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments Over Remaining Lease Periods | Approximate future minimum lease payments over the remaining lease periods as of September 30, 2017 , are as follows: Remainder of 2017 $ 945 2018 3,564 2019 1,618 2020 546 2021 359 Thereafter 55 Total minimum payments $ 7,087 |
Minimum Purchase Commitments | The following summarizes minimum commitments as of September 30, 2017 : Remainder of 2017 $ 9,834 2018 23,799 2019 7,145 2020 442 2021 — Thereafter — Total minimum payments $ 41,220 |
Segment Reporting and Geograp38
Segment Reporting and Geographic Areas (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Revenue Earned by Geographic Area | The following table sets forth our revenue by geographic area: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Americas $ 29,485 64.0 % $ 24,072 61.0 % $ 86,093 63.2 % $ 74,183 59.6 % EMEA 9,280 20.1 % 6,912 17.5 % 26,543 19.5 % 23,300 18.7 % Asia Pacific 7,304 15.9 % 8,489 21.5 % 23,537 17.3 % 26,973 21.7 % Total revenue $ 46,069 100.0 % $ 39,473 100.0 % $ 136,173 100.0 % $ 124,456 100.0 % |
Long-lived Assets by Geographical Area | The following table sets forth long-lived assets by geographic area in which the assets are located: September 30, December 31, 2017 2016 Americas $ 17,372 $ 18,665 International 12,463 11,687 Total long-lived assets $ 29,835 $ 30,352 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [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 September 30, 2017 : 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) $ 111 $ 111 $ — $ — Certificate of deposit (1) 40 — 40 — Commercial paper (1) 998 — 998 — Corporate notes and bonds (1) 35,950 — 35,950 — Total assets measured at fair value $ 37,099 $ 111 $ 36,988 $ — ____________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents The following is a summary of fair value measurements at December 31, 2016 : 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) $ 301 $ 301 $ — $ — Certificate of deposit (1) 40 — 40 — Commercial paper (1) 8,222 — 8,222 — Corporate notes and bonds (1) 36,231 — 36,231 — Total assets measured at fair value $ 44,794 $ 301 $ 44,493 $ — ____________ (1) Classified in marketable securities (2) Classified in cash and cash equivalents |
Summary of Significant Accoun40
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Increase in net operating loss carryforward deferred tax asset | $ 5,200 | |
Increase in deferred tax asset valuation allowance | 5,200 | |
Contract acquisition costs | $ 800 | |
ASU 2015-07 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Decrease in current deferred tax assets | $ 88 | |
Increase in noncurrent deferred tax assets | $ 88 |
Investments in Marketable Sec41
Investments in Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | $ 37,031 | $ 44,621 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 43 | 128 |
Estimated Fair Value | 36,988 | 44,493 |
Certificate of deposit | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 40 | 40 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 40 | 40 |
Commercial paper | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 998 | 8,228 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 6 |
Estimated Fair Value | 998 | 8,222 |
Corporate notes and bonds | ||
Summary of marketable securities (designated as available-for-sale) | ||
Amortized Cost | 35,993 | 36,353 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 43 | 122 |
Estimated Fair Value | $ 35,950 | $ 36,231 |
Investments in Marketable Sec42
Investments in Marketable Securities (Details 1) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Amortized cost and estimated fair value of marketable securities (designated as available-for-sale) by maturity | ||
Amortized Cost | $ 37,031 | $ 44,621 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 43 | 128 |
Estimated Fair Value | 36,988 | 44,493 |
Debt securities | ||
Amortized cost and estimated fair value of marketable securities (designated as available-for-sale) by maturity | ||
Amortized Cost, Due in one year or less | 33,481 | 27,920 |
Gross Unrealized Gains, Due in one year or less | 0 | 0 |
Gross Unrealized Losses, Due in one year or less | 36 | 52 |
Estimated Fair Value, Due in one year or less | 33,445 | 27,868 |
Amortized Cost, Due after one year and through five years | 3,550 | 16,701 |
Gross Unrealized Gains, Due after one year and through five years | 0 | 0 |
Gross Unrealized Losses, Due after one year and through five years | 7 | 76 |
Estimated Fair Value, Due after one year and through five years | 3,543 | 16,625 |
Amortized Cost | 37,031 | 44,621 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 43 | 128 |
Estimated Fair Value | $ 36,988 | $ 44,493 |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Summary of Accounts Receivable, net | ||
Accounts receivable | $ 29,756 | $ 28,260 |
Less: credit allowance | (240) | (225) |
Less: allowance for doubtful accounts | (804) | (617) |
Total accounts receivable, net | $ 28,712 | $ 27,418 |
Prepaid Expenses and Other Cu44
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid bandwidth and backbone | $ 1,036 | $ 698 |
VAT receivable | 1,041 | 1,296 |
Prepaid expenses and insurance | 1,993 | 2,321 |
Vendor deposits and other | 383 | 550 |
Total prepaid expenses and other current assets | $ 4,453 | $ 4,865 |
Property and Equipment, net (De
Property and Equipment, net (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Property and equipment, net | ||
Property and equipment, gross | $ 124,565 | $ 126,439 |
Less: accumulated depreciation | (94,730) | (96,087) |
Total property and equipment, net | 29,835 | 30,352 |
Network equipment | ||
Property and equipment, net | ||
Property and equipment, gross | 106,841 | 108,416 |
Computer equipment and software | ||
Property and equipment, net | ||
Property and equipment, gross | 9,621 | 10,282 |
Furniture and fixtures | ||
Property and equipment, net | ||
Property and equipment, gross | 2,435 | 2,432 |
Leasehold improvements | ||
Property and equipment, net | ||
Property and equipment, gross | 5,485 | 5,127 |
Other equipment | ||
Property and equipment, net | ||
Property and equipment, gross | $ 183 | $ 182 |
Property and Equipment, net (46
Property and Equipment, net (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | ||||
Operating expense depreciation | $ 603 | $ 611 | $ 1,789 | $ 1,848 |
Goodwill (Details Textual)
Goodwill (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2017 | Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Foreign currency translation adjustment | $ 107 | $ (682) |
Other Current Liabilities (Deta
Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Other Liabilities Disclosure [Abstract] | ||
Accrued compensation and benefits | $ 10,074 | $ 5,061 |
Accrued cost of revenue | 2,488 | 2,178 |
Deferred rent | 790 | 730 |
Accrued legal fees | 235 | 262 |
Other accrued expenses | 2,078 | 4,605 |
Total other current liabilities | $ 15,665 | $ 12,836 |
Line of Credit (Details)
Line of Credit (Details) - Revolving Credit Facility - Credit Agreement - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Oct. 31, 2017 | Oct. 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Nov. 02, 2015 | |
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing amount | $ 5,000,000 | $ 25,000,000 | ||||||
Borrowing capacity limit, percent of accounts receivable | 80.00% | |||||||
Proceeds from line of credit | $ 0 | $ 0 | $ 0 | |||||
Current borrowing capacity | 5,000,000 | 5,000,000 | $ 5,000,000 | |||||
Minimum liquidity benchmark | $ 17,500,000 | |||||||
Commitment fee percentage paid at closing | 0.45% | |||||||
Unused line fee percentage | 0.30% | 0.375% | ||||||
Interest expense, line of credit | 0 | $ 24,000 | $ 0 | $ 205,000 | ||||
Commitment fees amortization | 18,000 | $ 127,000 | $ 42,000 | $ 267,000 | ||||
Voting stock percentage in foreign subsidiaries | 65.00% | |||||||
Line of credit facility, covenant compliance, minimum cash and revolver availability | 7,500,000 | $ 7,500,000 | ||||||
Line of credit facility, covenant compliance, minimum cash at lender | $ 5,000,000 | $ 5,000,000 | ||||||
LIBOR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Variable rate | 2.75% | |||||||
Alternative Base Rate | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Variable rate | 0.50% | |||||||
Variable rate minimum | 0.50% | |||||||
Variable rate maximum | 1.50% | |||||||
Subsequent Event | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing amount | $ 10,000,000 | |||||||
Unused line fee percentage | 0.20% | |||||||
Line of credit facility, covenant compliance, minimum cash and revolver availability | $ 10,000,000 | |||||||
Line of credit facility, covenant compliance, minimum cash at lender | 5,000,000 | |||||||
Amendment fee | $ 25,000 | |||||||
Subsequent Event | LIBOR | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Variable rate | 2.50% |
Other Long Term Liabilities (De
Other Long Term Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Other Liabilities Disclosure [Abstract] | ||
Deferred rent | $ 615 | $ 1,186 |
Income taxes payable | 244 | 249 |
Total other long term liabilities | $ 859 | $ 1,435 |
Contingencies (Details)
Contingencies (Details) $ in Thousands | Aug. 01, 2016USD ($)installment_payment | Aug. 13, 2015 | Apr. 30, 2016Patentcounterclaim | Feb. 29, 2008USD ($)Claim | Sep. 30, 2017USD ($) | Apr. 29, 2016Patent | Feb. 16, 2016Patent | Nov. 30, 2015Patent |
Akamai '703 Litigation | Pending Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of claims Company infringed | Claim | 4 | |||||||
Aggregate of lost profits, reasonable royalties and price erosion damages | $ | $ 45,500 | |||||||
Duration of appeals in the courts | 6 years | |||||||
Akamai '703 Litigation | Settled Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Provision for litigation | $ | $ (54,000) | |||||||
Number of quarterly installment payments for litigation settlement | installment_payment | 12 | |||||||
Litigation reserve, remaining amount due | $ | $ 31,500 | |||||||
Akamai and XO Communications Litigation | Pending Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of company patents infringed | 6 | |||||||
Akamai Litigation | Pending Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of patents Company was infringing | 5 | |||||||
2016 Akamai Litigation | Pending Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of company patents infringed | 2 | |||||||
Number of patents Company was infringing | 3 | |||||||
Number of patents company infringed, withdrawn | 1 | |||||||
Number of counterclaims | counterclaim | 2 |
Net Loss per Share (Details)
Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (1,756) | $ (6,122) | $ (6,718) | $ (70,006) |
Basic and diluted weighted average outstanding shares of common stock (in shares) | 109,342 | 104,860 | 108,376 | 103,819 |
Basic and diluted (in usd per share) | $ (0.02) | $ (0.06) | $ (0.06) | $ (0.67) |
Net Loss per Share Dilutive Com
Net Loss per Share Dilutive Common Stock (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Excluded outstanding options and restricted stock units (in shares) | 6,423 | 1,636 | 4,593 | 1,371 |
Employee stock purchase plan | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Excluded outstanding options and restricted stock units (in shares) | 276 | 567 | 276 | 567 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Excluded outstanding options and restricted stock units (in shares) | 3,002 | 54 | 1,509 | 91 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Excluded outstanding options and restricted stock units (in shares) | 3,145 | 1,015 | 2,808 | 713 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | 9 Months Ended | |||
Sep. 30, 2017 | Mar. 14, 2017 | Dec. 31, 2016 | Feb. 12, 2014 | |
Equity, Class of Treasury Stock [Line Items] | ||||
Issuance of preferred stock authorized (in shares) | 7,500,000 | 7,500,000 | ||
Employee Stock Purchase Plan | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Discount from market price for employees | 15.00% | |||
Shares issued (in shares) | 432,000 | |||
Cash proceeds from purchase of shares | $ 885,000 | |||
Common Stock reserved for future options and restricted stock awards (in shares) | 886,000 | |||
Employee funds held by company for future purchase of shares | $ 744,000 | |||
2007 Equity Incentive Plan | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Shares authorized for issuance under Restated 2007 Plan (in shares) | 8,435,000 | |||
2017 Share Repurchase Program | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock repurchase amount authorized | $ 25,000,000 | |||
2012 Share Repurchase Program | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Stock repurchase amount authorized | $ 15,000,000 | |||
Remaining authorized repurchase amount | $ 9,500,000 |
Accumulated Other Comprehensi55
Accumulated Other Comprehensive Loss (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($) | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Accumulated other comprehensive income, beginning balance | $ 137,568 |
Accumulated other comprehensive income, ending balance | 141,880 |
Foreign Currency | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Accumulated other comprehensive income, beginning balance | (10,910) |
Other comprehensive income before reclassifications | 2,276 |
Amounts reclassified from accumulated other comprehensive loss | 0 |
Net current period other comprehensive income | 2,276 |
Accumulated other comprehensive income, ending balance | (8,634) |
Unrealized Gains (Losses) on Available for Sale Securities | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Accumulated other comprehensive income, beginning balance | (128) |
Other comprehensive income before reclassifications | 83 |
Amounts reclassified from accumulated other comprehensive loss | 0 |
Net current period other comprehensive income | 83 |
Accumulated other comprehensive income, ending balance | (45) |
AOCI | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Accumulated other comprehensive income, beginning balance | (11,038) |
Other comprehensive income before reclassifications | 2,359 |
Amounts reclassified from accumulated other comprehensive loss | 0 |
Net current period other comprehensive income | 2,359 |
Accumulated other comprehensive income, ending balance | $ (8,679) |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Components of share-based compensation expense | ||||
Share-based compensation | $ 3,112 | $ 2,987 | $ 9,442 | $ 9,776 |
Cost of services | ||||
Components of share-based compensation expense | ||||
Share-based compensation | 352 | 209 | 1,075 | 1,118 |
General and administrative expense | ||||
Components of share-based compensation expense | ||||
Share-based compensation | 1,565 | 1,616 | 4,773 | 5,119 |
Sales and marketing expense | ||||
Components of share-based compensation expense | ||||
Share-based compensation | 611 | 641 | 1,848 | 2,016 |
Research and development expense | ||||
Components of share-based compensation expense | ||||
Share-based compensation | 584 | 521 | 1,746 | 1,523 |
Stock options | ||||
Components of share-based compensation expense | ||||
Share-based compensation | 917 | 812 | 2,776 | 2,755 |
Restricted stock units | ||||
Components of share-based compensation expense | ||||
Share-based compensation | 2,075 | 1,999 | 6,213 | 6,467 |
ESPP | ||||
Components of share-based compensation expense | ||||
Share-based compensation | $ 120 | $ 176 | $ 453 | $ 554 |
Share-Based Compensation (Det57
Share-Based Compensation (Details Textual) $ in Thousands | Sep. 30, 2017USD ($) |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |
Unrecognized share-based compensation expense total | $ 16,288 |
Share-based compensation expense, remainder of 2016 | 2,865 |
Share-based compensation expense, 2017 | 8,392 |
Stock options | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |
Unrecognized share-based compensation expense total | 5,049 |
Restricted stock units | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |
Unrecognized share-based compensation expense total | $ 11,239 |
Leases and Purchase Commitmen58
Leases and Purchase Commitments (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Future minimum lease payments over remaining lease periods | |
Remainder of 2017 | $ 945 |
2,018 | 3,564 |
2,019 | 1,618 |
2,020 | 546 |
2,021 | 359 |
Thereafter | 55 |
Total minimum payments | $ 7,087 |
Leases and Purchase Commitmen59
Leases and Purchase Commitments (Details 1) $ in Thousands | Sep. 30, 2017USD ($) |
Minimum purchase commitments | |
Remainder of 2017 | $ 9,834 |
2,018 | 23,799 |
2,019 | 7,145 |
2,020 | 442 |
2,021 | 0 |
Thereafter | 0 |
Total minimum payments | $ 41,220 |
Concentrations (Details)
Concentrations (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017USD ($)customercountry | Sep. 30, 2016USD ($)customercountry | Sep. 30, 2017USD ($)customercountry | Sep. 30, 2016USD ($)customercountry | |
Concentration Risk [Line Items] | ||||
Number of customers who represented 10% or more of total revenue | customer | 2 | 0 | 1 | 0 |
Revenues | $ 46,069 | $ 39,473 | $ 136,173 | $ 124,456 |
Geographic concentration | Total revenue | ||||
Concentration Risk [Line Items] | ||||
Number of countries accounting for 10% or more of revenue | country | 2 | 2 | 3 | 2 |
United States | Geographic concentration | Total revenue | ||||
Concentration Risk [Line Items] | ||||
Revenues | $ 28,630 | $ 22,996 | $ 83,021 | $ 69,033 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 188 | $ 130 | $ 448 | $ 404 |
Segment Reporting and Geograp62
Segment Reporting and Geographic Areas (Details Textual) | 9 Months Ended |
Sep. 30, 2017SegmentLocation | |
Segment Reporting [Abstract] | |
Number of industry segment | Segment | 1 |
Number of geographic areas | Location | 3 |
Segment Reporting and Geograp63
Segment Reporting and Geographic Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenue earned by geographic area | ||||
Revenues | $ 46,069 | $ 39,473 | $ 136,173 | $ 124,456 |
Americas | ||||
Revenue earned by geographic area | ||||
Revenues | 29,485 | 24,072 | 86,093 | 74,183 |
EMEA | ||||
Revenue earned by geographic area | ||||
Revenues | 9,280 | 6,912 | 26,543 | 23,300 |
Asia Pacific | ||||
Revenue earned by geographic area | ||||
Revenues | $ 7,304 | $ 8,489 | $ 23,537 | $ 26,973 |
Geographic concentration | ||||
Revenue earned by geographic area | ||||
Percent of revenue | 100.00% | 100.00% | 100.00% | 100.00% |
Geographic concentration | Americas | ||||
Revenue earned by geographic area | ||||
Percent of revenue | 64.00% | 61.00% | 63.20% | 59.60% |
Geographic concentration | EMEA | ||||
Revenue earned by geographic area | ||||
Percent of revenue | 20.10% | 17.50% | 19.50% | 18.70% |
Geographic concentration | Asia Pacific | ||||
Revenue earned by geographic area | ||||
Percent of revenue | 15.90% | 21.50% | 17.30% | 21.70% |
Segment Reporting and Geograp64
Segment Reporting and Geographic Areas (Details 1) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Long-lived assets by geographical area | ||
Long-lived assets | $ 29,835 | $ 30,352 |
Americas | ||
Long-lived assets by geographical area | ||
Long-lived assets | 17,372 | 18,665 |
International | ||
Long-lived assets by geographical area | ||
Long-lived assets | $ 12,463 | $ 11,687 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring basis - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | ||
Assets: | ||||
Total assets measured at fair value | $ 37,099 | $ 44,794 | ||
Money market funds | ||||
Assets: | ||||
Total assets measured at fair value | 111 | [1] | 301 | [2] |
Certificate of deposit | ||||
Assets: | ||||
Total assets measured at fair value | 40 | [3] | 40 | [4] |
Commercial paper | ||||
Assets: | ||||
Total assets measured at fair value | 998 | [3] | 8,222 | [4] |
Corporate notes and bonds | ||||
Assets: | ||||
Total assets measured at fair value | 35,950 | [3] | 36,231 | [4] |
Quoted Prices In Active Markets for Identical Assets (Level 1) | ||||
Assets: | ||||
Total assets measured at fair value | 111 | 301 | ||
Quoted Prices In Active Markets for Identical Assets (Level 1) | Money market funds | ||||
Assets: | ||||
Total assets measured at fair value | 111 | [1] | 301 | [2] |
Quoted Prices In Active Markets for Identical Assets (Level 1) | Certificate of deposit | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [3] | 0 | [4] |
Quoted Prices In Active Markets for Identical Assets (Level 1) | Commercial paper | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [3] | 0 | [4] |
Quoted Prices In Active Markets for Identical Assets (Level 1) | Corporate notes and bonds | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [3] | 0 | [4] |
Significant Other Observable Inputs (Level 2) | ||||
Assets: | ||||
Total assets measured at fair value | 36,988 | 44,493 | ||
Significant Other Observable Inputs (Level 2) | Money market funds | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [1] | 0 | [2] |
Significant Other Observable Inputs (Level 2) | Certificate of deposit | ||||
Assets: | ||||
Total assets measured at fair value | 40 | [3] | 40 | [4] |
Significant Other Observable Inputs (Level 2) | Commercial paper | ||||
Assets: | ||||
Total assets measured at fair value | 998 | [3] | 8,222 | [4] |
Significant Other Observable Inputs (Level 2) | Corporate notes and bonds | ||||
Assets: | ||||
Total assets measured at fair value | 35,950 | [3] | 36,231 | [4] |
Significant Unobservable Inputs (Level 3) | ||||
Assets: | ||||
Total assets measured at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) | Money market funds | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [1] | 0 | [2] |
Significant Unobservable Inputs (Level 3) | Certificate of deposit | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [3] | 0 | [4] |
Significant Unobservable Inputs (Level 3) | Commercial paper | ||||
Assets: | ||||
Total assets measured at fair value | 0 | [3] | 0 | [4] |
Significant Unobservable Inputs (Level 3) | Corporate notes and bonds | ||||
Assets: | ||||
Total assets measured at fair value | $ 0 | [3] | $ 0 | [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 |