Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 19, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | CSOD | ||
Entity Registrant Name | CORNERSTONE ONDEMAND INC | ||
Entity Central Index Key | 1,401,680 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 54,794,363 | ||
Entity Public Float | $ 859,871,773 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current Assets | ||
Cash and cash equivalents | $ 107,691 | $ 166,557 |
Short-term investments | 136,841 | 116,106 |
Accounts receivable, net | 104,686 | 84,499 |
Deferred commissions | 35,910 | 26,236 |
Prepaid expenses and other current assets | 15,297 | 13,007 |
Total current assets | 400,425 | 406,405 |
Capitalized software development costs, net | 23,089 | 15,719 |
Property and equipment, net | 27,021 | 21,424 |
Long-term investments | 64,247 | 3,938 |
Intangible assets, net | 16,713 | 27,282 |
Goodwill | 25,894 | 25,894 |
Other assets, net | 4,156 | 4,993 |
Total Assets | 561,545 | 505,655 |
Current Liabilities | ||
Accounts payable | 18,954 | 16,737 |
Accrued expenses | 44,111 | 29,476 |
Deferred revenue, current portion | 237,679 | 180,598 |
Capital lease obligations, current portion | 33 | 236 |
Debt, current portion | 0 | 351 |
Other liabilities | 2,663 | 3,052 |
Total current liabilities | 303,440 | 230,450 |
Convertible notes, net | 232,583 | 225,094 |
Other liabilities, non-current | 3,240 | 3,871 |
Deferred revenue, net of current portion | 14,460 | 10,738 |
Total liabilities | $ 553,723 | $ 470,153 |
Commitments and contingencies | ||
Stockholders’ Equity: | ||
Common stock, $0.0001 par value; 1,000,000 shares authorized, 54,704 and 53,826 shares issued and outstanding at December 31, 2015 and 2014 | $ 5 | $ 5 |
Additional paid-in capital | 394,089 | 336,692 |
Accumulated deficit | (386,882) | (301,366) |
Accumulated other comprehensive income | 610 | 171 |
Total stockholders’ equity | 7,822 | 35,502 |
Total Liabilities and Stockholders’ Equity | $ 561,545 | $ 505,655 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 54,704,000 | 53,826,000 |
Common stock, shares outstanding | 54,704,000 | 53,826,000 |
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] | |||
Revenue | $ 339,651 | $ 263,568 | $ 185,129 |
Cost of revenue | 109,864 | 77,684 | 53,548 |
Gross profit | 229,787 | 185,884 | 131,581 |
Operating expenses: | |||
Sales and marketing | 207,026 | 162,552 | 109,737 |
Research and development | 40,991 | 30,618 | 21,260 |
General and administrative | 49,877 | 41,802 | 33,572 |
Amortization of certain acquired intangible assets | 600 | 828 | 1,004 |
Total operating expenses | 298,494 | 235,800 | 165,573 |
Loss from operations | (68,707) | (49,916) | (33,992) |
Other income (expense): | |||
Interest income | 894 | 720 | 357 |
Interest expense | (12,506) | (12,157) | (6,563) |
Other, net | (4,016) | (2,691) | (356) |
Other income (expense), net | (15,628) | (14,128) | (6,562) |
Loss before income tax (provision) benefit | (84,335) | (64,044) | (40,554) |
Income tax (provision) benefit | (1,181) | (855) | 128 |
Net loss | $ (85,516) | $ (64,899) | $ (40,426) |
Net loss per share — basic and diluted (USD per share) | $ (1.58) | $ (1.22) | $ (0.79) |
Weighted average common shares outstanding, basic and diluted (shares) | 54,171 | 53,267 | 51,427 |
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 | $ (85,516) | $ (64,899) | $ (40,426) |
Other comprehensive income, net of tax: | |||
Foreign currency translation adjustment | 686 | 308 | 3 |
Net change in unrealized (losses) gains on investments | (247) | (187) | 130 |
Other comprehensive income, net of tax | 439 | 121 | 133 |
Total comprehensive loss | $ (85,077) | $ (64,778) | $ (40,293) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital (Deficit) | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2012 | 50,690 | ||||
Beginning balance at Dec. 31, 2012 | $ 46,648 | $ 5 | $ 242,767 | $ (196,041) | $ (83) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon the exercise of options (in shares) | 1,566 | ||||
Issuance of common stock upon the exercise of options | 13,432 | 13,432 | |||
Vesting of early exercised options | 28 | 28 | |||
Vesting of restricted stock units (in shares) | 214 | ||||
Tax benefits from employee stock plans | 29 | 29 | |||
Stock-based compensation | 21,769 | 21,769 | |||
Equity component of convertible notes | 11,282 | 11,282 | |||
Net loss | (40,426) | (40,426) | |||
Other comprehensive income, net of tax | 133 | 133 | |||
Ending balance at Dec. 31, 2013 | 52,895 | $ 5 | 289,307 | (236,467) | 50 |
Ending balance (in shares) at Dec. 31, 2013 | 52,470 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon the exercise of options (in shares) | 1,154 | ||||
Issuance of common stock upon the exercise of options | 12,142 | 12,142 | |||
Vesting of restricted stock units (in shares) | 202 | ||||
Stock-based compensation | 35,243 | 35,243 | |||
Net loss | (64,899) | (64,899) | |||
Other comprehensive income, net of tax | 121 | 121 | |||
Ending balance at Dec. 31, 2014 | $ 35,502 | $ 5 | 336,692 | (301,366) | 171 |
Ending balance (in shares) at Dec. 31, 2014 | 53,826 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon the exercise of options (in shares) | 565 | 565 | |||
Issuance of common stock upon the exercise of options | $ 8,448 | 8,448 | |||
Vesting of restricted stock units (in shares) | 200 | ||||
Shares issued under employee stock purchase plan (in shares) | 113 | ||||
Shares issued under employee stock purchase plan | 3,035 | 3,035 | |||
Stock-based compensation | 45,914 | 45,914 | |||
Net loss | (85,516) | (85,516) | |||
Other comprehensive income, net of tax | 439 | 439 | |||
Ending balance at Dec. 31, 2015 | $ 7,822 | $ 5 | $ 394,089 | $ (386,882) | $ 610 |
Ending balance (in shares) at Dec. 31, 2015 | 54,704 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net loss | $ (85,516) | $ (64,899) | $ (40,426) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 27,512 | 15,086 | 9,700 |
Accretion of debt discount and amortization of debt issuance costs | 8,691 | 8,274 | 4,273 |
Purchased investment premium, net of amortization | 262 | 816 | (2,031) |
Net foreign currency loss | 1,584 | 1,656 | 242 |
Stock-based compensation expense | 43,081 | 33,680 | 20,840 |
Deferred income taxes | (105) | (7) | (865) |
Changes in operating assets and liabilities, net of effects from acquisition: | |||
Accounts receivable | (21,837) | (18,674) | (19,046) |
Deferred commissions | (10,296) | (10,097) | (7,085) |
Prepaid expenses and other assets | (2,575) | 1,245 | (6,057) |
Accounts payable | 4,444 | 4,562 | 5,082 |
Accrued expenses | 14,724 | 6,446 | 6,828 |
Deferred revenue | 64,774 | 55,216 | 45,230 |
Other liabilities | (947) | (295) | 746 |
Net cash provided by operating activities | 43,796 | 33,009 | 17,431 |
Cash flows from investing activities: | |||
Purchases of investments | (220,383) | (124,191) | (203,959) |
Maturities of investments | 138,360 | 203,078 | 6,182 |
Purchases of property and equipment | (15,633) | (11,025) | (8,762) |
Capitalized software costs | (13,283) | (9,529) | (6,906) |
Cash paid for acquisition, net of cash acquired | 0 | (43,328) | 0 |
Net cash (used in) provided by investing activities | (110,939) | 15,005 | (213,445) |
Cash flows from financing activities: | |||
Proceeds from issuance of convertible notes, net | 0 | 0 | 245,664 |
Payments for convertible note hedges | 0 | 0 | (49,537) |
Proceeds from the issuance of warrants | 0 | 0 | 23,225 |
Proceeds from the issuance of debt | 0 | 0 | 1,914 |
Repayment of debt | (352) | (559) | (4,038) |
Principal payments under capital lease obligations | (202) | (886) | (1,747) |
Proceeds from employee stock plans | 11,559 | 12,285 | 13,447 |
Net cash provided by financing activities | 11,005 | 10,840 | 228,928 |
Effect of exchange rate changes on cash and cash equivalents | (2,728) | (1,880) | 227 |
Net (decrease) increase in cash and cash equivalents | (58,866) | 56,974 | 33,141 |
Cash and cash equivalents at beginning of period | 166,557 | 109,583 | 76,442 |
Cash and cash equivalents at end of period | 107,691 | 166,557 | 109,583 |
Supplemental cash flow information: | |||
Cash paid for interest | 1,915 | 3,880 | 2,294 |
Cash paid for income taxes | 1,520 | 546 | 485 |
Proceeds from employee stock plans received in advance of stock issuance | 193 | 0 | 0 |
Non-cash investing and financing activities: | |||
Assets acquired under capital leases and other financing arrangements | 0 | 0 | 88 |
Capitalized assets financed by accounts payable and accrued expenses | 705 | 2,925 | 1,175 |
Capitalized stock-based compensation | $ 2,833 | $ 1,563 | $ 941 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | ORGANIZATION Company Overview Cornerstone OnDemand, Inc. (“Cornerstone” or the “Company”) was incorporated on May 24, 1999 in the state of Delaware and began its principal operations in November 1999 . The Company is a leading global provider of learning and talent management solutions delivered as Software-as-a-Service (“SaaS”). The Company’s Enterprise and Mid-Market solution is a comprehensive and unified cloud-based suite that addresses critical talent needs throughout the entire employee lifecycle, from recruitment, onboarding, training and collaboration, to performance management, compensation, succession planning and analytics. The Company’s solutions are designed to enable organizations to meet the challenges they face in empowering and maximizing the productivity of their human capital. These challenges include hiring and developing employees throughout their careers, engaging all employees effectively, improving business execution, cultivating future leaders, and integrating with an organization’s extended enterprise of clients, vendors and distributors by delivering training, certification programs and other content. The Company’s management has determined that the Company operates in one segment as it only reports financial information on an aggregate and consolidated basis to the Company’s chief executive officer, who is the Company’s chief operating decision maker. Office Locations The Company is headquartered in Santa Monica, California and has offices in Amsterdam, Auckland, Bangalore, Düsseldorf, Hong Kong, London, Madrid, Mumbai, Munich, New Delhi, Paris, San Francisco, São Paulo, Stockholm, Sunnyvale, Sydney, Tel Aviv, and Tokyo. |
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 Consolidation The accompanying consolidated financial statements include the accounts of Cornerstone OnDemand, Inc., and its wholly owned subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. On an on-going basis, management evaluates its estimates, including among others those related to: (i) the realization of tax assets and estimates of tax liabilities and reserves, (ii) the recognition and disclosure of contingent liabilities, (iii) the collectability of accounts receivable, (iv) the evaluation of revenue recognition criteria, including the determination of standalone value and estimates of the selling price of multiple-deliverables in the Company’s revenue arrangements, (v) fair values of investments in marketable securities and strategic investments carried at fair value, (vi) the fair values of acquired assets and assumed liabilities in business combinations, (vii) the useful lives of property and equipment, capitalized software and intangible assets, (viii) impairment of long-lived assets, including goodwill, (ix) the amount and period of amortization of the commission payments to record to expense in proportion to the revenue that is recognized, (x) assumptions used in the Black-Scholes option pricing model to determine the fair value of stock options, and (xi) assumptions used in the valuation of various types of performance-based awards. These estimates are based on historical data and experience, as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. The Company engages third-party valuation specialists to assist with the allocation of the purchase price in business combinations. Such estimates required the selection of appropriate valuation methodologies and models, and significant judgment in evaluating ranges of assumptions and financial inputs. Business Combinations The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of the acquisition. Purchase accounting results in assets and liabilities of an acquired business being recorded at their estimated fair values on the acquisition date. Any excess consideration over the fair value of assets acquired and liabilities assumed is recognized as goodwill. The Company performs valuations of assets acquired and liabilities assumed for an acquisition and allocates the purchase price to its respective net tangible and intangible assets. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates and selection of comparable companies. The Company engages the assistance of valuation specialists in concluding on fair value measurements in connection with determining fair values of assets acquired and liabilities assumed in a business combination. Transaction costs associated with business combinations are expensed as incurred, and are included in general and administrative expenses in the consolidated statement of operations. Transaction costs were $1.3 million for the year ended December 31, 2014. There were no transaction costs for the years ended December 31, 2015 and 2013. Revenue Recognition The Company derives its revenue from the following sources: • Subscriptions to the Company’s solutions —Clients pay subscription fees for access to the Company’s solutions for a specified period of time, typically three years for the Company’s Enterprise and Mid-Market solution or annually or three-year periods for the Company’s Cornerstone for Salesforce and Cornerstone Growth Edition solutions. Fees are based on a number of factors, including the number of solutions purchased and the number of users having access to a solution. The Company generally recognizes revenue from subscriptions ratably over the term of the agreement. • Consulting services —The Company offers its clients assistance in implementing its solutions and optimizing their use. Consulting services include application configuration, system integration, business process re-engineering, change management, and training services. Services are billed either on a time-and-material or a fixed-fee basis. These services are generally purchased as part of a subscription arrangement. Clients may also purchase consulting services at any other time. Consulting services are performed by the Company directly or by third-party professional service providers the Company engages. Clients may also choose to perform these services themselves or engage their own third-party service providers. The Company generally recognizes revenue from fixed fee consulting services using the proportional performance method over the period the services are performed and as time is incurred for time-and-material arrangements. • E-learning content —The Company resells third-party on-line training content, referred to as e-learning content, to its clients. In addition, the Company also hosts other e-learning content provided by its clients. The Company generally recognizes revenue from the resale of e-learning content as it is delivered and recognizes revenue from hosting as the hosting services are provided. The Company recognizes revenue when: (i) persuasive evidence of an arrangement for the sale of the Company’s solutions or consulting services exists, (ii) the solutions have been made available or delivered, or services have been performed, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. The timing and amount the Company recognizes as revenue is determined based on the facts and circumstances of each client arrangement. Evidence of an arrangement consists of a signed client agreement. The Company considers that delivery of a solution has commenced once it provides the client with log-in information to access and use the solution. If non-standard acceptance periods or non-standard performance criteria exist, revenue recognition commences upon the satisfaction of the non-standard acceptance or performance criteria, as applicable. Standard acceptance or performance clauses relate to the Company’s solutions meeting certain perfunctory operating thresholds. Fees are fixed based on stated rates specified in the client agreement. If collectability is not considered reasonably assured, revenue is deferred until the fees are collected. The majority of client arrangements include multiple deliverables, such as subscriptions to the Company’s software solutions and consulting services. The Company therefore recognizes revenue in accordance with the guidance for arrangements with multiple deliverables under Accounting Standards Update (“ASU”) 2009-13 “ Revenue Recognition (Topic 605)—Multiple-Deliverable Revenue Arrangements—a Consensus of the Emerging Issues Task Force ,” or ASU 2009-13. As clients do not have the right to the underlying software code for the solutions, the Company’s revenue arrangements are outside the scope of software revenue recognition guidance. The Company’s agreements generally do not contain any cancellation or refund provisions other than in the event of the Company’s default. For multiple-deliverable revenue arrangements, the Company first assesses whether each deliverable has value to the client on a standalone basis. The Company has determined that the solutions have standalone value, because, once access is given to a client, the solutions are fully functional and do not require any additional development, modification or customization. Consulting services have standalone value because third-party service providers, distributors or clients themselves can perform these services without the Company’s involvement. The consulting services assist clients with the configuration and integration of the Company’s solutions. The performance of these services generally does not require highly specialized or skilled individuals and are not essential to the functionality of the solutions. Based on the standalone value of the deliverables, and since clients do not have a general right of return relative to the included consulting services, the Company allocates revenue among the separate deliverables in an arrangement under the relative selling price method using the selling price hierarchy established in ASU 2009-13. This hierarchy requires the selling price of each deliverable in a multiple deliverable arrangement to be based on, in descending order: (i) vendor-specific objective evidence of fair value (“VSOE”), (ii) third-party evidence of fair value (“TPE”) or (iii) management’s best estimate of the selling price (“BESP”). The Company is generally not able to determine VSOE or TPE for its deliverables, because the deliverables are sold separately and within a sufficiently narrow price range only infrequently, and because management has determined that there are no third-party offerings reasonably comparable to the Company’s solutions. Accordingly, the selling prices of subscriptions to the solutions and consulting services is based on BESP. The determination of BESP requires the Company to make significant estimates and judgments. The Company considers numerous factors, including the nature of the deliverables themselves; the geography, market conditions and competitive landscape for the sale; internal costs; and pricing and discounting practices. The determination of BESP is made through consultation with senior management. The Company updates its estimates of BESP on an ongoing basis as events and as circumstances may require. After the contract value is allocated to each deliverable in a multiple deliverable arrangement based on the relative selling price method, revenue is recognized for each deliverable based on the pattern in which the revenue is earned. For subscriptions to the solutions, revenue is recognized on a straight-line basis over the subscription term, which is typically three years. For consulting services, revenue is recognized using the proportional performance method over the period the services are performed. For e-learning content and hosting, revenue is recognized ratably over the period the content is delivered or hosting service is provided. In a limited number of cases, the client’s intended use of a solution requires enhancements to its underlying features and functionality. In some of these cases, revenue is recognized as one unit of accounting on a straight-line basis from the point at which the enhancements have been made to the solution, through the remaining term of the agreement. In other cases where the enhancement is not required for the client’s intended use, revenue is recognized separately for the enhancement and the solution. The enhancement revenue is recognized based on the allocated value on a straight-line basis once the enhancement has been made to the solution. For arrangements in which the Company resells third-party e-learning training content to clients or hosts client or third-party e-learning training content provided by the client, revenue is recognized in accordance with accounting guidance as to when to report gross revenue as a principal or report net revenue as an agent. The Company recognizes third-party content revenue at the gross amount invoiced to clients when (i) the Company is the primary obligor, (ii) the Company has latitude to establish the price charged, and (iii) the Company bears the credit risk in the transaction. For arrangements involving the sale of third-party content, clients are charged for the content based on pay-per-use or a fixed rate for a specified number of users, and revenue is recognized at the gross amount invoiced as the content is delivered. For arrangements where clients purchase third-party content directly from a third-party vendor, or provide it themselves, and the Company integrates the content into a solution, the Company charges a fee per user or fee based on estimated bandwidth. In such cases, the fees are recognized at the net amount charged by the Company for hosting services as the content is delivered. The Company records amounts that have been invoiced to its clients in accounts receivable and in either deferred revenue or revenue depending on whether the revenue recognition criteria described above have been met. Deferred revenue that will be recognized during the succeeding twelve month period from the respective balance sheet date is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. Cost of Revenue Cost of revenue consists primarily of costs related to hosting the Company’s solutions; personnel and related expenses, including stock-based compensation, and related expenses for network infrastructure, IT support, consulting services and on-going client support staff; payments to external service providers; amortization of capitalized software costs, developed technology and licensing fees; and referral fees. In addition, the Company allocates a portion of overhead, such as rent, IT costs, depreciation and amortization and employee benefits costs, to cost of revenue based on headcount. Costs associated with providing consulting services are recognized as incurred when the services are performed. Out-of-pocket travel costs related to the delivery of professional services are typically reimbursed by the client and are accounted for as both revenue and expense in the period in which the cost is incurred. Commission Payments The Company defers commissions paid to its sales force and related payroll taxes because these amounts are recoverable from the future revenue from the non-cancelable client agreements that gave rise to the commissions. Commissions are deferred on the balance sheet and are recognized as sales and marketing expense over the term of the client agreement in proportion to the revenue that is recognized. Commissions are considered direct and incremental costs to client agreements and the Company generally commences payment of commissions within 45 to 75 days after execution of client agreements. During the years ended December 31, 2015 , 2014 , and 2013 , the Company deferred $42.0 million , $31.7 million and $22.8 million , respectively, of commissions on the balance sheet. During the years ended December 31, 2015 , 2014 and 2013 , the Company recognized $32.3 million , $22.1 million and $15.5 million in commissions expense to sales and marketing expense, respectively. As of December 31, 2015 and 2014 , deferred commissions on the Company’s consolidated balance sheets totaled $35.9 million and $26.2 million , respectively. Research & Development Research and development expenses consist primarily of personnel and related expenses for the Company’s research and development staff, including salaries, benefits, bonuses and stock-based compensation; the cost of certain third-party service providers; and allocated overhead. Research and development expenses, other than software development costs qualifying for capitalization, are expensed as incurred. The Company’s research and development expenses were $41.0 million in 2015 , $30.6 million in 2014 and $21.3 million in 2013 . Advertising Advertising expenses for 2015 , 2014 , and 2013 were $5.4 million , $3.7 million , and $2.0 million , respectively, and are expensed as incurred. Stock-Based Compensation The Company accounts for stock-based compensation awards granted to employees and directors by recording compensation expense based on the awards’ estimated fair value. The Company estimates the fair value of its restricted stock units based on the closing price of its common stock as of the date of grant. The Company estimates the fair value of its stock options as of the date of grant using the Black-Scholes option-pricing model. The resulting fair value, net of estimated forfeitures, is recognized over the period during which an employee is required to provide service in exchange for the award, the vesting period, which is generally four years. The Company recognizes the fair value of stock-based compensation for awards which contain only service conditions on a straight-line basis over the vesting period of the awards. The Black-Scholes option pricing model requires assumptions, estimated volatility, risk-free rate, expected term and estimated dividend yield. The assumptions used in calculating the fair value of stock options represents the Company’s best estimates, based on management judgment. The Company uses the average volatility of similar publicly traded companies as an estimate for estimated volatility. The Company determines the expected term of awards which contain only service conditions using the simplified approach, in which the expected term of an award is presumed to be the mid-point between the vesting date and the expiration date of the award, as the Company does not have sufficient historical data relating to stock-option exercises. For awards granted which contain performance conditions the Company estimates the expected term based on estimates of post-vesting employment termination behavior taking into account the life of the award. The risk-free interest rate for periods within the expected or contractual life of the option, as applicable, is based on the United States Treasury yield curve in effect during the period the options were granted. The estimated dividend yield is zero, as the Company has not declared, and does not currently intend to declare, dividends in the foreseeable future. The following information represents the weighted average of the assumptions used in the Black-Scholes option-pricing model for stock options: For the Years Ended December 31, 2015 2014 2013 Risk-free interest rate 1.8 % 1.9 % 1.5 % Expected term (in years) 6.0 6.0 6.0 Estimated dividend yield — % — % — % Estimated volatility 41.8 % 49.9 % 51.5 % The Company recognizes the fair value of stock-based compensation for awards which contain performance conditions based upon the probability of the performance conditions being met, net of estimated forfeitures, using the graded vesting method. Estimated forfeitures are based upon the Company’s historical experience and the Company revises its estimates, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. The Company estimates the fair value of its performance-based restricted stock units, which include a market-based condition such as performance of the Company’s stock, using a Monte Carlo simulation model that factors in the probability of the award vesting. The Company recognizes the fair value of stock-based compensation for awards which contain market-based conditions using the graded vesting method regardless of whether the award actually vests. For performance-based awards, the fair value is not determined until all of the terms and conditions are established. The Company accounts for stock-based compensation for its 2010 Employee Stock Purchase Plan (“ESPP”) by recording compensation expense based on the awards’ estimated fair value. The fair value of each stock purchase right granted under the ESPP was estimated on the date of grant using the Black-Scholes option-pricing model and this value is recognized on a straight-line basis over the offering period. The following information represents the weighted average of the assumptions used in the Black-Scholes option-pricing model for ESPP: For the Years Ended December 31, 2015 2014 2013 Risk-free interest rate 0.3 % n/a n/a Expected term (in years) 0.5 n/a n/a Estimated dividend yield — % n/a n/a Estimated volatility 33.5 % n/a n/a Due to the full valuation allowance provided on its net deferred tax assets, the Company has not recorded any significant tax benefit attributable to stock-based compensation expense as of December 31, 2015 and 2014 . Capitalized Software Costs The Company capitalizes the costs associated with software developed or obtained for internal use, including costs incurred in connection with the development of its solutions, when the preliminary project stage is completed, management has decided to make the project a part of its future offering, and the software will be used to perform the function intended. These capitalized costs include external direct costs of materials and services consumed in developing or obtaining internal-use software, personnel and related expenses for employees who are directly associated with and who devote time to internal-use software projects and, when material, interest costs incurred during the development. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Costs incurred for upgrades and enhancements to the solutions are also capitalized. Post-configuration training and maintenance costs are expensed as incurred. Capitalized software costs are amortized to cost of revenue using the straight-line method over an estimated useful life of the software of three years , commencing when the software is ready for its intended use. The Company does not transfer ownership of, or lease its software to its clients. During the years ended December 31, 2015 , 2014 and 2013 , the Company capitalized $16.5 million , $11.4 million and $7.9 million , respectively, of software development costs to the balance sheet. During the years ended December 31, 2015 , 2014 and 2013 , the Company amortized $9.1 million , $6.3 million and $4.3 million to cost of revenue, respectively. Based on the Company’s capitalized software costs at December 31, 2015 , estimated amortization expense of $10.9 million , $8.0 million , $4.0 million and $0.2 million is expected to be recognized in 2016 , 2017 , 2018 and 2019 , respectively. Comprehensive Loss Comprehensive loss encompasses all changes in equity other than those arising from transactions with stockholders, and consists of net loss, currency translation adjustments and unrealized gains or losses on investments. For the years ended December 31, 2015 , 2014 and 2013 , accumulated other comprehensive income (loss) comprised a cumulative translation adjustment and also included net unrealized gains (losses) on investments. Income Taxes The Company uses the liability method of accounting for income taxes. Under the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities, using tax rates expected to be in effect during the years in which the bases differences are expected to reverse. A valuation allowance is recorded when it is more likely than not that some of the deferred tax assets will not be realized. In determining the need for valuation allowances, the Company considers projected future taxable income and the availability of tax planning strategies. The Company has recorded a full valuation allowance to reduce its United States, United Kingdom, New Zealand, Hong Kong and Brazil net deferred tax assets to zero, as it has determined that it is not more likely than not that these deferred tax assets will be realized. The Company has assessed its income tax positions and recorded tax benefits for all years subject to examination, based upon its evaluation of the facts, circumstances and information available at each period end. For those tax positions where the Company has determined there is a greater than 50% likelihood that a tax benefit will be sustained, the Company has recorded the largest amount of tax benefit that may potentially be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where it is determined there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit has been recognized. Cash and Cash Equivalents The Company considers cash and cash equivalents to include short-term, highly liquid investments that are readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value, including investments with original or remaining maturities from the date of purchase of three months or less. At December 31, 2015 and 2014 , cash and cash equivalents consisted of cash balances of $45.7 million and $76.0 million , respectively, and money market funds backed by United States Treasury securities of $62.0 million and $90.6 million , respectively. Investments in Marketable Securities The Company’s available-for-sale investments in marketable securities are recorded at fair value, with any unrealized gains and losses, net of taxes, reported as a component of stockholders’ equity until realized or until a determination is made that an other-than-temporary decline in market value has occurred. If the Company determines that an other-than-temporary decline has occurred for debt securities that the Company does not then currently intend to sell, the Company recognizes the credit loss component of an other-than-temporary impairment in other income (expense) and the remaining portion in other comprehensive income (loss). The credit loss component is identified as the amount of the present value of cash flows not expected to be received over the remaining term of the security, based on cash flow projections. In determining whether an other-than-temporary impairment exists, the Company considers: (i) the length of time and the extent to which the fair value has been less than cost; (ii) the financial condition and near-term prospects of the issuer of the securities; and (iii) the Company’s intent and ability to retain the security for a period of time sufficient to allow for any anticipated recovery in fair value. The cost of marketable securities sold is determined based on the specific identification method and any realized gains or losses on the sale of investments are reflected as a component of interest income or expense. In addition, the Company classifies marketable securities as current or non-current based upon the maturity dates of the securities. At December 31, 2015 and 2014 , the Company had $199.5 million and $119.2 million , respectively, of investments in marketable securities. Strategic Investments In December 2015, the Company invested an aggregate of $0.3 million in equity securities of two privately-held companies. In July 2015, the Company invested $0.2 million in equity securities of a privately-held company, and agreed to invest an additional $0.3 million in equity securities of such privately-held company upon achievement of certain milestones. In May 2015, the Company invested $0.5 million in equity securities of a privately-held company. In September 2014, the Company invested $0.4 million in equity securities of a privately-held company. The Company accounted for each of these investment using the cost method of accounting, as we do not have significant influence or a controlling financial interest over these entities. These investments are subject to periodic impairment reviews and are considered to be impaired when a decline in fair value is judged to be other-than-temporary. These investments are included in long-term investments on the Consolidated Balance Sheets. In June 2014, the Company invested $0.5 million in a debt security of a privately-held company. The Company accounted for this debt security as an available-for-sale investment at fair value, and elected to record any changes in value in other income (expense) in the accompanying Consolidated Statement of Operations. As of December 31, 2015 , the Company estimated the fair value of its investment in the debt security to be $0.2 million based upon the probability-weighted present value under various possible future event scenarios, taking into account the likelihood and timing of such events. This investment is included in short-term investments on the Consolidated Balance Sheets. Restricted Cash Included in current and non-current other assets at December 31, 2015 and 2014 were restricted cash of $0.1 million and $0.1 million , respectively, in relation to a standby letter of credit in British Pounds for a foreign sales arrangement with a customer in the United Kingdom. Allowance for Doubtful Accounts The Company bases its allowance for doubtful accounts on its historical collection experience and a review in each period of the status of the then-outstanding accounts receivable. A reconciliation of the beginning and ending amount of allowance for doubtful accounts for the years ended December 31, 2015 , 2014 and 2013 , is as follows (in thousands): 2015 2014 2013 Beginning balance, January 1 $ 2,177 $ 1,021 $ 464 Additions and adjustments 1,368 2,084 968 Write-offs (967 ) (928 ) (411 ) Ending balance, December 31 $ 2,578 $ 2,177 $ 1,021 Property and Equipment, Net Property and equipment are recorded at historical cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally two to seven years (See Note 7 ). The Company leases equipment under capital lease arrangements. The assets and liabilities under capital lease are recorded at the lesser of the present value of aggregate future minimum lease payments, including estimated bargain purchase options, or the fair value of the asset under lease. Assets under capital lease are depreciated using the straight-line method over the lesser of the estimated useful life of the asset or the term of the lease. Leasehold improvements are depreciated on a straight-line basis over the shorter of their estimated useful lives or lease terms. Repair and maintenance costs are charged to expense as incurred, while renewals and improvements are capitalized. Impairment of Long Lived Assets The Company evaluates the recoverability of its long-lived assets with finite useful lives, including intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Such triggering events or changes in circumstances may include: a significant decrease in the market price of a long-lived asset, a significant adverse change in the extent or manner in which a long-lived asset is being used, a significant adverse change in legal factors or in the business climate, the impact of competition or other factors that could affect the value of a long-lived asset, a significant adverse deterioration in the amount of revenue or cash flows expected to be generated from an asset group, an accumulation of costs significantly in excess of the amount originally expected for the acquisition or development of a long-lived asset, current or future operating or cash flow losses that demonstrate continuing losses associated with the use of a long-lived asset, or a current expectation that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. If events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable and the expected undiscounted future cash flows attributable to the asset group are less than the carrying amount of the asset group, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Fair value is determined based upon estimated undiscounted future cash flows. There were no impairment charges related to identifiable long lived assets in the years ended December 31, 2015 and 2014 . Intangible Assets Identifiable intangible assets primarily consist of trade names and intellectual property and acquisition-related intangibles, |
Business Acquisition
Business Acquisition | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Business Acquisition | BUSINESS ACQUISITION 2014 Business Acquisition On November 3, 2014, the Company completed the acquisition of Evolv Inc., (“Evolv”), a San Francisco based SaaS company. Evolv’s platform has been developed with big data architecture and machine learning algorithms to perform predictive and prescriptive analytics and has broad data capturing capabilities that are used to help companies solve workforce management challenges. The acquisition was completed pursuant to a merger whereby Evolv became a wholly owned subsidiary of the Company. In connection with the merger, the Company paid total purchase consideration of approximately $43.4 million . The acquisition has been accounted for under the acquisition method of accounting in accordance with the FASB’s Accounting Standards Codification (“ASC”) Topic 805, Business Combinations . As such, the Evolv assets acquired and liabilities assumed are recorded at their acquisition-date fair values. Acquisition-related transaction costs are not included as a component of consideration transferred, but are accounted for as an expense in the period in which the costs are incurred. Any excess of the acquisition consideration over the fair value of assets acquired and liabilities assumed is allocated to goodwill, which is not deductible for tax purposes. Goodwill is attributable primarily to expected synergies and other benefits, including the acquired workforce, from combining Evolv with the Company. The Company acquired Evolv to allow clients to leverage the power of big data analytics to make better workforce decisions. The Company’s allocation of the total purchase consideration as of November 3, 2014 is summarized below (in thousands): Cash and cash equivalents $ 107 Account receivables 979 Prepaid expenses and other current assets 194 Property and equipment 77 Intangibles - Developed technology 26,184 Goodwill 17,701 Total assets acquired 45,242 Accounts payable 712 Accrued expenses 619 Deferred revenue 477 Total liabilities assumed 1,808 Total purchase price $ 43,434 The developed technology is being amortized on a straight-line basis over 3 years. Unaudited Pro Forma Financial Information The following table reflects the unaudited pro forma consolidated results of operations as if the Evolv acquisition had taken place on January 1, 2013, after giving effect to certain adjustments including the amortization of acquired intangible assets and the elimination of the Company’s and Evolv’s non-recurring acquisition-related expenses (in thousands): For the Years Ended December 31, 2014 2013 Pro Forma Pro Forma Revenue $ 268,771 $ 190,551 Net loss $ (85,521 ) $ (64,474 ) The unaudited pro forma information presented does not purport to be indicative of the results that would have been achieved had the acquisition been consummated as of January 1, 2013 nor of the results which may occur in the future. The pro forma adjustments are based upon available information and certain assumptions that the Company believes are reasonable. The unaudited pro forma information does not include any adjustments for any restructuring activities, operating efficiencies or cost savings. |
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 The following table presents the basic and diluted loss per share (in thousands, except per share amounts): For the Years Ended December 31, 2015 2014 2013 Net loss $ (85,516 ) $ (64,899 ) $ (40,426 ) Weighted-average shares of common stock outstanding 54,171 53,267 51,427 Net loss per share — basic and diluted $ (1.58 ) $ (1.22 ) $ (0.79 ) The following table presents the number of anti-dilutive shares excluded from the calculation of diluted net loss per share (in thousands): December 31, 2015 2014 2013 Options to purchase common stock and restricted stock units 10,860 8,554 7,730 Shares issuable pursuant to employee stock purchase plan 77 — — Convertible notes 4,682 4,682 4,682 Common stock warrants 4,682 4,682 4,682 Other restricted common stock — — 12 Total shares excluded from net loss per share 20,301 17,918 17,106 Under the treasury stock method, the convertible notes and common stock warrants will have a dilutive impact on net earnings per share when the average stock price for the period exceeds the respective conversion prices and the Company has net income. The Company also entered into note hedge transactions (“Note Hedges”) in connection with the convertible notes with respect to its common stock to minimize the impact of potential economic dilution upon conversion of the convertible notes. The Note Hedges were outstanding as of December 31, 2015 . Since the beneficial impact of the Note Hedges were anti-dilutive, they were excluded from the calculation of diluted net income (loss) per share. See Note 9 of the Notes to Consolidated Financial Statements. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | INVESTMENTS The Company’s investments in available-for-sale marketable securities are made pursuant to its investment policy, which has established guidelines relative to the diversification of the Company’s investments and their maturities, with the principle objective of capital preservation and maintaining liquidity that is sufficient to meet cash flow requirements. The following is a summary of investments in marketable securities, including cash equivalents, as of December 31, 2015 and 2014 (in thousands): December 31, 2015 Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Money market funds $ 61,986 $ — $ — $ 61,986 Corporate bonds 56,205 3 (99 ) 56,109 Agency bonds 85,572 — (111 ) 85,461 U.S. treasury securities 58,004 2 (98 ) 57,908 $ 261,767 $ 5 $ (308 ) $ 261,464 December 31, 2014 Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Money market funds $ 90,569 $ — $ — $ 90,569 Corporate bonds 43,031 — (42 ) 42,989 Agency bonds 64,210 1 (15 ) 64,196 U.S. treasury securities 12,000 — (1 ) 11,999 $ 209,810 $ 1 $ (58 ) $ 209,753 As of December 31, 2015 , the Company’s investment in corporate bonds, agency bonds and U.S. treasury securities had a weighted-average maturity date of approximately eight months . Unrealized gains and losses on investments were not significant, and the Company does not believe the unrealized losses represent other-than-temporary impairments as of December 31, 2015 . No marketable securities held have been in a continuous unrealized loss position for more than 12 months as of December 31, 2015 . Strategic Investments In December 2015, the Company invested an aggregate of $0.3 million in equity securities of two privately-held companies. In July 2015, the Company invested $0.2 million in equity securities of a privately-held company, and agreed to invest an additional $0.3 million in equity securities of such privately-held company upon achievement of certain milestones. In May 2015, the Company invested $0.5 million in equity securities of a privately-held company. In September 2014, the Company invested $0.4 million in equity securities of a privately-held company. The Company accounted for each of these investments using the cost method of accounting, as the Company does not have significant influence or a controlling financial interest over these entities. These investments are subject to periodic impairment reviews and are considered to be impaired when a decline in fair value is judged to be other-than-temporary. As of December 31, 2015 , the Company determined there were no impairments of these investments. In June 2014, the Company invested $0.5 million in a debt security of a privately-held company. The Company accounted for this debt security as an available-for-sale security at fair value, which was determined to be $0.2 million as of December 31, 2015 . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS Finite-lived Intangibles The Company has finite-lived intangible assets which are amortized over their estimated useful lives on a straight line basis. The following table presents the gross carrying amount and accumulated amortization of finite-lived intangible assets as of December 31, 2015 and 2014 (in thousands): December 31, 2015 December 31, 2014 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 29,984 $ (13,732 ) $ 16,252 $ 29,984 $ (4,054 ) $ 25,930 Customer relationships 2,400 (2,242 ) 158 2,400 (1,642 ) 758 Software license rights 1,654 (1,351 ) 303 1,654 (1,060 ) 594 Total $ 34,038 $ (17,325 ) $ 16,713 $ 34,038 $ (6,756 ) $ 27,282 In November 2014, the Company recorded additional finite-lived intangible assets totaling $26.2 million , related to developed technology from the acquisition of Evolv (see Note 3 ). Total amortization expense from finite-lived intangible assets were $10.6 million , $3.5 million and $2.3 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. Amortization expense of $10.0 million , $2.7 million and $1.3 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, related to developed technology and software license rights was recorded in cost of revenue and the remainder in “Amortization of certain acquired intangible assets” in the accompanying Consolidated Statements of Operations. The following table presents the Company’s estimate of remaining amortization expense for finite-lived intangible assets that existed at December 31, 2015 (in thousands): 2016 $ 9,282 2017 7,431 Total $ 16,713 Estimated remaining amortization expense of $9.1 million and $7.4 million , will be recorded in cost of revenue for 2016 and 2017 , respectively. The remaining estimated amortization expense will be recorded in amortization of acquired intangible assets within operating expenses. Goodwill The following table presents the changes in the carrying amount of goodwill for the years ended December 31, 2015 and 2014 (in thousands): Goodwill as of December 31, 2013 $ 8,193 Goodwill from Evolv acquisition 17,701 Goodwill as of December 31, 2014 $ 25,894 Adjustments — Goodwill as of December 31, 2015 $ 25,894 |
Other Balance Sheet Amounts
Other Balance Sheet Amounts | 12 Months Ended |
Dec. 31, 2015 | |
Balance Sheet Related Disclosures [Abstract] | |
Other Balance Sheet Amounts | OTHER BALANCE SHEET AMOUNTS The balance of property and equipment, net is as follows (in thousands): Useful Life December 31, 2015 2014 Computer equipment and software 2 – 5 years $ 26,870 $ 22,352 Furniture and fixtures 7 years 3,648 2,910 Leasehold improvements 2 – 6 years 9,972 8,453 Renovation in progress n/a 179 703 40,669 34,418 Less: accumulated depreciation and amortization (13,648 ) (12,994 ) Total property and equipment, net $ 27,021 $ 21,424 Depreciation expense for the years ended December 31, 2015 , 2014 and 2013 was $7.6 million , $5.2 million , $3.2 million , respectively. The balance of accrued expenses is as follows (in thousands): December 31, 2015 2014 Accrued bonuses $ 11,402 $ 7,811 Accrued commissions 13,619 10,088 Other accrued expenses 19,090 11,577 Total accrued expenses $ 44,111 $ 29,476 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | FAIR VALUE OF FINANCIAL INSTRUMENTS Assets and liabilities measured at fair value on a recurring basis include the following as of December 31, 2015 and 2014 (in thousands): December 31, 2015 December 31, 2014 Fair Value Level 1 Level 2 Level 3 Fair Value Level 1 Level 2 Level 3 Cash equivalents $ 61,986 $ 61,986 $ — $ — $ 90,569 $ 90,569 $ — $ — Corporate bonds 56,109 — 56,109 — 42,989 — 42,989 — Agency bonds 85,461 — 85,461 — 64,196 — 64,196 — U.S. treasury securities 57,908 — 57,908 — 11,999 — 11,999 — Strategic investments 150 — — 150 500 — — 500 $ 261,614 $ 61,986 $ 199,478 $ 150 $ 210,253 $ 90,569 $ 119,184 $ 500 The Company’s cash equivalents at December 31, 2015 and 2014 consisted of money market funds backed by U.S. Treasury securities. Cash equivalents are classified as Level 1. As of December 31, 2015 , corporate bonds, agency bonds and U.S. treasury securities were classified within Level 2 of the fair value hierarchy. The bonds were valued using information obtained from pricing services, which obtained quoted market prices from a variety of industry data providers, security master files from large financial institutions, and other third-party sources. The Company performed supplemental analysis to validate information obtained from its pricing services. As of December 31, 2015 , no adjustments were made to such pricing information. Strategic Investments The Company’s investments in privately-held companies are shown in the accompanying Consolidated Balance Sheets in short-term investments and accompanying Consolidated Statements of Cash Flows in purchases of investments. The investment in debt securities is considered Level 3 in the fair value hierarchy as it has been valued using significant unobservable inputs or data from various valuation approaches and is measured each reporting period at fair value. The following table presents a reconciliation of the investment in debt securities measured at fair value using significant unobservable inputs (Level 3) as of December 31, 2015 (in thousands): Balance as of December 31, 2014 $ 500 Fair value adjustment (350 ) Balance as of December 31, 2015 $ 150 Senior Convertible Notes The Company’s senior convertible notes are shown in the accompanying Consolidated Balance Sheets at their original issuance value, net of unamortized discount, and are not re-measured to fair value each period. The approximate fair value of the Company’s convertible notes as of December 31, 2015 was $250.5 million . The fair value of the convertible notes was estimated on the basis of quoted market prices, which, due to limited trading activity, are considered Level 2 in the fair value hierarchy. |
Debt and Other Financing Arrang
Debt and Other Financing Arrangements | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt and Other Financing Arrangements | DEBT AND OTHER FINANCING ARRANGEMENTS Senior Convertible Notes In 2013, the Company issued senior convertible notes (the “Notes”) raising gross proceeds of $253.0 million . The Notes are governed by an Indenture, dated June 17, 2013 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee. The Notes mature on July 1, 2018, unless earlier repurchased or converted, and bear interest at a rate of 1.50% per year payable semi-annually in arrears on January 1 and July 1 of each year, commencing January 1, 2014. The Notes are convertible at an initial conversion rate of 18.5046 shares of the Company’s common stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $54.04 per share, subject to adjustment for anti-dilutive issuances, voluntary increases in the conversion rate and make-whole adjustments upon a fundamental change. A fundamental change includes a change in control, delisting of the Company’s common stock and a liquidation of the Company. Upon conversion, the Company will deliver cash for the principal amount, and the Company has the right to settle any amounts in excess of the principal in cash or shares. Prior to April 1, 2018, the Notes are only convertible upon satisfaction of certain conditions as follows: • during any calendar quarter after September 30, 2013, if the last reported sale price of common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each trading day of that five consecutive trading day period was less than 98% of the product of the last reported sale price of common stock and the conversion rate on each such trading day; or • upon the occurrence of specified corporate events as defined in the Indenture. Holders of the Notes may convert their Notes at any time on or after April 1, 2018, until the close of business on the second scheduled trading day immediately preceding the maturity date. The holders of the Notes may require the Company to repurchase all or a portion of their Notes at a cash repurchase price equal to 100% of the principal amount of the Notes being repurchased, plus accrued and unpaid interest, upon a fundamental change and events of default, including non-payment of interest or principal and other obligations under the Indenture. In accounting for the Notes at issuance, the Company separated the Notes into debt and equity components pursuant to the accounting standards for convertible debt instruments that may be fully or partially settled in cash upon conversion. The fair value of the debt component was estimated using an interest rate for nonconvertible debt, with terms similar to the Notes, excluding the conversion feature. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The excess of the principal amount of the Notes over the fair value of the debt component was recorded as a debt discount and a corresponding increase in additional paid-in capital. The debt discount is accreted to interest expense over the term of the Notes using the interest method. The amount recorded to additional paid-in capital is not to be remeasured as long as it continues to meet the conditions for equity classification. Upon issuance of the $253.0 million of Notes, the Company recorded $214.3 million to debt and $38.7 million to additional paid-in capital for the debt discount. The Company incurred transaction costs of approximately $7.3 million related to the issuance of the Notes. In accounting for these costs, the Company allocated the costs to the debt and equity components in proportion to the allocation of proceeds from the issuance of the Notes to such components. Transaction costs allocated to the debt component of $6.2 million are deferred as an asset and amortized to interest expense over the term of the Notes. The transaction costs allocated to the equity component of $1.1 million were recorded to additional paid-in capital. The transaction costs allocated to the debt component were recorded as deferred offering costs in other noncurrent assets. The net carrying amount of the liability component of the Notes as of December 31, 2015 consists of the following (in thousands): Principal amount $ 253,000 Unamortized debt discount (20,417 ) Net carrying value $ 232,583 The following table presents the interest expense recognized related to the Notes for years ended December 31, 2015 , 2014 and 2013 (in thousands): Year Ended December 31, Year Ended December 31, Year Ended December 31, 2015 2014 2013 Contractual interest expense at 1.5% per annum $ 3,795 $ 3,795 $ 2,045 Amortization of debt issuance costs 1,202 1,145 591 Accretion of debt discount 7,489 7,129 3,681 Total $ 12,486 $ 12,069 $ 6,317 The net proceeds from the Notes were approximately $246.0 million after payment of the initial purchasers' offering expenses. The Company used approximately $49.5 million of the net proceeds of the Notes offering to pay the cost of the Note Hedges described below, which was partially offset by $23.2 million of the proceeds from the Company's sale of the Warrants also described below. Note Hedges Concurrent with the issuance of the Notes, the Company entered into note hedges (the “Note Hedges”) with certain bank counterparties, with respect to its common stock. The Company paid $49.5 million for the Note Hedges. The Note Hedges cover approximately 4.7 million shares of the Company's common stock at a strike price of $54.04 per share, and are exercisable by the Company upon conversion of the Notes. The Note Hedges will expire upon the maturity of the Notes. The Note Hedges are intended to reduce the potential economic dilution upon conversion of the Notes in the event that the fair value per share of the Company's common stock at the time of exercise is greater than the conversion price of the Notes. Warrants Separately and concurrently with the entry by the Company into the Note Hedges, the Company entered into warrant transactions, whereby it sold warrants to the same bank counterparties as the Note Hedges to acquire up to 4.7 million shares of the Company's common stock at a strike price of $80.06 per share (“Warrants”), subject to anti-dilution adjustments. The Company received proceeds of $23.2 million from the sale of the Warrants. The Warrants expire at various dates during 2018 and 2019. If the fair value per share of the Company's common stock exceeds the strike price of the Warrants, the Warrants will reduce diluted earnings per share to the extent that the calculation does not have an anti-dilutive effect. The amounts paid and received for the Note Hedges and the Warrants have been recorded in additional paid-in capital. The fair value of the Note Hedges and the Warrants are not remeasured through earnings each reporting period. Other Debt Arrangements The Company has entered into other debt arrangements with finance companies to finance the purchase of property, equipment and software. As of December 31, 2015 , there were no amounts outstanding under these arrangements. As of December 31, 2014, total amounts outstanding under these arrangements were $0.4 million . Principal and interest was generally due monthly, through 2015. The weighted-average interest rate on borrowings for the year ended December 31, 2014 was 6.9% . The estimated fair value of the Company’s debt was $0.4 million at December 31, 2014 . The fair value was estimated based on discounted cash flow analyses using appropriate current discount rates, taking into consideration the particular terms of the borrowing agreements, at the end of the respective periods. These estimates involve considerable judgment and changes in those assumptions could significantly affect the estimates. Although the Company has determined the estimated fair value amount using commonly accepted valuation methodologies, judgment is required in interpreting market data to develop the estimate of fair value. Accordingly, the estimates are not necessarily indicative of the amount the Company, or holders of the instruments, could realize in a current market exchange. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair value. The fair value estimate is based on information available as of December 31, 2014 . This amount has not been revalued since that date, and current estimates of fair value could differ significantly from the amount presented. |
Capitalization
Capitalization | 12 Months Ended |
Dec. 31, 2015 | |
Stockholders' Equity Note [Abstract] | |
Capitalization | CAPITALIZATION As of December 31, 2015 , the Company’s authorized stock consists of 1,000,000,000 shares of common stock, par value of $0.0001 per share, and 50,000,000 shares of preferred stock, par value of $0.0001 per share. No shares of preferred stock were issued or outstanding at December 31, 2015 and 2014. |
Stock-Based Awards
Stock-Based Awards | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Awards | STOCK-BASED AWARDS 1999 and 2009 Plans In November 1999, the Company adopted the 1999 Stock Plan (“1999 Plan”) as amended. In January 2009, the Company adopted the 2009 Plan (“2009 Plan”) as amended. Stock options granted under the 1999 and 2009 Plans may be incentive stock options or non-statutory stock options. Incentive stock options may only be granted to employees. Stock purchase rights may also be granted under the 1999 and 2009 Plans. The Board of Directors determines the period over which stock options become exercisable. However, except in specific cases of stock options granted to officers, directors and consultants, stock options become exercisable at a rate of not less than 20% per year over five years from the date the stock options are granted. Options granted under the 1999 and 2009 Plans expire ten years after the grant date and generally vest one-fourth on the first anniversary of the grant and ratably thereafter for the following thirty-six months . The exercise price of incentive stock options and non-statutory stock options cannot be less than 100% and 85% , respectively, of the fair market value per share of the Company’s common stock on the grant date as determined by the Company’s Board of Directors. If an individual owns stock representing more than 10% of the outstanding shares, the price of each incentive stock option or non-statutory stock option share must be at least 110% of fair market value, as determined by the Board of Directors. The term of the stock options is ten years except for incentive stock options granted to an individual who owns stock representing more than 10% of the outstanding shares, in which case the term of the stock options is 5 years . The Company may also grant options that are immediately exercisable upon the Board of Directors’ approval. At December 31, 2015 , no shares are issuable under the 1999 and 2009 Plans. 2010 Plan In March 2011, upon the completion of the Company’s IPO, the Company adopted the 2010 Plan and determined that it will no longer grant any additional awards under the 1999 Plan and the 2009 Plan. However, the 1999 Plan and the 2009 Plan continue to govern the terms and conditions of the outstanding awards previously granted under each respective plan. Upon the adoption of the 2010 Plan, the maximum aggregate number of shares issuable thereunder was 3,680,480 shares, plus (i) any shares subject to stock options or similar awards granted under the 1999 Plan or 2009 Plan prior to March 16, 2011 that expire or otherwise terminate without having been exercised in full and (ii) shares issued pursuant to awards granted under the 1999 Plan and 2009 Plan that are forfeited to or repurchased by the Company after March 16, 2011, with the maximum number of shares to be added to the 2010 Plan from the 1999 Plan and 2009 Plan equal to 5,614,369 shares of common stock. In addition, the number of shares available for issuance under the 2010 Plan will be annually increased on the first day of each fiscal year beginning with 2012, by an amount equal to the lesser of 5,500,000 shares, 4.5% of the outstanding shares of the Company’s common stock as of the last day of the immediately preceding fiscal year, or such other amount as the Company’s Board of Directors determines. Shares issued pursuant to awards under the 2010 Plan that are repurchased by the Company or that expire or are forfeited, as well as shares used to pay the exercise price of an award or to satisfy the minimum tax withholding obligations related to an award, will become available for future grant or sale under the 2010 Plan. In addition, to the extent that an award is paid out in cash rather than shares, such cash payment will not reduce the number of shares available for issuance under the 2010 Plan. The 2010 Plan permits the grant of incentive stock options to employees and the grant of non-statutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to the Company’s employees, directors and consultants. Under the 2010 Plan, 1,534,144 shares remained available for issuance, at December 31, 2015 . Stock Options The exercise price of stock options granted under the 2010 Plan must equal at least the fair market value of the Company’s common stock on the date of grant. The term of an incentive stock option may not exceed ten years ; provided, however, that an incentive stock option held by a participant who owns more than 10% of the total combined voting power of all classes of the Company’s stock, may not have a term in excess of five years and must have an exercise price of at least 110% of the fair market value of the Company’s common stock on the grant date. Restricted Stock Awards The Company may grant restricted stock under the 2010 Plan. Restricted stock awards are grants of shares of the Company’s common stock that are subject to various restrictions, including restrictions on transferability and forfeiture provisions. Recipients of restricted stock awards generally will have voting and dividend rights with respect to such shares upon grant without regard to vesting, unless the Board of Directors provides otherwise. Shares of restricted stock that do not vest for any reason will be forfeited by the recipient and will revert to the Company. The fair value of each share of restricted stock granted is equal to the grant date fair market value of the Company’s common stock. Restricted Stock Units The Company may also grant restricted stock units under the 2010 Plan. The fair value of each restricted stock unit granted is equal to the grant date fair market value of the Company’s common stock. The payment of restricted stock units may be in the form of cash, shares, or in a combination thereof, as determined by the Board of Directors. During 2015 , the Company granted 2,167,544 restricted stock units under the 2010 Plan, containing service conditions. Stock Appreciation Rights The Company may also grant stock appreciation rights under the 2010 Plan. Stock appreciation rights allow the recipient to receive the appreciation in the price of the Company’s common stock between the date of grant and the exercise date. The payment of stock appreciation rights may be in the form of cash, shares, or in a combination thereof, as determined by the Board of Directors. As of December 31, 2015 , no stock appreciation rights had been granted under the 2010 Plan. Performance Units/Performance Shares The Company may also grant performance units and performance shares under the 2010 Plan. Performance units and performance shares are awards that will result in a payment to a participant only if performance goals for a predetermined period, established by the Board of Directors, are achieved or the awards otherwise vest. The fair value of each performance unit and performance share awarded is equal to the grant date fair market value of the Company’s common stock when the performance goals are defined solely by reference to the Company’s own operations. The fair value of each performance unit and performance award that contain performance goals tied to performance of the Company’s common stock is estimated using a Monte-Carlo simulation. The payment of performance units and performance shares may be in the form of cash, shares, or a combination thereof, as determined by the Board of Directors. Employee Stock Purchase Plan Under the Company’s 2010 Employee Stock Purchase Plan (“ESPP”) eligible employees are granted the right to purchase shares at the lower of 85% of the fair market value of the stock at the time of grant or 85% of the fair market value at the time of exercise. The right to purchase shares is granted twice yearly for six month offering periods in June and December and exercisable on or about the succeeding December and June, respectively, on each year. The Company commenced its first offering period in December 2014 and the first purchase period occurred in June 2015. Under the ESPP, 2,250,832 shares remained available for issuance, at December 31, 2015 . The Company recognized compensation expense related to the ESPP of $0.9 million for the year ended December 31, 2015 . Stock Options The Company has granted stock options which vest upon meeting service conditions. The following table summarizes the stock option activity which contain only service conditions, under the Company’s 1999, 2009 and 2010 Plans (in thousands, except per share and term information): Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2014 7,746 $ 30.04 7.8 $ 77,498 Granted 570 34.63 Exercised (565 ) 14.94 Forfeited (487 ) 42.26 Outstanding, December 31, 2015 7,264 30.75 7.1 63,328 Exercisable at December 31, 2015 4,810 25.55 6.4 61,244 Vested and expected to vest at December 31, 2015 7,179 $ 30.63 7.1 $ 63,266 The following table summarizes information about stock options, which contain only service conditions, under the Company’s equity incentive plans at December 31, 2015 (in thousands except term information): Options Outstanding at December 31, 2015 Options Exercisable at December 31, 2015 Number of Options Weighted Average Remaining Contractual Term (in years) Number of Options Weighted Average Remaining Contractual Term (in years) Range of Exercise Prices $0.34 to $1.65 300 3.4 300 3.4 $5.93 to $8.88 888 4.9 888 4.9 $12.54 to $15.41 398 5.7 398 5.7 $16.24 to $18.82 487 6.0 482 6.0 $20.85 to $23.94 749 6.4 671 6.4 $27.55 to $31.44 356 7.4 242 7.0 $32.92 to $36.15 1,098 8.5 340 7.3 $38.03 to $45.76 1,350 8.0 713 7.9 $46.20 to $56.05 1,638 8.1 776 8.0 7,264 7.1 4,810 6.4 The total intrinsic value of options exercised during the years ended December 31, 2015 , 2014 and 2013 was $11.4 million , $42.9 million , and $57.7 million , respectively. The total grant date fair value of stock options vested during the years ended December 31, 2015 , 2014 and 2013 was $32.3 million , $27.6 million , and $15.3 million , respectively. The Company recognized compensation expense related to stock options of $28.0 million , $28.8 million , and $17.2 million for the years ended December 31, 2015 , 2014 , and 2013 , respectively. Unrecognized compensation expense relating to stock options was $43.7 million at December 31, 2015 which is expected to be recognized over a weighted-average period of 2.2 years. The aggregate grant date fair value of stock options granted for the years ended December 31, 2015 , 2014 and 2013 was $8.4 million , $48.0 million , and $51.5 million , respectively. Restricted Stock Units Restricted stock unit activity for the year ended December 31, 2015 under the Company’s equity incentive plans is summarized as follows (shares in thousands): Number of Shares Weighted Average Grant Date Fair Value Nonvested shares subject to restricted stock units outstanding at December 31, 2014 711 $ 36.91 Granted 2,168 34.13 Forfeited (219 ) 34.90 Vested (200 ) 36.03 Nonvested shares subject to restricted stock units outstanding at December 31, 2015 2,460 $ 34.71 The Company recognized compensation expense related to restricted stock units of $15.0 million , $5.7 million and $3.4 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. Unrecognized compensation expense related to nonvested restricted stock units was $68.6 million at December 31, 2015 , which is expected to be recognized as expense over the weighted-average period of 3.2 years. Performance-Based Restricted Stock Units In July 2014, the Company granted performance-based restricted stock units to an executive of the Company. The number of shares of the Company’s common stock issuable upon the vesting of this performance-based restricted stock award is based upon (a) the performance of the Company’s stock price relative to a certain independent market index, and (b) the recipient continuing to provide service through the end of the three year term of the award. Achievement of the maximum performance level would result in the issuance of 60,900 shares. The Company has used a Monte Carlo simulation to estimate the fair value of this award which factors in the probability of the award vesting. The grant date fair value of the award was $1.8 million , which will be recognized ratably over the three year term of the award. In December 2014, the Compensation Committee of the Company’s Board of Directors approved the issuance of performance-based restricted stock units to certain executives of the Company. The number of shares of the Company’s common stock issuable upon the vesting of these performance-based restricted stock unit awards is based upon (a) the performance of the Company’s stock price relative to a certain independent market index, (b) the achievement of the Company’s revenue guidance for each of fiscal year 2015 and 2016 and (c) the recipient continuing to provide services to the Company through the end of the three year term of the award. The Company finalizes its revenue guidance in February of each year, thus establishing a grant date for the portion of the award related to that year’s revenue guidance. Each tranche is treated as a separate grant and recognized from the date the revenue guidance is determined over the remaining portion of the original three year term of the award. Achievement of the maximum performance level would result in the issuance of an aggregate of 1,070,000 shares. The Company used a Monte Carlo simulation to estimate the fair value of the portion of the awards for which a grant date has been established. The valuation factors in the probability of achieving the performance of the Company’s stock price relative to the market index. The grant date fair value of the first half of the award was $9.9 million . The expense recognized will depend on the Company’s performance in relation to the revenue guidance and the probable amount of shares that will ultimately vest, which will be evaluated each reporting period. Based on the revenue for the year ended December 31, 2015 in comparison to the original revenue guidance for 2015, the Company determined that the total expense to be recognized for the first half of the award was decreased from $9.9 million to $5.0 million . The maximum level of shares was decreased from an aggregate of 1,070,000 shares to an aggregate of 802,500 shares, including the second half of the award. The Company recognized compensation expense related to these performance based awards of $1.9 million , $0.7 million and $0.3 million for the years ended December 31, 2015 , 2014 and 2013 . Unrecognized compensation expense related to nonvested performance-based restricted stock units was $4.3 million at December 31, 2015 , based on the probable performance target at that date, which is expected to be recognized as expense over the weighted-average period of 2.0 years. Stock-Based Compensation Stock-based compensation expense related to stock options, restricted stock units, restricted stock awards and performance-based restricted stock units is included in the following line items in the accompanying Consolidated Statement of Operations for the years ended December 31, 2015 , 2014 , and 2013 (in thousands): Years Ended December 31, 2015 2014 2013 Cost of revenue $ 3,887 $ 2,669 $ 2,207 Sales and marketing 23,604 18,364 9,866 Research and development 6,010 3,551 2,052 General and administrative 9,580 9,096 6,715 Total $ 43,081 $ 33,680 $ 20,840 In certain instances the Company is responsible for payroll taxes related to stock options exercised or the underlying shares sold by its employees. The Company accrues its obligations at the time of the exercise of the stock options or the sale of the underlying shares. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The components of the Company’s loss before provision (benefit) for income taxes are as follows (in thousands): Years Ended December 31, 2015 2014 2013 United States $ (59,797 ) $ (59,249 ) $ (36,821 ) Foreign (24,538 ) (4,795 ) (3,733 ) Loss before provision for income taxes $ (84,335 ) $ (64,044 ) $ (40,554 ) The components of the provision (benefit) for income taxes attributable to continuing operations are as follows (in thousands): Years Ended December 31, 2015 2014 2013 Current income tax provision: Federal $ — $ — $ — State 147 40 117 Foreign 1,139 822 620 Total current income tax provision 1,286 862 737 Deferred income tax benefit: Federal — — — State — — — Foreign (105 ) (7 ) (865 ) Total deferred income tax benefit (105 ) (7 ) (865 ) Total income tax provision (benefit) $ 1,181 $ 855 $ (128 ) On a consolidated basis, the Company has incurred operating losses and has recorded a full valuation allowance against its United States, United Kingdom, New Zealand, Hong Kong and Brazil deferred tax assets for all periods to date and, accordingly, has not recorded a provision (benefit) for income taxes for any of the periods presented other than a provision (benefit) for certain foreign and state income taxes. Certain foreign subsidiaries and branches of the Company provide intercompany services and are compensated on a cost-plus basis, and therefore, have incurred liabilities for foreign income taxes in their respective jurisdictions. The differences in the total provision for income taxes that would result from applying the 34% federal statutory rate to loss before provision for income taxes and the reported provision for income taxes are as follows (in thousands): Years Ended December 31, 2015 2014 2013 U.S. Federal tax benefit at statutory rates $ (28,681 ) $ (21,795 ) $ (13,784 ) State income taxes, net of federal tax benefit (1,632 ) (2,013 ) (415 ) Foreign rate differential 3,964 734 1,354 Stock based compensation 4,673 4,121 2,039 Other permanent differences (99 ) 941 410 Other 536 (82 ) 76 Valuation allowance 22,420 18,949 10,192 Total income tax (benefit) provision $ 1,181 $ 855 $ (128 ) Major components of the Company’s deferred tax assets (liabilities) at December 31, 2015 and 2014 are as follows (in thousands): December 31, 2015 2014 Deferred tax assets: Accrued expenses $ 1,508 $ 1,795 Long-lived intangible assets and fixed assets — basis difference 12,766 585 Net operating loss carryforwards 68,395 63,438 Stock-based compensation 15,049 8,630 Deferred revenue 2,828 1,532 Convertible note hedge 10,299 13,913 Other 1,418 715 Total deferred tax assets 112,263 90,608 Valuation allowance (96,326 ) (73,906 ) Deferred tax assets, net of valuation allowance 15,937 16,702 Deferred tax liabilities: Prepaid expenses and deferred commissions (7,401 ) (5,940 ) Convertible note discount (7,688 ) (10,511 ) Other (612 ) (121 ) Total deferred tax liabilities (15,701 ) (16,572 ) Net deferred tax assets (liabilities) $ 236 $ 130 At December 31, 2015 , the Company had federal, state and foreign net operating losses of approximately $254.1 million , $264.4 million and $39.9 million , respectively. The federal net operating loss carryforward will begin expiring in 2019, the state net operating loss carryforward began expiring in 2015, and the foreign net operating loss has an unlimited carryforward period. The Internal Revenue Code of 1986, as amended, imposes substantial restrictions on the utilization of net operating losses in the event of an “ownership change” of a corporation. Accordingly, a company’s ability to use net operating losses may be limited as prescribed under Internal Revenue Code Section 382 (“IRC Section 382”). Events which may cause limitations in the amount of the net operating losses that the Company may use in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. Due to the effects of historical equity issuances, the Company has determined that the future utilization of a portion of its net operating losses is limited annually pursuant to IRC Section 382. The Company has determined that none of its net operating losses will expire because of the annual limitation. The Company acquired federal and state R&D credits as a result of the Evolv acquisition in the amounts of $0.4 million and $0.5 million , respectively. The federal R&D credit will begin the expire in 2030; the state credit has indefinite carryforward. The Company has recorded a full valuation allowance against its otherwise recognizable United States, United Kingdom, New Zealand, Hong Kong and Brazil deferred income tax assets as of December 31, 2015 . Management has determined, after evaluating all positive and negative historical and prospective evidence, that it is more likely than not that these assets will not be realized. The net increase to the valuation allowance of $22.4 million , $25.3 million and $14.5 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, was primarily due to additional net operating losses generated by the Company. The Company has excluded excess windfall tax benefits resulting from stock option exercises as components of the Company’s gross deferred tax assets and corresponding valuation allowance disclosures, as tax attributes related to such windfall tax benefits should not be recognized until they result in a reduction of taxes payable. The tax effected amount of gross unrealized net operating loss carryforwards, and their corresponding valuation allowances resulting from stock option exercises was $35.8 million at December 31, 2015 ; the corresponding gross amount is $97.5 million . When realized, excess windfall tax benefits are credited to additional paid-in capital. The Company follows the with-and-without allocation approach to determine when such net operating loss carryforwards have been realized. Deferred income taxes have not been provided on the undistributed earnings of the Company’s foreign subsidiaries because the Company’s practice and intent is to permanently reinvest these earnings. The cumulative amount of such undistributed earnings was $2.2 million and $2.1 million at December 31, 2015 and December 31, 2014 , respectively. Any future distribution of these non-U.S. earnings may subject the Company to both U.S. federal and state income taxes, as adjusted for tax credits, and foreign withholding taxes that the Company estimates would be $0.3 million and $0.2 million at December 31, 2015 and 2014 , respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2015 , 2014 , and 2013 is as follows (in thousands): Years Ended December 31, 2015 2014 2013 Balance at January 1 $ 276 $ 276 $ 276 Additions for tax positions related to the current year — — — Balance at December 31 $ 276 $ 276 $ 276 The provision for uncertain tax positions relate to business in territories outside of the United States. The Company’s policy is to classify interest and penalties on uncertain tax positions as a component of tax expense. An insignificant amount of interest and penalties on unrecognized tax benefits were accrued during the 2015 tax year. The amount of accrued interest and penalties on unrecognized tax benefits was insignificant, as of December 31, 2015 and 2014 . The Company does not expect the change in uncertain tax positions to have a material impact on its financial position, results of operations or liquidity. The recognition of previously unrecognized tax benefits on uncertain positions would result in a $0.4 million tax benefit. The Company does not expect any significant increases or decreases to its unrecognized tax benefits within the next twelve months. The Company is subject to United States federal income tax as well as to income tax in multiple state and foreign jurisdictions, including the United Kingdom. Federal income tax returns of the Company are subject to IRS examination for the 2012 through 2015 tax years. State income tax returns are subject to examination for the 2011 through 2015 tax years. Foreign income tax returns are subject to examination for the 2007 through 2015 tax years. |
Geographic Information
Geographic Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Geographic Information | GEOGRAPHIC INFORMATION Revenue by geographic region, as determined based on the location of the Company’s clients is set forth below (in thousands): Years Ended December 31, 2015 2014 2013 Revenue United States $ 228,724 $ 180,834 $ 128,983 United Kingdom 30,104 28,938 19,448 All other countries 80,823 53,796 36,698 Total revenue $ 339,651 $ 263,568 $ 185,129 Property and equipment by region is set forth below (in thousands): December 31, 2015 2014 Property and equipment, net United States $ 22,072 $ 16,990 United Kingdom 3,272 2,802 All other countries 1,677 1,632 Total property and equipment, net $ 27,021 $ 21,424 |
401(k) Savings Plan
401(k) Savings Plan | 12 Months Ended |
Dec. 31, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
401(k) Savings Plan | 401(K) SAVINGS PLAN The Company has a defined contribution savings plan (the “Plan”) under Section 401(k) of the Internal Revenue Code. The Plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Company contributions to the plan may be made at the discretion of the Board of Directors. Beginning in 2012, the Plan provided for a Company match of employees’ contributions in an amount equal to 50% of an employee’s contributions up to $2,400 per year which vests over four years. The Company incurred approximately $1.6 million , $1.3 million and $0.8 million of matching contribution expenses related to the Plan during the years ended December 31, 2015 , 2014 and 2013, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Leases The Company has various non-cancelable operating leases for its offices and its managed hosting facilities and services. These leases expire at various times through 2019. Certain lease agreements contain renewal options, rent abatement, and escalation clauses. The Company recognizes rent expense on a straight-line basis over the lease term, commencing when the Company takes possession of the property. Certain of the Company’s office leases entitle the Company to receive a tenant allowance from the landlord. The Company records tenant allowances as a deferred rent credit, which the Company amortizes on a straight-line basis, as a reduction of rent expense, over the term of the underlying lease. Total rent expense under operating leases was approximately $6.7 million , $5.7 million , $4.1 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. Future minimum lease payments under non-cancelable operating and capital leases at December 31, 2015 are as follows (in thousands): Operating Leases Capital Leases 2016 $ 7,802 $ 33 2017 7,174 — 2018 7,323 — 2019 581 — Total minimum lease payments $ 22,880 33 Less: Amounts representing interest — Present value of capital lease obligations 33 Less: Current portion (33 ) Long-term portion of capital lease obligations $ — Letters of Credit During 2015, the Company amended a standby letter of credit in association with its building lease. In addition, the Company maintains standby letters of credit in association with other contractual arrangements. Total letters of credit outstanding at December 31, 2015 was $1.9 million . Other Commitments As of December 31, 2015 , the Company had various content reseller agreements with third-party content providers. The Company is obligated to pay content fees under this agreement of $1.4 million in 2016 and $0.5 million in 2017. As of December 31, 2015 , the Company had agreements with various third-party service providers whereby the Company has committed to assign certain dollar amounts or hours of professional service projects related to implementation and other services for clients of the Company’s Enterprise and Mid-Market solution. In aggregate, these estimated commitments total approximately $17.6 million in 2016, $17.6 million in 2017 and $5.6 million in each of 2018 and 2019. Guarantees and Indemnifications The Company has made guarantees and indemnities under which it may be required to make payments to a guaranteed or indemnified party, in relation to certain transactions, including revenue transactions in the ordinary course of business. In connection with certain facility leases, the Company has agreed to indemnify its lessors for certain claims arising from the facility or the lease. The Company is obligated to indemnify its directors and officers to the maximum extent permitted under the laws of the State of Delaware. However, the Company has a directors and officers insurance policy that may reduce its exposure in certain circumstances and may enable it to recover a portion of future amounts that may be payable, if any. The duration of the guarantees and indemnities varies and, in many cases, is indefinite but subject to statutes of limitations. To date, the Company has made no payments related to these guarantees and indemnities. The Company estimates the fair value of its indemnification obligations as insignificant based on this history and the Company’s insurance coverage and therefore has not recorded any liability for these guarantees and indemnities in the accompanying consolidated balance sheets. Litigation The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. If the Company determines that it is probable that a loss has been incurred and the amount is reasonably estimable, the Company will record a liability. The Company has determined that it does not have a potential liability related to any legal proceedings or claims that would individually or in the aggregate materially adversely affect its financial conditions or operating results. Taxes From time to time, various federal, state and other jurisdictional tax authorities undertake review of the Company and its filings. In evaluating the exposure associated with various tax filing positions, the Company accrues charges for possible exposures. The Company believes any adjustments that may ultimately be required as a result of any of these reviews will not be material to its consolidated financial statements. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS In 2010, the Cornerstone OnDemand Foundation, or the Foundation, was formed to empower communities in the United States and internationally by increasing the impact of the non-profit sector through the utilization of talent management technology including the Company’s Enterprise and Mid-Market solution. The Company’s Chief Executive Officer is on the Board of Directors of the Foundation. The Company does not direct the Foundation’s activities, and accordingly, the Company does not consolidate the Foundation’s statement of activities with its financial results. During the years ended December 31, 2015 , 2014 and 2013 , the Company has provided at no charge certain resources to the Foundation, with approximate value of $2.9 million , $2.2 million and $1.3 million , respectively. During June 2010, an executive officer of an accounting software company joined the Company’s Board of Directors. During May 2012, an executive officer of a travel and expense management software company joined the Company’s Board of Directors and resigned in January 2015. For the years ended December 31, 2015 , 2014 and 2013 , the Company recorded $0.6 million , $0.8 million and $0.5 million , respectively, in expenses related to the use of the accounting and travel and expense software from companies whose executive officers served on the Company’s Board of Directors during those years. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS On January 1, 2016, shares issuable under the Company’s 2010 Employee Stock Purchase Plan increased by 547,037 shares and shares issuable under the Company’s 2010 Plan increased by 2,461,669 shares in accordance with the automatic annual increase provisions of such plans. During January and February 2016, the Compensation Committee of the Company’s Board of Directors granted restricted stock units covering an aggregate of 222,805 shares of the Company’s common stock which generally vest annually over four years. During February 2016, the Company amended an agreement with one of its third party service providers, whereby the Company has committed to provide certain dollar amounts of professional service projects related to implementation and other services for clients of the Company. The amendment increased the contractual commitment amount by $0.5 million in 2016 and $0.5 million in 2017. |
Selected Quarterly Data (Unaudi
Selected Quarterly Data (Unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Data (Unaudited) | SELECTED QUARTERLY DATA (UNAUDITED) The following unaudited quarterly consolidated statements of operations for each of the quarters in the years ended December 31, 2015 and 2014 have been prepared on a basis consistent with the Company’s audited annual financial statements and include, in the opinion of management, all normal recurring adjustments necessary for the fair statement of the financial information contained in these statements. Quarter Ended (in thousands, except per share data) Mar. 31, June 30, Sept. 30, Dec. 31, Mar. 31, 2015 June 30, 2015 Sept. 30, 2015 Dec. 31, 2015 Revenue $ 57,409 $ 61,468 $ 68,318 $ 76,373 $ 73,955 $ 82,563 $ 87,271 $ 95,862 Cost of revenue 17,404 17,409 19,374 23,497 24,662 27,893 27,246 30,063 Gross profit 40,005 44,059 48,944 52,876 49,293 54,670 60,025 65,799 Operating expenses: Sales and marketing 35,139 39,608 41,512 46,293 45,958 51,446 53,255 56,367 Research and development 6,883 6,900 7,552 9,283 9,767 9,983 10,457 10,784 General and administrative 10,454 10,455 9,576 11,317 11,091 12,260 13,194 13,332 Amortization of certain acquired intangible assets 251 213 211 153 150 150 150 150 Total operating expenses 52,727 57,176 58,851 67,046 66,966 73,839 77,056 80,633 Loss from operations (12,722 ) (13,117 ) (9,907 ) (14,170 ) (17,673 ) (19,169 ) (17,031 ) (14,834 ) Other income (expense): Interest income (expense) and other income (expense), net (2,915 ) (3,315 ) (4,226 ) (3,672 ) (5,311 ) (3,713 ) (2,986 ) (3,618 ) Loss before income tax (provision) benefit (15,637 ) (16,432 ) (14,133 ) (17,842 ) (22,984 ) (22,882 ) (20,017 ) (18,452 ) Income tax (provision) benefit (153 ) (200 ) (178 ) (324 ) (278 ) (380 ) (132 ) (391 ) Net loss $ (15,790 ) $ (16,632 ) $ (14,311 ) $ (18,166 ) $ (23,262 ) $ (23,262 ) $ (20,149 ) $ (18,843 ) Net loss per share, basic and diluted $ (0.30 ) $ (0.31 ) $ (0.27 ) $ (0.34 ) $ (0.43 ) $ (0.43 ) $ (0.37 ) $ (0.35 ) Weighted average common shares outstanding, basic and diluted 52,726 53,197 53,423 53,660 53,876 53,987 54,260 54,551 |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Consolidation | Basis of Consolidation The accompanying consolidated financial statements include the accounts of Cornerstone OnDemand, Inc., and its wholly owned subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. On an on-going basis, management evaluates its estimates, including among others those related to: (i) the realization of tax assets and estimates of tax liabilities and reserves, (ii) the recognition and disclosure of contingent liabilities, (iii) the collectability of accounts receivable, (iv) the evaluation of revenue recognition criteria, including the determination of standalone value and estimates of the selling price of multiple-deliverables in the Company’s revenue arrangements, (v) fair values of investments in marketable securities and strategic investments carried at fair value, (vi) the fair values of acquired assets and assumed liabilities in business combinations, (vii) the useful lives of property and equipment, capitalized software and intangible assets, (viii) impairment of long-lived assets, including goodwill, (ix) the amount and period of amortization of the commission payments to record to expense in proportion to the revenue that is recognized, (x) assumptions used in the Black-Scholes option pricing model to determine the fair value of stock options, and (xi) assumptions used in the valuation of various types of performance-based awards. These estimates are based on historical data and experience, as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. The Company engages third-party valuation specialists to assist with the allocation of the purchase price in business combinations. Such estimates required the selection of appropriate valuation methodologies and models, and significant judgment in evaluating ranges of assumptions and financial inputs. |
Business Combinations | Business Combinations The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of the acquisition. Purchase accounting results in assets and liabilities of an acquired business being recorded at their estimated fair values on the acquisition date. Any excess consideration over the fair value of assets acquired and liabilities assumed is recognized as goodwill. The Company performs valuations of assets acquired and liabilities assumed for an acquisition and allocates the purchase price to its respective net tangible and intangible assets. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates and selection of comparable companies. The Company engages the assistance of valuation specialists in concluding on fair value measurements in connection with determining fair values of assets acquired and liabilities assumed in a business combination. Transaction costs associated with business combinations are expensed as incurred, and are included in general and administrative expenses in the consolidated statement of operations. |
Revenue Recognition | Revenue Recognition The Company derives its revenue from the following sources: • Subscriptions to the Company’s solutions —Clients pay subscription fees for access to the Company’s solutions for a specified period of time, typically three years for the Company’s Enterprise and Mid-Market solution or annually or three-year periods for the Company’s Cornerstone for Salesforce and Cornerstone Growth Edition solutions. Fees are based on a number of factors, including the number of solutions purchased and the number of users having access to a solution. The Company generally recognizes revenue from subscriptions ratably over the term of the agreement. • Consulting services —The Company offers its clients assistance in implementing its solutions and optimizing their use. Consulting services include application configuration, system integration, business process re-engineering, change management, and training services. Services are billed either on a time-and-material or a fixed-fee basis. These services are generally purchased as part of a subscription arrangement. Clients may also purchase consulting services at any other time. Consulting services are performed by the Company directly or by third-party professional service providers the Company engages. Clients may also choose to perform these services themselves or engage their own third-party service providers. The Company generally recognizes revenue from fixed fee consulting services using the proportional performance method over the period the services are performed and as time is incurred for time-and-material arrangements. • E-learning content —The Company resells third-party on-line training content, referred to as e-learning content, to its clients. In addition, the Company also hosts other e-learning content provided by its clients. The Company generally recognizes revenue from the resale of e-learning content as it is delivered and recognizes revenue from hosting as the hosting services are provided. The Company recognizes revenue when: (i) persuasive evidence of an arrangement for the sale of the Company’s solutions or consulting services exists, (ii) the solutions have been made available or delivered, or services have been performed, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. The timing and amount the Company recognizes as revenue is determined based on the facts and circumstances of each client arrangement. Evidence of an arrangement consists of a signed client agreement. The Company considers that delivery of a solution has commenced once it provides the client with log-in information to access and use the solution. If non-standard acceptance periods or non-standard performance criteria exist, revenue recognition commences upon the satisfaction of the non-standard acceptance or performance criteria, as applicable. Standard acceptance or performance clauses relate to the Company’s solutions meeting certain perfunctory operating thresholds. Fees are fixed based on stated rates specified in the client agreement. If collectability is not considered reasonably assured, revenue is deferred until the fees are collected. The majority of client arrangements include multiple deliverables, such as subscriptions to the Company’s software solutions and consulting services. The Company therefore recognizes revenue in accordance with the guidance for arrangements with multiple deliverables under Accounting Standards Update (“ASU”) 2009-13 “ Revenue Recognition (Topic 605)—Multiple-Deliverable Revenue Arrangements—a Consensus of the Emerging Issues Task Force ,” or ASU 2009-13. As clients do not have the right to the underlying software code for the solutions, the Company’s revenue arrangements are outside the scope of software revenue recognition guidance. The Company’s agreements generally do not contain any cancellation or refund provisions other than in the event of the Company’s default. For multiple-deliverable revenue arrangements, the Company first assesses whether each deliverable has value to the client on a standalone basis. The Company has determined that the solutions have standalone value, because, once access is given to a client, the solutions are fully functional and do not require any additional development, modification or customization. Consulting services have standalone value because third-party service providers, distributors or clients themselves can perform these services without the Company’s involvement. The consulting services assist clients with the configuration and integration of the Company’s solutions. The performance of these services generally does not require highly specialized or skilled individuals and are not essential to the functionality of the solutions. Based on the standalone value of the deliverables, and since clients do not have a general right of return relative to the included consulting services, the Company allocates revenue among the separate deliverables in an arrangement under the relative selling price method using the selling price hierarchy established in ASU 2009-13. This hierarchy requires the selling price of each deliverable in a multiple deliverable arrangement to be based on, in descending order: (i) vendor-specific objective evidence of fair value (“VSOE”), (ii) third-party evidence of fair value (“TPE”) or (iii) management’s best estimate of the selling price (“BESP”). The Company is generally not able to determine VSOE or TPE for its deliverables, because the deliverables are sold separately and within a sufficiently narrow price range only infrequently, and because management has determined that there are no third-party offerings reasonably comparable to the Company’s solutions. Accordingly, the selling prices of subscriptions to the solutions and consulting services is based on BESP. The determination of BESP requires the Company to make significant estimates and judgments. The Company considers numerous factors, including the nature of the deliverables themselves; the geography, market conditions and competitive landscape for the sale; internal costs; and pricing and discounting practices. The determination of BESP is made through consultation with senior management. The Company updates its estimates of BESP on an ongoing basis as events and as circumstances may require. After the contract value is allocated to each deliverable in a multiple deliverable arrangement based on the relative selling price method, revenue is recognized for each deliverable based on the pattern in which the revenue is earned. For subscriptions to the solutions, revenue is recognized on a straight-line basis over the subscription term, which is typically three years. For consulting services, revenue is recognized using the proportional performance method over the period the services are performed. For e-learning content and hosting, revenue is recognized ratably over the period the content is delivered or hosting service is provided. In a limited number of cases, the client’s intended use of a solution requires enhancements to its underlying features and functionality. In some of these cases, revenue is recognized as one unit of accounting on a straight-line basis from the point at which the enhancements have been made to the solution, through the remaining term of the agreement. In other cases where the enhancement is not required for the client’s intended use, revenue is recognized separately for the enhancement and the solution. The enhancement revenue is recognized based on the allocated value on a straight-line basis once the enhancement has been made to the solution. For arrangements in which the Company resells third-party e-learning training content to clients or hosts client or third-party e-learning training content provided by the client, revenue is recognized in accordance with accounting guidance as to when to report gross revenue as a principal or report net revenue as an agent. The Company recognizes third-party content revenue at the gross amount invoiced to clients when (i) the Company is the primary obligor, (ii) the Company has latitude to establish the price charged, and (iii) the Company bears the credit risk in the transaction. For arrangements involving the sale of third-party content, clients are charged for the content based on pay-per-use or a fixed rate for a specified number of users, and revenue is recognized at the gross amount invoiced as the content is delivered. For arrangements where clients purchase third-party content directly from a third-party vendor, or provide it themselves, and the Company integrates the content into a solution, the Company charges a fee per user or fee based on estimated bandwidth. In such cases, the fees are recognized at the net amount charged by the Company for hosting services as the content is delivered. The Company records amounts that have been invoiced to its clients in accounts receivable and in either deferred revenue or revenue depending on whether the revenue recognition criteria described above have been met. Deferred revenue that will be recognized during the succeeding twelve month period from the respective balance sheet date is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. |
Cost of Revenue | Cost of Revenue Cost of revenue consists primarily of costs related to hosting the Company’s solutions; personnel and related expenses, including stock-based compensation, and related expenses for network infrastructure, IT support, consulting services and on-going client support staff; payments to external service providers; amortization of capitalized software costs, developed technology and licensing fees; and referral fees. In addition, the Company allocates a portion of overhead, such as rent, IT costs, depreciation and amortization and employee benefits costs, to cost of revenue based on headcount. Costs associated with providing consulting services are recognized as incurred when the services are performed. Out-of-pocket travel costs related to the delivery of professional services are typically reimbursed by the client and are accounted for as both revenue and expense in the period in which the cost is incurred. |
Commission Payments | Commission Payments The Company defers commissions paid to its sales force and related payroll taxes because these amounts are recoverable from the future revenue from the non-cancelable client agreements that gave rise to the commissions. Commissions are deferred on the balance sheet and are recognized as sales and marketing expense over the term of the client agreement in proportion to the revenue that is recognized. Commissions are considered direct and incremental costs to client agreements and the Company generally commences payment of commissions within 45 to 75 days after execution of client agreements. |
Research & Development | Research & Development Research and development expenses consist primarily of personnel and related expenses for the Company’s research and development staff, including salaries, benefits, bonuses and stock-based compensation; the cost of certain third-party service providers; and allocated overhead. Research and development expenses, other than software development costs qualifying for capitalization, are expensed as incurred. |
Advertising | Advertising Advertising expenses for 2015 , 2014 , and 2013 were $5.4 million , $3.7 million , and $2.0 million , respectively, and are expensed as incurred. |
Stock-based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation awards granted to employees and directors by recording compensation expense based on the awards’ estimated fair value. The Company estimates the fair value of its restricted stock units based on the closing price of its common stock as of the date of grant. The Company estimates the fair value of its stock options as of the date of grant using the Black-Scholes option-pricing model. The resulting fair value, net of estimated forfeitures, is recognized over the period during which an employee is required to provide service in exchange for the award, the vesting period, which is generally four years. The Company recognizes the fair value of stock-based compensation for awards which contain only service conditions on a straight-line basis over the vesting period of the awards. The Black-Scholes option pricing model requires assumptions, estimated volatility, risk-free rate, expected term and estimated dividend yield. The assumptions used in calculating the fair value of stock options represents the Company’s best estimates, based on management judgment. The Company uses the average volatility of similar publicly traded companies as an estimate for estimated volatility. The Company determines the expected term of awards which contain only service conditions using the simplified approach, in which the expected term of an award is presumed to be the mid-point between the vesting date and the expiration date of the award, as the Company does not have sufficient historical data relating to stock-option exercises. For awards granted which contain performance conditions the Company estimates the expected term based on estimates of post-vesting employment termination behavior taking into account the life of the award. The risk-free interest rate for periods within the expected or contractual life of the option, as applicable, is based on the United States Treasury yield curve in effect during the period the options were granted. The estimated dividend yield is zero, as the Company has not declared, and does not currently intend to declare, dividends in the foreseeable future. The following information represents the weighted average of the assumptions used in the Black-Scholes option-pricing model for stock options: For the Years Ended December 31, 2015 2014 2013 Risk-free interest rate 1.8 % 1.9 % 1.5 % Expected term (in years) 6.0 6.0 6.0 Estimated dividend yield — % — % — % Estimated volatility 41.8 % 49.9 % 51.5 % The Company recognizes the fair value of stock-based compensation for awards which contain performance conditions based upon the probability of the performance conditions being met, net of estimated forfeitures, using the graded vesting method. Estimated forfeitures are based upon the Company’s historical experience and the Company revises its estimates, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. The Company estimates the fair value of its performance-based restricted stock units, which include a market-based condition such as performance of the Company’s stock, using a Monte Carlo simulation model that factors in the probability of the award vesting. The Company recognizes the fair value of stock-based compensation for awards which contain market-based conditions using the graded vesting method regardless of whether the award actually vests. For performance-based awards, the fair value is not determined until all of the terms and conditions are established. The Company accounts for stock-based compensation for its 2010 Employee Stock Purchase Plan (“ESPP”) by recording compensation expense based on the awards’ estimated fair value. The fair value of each stock purchase right granted under the ESPP was estimated on the date of grant using the Black-Scholes option-pricing model and this value is recognized on a straight-line basis over the offering period. The following information represents the weighted average of the assumptions used in the Black-Scholes option-pricing model for ESPP: For the Years Ended December 31, 2015 2014 2013 Risk-free interest rate 0.3 % n/a n/a Expected term (in years) 0.5 n/a n/a Estimated dividend yield — % n/a n/a Estimated volatility 33.5 % n/a n/a Due to the full valuation allowance provided on its net deferred tax assets, the Company has not recorded any significant tax benefit attributable to stock-based compensation expense as of December 31, 2015 and 2014 . |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes the costs associated with software developed or obtained for internal use, including costs incurred in connection with the development of its solutions, when the preliminary project stage is completed, management has decided to make the project a part of its future offering, and the software will be used to perform the function intended. These capitalized costs include external direct costs of materials and services consumed in developing or obtaining internal-use software, personnel and related expenses for employees who are directly associated with and who devote time to internal-use software projects and, when material, interest costs incurred during the development. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Costs incurred for upgrades and enhancements to the solutions are also capitalized. Post-configuration training and maintenance costs are expensed as incurred. Capitalized software costs are amortized to cost of revenue using the straight-line method over an estimated useful life of the software of three years , commencing when the software is ready for its intended use. The Company does not transfer ownership of, or lease its software to its clients. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss encompasses all changes in equity other than those arising from transactions with stockholders, and consists of net loss, currency translation adjustments and unrealized gains or losses on investments. For the years ended December 31, 2015 , 2014 and 2013 , accumulated other comprehensive income (loss) comprised a cumulative translation adjustment and also included net unrealized gains (losses) on investments. |
Income Taxes | Income Taxes The Company uses the liability method of accounting for income taxes. Under the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities, using tax rates expected to be in effect during the years in which the bases differences are expected to reverse. A valuation allowance is recorded when it is more likely than not that some of the deferred tax assets will not be realized. In determining the need for valuation allowances, the Company considers projected future taxable income and the availability of tax planning strategies. The Company has recorded a full valuation allowance to reduce its United States, United Kingdom, New Zealand, Hong Kong and Brazil net deferred tax assets to zero, as it has determined that it is not more likely than not that these deferred tax assets will be realized. The Company has assessed its income tax positions and recorded tax benefits for all years subject to examination, based upon its evaluation of the facts, circumstances and information available at each period end. For those tax positions where the Company has determined there is a greater than 50% likelihood that a tax benefit will be sustained, the Company has recorded the largest amount of tax benefit that may potentially be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where it is determined there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit has been recognized. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers cash and cash equivalents to include short-term, highly liquid investments that are readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value, including investments with original or remaining maturities from the date of purchase of three months or less. |
Investments in Marketable Securities | Investments in Marketable Securities The Company’s available-for-sale investments in marketable securities are recorded at fair value, with any unrealized gains and losses, net of taxes, reported as a component of stockholders’ equity until realized or until a determination is made that an other-than-temporary decline in market value has occurred. If the Company determines that an other-than-temporary decline has occurred for debt securities that the Company does not then currently intend to sell, the Company recognizes the credit loss component of an other-than-temporary impairment in other income (expense) and the remaining portion in other comprehensive income (loss). The credit loss component is identified as the amount of the present value of cash flows not expected to be received over the remaining term of the security, based on cash flow projections. In determining whether an other-than-temporary impairment exists, the Company considers: (i) the length of time and the extent to which the fair value has been less than cost; (ii) the financial condition and near-term prospects of the issuer of the securities; and (iii) the Company’s intent and ability to retain the security for a period of time sufficient to allow for any anticipated recovery in fair value. The cost of marketable securities sold is determined based on the specific identification method and any realized gains or losses on the sale of investments are reflected as a component of interest income or expense. In addition, the Company classifies marketable securities as current or non-current based upon the maturity dates of the securities. |
Strategic Investments | Strategic Investments In December 2015, the Company invested an aggregate of $0.3 million in equity securities of two privately-held companies. In July 2015, the Company invested $0.2 million in equity securities of a privately-held company, and agreed to invest an additional $0.3 million in equity securities of such privately-held company upon achievement of certain milestones. In May 2015, the Company invested $0.5 million in equity securities of a privately-held company. In September 2014, the Company invested $0.4 million in equity securities of a privately-held company. The Company accounted for each of these investment using the cost method of accounting, as we do not have significant influence or a controlling financial interest over these entities. These investments are subject to periodic impairment reviews and are considered to be impaired when a decline in fair value is judged to be other-than-temporary. These investments are included in long-term investments on the Consolidated Balance Sheets. In June 2014, the Company invested $0.5 million in a debt security of a privately-held company. The Company accounted for this debt security as an available-for-sale investment at fair value, and elected to record any changes in value in other income (expense) in the accompanying Consolidated Statement of Operations. As of December 31, 2015 , the Company estimated the fair value of its investment in the debt security to be $0.2 million based upon the probability-weighted present value under various possible future event scenarios, taking into account the likelihood and timing of such events. This investment is included in short-term investments on the Consolidated Balance Sheets. |
Restricted Cash | Restricted Cash Included in current and non-current other assets at December 31, 2015 and 2014 were restricted cash of $0.1 million and $0.1 million , respectively, in relation to a standby letter of credit in British Pounds for a foreign sales arrangement with a customer in the United Kingdom. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company bases its allowance for doubtful accounts on its historical collection experience and a review in each period of the status of the then-outstanding accounts receivable. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are recorded at historical cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally two to seven years (See Note 7 ). The Company leases equipment under capital lease arrangements. The assets and liabilities under capital lease are recorded at the lesser of the present value of aggregate future minimum lease payments, including estimated bargain purchase options, or the fair value of the asset under lease. Assets under capital lease are depreciated using the straight-line method over the lesser of the estimated useful life of the asset or the term of the lease. Leasehold improvements are depreciated on a straight-line basis over the shorter of their estimated useful lives or lease terms. Repair and maintenance costs are charged to expense as incurred, while renewals and improvements are capitalized. |
Impairment of Long Lived Assets | Impairment of Long Lived Assets The Company evaluates the recoverability of its long-lived assets with finite useful lives, including intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Such triggering events or changes in circumstances may include: a significant decrease in the market price of a long-lived asset, a significant adverse change in the extent or manner in which a long-lived asset is being used, a significant adverse change in legal factors or in the business climate, the impact of competition or other factors that could affect the value of a long-lived asset, a significant adverse deterioration in the amount of revenue or cash flows expected to be generated from an asset group, an accumulation of costs significantly in excess of the amount originally expected for the acquisition or development of a long-lived asset, current or future operating or cash flow losses that demonstrate continuing losses associated with the use of a long-lived asset, or a current expectation that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. If events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable and the expected undiscounted future cash flows attributable to the asset group are less than the carrying amount of the asset group, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Fair value is determined based upon estimated undiscounted future cash flows. |
Intangible Assets | Intangible Assets Identifiable intangible assets primarily consist of trade names and intellectual property and acquisition-related intangibles, including developed technology, customer relationships, non-compete agreements, trade names and trademarks. The Company determines the appropriate useful life of its intangible assets by performing an analysis of expected cash flows of the acquired assets. Intangible assets are amortized over their estimated useful lives ranging from two to ten years, generally using the straight line method which approximates the pattern in which the economic benefits are consumed. |
Goodwill | Goodwill Goodwill is not amortized, but instead is required to be tested for impairment annually and under certain circumstances. The Company performs such testing of goodwill in the fourth quarter of each year, or as events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances which could trigger an impairment review include a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner of the Company’s use of the acquired assets or the strategy for the Company’s overall business, significant negative industry or economic trends, or significant underperformance relative to expected historical or projected future results of operations. As part of the annual impairment test, the Company may conduct an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company elects not to perform the qualitative assessment or it determines that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, it then conducts the first step of a two-step impairment test. The first step of the test for goodwill impairment compares the fair value of the applicable reporting unit with its carrying value. Fair value was determined using a market approach, which includes consideration of the Company’s own market capitalization. If the fair value of a reporting unit is less than the reporting unit’s carrying value, the Company performs the second step of the test for impairment of goodwill in which the Company compares the implied fair value of the reporting unit’s goodwill with the carrying value of that goodwill. The estimate of implied fair value of goodwill may require valuations of certain internally generated and unrecognized intangible assets and other assets and liabilities. If the carrying value of the goodwill exceeds the calculated implied fair value, the excess amount will be recognized as an impairment loss. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value represents the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on the following three levels of inputs, of which the first two are considered observable and the last one is considered unobservable: • Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities that management has the ability to access at the measurement date. • Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. • Level 3—Unobservable inputs. Observable inputs are based on market data obtained from independent sources. |
Concentration of Risk | Concentration of Risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, restricted cash, and accounts receivable. The Company’s cash and cash equivalents are deposited with several financial institutions and, at times, may exceed federally insured limits, as applicable. The Company performs ongoing credit evaluations of its clients. |
Foreign Currency Transactions and Translation | Foreign Currency Transactions and Translation Transactions in foreign currencies are translated into U.S. Dollars at the rates of exchange in effect at the date of the transaction. Unrealized transaction (losses) gains were approximately $(0.9) million , $(1.7) million and $(0.3) million for the years ended December 31, 2015 , 2014 and 2013 , respectively, and are included in other, net within other income (expense), net, in the accompanying consolidated statements of operations. The Company has entities in various countries. For entities where the local currency is different than the functional currency, the local currency financial statements have been remeasured from the local currency into the functional currency using the current exchange rate for monetary accounts and historical exchange rates for nonmonetary accounts, with exchange differences on remeasurement included in other income (loss). To the extent that the functional currency is different than the U.S Dollar, the financial statements have then been translated into U.S. Dollars using period-end exchanges rates for assets and liabilities and average exchanges rates for the results of operations. Foreign currency translation gains and losses are included as a component of Accumulated other comprehensive income or loss in the Consolidated Balance Sheets. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In November 2015, the Financial Accounting Standards Board (“FASB”) issued a new accounting standards update which eliminates the current requirement to present deferred tax liabilities and assets as current and noncurrent in a classified balance sheet. Instead, entities will be required to classify all deferred tax assets and liabilities as noncurrent. This guidance will be effective for reporting periods beginning after December 15, 2016 and interim periods within those fiscal years. The Company early adopted the new guidance retroactively in the year ended December 31, 2015. The adoption of this guidance did not have a significant impact on the Company’s disclosures or the results of operations or financial position. In April 2015, the FASB issued a new accounting standards update that provides additional guidance to customers about whether a cloud computing arrangement includes a software license. The guidance will be effective for reporting periods beginning after December 15, 2015 and interim periods within those fiscal years. The Company does not anticipate that the adoption of this guidance will have a significant impact on its results of operations or financial position. In April 2015, the FASB issued a new accounting standards update to simplify presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The guidance will be effective for reporting periods beginning after December 15, 2015 and interim periods within those fiscal years. The Company does not anticipate that the adoption of this guidance will have a significant impact on its results of operations or financial position. In February 2015, the FASB issued a new accounting standards update amending the consolidation guidance for Variable Interest Entities, which could change consolidation conclusions. The new standard is effective for reporting periods beginning after December 15, 2015. The Company early adopted the new guidance in the year ended December 31, 2015. The adoption of this guidance did not have a significant impact on the Company’s disclosures and the results of operations or financial position. In May 2014, the FASB issued a new accounting standards update that provides principles for recognizing revenue for the transfer of promised goods or services to customers with the consideration to which the entity expects to be entitled in exchange for those goods or services. In July 2015, the FASB approved a one-year deferral of the effective date for the new standard. As a result, the guidance will be effective for reporting periods beginning after December 15, 2017. Early adoption is permitted beginning January 1, 2017. The Company is currently evaluating the accounting, transition and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption. |
Summary of Significant Accoun27
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Schedule of black-scholes option-pricing model assumptions | The following information represents the weighted average of the assumptions used in the Black-Scholes option-pricing model for stock options: For the Years Ended December 31, 2015 2014 2013 Risk-free interest rate 1.8 % 1.9 % 1.5 % Expected term (in years) 6.0 6.0 6.0 Estimated dividend yield — % — % — % Estimated volatility 41.8 % 49.9 % 51.5 % The following information represents the weighted average of the assumptions used in the Black-Scholes option-pricing model for ESPP: For the Years Ended December 31, 2015 2014 2013 Risk-free interest rate 0.3 % n/a n/a Expected term (in years) 0.5 n/a n/a Estimated dividend yield — % n/a n/a Estimated volatility 33.5 % n/a n/a |
Reconciliation of beginning and ending amount of allowance for doubtful accounts | A reconciliation of the beginning and ending amount of allowance for doubtful accounts for the years ended December 31, 2015 , 2014 and 2013 , is as follows (in thousands): 2015 2014 2013 Beginning balance, January 1 $ 2,177 $ 1,021 $ 464 Additions and adjustments 1,368 2,084 968 Write-offs (967 ) (928 ) (411 ) Ending balance, December 31 $ 2,578 $ 2,177 $ 1,021 |
Business Acquisition (Tables)
Business Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Allocation of total purchase consideration | The Company’s allocation of the total purchase consideration as of November 3, 2014 is summarized below (in thousands): Cash and cash equivalents $ 107 Account receivables 979 Prepaid expenses and other current assets 194 Property and equipment 77 Intangibles - Developed technology 26,184 Goodwill 17,701 Total assets acquired 45,242 Accounts payable 712 Accrued expenses 619 Deferred revenue 477 Total liabilities assumed 1,808 Total purchase price $ 43,434 |
Unaudited pro forma financial information | The following table reflects the unaudited pro forma consolidated results of operations as if the Evolv acquisition had taken place on January 1, 2013, after giving effect to certain adjustments including the amortization of acquired intangible assets and the elimination of the Company’s and Evolv’s non-recurring acquisition-related expenses (in thousands): For the Years Ended December 31, 2014 2013 Pro Forma Pro Forma Revenue $ 268,771 $ 190,551 Net loss $ (85,521 ) $ (64,474 ) |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Basic and diluted loss per share | The following table presents the basic and diluted loss per share (in thousands, except per share amounts): For the Years Ended December 31, 2015 2014 2013 Net loss $ (85,516 ) $ (64,899 ) $ (40,426 ) Weighted-average shares of common stock outstanding 54,171 53,267 51,427 Net loss per share — basic and diluted $ (1.58 ) $ (1.22 ) $ (0.79 ) |
Anti-dilutive shares excluded from calculation of net loss per share | The following table presents the number of anti-dilutive shares excluded from the calculation of diluted net loss per share (in thousands): December 31, 2015 2014 2013 Options to purchase common stock and restricted stock units 10,860 8,554 7,730 Shares issuable pursuant to employee stock purchase plan 77 — — Convertible notes 4,682 4,682 4,682 Common stock warrants 4,682 4,682 4,682 Other restricted common stock — — 12 Total shares excluded from net loss per share 20,301 17,918 17,106 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of marketable securities | The following is a summary of investments in marketable securities, including cash equivalents, as of December 31, 2015 and 2014 (in thousands): December 31, 2015 Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Money market funds $ 61,986 $ — $ — $ 61,986 Corporate bonds 56,205 3 (99 ) 56,109 Agency bonds 85,572 — (111 ) 85,461 U.S. treasury securities 58,004 2 (98 ) 57,908 $ 261,767 $ 5 $ (308 ) $ 261,464 December 31, 2014 Amortized Cost Basis Unrealized Gains Unrealized Losses Fair Value Money market funds $ 90,569 $ — $ — $ 90,569 Corporate bonds 43,031 — (42 ) 42,989 Agency bonds 64,210 1 (15 ) 64,196 U.S. treasury securities 12,000 — (1 ) 11,999 $ 209,810 $ 1 $ (58 ) $ 209,753 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of finite-lived intangible assets | The following table presents the gross carrying amount and accumulated amortization of finite-lived intangible assets as of December 31, 2015 and 2014 (in thousands): December 31, 2015 December 31, 2014 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology $ 29,984 $ (13,732 ) $ 16,252 $ 29,984 $ (4,054 ) $ 25,930 Customer relationships 2,400 (2,242 ) 158 2,400 (1,642 ) 758 Software license rights 1,654 (1,351 ) 303 1,654 (1,060 ) 594 Total $ 34,038 $ (17,325 ) $ 16,713 $ 34,038 $ (6,756 ) $ 27,282 |
Estimated amortization expense for finite-lived intangible assets | The following table presents the Company’s estimate of remaining amortization expense for finite-lived intangible assets that existed at December 31, 2015 (in thousands): 2016 $ 9,282 2017 7,431 Total $ 16,713 |
Changes in carrying amount of goodwill | The following table presents the changes in the carrying amount of goodwill for the years ended December 31, 2015 and 2014 (in thousands): Goodwill as of December 31, 2013 $ 8,193 Goodwill from Evolv acquisition 17,701 Goodwill as of December 31, 2014 $ 25,894 Adjustments — Goodwill as of December 31, 2015 $ 25,894 |
Other Balance Sheet Amounts (Ta
Other Balance Sheet Amounts (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of property and equipment, net | The balance of property and equipment, net is as follows (in thousands): Useful Life December 31, 2015 2014 Computer equipment and software 2 – 5 years $ 26,870 $ 22,352 Furniture and fixtures 7 years 3,648 2,910 Leasehold improvements 2 – 6 years 9,972 8,453 Renovation in progress n/a 179 703 40,669 34,418 Less: accumulated depreciation and amortization (13,648 ) (12,994 ) Total property and equipment, net $ 27,021 $ 21,424 |
Schedule of accrued expenses | The balance of accrued expenses is as follows (in thousands): December 31, 2015 2014 Accrued bonuses $ 11,402 $ 7,811 Accrued commissions 13,619 10,088 Other accrued expenses 19,090 11,577 Total accrued expenses $ 44,111 $ 29,476 |
Fair Value of Financial Instr33
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Assets and liabilities measured at fair value | Assets and liabilities measured at fair value on a recurring basis include the following as of December 31, 2015 and 2014 (in thousands): December 31, 2015 December 31, 2014 Fair Value Level 1 Level 2 Level 3 Fair Value Level 1 Level 2 Level 3 Cash equivalents $ 61,986 $ 61,986 $ — $ — $ 90,569 $ 90,569 $ — $ — Corporate bonds 56,109 — 56,109 — 42,989 — 42,989 — Agency bonds 85,461 — 85,461 — 64,196 — 64,196 — U.S. treasury securities 57,908 — 57,908 — 11,999 — 11,999 — Strategic investments 150 — — 150 500 — — 500 $ 261,614 $ 61,986 $ 199,478 $ 150 $ 210,253 $ 90,569 $ 119,184 $ 500 |
Reconciliation of investment in debt securities | The following table presents a reconciliation of the investment in debt securities measured at fair value using significant unobservable inputs (Level 3) as of December 31, 2015 (in thousands): Balance as of December 31, 2014 $ 500 Fair value adjustment (350 ) Balance as of December 31, 2015 $ 150 |
Debt and Other Financing Arra34
Debt and Other Financing Arrangements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Liability component of notes, net carrying amount | The net carrying amount of the liability component of the Notes as of December 31, 2015 consists of the following (in thousands): Principal amount $ 253,000 Unamortized debt discount (20,417 ) Net carrying value $ 232,583 |
Schedule of note interest expense | The following table presents the interest expense recognized related to the Notes for years ended December 31, 2015 , 2014 and 2013 (in thousands): Year Ended December 31, Year Ended December 31, Year Ended December 31, 2015 2014 2013 Contractual interest expense at 1.5% per annum $ 3,795 $ 3,795 $ 2,045 Amortization of debt issuance costs 1,202 1,145 591 Accretion of debt discount 7,489 7,129 3,681 Total $ 12,486 $ 12,069 $ 6,317 |
Stock-Based Awards (Tables)
Stock-Based Awards (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of stock option activity | The following table summarizes the stock option activity which contain only service conditions, under the Company’s 1999, 2009 and 2010 Plans (in thousands, except per share and term information): Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2014 7,746 $ 30.04 7.8 $ 77,498 Granted 570 34.63 Exercised (565 ) 14.94 Forfeited (487 ) 42.26 Outstanding, December 31, 2015 7,264 30.75 7.1 63,328 Exercisable at December 31, 2015 4,810 25.55 6.4 61,244 Vested and expected to vest at December 31, 2015 7,179 $ 30.63 7.1 $ 63,266 |
Schedule of stock options outstanding and exercisable | The following table summarizes information about stock options, which contain only service conditions, under the Company’s equity incentive plans at December 31, 2015 (in thousands except term information): Options Outstanding at December 31, 2015 Options Exercisable at December 31, 2015 Number of Options Weighted Average Remaining Contractual Term (in years) Number of Options Weighted Average Remaining Contractual Term (in years) Range of Exercise Prices $0.34 to $1.65 300 3.4 300 3.4 $5.93 to $8.88 888 4.9 888 4.9 $12.54 to $15.41 398 5.7 398 5.7 $16.24 to $18.82 487 6.0 482 6.0 $20.85 to $23.94 749 6.4 671 6.4 $27.55 to $31.44 356 7.4 242 7.0 $32.92 to $36.15 1,098 8.5 340 7.3 $38.03 to $45.76 1,350 8.0 713 7.9 $46.20 to $56.05 1,638 8.1 776 8.0 7,264 7.1 4,810 6.4 |
Schedule of restricted stock unit activity | Restricted stock unit activity for the year ended December 31, 2015 under the Company’s equity incentive plans is summarized as follows (shares in thousands): Number of Shares Weighted Average Grant Date Fair Value Nonvested shares subject to restricted stock units outstanding at December 31, 2014 711 $ 36.91 Granted 2,168 34.13 Forfeited (219 ) 34.90 Vested (200 ) 36.03 Nonvested shares subject to restricted stock units outstanding at December 31, 2015 2,460 $ 34.71 |
Summary of stock-based compensation expense | Stock-based compensation expense related to stock options, restricted stock units, restricted stock awards and performance-based restricted stock units is included in the following line items in the accompanying Consolidated Statement of Operations for the years ended December 31, 2015 , 2014 , and 2013 (in thousands): Years Ended December 31, 2015 2014 2013 Cost of revenue $ 3,887 $ 2,669 $ 2,207 Sales and marketing 23,604 18,364 9,866 Research and development 6,010 3,551 2,052 General and administrative 9,580 9,096 6,715 Total $ 43,081 $ 33,680 $ 20,840 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income before Income Tax, Domestic and Foreign | The components of the Company’s loss before provision (benefit) for income taxes are as follows (in thousands): Years Ended December 31, 2015 2014 2013 United States $ (59,797 ) $ (59,249 ) $ (36,821 ) Foreign (24,538 ) (4,795 ) (3,733 ) Loss before provision for income taxes $ (84,335 ) $ (64,044 ) $ (40,554 ) |
Components of Income Tax Expense (Benefit) | The components of the provision (benefit) for income taxes attributable to continuing operations are as follows (in thousands): Years Ended December 31, 2015 2014 2013 Current income tax provision: Federal $ — $ — $ — State 147 40 117 Foreign 1,139 822 620 Total current income tax provision 1,286 862 737 Deferred income tax benefit: Federal — — — State — — — Foreign (105 ) (7 ) (865 ) Total deferred income tax benefit (105 ) (7 ) (865 ) Total income tax provision (benefit) $ 1,181 $ 855 $ (128 ) |
Effective Income Tax Rate Reconciliation | The differences in the total provision for income taxes that would result from applying the 34% federal statutory rate to loss before provision for income taxes and the reported provision for income taxes are as follows (in thousands): Years Ended December 31, 2015 2014 2013 U.S. Federal tax benefit at statutory rates $ (28,681 ) $ (21,795 ) $ (13,784 ) State income taxes, net of federal tax benefit (1,632 ) (2,013 ) (415 ) Foreign rate differential 3,964 734 1,354 Stock based compensation 4,673 4,121 2,039 Other permanent differences (99 ) 941 410 Other 536 (82 ) 76 Valuation allowance 22,420 18,949 10,192 Total income tax (benefit) provision $ 1,181 $ 855 $ (128 ) |
Deferred Tax Assets and Liabilities | Major components of the Company’s deferred tax assets (liabilities) at December 31, 2015 and 2014 are as follows (in thousands): December 31, 2015 2014 Deferred tax assets: Accrued expenses $ 1,508 $ 1,795 Long-lived intangible assets and fixed assets — basis difference 12,766 585 Net operating loss carryforwards 68,395 63,438 Stock-based compensation 15,049 8,630 Deferred revenue 2,828 1,532 Convertible note hedge 10,299 13,913 Other 1,418 715 Total deferred tax assets 112,263 90,608 Valuation allowance (96,326 ) (73,906 ) Deferred tax assets, net of valuation allowance 15,937 16,702 Deferred tax liabilities: Prepaid expenses and deferred commissions (7,401 ) (5,940 ) Convertible note discount (7,688 ) (10,511 ) Other (612 ) (121 ) Total deferred tax liabilities (15,701 ) (16,572 ) Net deferred tax assets (liabilities) $ 236 $ 130 |
Unrecognized Tax Benefits Roll Forward | A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2015 , 2014 , and 2013 is as follows (in thousands): Years Ended December 31, 2015 2014 2013 Balance at January 1 $ 276 $ 276 $ 276 Additions for tax positions related to the current year — — — Balance at December 31 $ 276 $ 276 $ 276 |
Geographic Information (Tables)
Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Schedule of revenue from external customers and long-lived assets, by geographical areas | Property and equipment by region is set forth below (in thousands): December 31, 2015 2014 Property and equipment, net United States $ 22,072 $ 16,990 United Kingdom 3,272 2,802 All other countries 1,677 1,632 Total property and equipment, net $ 27,021 $ 21,424 Revenue by geographic region, as determined based on the location of the Company’s clients is set forth below (in thousands): Years Ended December 31, 2015 2014 2013 Revenue United States $ 228,724 $ 180,834 $ 128,983 United Kingdom 30,104 28,938 19,448 All other countries 80,823 53,796 36,698 Total revenue $ 339,651 $ 263,568 $ 185,129 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments under Non-cancelable Operating and Capital Leases | Future minimum lease payments under non-cancelable operating and capital leases at December 31, 2015 are as follows (in thousands): Operating Leases Capital Leases 2016 $ 7,802 $ 33 2017 7,174 — 2018 7,323 — 2019 581 — Total minimum lease payments $ 22,880 33 Less: Amounts representing interest — Present value of capital lease obligations 33 Less: Current portion (33 ) Long-term portion of capital lease obligations $ — |
Selected Quarterly Data (Unau39
Selected Quarterly Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly consolidated statements of operations | The following unaudited quarterly consolidated statements of operations for each of the quarters in the years ended December 31, 2015 and 2014 have been prepared on a basis consistent with the Company’s audited annual financial statements and include, in the opinion of management, all normal recurring adjustments necessary for the fair statement of the financial information contained in these statements. Quarter Ended (in thousands, except per share data) Mar. 31, June 30, Sept. 30, Dec. 31, Mar. 31, 2015 June 30, 2015 Sept. 30, 2015 Dec. 31, 2015 Revenue $ 57,409 $ 61,468 $ 68,318 $ 76,373 $ 73,955 $ 82,563 $ 87,271 $ 95,862 Cost of revenue 17,404 17,409 19,374 23,497 24,662 27,893 27,246 30,063 Gross profit 40,005 44,059 48,944 52,876 49,293 54,670 60,025 65,799 Operating expenses: Sales and marketing 35,139 39,608 41,512 46,293 45,958 51,446 53,255 56,367 Research and development 6,883 6,900 7,552 9,283 9,767 9,983 10,457 10,784 General and administrative 10,454 10,455 9,576 11,317 11,091 12,260 13,194 13,332 Amortization of certain acquired intangible assets 251 213 211 153 150 150 150 150 Total operating expenses 52,727 57,176 58,851 67,046 66,966 73,839 77,056 80,633 Loss from operations (12,722 ) (13,117 ) (9,907 ) (14,170 ) (17,673 ) (19,169 ) (17,031 ) (14,834 ) Other income (expense): Interest income (expense) and other income (expense), net (2,915 ) (3,315 ) (4,226 ) (3,672 ) (5,311 ) (3,713 ) (2,986 ) (3,618 ) Loss before income tax (provision) benefit (15,637 ) (16,432 ) (14,133 ) (17,842 ) (22,984 ) (22,882 ) (20,017 ) (18,452 ) Income tax (provision) benefit (153 ) (200 ) (178 ) (324 ) (278 ) (380 ) (132 ) (391 ) Net loss $ (15,790 ) $ (16,632 ) $ (14,311 ) $ (18,166 ) $ (23,262 ) $ (23,262 ) $ (20,149 ) $ (18,843 ) Net loss per share, basic and diluted $ (0.30 ) $ (0.31 ) $ (0.27 ) $ (0.34 ) $ (0.43 ) $ (0.43 ) $ (0.37 ) $ (0.35 ) Weighted average common shares outstanding, basic and diluted 52,726 53,197 53,423 53,660 53,876 53,987 54,260 54,551 |
Organization (Details)
Organization (Details) | 12 Months Ended |
Dec. 31, 2015segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Date of incorporation | May 24, 1999 |
State of incorporation | Delaware |
Principal operations beginning date | 1999-11 |
Number of operating segments | 1 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies - Business Combinations (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
General and administrative | |||
Business Acquisition [Line Items] | |||
Acquisition related costs | $ 0 | $ 1,300,000 | $ 0 |
Summary of Significant Accoun42
Summary of Significant Accounting Policies - Commission Payments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accounting for Commission Payments | |||
Commissions deferred during the period | $ 42,000 | $ 31,700 | $ 22,800 |
Deferred commissions | $ 35,910 | 26,236 | |
Minimum | |||
Accounting for Commission Payments | |||
Commission payment period | 45 days | ||
Maximum | |||
Accounting for Commission Payments | |||
Commission payment period | 75 days | ||
Sales and marketing | |||
Accounting for Commission Payments | |||
Amortization of deferred commissions | $ 32,300 | $ 22,100 | $ 15,500 |
Summary of Significant Accoun43
Summary of Significant Accounting Policies - Research & Development and Advertising (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 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accounting Policies [Abstract] | |||||||||||
Research and development | $ 10,784 | $ 10,457 | $ 9,983 | $ 9,767 | $ 9,283 | $ 7,552 | $ 6,900 | $ 6,883 | $ 40,991 | $ 30,618 | $ 21,260 |
Advertising expense | $ 5,400 | $ 3,700 | $ 2,000 |
Summary of Significant Accoun44
Summary of Significant Accounting Policies - Share-Based Compensation (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Stock Based Compensation - Black-Scholes Option-Pricing Model Assumptions: | |||
Tax benefit from share based compensation | $ 0 | $ 0 | |
Stock options | |||
Stock Based Compensation - Black-Scholes Option-Pricing Model Assumptions: | |||
Risk-free interest rate | 1.80% | 1.90% | 1.50% |
Expected term (in years) | 5 years 11 months 18 days | 6 years 15 days | 6 years 11 days |
Estimated dividend yield | 0.00% | 0.00% | 0.00% |
Estimated volatility | 41.80% | 49.90% | 51.50% |
ESPP | |||
Stock Based Compensation - Black-Scholes Option-Pricing Model Assumptions: | |||
Risk-free interest rate | 0.30% | ||
Expected term (in years) | 6 months | ||
Estimated dividend yield | 0.00% | ||
Estimated volatility | 33.50% |
Summary of Significant Accoun45
Summary of Significant Accounting Policies - Capitalized Software Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Capitalized Software Costs | |||
Capitalized software costs, estimated useful life | 3 years | ||
Capitalized software costs, amount capitalized during the period | $ 16.5 | $ 11.4 | $ 7.9 |
Amortization of capitalized software costs | 9.1 | $ 6.3 | $ 4.3 |
Capitalized software costs, estimated amortization expense within the next year | 10.9 | ||
Capitalized software costs, estimated amortization expense within two years | 8 | ||
Capitalized software costs, estimated amortization expense within three years | 4 | ||
Capitalized software costs, estimated amortization expense within four years | $ 0.2 |
Summary of Significant Accoun46
Summary of Significant Accounting Policies - Cash and Investments (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Jul. 31, 2015 | Dec. 31, 2016 | May. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | |
Cash and Cash Equivalents | |||||||
Cash balances | $ 45.7 | $ 76 | |||||
Money market funds backed by U.S. Treasury Securities | 62 | 90.6 | |||||
Marketable Securities | 199.5 | 119.2 | |||||
Restricted cash | 0.1 | $ 0.1 | |||||
Debt Securities | |||||||
Investment [Line Items] | |||||||
Strategic investments | 0.2 | $ 0.5 | |||||
Equity Securities | |||||||
Investment [Line Items] | |||||||
Payments to acquire investments | $ 0.3 | $ 0.2 | |||||
Strategic investments | $ 0.5 | $ 0.4 | |||||
Equity Securities | Forecast | |||||||
Investment [Line Items] | |||||||
Payments to acquire investments | $ 0.3 |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Allowance for Doubtful Accounts - Reconciliation: | |||
Beginning balance, January 1 | $ 2,177 | $ 1,021 | $ 464 |
Additions and adjustments | 1,368 | 2,084 | 968 |
Write-offs | (967) | (928) | (411) |
Ending balance, December 31 | $ 2,578 | $ 2,177 | $ 1,021 |
Summary of Significant Accoun48
Summary of Significant Accounting Policies - Impairment and Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Impairment of Long Lived Assets | ||
Impairment charges related to identified intangible assets | $ 0 | $ 0 |
Goodwill, impairment loss | $ 0 | |
Minimum | ||
Intangible Assets | ||
Identified intangible assets amortization period | 2 years | |
Maximum | ||
Intangible Assets | ||
Identified intangible assets amortization period | 10 years |
Summary of Significant Accoun49
Summary of Significant Accounting Policies - Foreign Currency Transactions and Translation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Other income (expense), net | |||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||
Foreign currency transactions and translation | $ (0.9) | $ (1.7) | $ (0.3) |
Business Acquisition - Addition
Business Acquisition - Additional Information (Details) - Evolv Inc. $ in Thousands | Nov. 03, 2014USD ($) |
Business Acquisition [Line Items] | |
Total consideration paid | $ 43,434 |
Identified intangible assets amortization period | 3 years |
Business Acquisition - Allocati
Business Acquisition - Allocation of Total Purchase Consideration (Details) - USD ($) $ in Thousands | Nov. 03, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 25,894 | $ 25,894 | $ 8,193 | |
Evolv Inc. | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 107 | |||
Account receivables | 979 | |||
Prepaid expenses and other current assets | 194 | |||
Property and equipment | 77 | |||
Intangibles - Developed technology | 26,184 | |||
Goodwill | 17,701 | |||
Total assets acquired | 45,242 | |||
Accounts payable | 712 | |||
Accrued expenses | 619 | |||
Deferred revenue | 477 | |||
Total liabilities assumed | 1,808 | |||
Total purchase price | $ 43,434 |
Business Acquisition - Unaudite
Business Acquisition - Unaudited Pro forma Financial Information (Details) - Evolv Inc. - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Business Acquisition [Line Items] | ||
Revenue | $ 268,771 | $ 190,551 |
Net loss | $ (85,521) | $ (64,474) |
Net Loss Per Share - Basic and
Net Loss Per Share - Basic and Diluted 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 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share [Abstract] | |||||||||||
Net loss | $ (85,516) | $ (64,899) | $ (40,426) | ||||||||
Weighted average common shares outstanding, basic and diluted (shares) | 54,551 | 54,260 | 53,987 | 53,876 | 53,660 | 53,423 | 53,197 | 52,726 | 54,171 | 53,267 | 51,427 |
Net loss per share — basic and diluted (USD per share) | $ (0.35) | $ (0.37) | $ (0.43) | $ (0.43) | $ (0.34) | $ (0.27) | $ (0.31) | $ (0.30) | $ (1.58) | $ (1.22) | $ (0.79) |
Net Loss Per Share - Anti-dilut
Net Loss Per Share - Anti-dilutive Shares Excluded From Calculation of Net Loss Per Share (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] | |||
Shares excluded from net loss per share attributable to common stockholders | 20,301 | 17,918 | 17,106 |
Options to purchase common stock and restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from net loss per share attributable to common stockholders | 10,860 | 8,554 | 7,730 |
Shares issuable pursuant to employee stock purchase plan | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from net loss per share attributable to common stockholders | 77 | 0 | 0 |
Convertible notes | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from net loss per share attributable to common stockholders | 4,682 | 4,682 | 4,682 |
Common stock warrants | Common Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from net loss per share attributable to common stockholders | 4,682 | 4,682 | 4,682 |
Other restricted common stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from net loss per share attributable to common stockholders | 0 | 0 | 12 |
Investments - Schedule of Marke
Investments - Schedule of Marketable Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | $ 261,767 | $ 209,810 |
Unrealized Gains | 5 | 1 |
Unrealized Losses | (308) | (58) |
Fair Value | 261,464 | 209,753 |
Money market funds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 61,986 | 90,569 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 61,986 | 90,569 |
Corporate bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 56,205 | 43,031 |
Unrealized Gains | 3 | 0 |
Unrealized Losses | (99) | (42) |
Fair Value | 56,109 | 42,989 |
Agency bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 85,572 | 64,210 |
Unrealized Gains | 0 | 1 |
Unrealized Losses | (111) | (15) |
Fair Value | 85,461 | 64,196 |
U.S. treasury securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost Basis | 58,004 | 12,000 |
Unrealized Gains | 2 | 0 |
Unrealized Losses | (98) | (1) |
Fair Value | $ 57,908 | $ 11,999 |
Investments - Additional Inform
Investments - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015 | Jul. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | May. 31, 2015 | Sep. 30, 2014 | Jun. 30, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | |||||||
Investments, weighted average maturity | 8 months | ||||||
Equity Securities | |||||||
Schedule of Available-for-sale Securities [Line Items] | |||||||
Payments to acquire investments | $ 0.3 | $ 0.2 | |||||
Strategic investments | $ 0.5 | $ 0.4 | |||||
Debt Securities | |||||||
Schedule of Available-for-sale Securities [Line Items] | |||||||
Strategic investments | $ 0.2 | $ 0.2 | $ 0.5 | ||||
Forecast | Equity Securities | |||||||
Schedule of Available-for-sale Securities [Line Items] | |||||||
Payments to acquire investments | $ 0.3 |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Schedule of Finite-lived Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 34,038 | $ 34,038 |
Accumulated Amortization | (17,325) | (6,756) |
Net Carrying Amount | 16,713 | 27,282 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 29,984 | 29,984 |
Accumulated Amortization | (13,732) | (4,054) |
Net Carrying Amount | 16,252 | 25,930 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,400 | 2,400 |
Accumulated Amortization | (2,242) | (1,642) |
Net Carrying Amount | 158 | 758 |
Software license rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,654 | 1,654 |
Accumulated Amortization | (1,351) | (1,060) |
Net Carrying Amount | $ 303 | $ 594 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Estimated Amortization Expense for Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,016 | $ 9,282 | |
2,017 | 7,431 | |
Net Carrying Amount | $ 16,713 | $ 27,282 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Changes in Carrying Amount of Goodwill | ||
Beginning of Period | $ 25,894 | $ 8,193 |
Goodwill acquired | 0 | 17,701 |
Ending of Period | $ 25,894 | $ 25,894 |
Goodwill and Intangible Asset60
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | Nov. 03, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization expense | $ 10,600 | $ 3,500 | $ 2,300 | |
Estimated amortization expense within one year | 9,282 | |||
Estimated amortization expense within two years | 7,431 | |||
Evolv Inc. | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets additions | $ 26,200 | |||
Cost of revenue | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets amortization expense | 10,000 | $ 2,700 | $ 1,300 | |
Estimated amortization expense within one year | 9,100 | |||
Estimated amortization expense within two years | $ 7,400 |
Other Balance Sheet Amounts - P
Other Balance Sheet Amounts - Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property and Equipment [Details] | |||
Property and equipment, gross | $ 40,669 | $ 34,418 | |
Less: accumulated depreciation and amortization | (13,648) | (12,994) | |
Total property and equipment, net | 27,021 | 21,424 | |
Depreciation expense | 7,600 | 5,200 | $ 3,200 |
Computer equipment and software | |||
Property and Equipment [Details] | |||
Property and equipment, gross | $ 26,870 | 22,352 | |
Computer equipment and software | Minimum | |||
Property and Equipment [Details] | |||
Property, plant and equipment, useful life | 2 years | ||
Computer equipment and software | Maximum | |||
Property and Equipment [Details] | |||
Property, plant and equipment, useful life | 5 years | ||
Furniture and fixtures | |||
Property and Equipment [Details] | |||
Property and equipment, gross | $ 3,648 | 2,910 | |
Property, plant and equipment, useful life | 7 years | ||
Leasehold improvements | |||
Property and Equipment [Details] | |||
Property and equipment, gross | $ 9,972 | 8,453 | |
Leasehold improvements | Minimum | |||
Property and Equipment [Details] | |||
Property, plant and equipment, useful life | 2 years | ||
Leasehold improvements | Maximum | |||
Property and Equipment [Details] | |||
Property, plant and equipment, useful life | 6 years | ||
Renovation in progress | |||
Property and Equipment [Details] | |||
Property and equipment, gross | $ 179 | $ 703 |
Other Balance Sheet Amounts - A
Other Balance Sheet Amounts - Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accrued Expenses | ||
Accrued bonuses | $ 11,402 | $ 7,811 |
Accrued commissions | 13,619 | 10,088 |
Other accrued expenses | 19,090 | 11,577 |
Total accrued expenses | $ 44,111 | $ 29,476 |
Fair Value of Financial Instr63
Fair Value of Financial Instruments - Assets and Liabilities Measured at Fair Value (Details) - 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 | $ 261,464 | $ 209,753 |
Level 3 | Strategic Investment | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Investment in debt securities, beginning balance | 500 | |
Fair value adjustment | (350) | |
Investment in debt securities, ending balance | 150 | |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 56,109 | 42,989 |
Agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 85,461 | 64,196 |
U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 57,908 | 11,999 |
Recurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 61,986 | 90,569 |
Strategic investments | 150 | 500 |
Assets and liabilities measured at fair value, total | 261,614 | 210,253 |
Recurring basis | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 61,986 | 90,569 |
Strategic investments | 0 | 0 |
Assets and liabilities measured at fair value, total | 61,986 | 90,569 |
Recurring basis | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Strategic investments | 0 | 0 |
Assets and liabilities measured at fair value, total | 199,478 | 119,184 |
Recurring basis | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Strategic investments | 150 | 500 |
Assets and liabilities measured at fair value, total | 150 | 500 |
Recurring basis | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 56,109 | 42,989 |
Recurring basis | Corporate bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Recurring basis | Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 56,109 | 42,989 |
Recurring basis | Corporate bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Recurring basis | Agency bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 85,461 | 64,196 |
Recurring basis | Agency bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Recurring basis | Agency bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 85,461 | 64,196 |
Recurring basis | Agency bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Recurring basis | U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 57,908 | 11,999 |
Recurring basis | U.S. treasury securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 0 | 0 |
Recurring basis | U.S. treasury securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | 57,908 | 11,999 |
Recurring basis | U.S. treasury securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments | $ 0 | $ 0 |
Fair Value of Financial Instr64
Fair Value of Financial Instruments - Additional Information (Details) $ in Millions | Dec. 31, 2015USD ($) |
Fair Value Disclosures [Abstract] | |
Fair value of convertible notes | $ 250.5 |
Debt and Other Financing Arra65
Debt and Other Financing Arrangements - Liability Component of Notes, Net Carrying Amount (Details) - Convertible Debt - USD ($) $ in Thousands | Dec. 31, 2015 | Jun. 17, 2013 |
Debt Instrument [Line Items] | ||
Principal amount | $ 253,000 | |
Unamortized debt discount | (20,417) | |
Net carrying value | $ 232,583 | $ 214,300 |
Debt and Other Financing Arra66
Debt and Other Financing Arrangements - Schedule of Note Interest Expense (Details) - Convertible Debt - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Debt Instrument [Line Items] | |||
Contractual interest expense at 1.5% per annum | $ 3,795 | $ 3,795 | $ 2,045 |
Amortization of debt issuance costs | 1,202 | 1,145 | 591 |
Accretion of debt discount | 7,489 | 7,129 | 3,681 |
Total | $ 12,486 | $ 12,069 | $ 6,317 |
Debt and Other Financing Arra67
Debt and Other Financing Arrangements - Additional Information (Details) | Jun. 17, 2013USD ($)trading_day$ / sharesshares | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) |
Debt Instrument [Line Items] | ||||
Adjustments for equity component of convertible debt | $ (11,282,000) | |||
Payments for convertible note hedges | $ (49,500,000) | $ 0 | $ 0 | (49,537,000) |
Proceeds from the issuance of warrants | $ 23,200,000 | 0 | $ 0 | $ 23,225,000 |
Note hedges on common stock (in shares) | shares | 4,700,000 | |||
Number of shares purchasable upon warrant exercise (in shares) | shares | 4,700,000 | |||
Warrants exercise price (usd per share) | $ / shares | $ 80.06 | |||
Weighted average interest rate on current debt | 6.90% | |||
Fair value of debt | $ 400,000 | |||
Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Debt issued, senior convertible notes | $ 253,000,000 | |||
Interest rate on convertible notes issued | 1.50% | |||
Conversion rate on convertible debt | 18.5046 | |||
Conversion price on convertible debt (usd per share) | $ / shares | $ 54.04 | |||
Convertible Debt | $ 214,300,000 | 232,583,000 | ||
Adjustments for equity component of convertible debt | (38,700,000) | |||
Debt issuance cost | 7,300,000 | |||
Unamortized debt issuance expense | 6,200,000 | |||
Issuance cost allocated to equity components | 1,100,000 | |||
Proceeds from issuance of debt | $ 246,000,000 | |||
Other Debt Arrangements | ||||
Debt Instrument [Line Items] | ||||
Other debt arrangements, amount outstanding | $ 0 | $ 400,000 | ||
Prior to April 1, 2018 | Maximum | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Trading day threshold on convertible debt | trading_day | 20 | |||
Consecutive trading day threshold on convertible debt | 30 days | |||
Stock price threshold, convertible debt | 130.00% | |||
Prior to April 1, 2018 | Minimum | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Trading day threshold on convertible debt | trading_day | 5 | |||
Consecutive trading day threshold on convertible debt | 5 days | |||
Stock price threshold, convertible debt | 98.00% |
Capitalization (Details)
Capitalization (Details) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Stockholders' Equity Note [Abstract] | ||
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 50,000,000 | |
Preferred stock, par value (usd per share) | $ 0.0001 | |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Stock-Based Awards - Plans Info
Stock-Based Awards - Plans Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock based compensation plan, individual ownership threshold | 10.00% | ||
Employee Stock Purchase Plan (ESPP), Purchase Price Percentage of Fair Market Value, Grant Date | 85.00% | ||
Employee Stock Purchase Plan (ESPP), Purchase Price Percentage of Fair Market Value, Exercise Date | 85.00% | ||
Compensation expense recognized | $ 43,081 | $ 33,680 | $ 20,840 |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense recognized | $ 28,000 | 28,800 | 17,200 |
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards granted (in shares/units) | 2,168,000 | ||
Compensation expense recognized | $ 15,000 | $ 5,700 | $ 3,400 |
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issuable under plan | 2,250,832 | ||
Compensation expense recognized | $ 900 | ||
1999 and 2009 Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issuable under plan | 0 | ||
1999 and 2009 Plans | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Minimum vesting rate, percentage per year over 5 years | 20.00% | ||
Minimum vesting rate, period | 5 years | ||
1999 and 2009 Plans | Stock options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award expiration period | 10 years | ||
1999 and 2009 Plans | Stock options | Grantee other than individual owning more than 10% of outstanding stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award expiration period | 10 years | ||
1999 and 2009 Plans | Stock options | Grantee other than individual owning more than 10% of outstanding stock | Cliff vesting on first anniversary of grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award cliff vesting percentage | 25.00% | ||
1999 and 2009 Plans | Stock options | Grantee other than individual owning more than 10% of outstanding stock | Ratable vesting after first anniversary of grant | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award ratable vesting period | 36 months | ||
1999 and 2009 Plans | Stock options | Individual owning more than 10% of outstanding stock | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price as percentage of fair market value per share | 110.00% | ||
1999 and 2009 Plans | Incentive stock options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price as percentage of fair market value per share | 100.00% | ||
1999 and 2009 Plans | Incentive stock options | Individual owning more than 10% of outstanding stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award expiration period | 5 years | ||
1999 and 2009 Plans | Non-statutory stock options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price as percentage of fair market value per share | 85.00% | ||
2010 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional issuable shares authorization, annual increase, maximum number of shares | 5,500,000 | ||
Additional issuable shares authorization, annual increase, percentage of outstanding stock, maximum | 4.50% | ||
Number of shares issuable under plan | 1,534,144 | ||
2010 Plan | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares to be added from 1999 and 2009 Plans | 5,614,369 | ||
2010 Plan | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized under plan | 3,680,480 | ||
2010 Plan | Incentive stock options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award expiration period | 10 years | ||
2010 Plan | Incentive stock options | Individual owning more than 10% of outstanding stock | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award expiration period | 5 years | ||
2010 Plan | Incentive stock options | Individual owning more than 10% of outstanding stock | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price as percentage of fair market value per share | 110.00% | ||
2010 Plan | Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards granted (in shares/units) | 2,167,544 | ||
2010 Plan | Stock Appreciation Rights | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards granted (in shares/units) | 0 |
Stock-Based Awards - Stock Opti
Stock-Based Awards - Stock Option Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense recognized | $ 43,081 | $ 33,680 | $ 20,840 |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total intrinsic value of options exercised | 11,400 | 42,900 | 57,700 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 32,300 | 27,600 | 15,300 |
Compensation expense recognized | 28,000 | 28,800 | 17,200 |
Unrecognized compensation expense related to options | $ 43,700 | ||
Unrecognized compensation expense, weighted-average period of recognition | 2 years 1 month 25 days | ||
Aggregate grant date fair value of stock options granted | $ 8,400 | $ 48,000 | $ 51,500 |
Stock-Based Awards - Summary of
Stock-Based Awards - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Stock Options Outstanding, Shares | ||
Shares Outstanding, Beginning of Period | 7,746 | |
Shares Granted | 570 | |
Shares Exercised | (565) | |
Shares Forfeited | (487) | |
Shares Outstanding, Period End | 7,264 | 7,746 |
Stock Options Outstanding, Weighted Average Exercise Price | ||
Weighted Average Exercise Price, Outstanding, Beginning of Period (in usd per share) | $ 30.04 | |
Weighted Average Exercise Price, Granted (in usd per share) | 34.63 | |
Weighted Average Exercise Price, Exercised (in usd per share) | 14.94 | |
Weighted Average Exercise Price, Forfeited (in usd per share) | 42.26 | |
Weighted Average Exercise Price, Outstanding, Period End (in usd per share) | $ 30.75 | $ 30.04 |
Stock Options, Additional Disclosures | ||
Weighted Average Remaining Contractual Term, Outstanding | 7 years 27 days | 7 years 10 months 2 days |
Aggregate Intrinsic Value, Outstanding | $ 63,328 | $ 77,498 |
Shares Exercisable | 4,810 | |
Weighted Average Exercise Price, Exercisable (in usd per share) | $ 25.55 | |
Weighted Average Remaining Contractual Term, Exercisable | 6 years 4 months 30 days | |
Aggregate Intrinsic Value, Exercisable | $ 61,244 | |
Stock Options Vested and Expected to Vest | ||
Shares Vested and Expected to Vest | 7,179 | |
Weighted Average Exercise Price, Vested and Expected (in usd per share) | $ 30.63 | |
Weighted Average Remaining Contractual Term, Vested and Expected to Vest | 7 years 21 days | |
Aggregate Intrinsic Value, Vested and Expected to Vest | $ 63,266 |
Stock-Based Awards - Schedule o
Stock-Based Awards - Schedule of Stock Options Outstanding and Exercisable (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options Outstanding, Number of Options | 7,264 |
Options Outstanding, Weighted Average Remaining Contractual Life | 7 years 26 days |
Options Exercisable, Number of Options | 4,810 |
Options Exercisable, Weighted Average Remaining Contractual Life | 6 years 4 months 30 days |
$0.34 to $1.65 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 0.34 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 1.65 |
Options Outstanding, Number of Options | 300 |
Options Outstanding, Weighted Average Remaining Contractual Life | 3 years 5 months 10 days |
Options Exercisable, Number of Options | 300 |
Options Exercisable, Weighted Average Remaining Contractual Life | 3 years 5 months 9 days |
$5.93 to $8.88 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 5.93 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 8.88 |
Options Outstanding, Number of Options | 888 |
Options Outstanding, Weighted Average Remaining Contractual Life | 4 years 10 months 14 days |
Options Exercisable, Number of Options | 888 |
Options Exercisable, Weighted Average Remaining Contractual Life | 4 years 10 months 13 days |
$12.54 to $15.41 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 12.54 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 15.41 |
Options Outstanding, Number of Options | 398 |
Options Outstanding, Weighted Average Remaining Contractual Life | 5 years 8 months 19 days |
Options Exercisable, Number of Options | 398 |
Options Exercisable, Weighted Average Remaining Contractual Life | 5 years 8 months 19 days |
$16.24 to $18.82 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 16.24 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 18.82 |
Options Outstanding, Number of Options | 487 |
Options Outstanding, Weighted Average Remaining Contractual Life | 6 years 2 days |
Options Exercisable, Number of Options | 482 |
Options Exercisable, Weighted Average Remaining Contractual Life | 6 years 1 day |
$20.85 to $23.94 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 20.85 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 23.94 |
Options Outstanding, Number of Options | 749 |
Options Outstanding, Weighted Average Remaining Contractual Life | 6 years 4 months 9 days |
Options Exercisable, Number of Options | 671 |
Options Exercisable, Weighted Average Remaining Contractual Life | 6 years 4 months 9 days |
$27.55 to $31.44 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 27.55 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 31.44 |
Options Outstanding, Number of Options | 356 |
Options Outstanding, Weighted Average Remaining Contractual Life | 7 years 5 months 5 days |
Options Exercisable, Number of Options | 242 |
Options Exercisable, Weighted Average Remaining Contractual Life | 7 years 7 days |
$32.92 to $36.15 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 32.92 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 36.15 |
Options Outstanding, Number of Options | 1,098 |
Options Outstanding, Weighted Average Remaining Contractual Life | 8 years 5 months 23 days |
Options Exercisable, Number of Options | 340 |
Options Exercisable, Weighted Average Remaining Contractual Life | 7 years 4 months 3 days |
$38.03 to $45.76 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 38.03 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 45.76 |
Options Outstanding, Number of Options | 1,350 |
Options Outstanding, Weighted Average Remaining Contractual Life | 7 years 11 months 27 days |
Options Exercisable, Number of Options | 713 |
Options Exercisable, Weighted Average Remaining Contractual Life | 7 years 10 months 19 days |
$46.20 to $56.05 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower (in usd per share) | $ / shares | $ 46.20 |
Range of Exercise Prices, Upper (in usd per share) | $ / shares | $ 56.05 |
Options Outstanding, Number of Options | 1,638 |
Options Outstanding, Weighted Average Remaining Contractual Life | 8 years 1 month 13 days |
Options Exercisable, Number of Options | 776 |
Options Exercisable, Weighted Average Remaining Contractual Life | 8 years 18 days |
Stock-Based Awards - Restricted
Stock-Based Awards - Restricted Stock Units (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Additional Information | |||
Compensation expense recognized | $ 43,081 | $ 33,680 | $ 20,840 |
Restricted stock units | |||
Nonvested Shares Subject to Performance Based Awards, Number of Shares | |||
Number of Shares, Outstanding at Beginning of Period | 711 | ||
Number of Shares, Granted | 2,168 | ||
Number of Shares, Forfeited | (219) | ||
Number of shares, vested (in shares) | (200) | ||
Number of Shares, Outstanding at Period End | 2,460 | 711 | |
Nonvested Shares Subject to Performance Based Awards, Weighted Average Grant Date Fair Value | |||
Weighted Average Grant Date Fair Value, Outstanding at Beginning of Period (in usd per share) | $ 36.91 | ||
Weighted Average Grant Date Fair Value, Granted (in usd per share) | 34.13 | ||
Weighted Average Grant Date Fair Value, Forfeited (in usd per share) | 34.90 | ||
Weighted Average Grant Date Fair Value, Vested (in usd per share) | 36.03 | ||
Weighted Average Grant Date Fair Value, Outstanding at Period End (in usd per share) | $ 34.71 | $ 36.91 | |
Additional Information | |||
Compensation expense recognized | $ 15,000 | $ 5,700 | $ 3,400 |
Unrecognized compensation expense related to nonvested restricted stock units | $ 68,600 | ||
Unrecognized compensation expense, weighted-average period of recognition | 3 years 1 month 25 days |
Stock-Based Awards - Performanc
Stock-Based Awards - Performance Awards Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2015 | Jul. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation expense | $ 43,081 | $ 33,680 | $ 20,840 | ||
Performance awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation expense | 1,900 | $ 700 | $ 300 | ||
Unrecognized compensation expense | $ 4,300 | ||||
Unrecognized compensation expense, weighted-average period of recognition | 1 year 11 months 19 days | ||||
Performance based restricted stock units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 3 years | 3 years | |||
Number of shares, vested (in shares) | 802,500 | ||||
Aggregated grant date fair value | $ 9,900 | $ 1,800 | |||
Share-based compensation expense | $ 5,000 | ||||
Performance based restricted stock units | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected to vest | 1,070,000 | 60,900 |
Stock-Based Awards - Schedule75
Stock-Based Awards - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 43,081 | $ 33,680 | $ 20,840 |
Cost of revenue | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 3,887 | 2,669 | 2,207 |
Sales and marketing | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 23,604 | 18,364 | 9,866 |
Research and development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | 6,010 | 3,551 | 2,052 |
General and administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Share-based compensation expense | $ 9,580 | $ 9,096 | $ 6,715 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Nov. 03, 2014 | |
Operating Loss Carryforwards [Line Items] | ||||
Federal statutory tax rate | 34.00% | 34.00% | 34.00% | |
Net increase to valuation allowance primarily due to additional net operating losses | $ 22.4 | $ 25.3 | $ 14.5 | |
Share-based compensation tax benefit not recognized in deferred tax assets, net of allowance | 35.8 | |||
Share-based compensation tax benefit not recognized in deferred tax assets | 97.5 | |||
Undistributed foreign earnings | 2.2 | 2.1 | ||
Potential tax impact if undistributed foreign earnings were distributed | 0.3 | $ 0.2 | ||
Reduction in tax expense if unrecognized tax benefits are recognized | 0.4 | |||
Federal Tax Authority | ||||
Operating Loss Carryforwards [Line Items] | ||||
Federal, state and foreign net operating losses | 254.1 | |||
State and Local Jurisdiction | ||||
Operating Loss Carryforwards [Line Items] | ||||
Federal, state and foreign net operating losses | 264.4 | |||
Foreign Tax Authority | ||||
Operating Loss Carryforwards [Line Items] | ||||
Federal, state and foreign net operating losses | $ 39.9 | |||
Evolv Inc. | Federal Tax Authority | ||||
Operating Loss Carryforwards [Line Items] | ||||
Deferred tax assets, tax credit carryforwards, research | $ 0.4 | |||
Evolv Inc. | State and Local Jurisdiction | ||||
Operating Loss Carryforwards [Line Items] | ||||
Deferred tax assets, tax credit carryforwards, research | $ 0.5 |
Income Taxes - Components of In
Income Taxes - Components of Income Before Taxes (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 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||||||||||
United States | $ (59,797) | $ (59,249) | $ (36,821) | ||||||||
Foreign | (24,538) | (4,795) | (3,733) | ||||||||
Loss before income tax (provision) benefit | $ (18,452) | $ (20,017) | $ (22,882) | $ (22,984) | $ (17,842) | $ (14,133) | $ (16,432) | $ (15,637) | $ (84,335) | $ (64,044) | $ (40,554) |
Income Taxes - Components of 78
Income Taxes - Components of Income Tax Provision (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 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current income tax provision: | |||||||||||
Federal | $ 0 | $ 0 | $ 0 | ||||||||
State | 147 | 40 | 117 | ||||||||
Foreign | 1,139 | 822 | 620 | ||||||||
Total current income tax provision | 1,286 | 862 | 737 | ||||||||
Deferred income tax benefit: | |||||||||||
Federal | 0 | 0 | 0 | ||||||||
State | 0 | 0 | 0 | ||||||||
Foreign | (105) | (7) | (865) | ||||||||
Total deferred income tax benefit | (105) | (7) | (865) | ||||||||
Total income tax provision (benefit) | $ 391 | $ 132 | $ 380 | $ 278 | $ 324 | $ 178 | $ 200 | $ 153 | $ 1,181 | $ 855 | $ (128) |
Income Taxes - Components of 79
Income Taxes - Components of Income Tax Reconciliation (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 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Effective Income Tax Rate Reconciliation | |||||||||||
U.S. Federal tax benefit at statutory rates | $ (28,681) | $ (21,795) | $ (13,784) | ||||||||
State income taxes, net of federal tax benefit | (1,632) | (2,013) | (415) | ||||||||
Foreign rate differential | 3,964 | 734 | 1,354 | ||||||||
Stock based compensation | 4,673 | 4,121 | 2,039 | ||||||||
Other permanent differences | (99) | 941 | 410 | ||||||||
Other | 536 | (82) | 76 | ||||||||
Valuation allowance | 22,420 | 18,949 | 10,192 | ||||||||
Total income tax provision (benefit) | $ 391 | $ 132 | $ 380 | $ 278 | $ 324 | $ 178 | $ 200 | $ 153 | $ 1,181 | $ 855 | $ (128) |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Accrued expenses | $ 1,508 | $ 1,795 |
Long-lived intangible assets and fixed assets — basis difference | 12,766 | 585 |
Net operating loss carryforwards | 68,395 | 63,438 |
Stock-based compensation | 15,049 | 8,630 |
Deferred revenue | 2,828 | 1,532 |
Convertible note hedge | 10,299 | 13,913 |
Other | 1,418 | 715 |
Total deferred tax assets | 112,263 | 90,608 |
Valuation allowance | (96,326) | (73,906) |
Deferred tax assets, net of valuation allowance | 15,937 | 16,702 |
Deferred tax liabilities: | ||
Prepaid expenses and deferred commissions | (7,401) | (5,940) |
Convertible note discount | (7,688) | (10,511) |
Other | (612) | (121) |
Total deferred tax liabilities | (15,701) | (16,572) |
Net deferred tax assets (liabilities) | $ 236 | $ 130 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of Unrecognized Tax Benefits | |||
Unrecognized tax benefit, beginning balance | $ 276 | $ 276 | $ 276 |
Additions for tax positions related to the current year | 0 | 0 | 0 |
Unrecognized tax benefit, ending balance | $ 276 | $ 276 | $ 276 |
Geographic Information (Details
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 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | $ 95,862 | $ 87,271 | $ 82,563 | $ 73,955 | $ 76,373 | $ 68,318 | $ 61,468 | $ 57,409 | $ 339,651 | $ 263,568 | $ 185,129 |
Property and equipment, net | 27,021 | 21,424 | 27,021 | 21,424 | |||||||
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 228,724 | 180,834 | 128,983 | ||||||||
Property and equipment, net | 22,072 | 16,990 | 22,072 | 16,990 | |||||||
United Kingdom | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 30,104 | 28,938 | 19,448 | ||||||||
Property and equipment, net | 3,272 | 2,802 | 3,272 | 2,802 | |||||||
All other countries | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 80,823 | 53,796 | $ 36,698 | ||||||||
Property and equipment, net | $ 1,677 | $ 1,632 | $ 1,677 | $ 1,632 |
401(k) Savings Plan (Details)
401(k) Savings Plan (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Compensation and Retirement Disclosure [Abstract] | |||
401(k) employer matching percentage | 50.00% | ||
Maximum 401(k) annual contributions by employer per employee | $ 2,400 | ||
401(k) vesting period | 4 years | ||
401(k) matching contribution expenses | $ 1,600,000 | $ 1,300,000 | $ 800,000 |
Commitments and Contingencies -
Commitments and Contingencies - Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Loss Contingencies [Line Items] | |||
Rent expense under operating leases | $ 6,700 | $ 5,700 | $ 4,100 |
Capital Leases | |||
2,016 | 33 | ||
2,017 | 0 | ||
2,018 | 0 | ||
2,019 | 0 | ||
Total minimum lease payments | 33 | ||
Less: Amounts representing interest | 0 | ||
Present value of capital lease obligations | 33 | ||
Less: Current portion | (33) | $ (236) | |
Long-term portion of capital lease obligations | 0 | ||
Building lease and other commitments | |||
Operating Leases | |||
2,016 | 7,802 | ||
2,017 | 7,174 | ||
2,018 | 7,323 | ||
2,019 | 581 | ||
Total minimum lease payments | $ 22,880 |
Commitments and Contingencies85
Commitments and Contingencies - Letters of Credit (Details) $ in Millions | Dec. 31, 2015USD ($) |
Standby letters of credit | Building lease and other commitments | |
Loss Contingencies [Line Items] | |
Letter of credit outstanding | $ 1.9 |
Commitments and Contingencies86
Commitments and Contingencies - Additional Information (Detail) $ in Thousands | Dec. 31, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual commitment due within two years | $ 17,600 |
Contractual commitment due within three years | 5,600 |
Contractual commitment due within four years | 5,600 |
Contractual commitment due within the next year | 17,600 |
Reseller agreements due within the next year | 1,400 |
Reseller agreements due within two years | $ 500 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | |||
Value of resources donated to related parties | $ 2.9 | $ 2.2 | $ 1.3 |
Director | |||
Related Party Transaction [Line Items] | |||
Expenses from transactions with related party | $ 0.6 | $ 0.8 | $ 0.5 |
Subsequent Events (Detail)
Subsequent Events (Detail) - USD ($) $ in Millions | 1 Months Ended | 2 Months Ended | 12 Months Ended |
Jan. 31, 2016 | Feb. 23, 2016 | Dec. 31, 2015 | |
Subsequent Event [Line Items] | |||
Contractual commitment due within the next year | $ 17.6 | ||
Contractual commitment due within two years | $ 17.6 | ||
Restricted stock units | |||
Subsequent Event [Line Items] | |||
Awards granted (in shares/units) | 2,168,000 | ||
ESPP | |||
Subsequent Event [Line Items] | |||
Share increase under plan (in shares) | 547,037 | ||
2010 Plan | |||
Subsequent Event [Line Items] | |||
Share increase under plan (in shares) | 2,461,669 | ||
Subsequent event | |||
Subsequent Event [Line Items] | |||
Contractual commitment due within the next year | $ 0.5 | ||
Contractual commitment due within two years | $ 0.5 | ||
Subsequent event | Restricted stock units | |||
Subsequent Event [Line Items] | |||
Awards granted (in shares/units) | 222,805 | ||
Award vesting period | 4 years |
Selected Quarterly Data (Unau89
Selected Quarterly Data (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 | |
Unaudited Quarterly Consolidated Statements of Operations | |||||||||||
Revenue | $ 95,862 | $ 87,271 | $ 82,563 | $ 73,955 | $ 76,373 | $ 68,318 | $ 61,468 | $ 57,409 | $ 339,651 | $ 263,568 | $ 185,129 |
Cost of revenue | 30,063 | 27,246 | 27,893 | 24,662 | 23,497 | 19,374 | 17,409 | 17,404 | 109,864 | 77,684 | 53,548 |
Gross profit | 65,799 | 60,025 | 54,670 | 49,293 | 52,876 | 48,944 | 44,059 | 40,005 | 229,787 | 185,884 | 131,581 |
Operating expenses: | |||||||||||
Sales and marketing | 56,367 | 53,255 | 51,446 | 45,958 | 46,293 | 41,512 | 39,608 | 35,139 | 207,026 | 162,552 | 109,737 |
Research and development | 10,784 | 10,457 | 9,983 | 9,767 | 9,283 | 7,552 | 6,900 | 6,883 | 40,991 | 30,618 | 21,260 |
General and administrative | 13,332 | 13,194 | 12,260 | 11,091 | 11,317 | 9,576 | 10,455 | 10,454 | 49,877 | 41,802 | 33,572 |
Amortization of certain acquired intangible assets | 150 | 150 | 150 | 150 | 153 | 211 | 213 | 251 | 600 | 828 | 1,004 |
Total operating expenses | 80,633 | 77,056 | 73,839 | 66,966 | 67,046 | 58,851 | 57,176 | 52,727 | 298,494 | 235,800 | 165,573 |
Loss from operations | (14,834) | (17,031) | (19,169) | (17,673) | (14,170) | (9,907) | (13,117) | (12,722) | (68,707) | (49,916) | (33,992) |
Other income (expense): | |||||||||||
Interest income (expense) and other income (expense), net | (3,618) | (2,986) | (3,713) | (5,311) | (3,672) | (4,226) | (3,315) | (2,915) | (15,628) | (14,128) | (6,562) |
Loss before income tax (provision) benefit | (18,452) | (20,017) | (22,882) | (22,984) | (17,842) | (14,133) | (16,432) | (15,637) | (84,335) | (64,044) | (40,554) |
Income tax (provision) benefit | (391) | (132) | (380) | (278) | (324) | (178) | (200) | (153) | (1,181) | (855) | 128 |
Net loss | $ (18,843) | $ (20,149) | $ (23,262) | $ (23,262) | $ (18,166) | $ (14,311) | $ (16,632) | $ (15,790) | $ (85,516) | $ (64,899) | $ (40,426) |
Net loss per share — basic and diluted (USD per share) | $ (0.35) | $ (0.37) | $ (0.43) | $ (0.43) | $ (0.34) | $ (0.27) | $ (0.31) | $ (0.30) | $ (1.58) | $ (1.22) | $ (0.79) |
Weighted average common shares outstanding, basic and diluted (shares) | 54,551 | 54,260 | 53,987 | 53,876 | 53,660 | 53,423 | 53,197 | 52,726 | 54,171 | 53,267 | 51,427 |