Nevro (NVRO) 10-Q 5 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 31, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3
Trading Symbol	NVRO
Entity Registrant Name	NEVRO CORP
Entity Central Index Key	1,444,380
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		30,156,127

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets
Cash and cash equivalents	$ 21,377	$ 42,845
Short-term investments	236,615	226,467
Accounts receivable, net of allowance for doubtful accounts of $884 and $1,333 at September 30, 2018 and December 31, 2017, respectively	73,993	67,287
Inventories	93,606	98,119
Prepaid expenses and other current assets	7,226	6,463
Total current assets	432,817	441,181
Property and equipment, net	13,312	8,819
Other assets	4,315	3,250
Restricted cash	606	806
Total assets	451,050	454,056
Current liabilities
Accounts payable	20,173	18,492
Accrued liabilities	33,518	39,390
Other current liabilities	104	122
Total current liabilities	53,795	58,004
Long-term debt	150,508	145,019
Other long-term liabilities	2,445	1,861
Total liabilities	206,748	204,884
Commitments and contingencies (Note 6)
Stockholders’ equity
Preferred stock, $0.001 par value, 10,000,000 shares authorized at September 30, 2018 and December 31, 2017; zero shares issued and outstanding at September 30, 2018 and December 31, 2017
Common stock, $0.001 par value, 290,000,000 shares authorized at September 30, 2018 and December 31, 2017; 30,150,577 and 29,737,561 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively	30	30
Additional paid-in capital	541,695	508,228
Accumulated other comprehensive loss	(948)	(1,242)
Accumulated deficit	(296,475)	(257,844)
Total stockholders’ equity	244,302	249,172
Total liabilities and stockholders’ equity	$ 451,050	$ 454,056

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Statement Of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 884	$ 1,333
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	290,000,000	290,000,000
Common stock, shares issued	30,150,577	29,737,561
Common stock, shares outstanding	30,150,577	29,737,561

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Revenue	$ 95,630	$ 82,256	$ 279,345	$ 228,711
Cost of revenue	28,382	24,316	82,175	70,530
Gross profit	67,248	57,940	197,170	158,181
Operating expenses
Research and development	12,478	9,381	34,979	27,617
Sales, general and administrative	64,007	52,977	195,331	157,971
Total operating expenses	76,485	62,358	230,310	185,588
Loss from operations	(9,237)	(4,418)	(33,140)	(27,407)
Interest income	1,275	808	3,423	2,264
Interest expense	(2,622)	(2,497)	(7,759)	(7,386)
Other income (expense), net	(130)	251	(845)	1,198
Loss before income taxes	(10,714)	(5,856)	(38,321)	(31,331)
Provision for income taxes	551	374	1,277	1,016
Net loss	(11,265)	(6,230)	(39,598)	(32,347)
Other comprehensive loss:
Changes in foreign currency translation adjustment	(155)	165	104	(41)
Changes in unrealized gains on short-term investments, net	269	13	191	107
Net change in other comprehensive loss	114	178	295	66
Comprehensive loss	$ (11,151)	$ (6,052)	$ (39,303)	$ (32,281)
Net loss per share, basic and diluted	$ (0.37)	$ (0.21)	$ (1.32)	$ (1.10)
Weighted average number of common shares used to compute basic and diluted net loss per share	30,123,188	29,513,842	29,997,201	29,342,883

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Cash flows from operating activities
Net loss			$ (39,598)	$ (32,347)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	$ 1,078	$ 666	2,845	1,774
Stock-based compensation expense			27,018	18,867
Accretion of discount on short-term investments			(563)	(168)
Provision for doubtful accounts			(444)	(85)
Write-down of inventory	500	300	870	3,675
Non-cash interest expense			5,494	5,120
Unrealized (gains) losses on foreign currency transactions			910	(1,074)
Changes in operating assets and liabilities
Accounts receivable			(5,376)	288
Inventories			3,543	(13,399)
Prepaid expenses and other current assets			(1,360)	(296)
Other assets			(1,065)	(988)
Accounts payable			1,786	1,791
Accrued liabilities			(5,352)	4,392
Other long-term liabilities			584	620
Net cash used in operating activities			(10,708)	(11,830)	$ (14,300)
Cash flows from investing activities
Purchases of short-term investments			(137,867)	(206,891)
Proceeds from sales of short-term investments				5,993
Proceeds from maturity of short-term investments			128,474	208,811
Purchases of property and equipment			(7,876)	(2,475)
Net cash provided by (used in) investing activities			(17,269)	5,438
Cash flows from financing activities
Minimum tax withholding paid on behalf of employees for net share settlement			(1,025)	(732)
Proceeds from issuance of common stock to employees			7,480	9,337
Net cash provided by financing activities			6,455	8,605
Effect of exchange rate changes on cash and cash equivalents			(146)	423
Net increase (decrease) in cash, cash equivalents and restricted cash			(21,668)	2,636
Cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period			43,651	42,212	42,212
Cash, cash equivalents and restricted cash at end of period	$ 21,983	$ 44,848	21,983	44,848	$ 43,651
Significant non-cash transactions
Purchases of property and equipment in accounts payable			$ 55	79
Vesting of early-exercised stock options				$ 7

Formation and Business of the C

Formation and Business of the Company	9 Months Ended
	Sep. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Formation and Business of the Company	1. Formation and Business of the Company Nevro Corp. (the Company) was incorporated in Minnesota on March 10, 2006 to manufacture and market innovative active implantable medical devices for the treatment of neurological disorders initially focusing on the treatment of chronic pain. Subsequently, the Company was reincorporated in Delaware on October 4, 2006 and relocated to California. Since inception, the Company has cumulatively incurred net losses and negative cash flows from operations. During the year ended December 31, 2017, the Company incurred a net loss of $36.7 million and used $14.3 million of cash in operations. For the nine months ended September 30, 2018, the Company incurred a net loss of $39.6 million and used $10.7 million of cash in operations. At September 30, 2018 and December 31, 2017, the Company had an accumulated deficit of $296.5 million and $257.8 million, respectively. The Company has financed operations to date primarily through private placements of equity securities, borrowings under a debt agreement, the issuance of common stock in its November 2014 initial public offering, its June 2015 underwritten public offering and its June 2016 underwritten public offering of convertible senior notes due 2021. The Company’s ability to continue to meet its obligations and to achieve its business objectives for the foreseeable future is dependent upon, amongst other things, generating sufficient revenues and its ability to continue to control expenses. Failure to increase sales of its products, manage discretionary expenditures or raise additional financing, if required, may adversely impact the Company’s ability to achieve its intended business objectives. The accompanying interim condensed consolidated financial statements as of September 30, 2018 and for the nine months ended September 30, 2018 and 2017, and the related interim information contained within the notes to the financial statements, are unaudited. The unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) for interim financial information and on the same basis as the audited financial statements included on the Company’s Annual Report on Form 10-K (Annual Report) filed with the Securities and Exchange Commission (SEC) on February 22, 2018. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to state fairly the Company’s financial position as of September 30, 2018, and the results of its operations and cash flows for the nine months ended September 30, 2018 and 2017. All such adjustments are of a normal and recurring nature. The interim financial data as of September 30, 2018 is not necessarily indicative of the results to be expected for the year ending December 31, 2018, or for any future period. The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2017 included in the Annual Report.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Presentation These condensed consolidated financial statements have been prepared in accordance with U.S. GAAP. The condensed consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Segments The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis, accompanied by information about revenue by geographic region, for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components below the consolidated unit level, other than revenue. Accordingly, the Company has determined that it has a single reportable and operating segment structure. The Company and its Chief Executive Officer evaluate performance based primarily on revenue in the geographic locations in which the Company operates. Revenue by geography is based on the billing address of the customer. The United States was the only country with revenue accounting for more than 10% of the total revenue in any of the periods presented, as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 United States 83 % 81 % 82 % 80 % Long-lived assets and operating income located outside the United States are not material; therefore, disclosures have been limited to revenue. Foreign Currency Translation The Company’s consolidated financial statements are prepared in U.S. dollars (USD). Its foreign subsidiaries use their local currency as their functional currency and maintain their records in the local currency. Accordingly, the assets and liabilities of these subsidiaries are translated into USD using the current exchange rates in effect at the balance sheet date and equity accounts are translated into USD using historical rates. Revenues and expenses are translated using the monthly average exchange rates during the period when the transaction occurs. The resulting foreign currency translation adjustments from this process are recorded in accumulated other comprehensive income (loss) on the consolidated balance sheets. Unrealized foreign exchange gains and losses from the remeasurement of assets and liabilities denominated in currencies other than the functional currency of the reporting entity are recorded in other income (expense), net. Additionally, realized gains and losses resulting from transactions denominated in currencies other than the local currency are recorded in other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. The Company recorded net unrealized and net realized foreign currency transaction gains (losses) during the periods presented as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net unrealized foreign currency gain (loss) $ (6 ) $ (223 ) $ (892 ) $ 1,092 Net realized foreign currency gain (loss) (75 ) 518 217 254 As the Company’s international operations grow, its risks associated with fluctuations in currency rates will become greater, and the Company will continue to reassess its approach to managing this risk. In addition, currency fluctuations or a weakening USD can increase the costs of the Company’s international expansion. To date, the Company has not entered into any foreign currency hedging contracts. Based on its current international structure, the Company does not plan on engaging in hedging activities in the near future. Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant accounting estimates and management judgments reflected in the condensed consolidated financial statements include items such as allowances for doubtful accounts; warranty obligations; clinical accruals; stock-based compensation; depreciation and amortization periods; inventory valuation; valuation of investments; and accounting for income taxes. Estimates are based on historical experience, where applicable, and other assumptions believed to be reasonable by the management. Actual results may differ from those estimates under different assumptions or conditions. Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash, cash equivalents and investments. The majority of the Company’s cash is held by one financial institution in the United States and is in excess of federally insured limits. The Company maintained investments in money market funds that were not federally insured during the periods ended September 30, 2018 and December 31, 2017. The Company also held cash in foreign banks of approximately $3.4 million at September 30, 2018 and $4.5 million at December 31, 2017 that was not federally insured. The Company has not experienced any losses on its deposits of cash and cash equivalents. The Company’s convertible note hedge transactions, entered into in connection with the 2021 Notes, subject the Company to credit risk such that the counterparties may be unable to fulfill the terms of the transactions. The associated risk is mitigated by limiting the counterparties to major financial institutions. In the international markets in which the Company participates, the Company uses a combination of a direct sales force, sales agents and independent distributors to sell its products, while in the United States the Company utilizes a direct sales force. The Company performs ongoing credit evaluations of its direct customers and distributors, does not require collateral, and maintains allowances for potential credit losses on customer accounts when deemed necessary. During the three and nine months ended September 30, 2018 and 2017, no single customer accounted for 10% or more of the Company’s revenue. As of September 30, 2018 and December 31, 2017, no single customer accounted for 10% or more of the accounts receivable balance. The Company is subject to risks common to medical device companies, including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, product liability, manufacturing quality and scaling, continued reimbursement from third-party payors, There can be no assurance that the Company’s products or services will continue to be accepted in its existing marketplaces, nor can there be any assurance that any future products or services can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products or services will be successfully marketed, if at all. The Company may choose to raise additional funds to further enhance its research and development efforts, for product expansion opportunities or to acquire a new business or products that are complementary to its business. There can be no assurance that such financing will be available or will be at terms acceptable by the Company. Fair Value of Financial Instruments The carrying amounts of certain of the Company’s financial instruments, including cash equivalents, short-term investments, accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities. Cash and Cash Equivalents The Company considers all highly-liquid investments purchased with an original maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents include money market funds in the amount of $8.2 million and $30.3 million as of September 30, 2018 and December 31, 2017, respectively. At September 30, 2018 and December 31, 2017, the Company’s cash equivalents were held at institutions in the United States and include deposits in a money market fund which was unrestricted as to withdrawal or use. Restricted Cash Restricted cash as of September 30, 2018 and December 31, 2017 consists of a letter of credit of $0.6 million representing collateral for the Company’s Redwood City, California building lease pursuant to an agreement dated March 5, 2015. Restricted cash additionally includes certificates of deposit of $0.2 million as of December 31, 2017, collateralizing payment of charges related to the Company’s credit cards. Investment Securities The Company classifies its investment securities as available-for-sale. Those investments with original maturities greater than three months at the date of purchase and remaining maturities of less than 12 months are considered short-term investments. Those investments with remaining maturities greater than 12 months at the date of purchase are also classified as short-term investments as management considers them to be available for current operations if needed. The Company’s investment securities classified as available-for-sale are recorded at fair value. Unrealized gains and losses, deemed temporary in nature, are reported as a separate component of accumulated comprehensive income (loss). A decline in the fair value of any security below cost that is deemed other than temporary results in a charge to earnings and the corresponding establishment of a new cost basis for the security. Premiums (discounts) are amortized (accreted) over the life of the related security as an adjustment to yield using the straight-line interest method. Dividend and interest income are recognized when earned. Realized gains and losses are included in earnings and are derived using the specific identification method for determining the cost of securities sold. Inventories Inventories are stated at the lower of cost to purchase or manufacture the inventory or the net realizable value of such inventory. Cost is determined using the standard cost method which approximates the first-in, first-out basis. Net realizable value is determined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. The Company writes down inventory that has become obsolete, inventory that has a cost basis in excess of its expected net realizable value, and inventory that is in excess of expected requirements. The estimate of excess quantities is subjective and primarily dependent on the Company’s estimates of future demand for a particular product. If the estimate of future demand is inaccurate based on actual sales, the Company may increase the write down for excess inventory for that component and record a charge to inventory impairment in the accompanying consolidated statements of operations and comprehensive loss. The Company periodically evaluates the carrying value of inventory on hand for potential excess amounts over demand using the same lower of cost or net realizable value approach that has been used to value inventory. The Company also periodically evaluates inventory quantities in consideration of actual loss experience. In addition, the Company determines at times that there may be certain inventory that does not meet its product requirements. As a result of these evaluations, the Company recognized total write downs of $0.5 million and $0.3 million for the three months ended September 30, 2018 and 2017, respectively, and $0.9 million and $3.7 million of its inventories for the nine months ended September 30, 2018 and 2017, respectively. The Company’s estimation of the future demand for any given particular component of the Senza product may vary and may result in changes in estimates of inventory values in any particular period. Shipping and Handling Costs The Company has made the accounting policy election under ASC 606 to account for shipping and handling costs as a fulfillment activity. These costs are accrued when the related revenue is recognized. Revenue Recognition The Company has revenue arrangements that generally consist of a single performance obligation, although, in some instances, revenue arrangements may consist of two performance obligations. The Company recognizes revenue at the point in time when it transfers control of promised goods to its customers. Revenue is measured as the amount of consideration it expects to receive in exchange for transferring goods. See Note 3 for further discussion on Revenue Recognition. Allowance for Doubtful Accounts The Company makes estimates of the collectability of accounts receivable. In doing so, the Company analyzes historical bad debt trends, customer credit worthiness, current economic trends and changes in customer payment patterns when evaluating the adequacy of the allowance for doubtful accounts. Warranty Obligations The Company provides a limited one- to five-year warranty and warrants that its products will operate substantially in conformity with product specifications. The Company records an estimate for the provision for warranty claims in cost of revenue when the related revenues are recognized. This estimate is based on historical and anticipated rates of warranty claims, the cost per claim and the number of units sold. The Company regularly assesses the adequacy of its recorded warranty obligations and adjusts the amounts as necessary. Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment, other than leasehold improvements, is computed using the straight-line method over the assets’ estimated useful lives of three to five years. Leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful life of the asset or the life of the lease. Upon retirement or sale, the cost and related accumulated depreciation are removed from the consolidated balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to operations as incurred. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group might not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is based either on discounted cash flows or appraised value, depending on the nature of the asset. There were no impairment charges or changes in estimated useful lives recorded through September 30, 2018. Income Taxes During the three and nine months ended September 30, 2018 and 2017, the Company calculated its interim tax provision to record taxes incurred on a discrete basis due to the variability of taxable income in the jurisdictions in which it operates. The provision for income taxes for the three and nine months ended September 30, 2018 and 2017 is primarily comprised of foreign and state taxes based upon income earned during the period with no tax benefit recorded for the loss jurisdictions. The Company records uncertain tax positions on the basis of a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company’s policy is to recognize interest and penalties related to income taxes as a component of income tax expense. No interest or penalties related to income taxes have been recognized in the statements of operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017. On December 22, 2017, the 2017 Tax Cuts and Jobs Act (the 2017 Tax Act) was enacted into law. The 2017 Tax Act contains several key tax law changes, including a reduction of the corporate income tax rate to 21% effective January 1, 2018, and a one-time mandatory transition tax on accumulated foreign earnings, among others. Consistent with guidance issued by the SEC, which provides for a measurement period of one year from the enactment date to finalize the accounting for effects of the 2017 Tax Act, as of December 31, 2017, the Company has made a reasonable estimate of the effects on its existing deferred taxes and related disclosures and the one-time transition tax. Due to its taxable losses and its federal valuation allowance position, the Company did not recognize any income tax expense or benefit as a result of the 2017 Tax Act. During the nine months ended September 30, 2018, the Company did not make any adjustments to its provisional amounts included in its consolidated financial statements for the year ended December 31, 2017. The Company will continue to complete its analysis of these provisional amounts, which are still subject to change during the measurement period, and anticipates further guidance on accounting interpretations from the FASB and application of the law from the Department of the Treasury. The accounting is expected to be completed when the 2017 U.S. corporate income tax return is filed in the fourth quarter of 2018. At September 30, 2018, the Company has not yet determined its policy election with respect to whether to record deferred taxes for basis differences expected to reverse as a result of the global intangible low-taxed income (GILTI) provisions in future periods or use the period cost method. The Company has, however, considered the potential effects of GILTI in estimating its tax provision for 2018. Due to its forecasted taxable losses for 2018 and its federal valuation allowance position, the Company is not forecasting any income tax expense or benefit as a result of the GILTI provisions. Comprehensive Income (Loss) Comprehensive income (loss) represents all changes in the stockholders’ equity except those resulting from distributions to stockholders. The Company’s changes in unrealized gains and losses on available-for-sale investment securities and foreign currency translation adjustments represent the components of other comprehensive income (loss) that are excluded from the reported net loss and have been presented in the consolidated statements of operations and comprehensive loss. Research and Development Research and development costs, including new product development, regulatory compliance and clinical research, are charged to operations as incurred in the consolidated statements of operations and comprehensive loss. Such costs include personnel-related costs, including stock-based compensation, supplies, services, depreciation, facilities and information services, clinical trial and related clinical manufacturing expenses, fees paid to investigative sites and other indirect costs. Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees in accordance with Accounting Standards Codification (ASC) 718, Compensation - Stock Compensation. In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-09, Stock Compensation (Topic 718): Improvements to Employee Shared-Based Payment Accounting The Company’s determination of the fair value of stock options on the date of grant utilizes the Black-Scholes option-pricing model, and is impacted by its common stock price as well as changes in assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the expected term that options will remain outstanding, the expected common stock price volatility over the term of the option awards, risk-free interest rates and expected dividends. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. The fair value of stock options is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period), on a straight-line basis. Stock-based compensation expense recognized at fair value includes the impact of estimated forfeitures. The Company estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company estimates the fair value of the rights to purchase shares by employees under the Employee Stock Purchase Plan using the Black-Scholes option pricing formula. The Employee Stock Purchase Plan provides for consecutive six-month offering periods and the Company uses its own historical volatility data in the valuation. Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustments as the underlying equity instruments vest. The fair value of options granted to consultants is expensed when vested. The Company accounts for stock-based compensation for the restricted stock units at their fair value, based on the closing market price of the Company’s common stock on the grant date. These costs are recognized on a straight-line basis over the requisite service period, which is generally the vesting term of four years. The Company also issues stock options and restricted stock units with vesting based upon completion of performance goals. The fair value for these performance-based awards is recognized over the period during which the goals are to be achieved. Stock-based compensation expense recognized at fair value includes the impact of estimated probability that the goals would be achieved, which is assessed prior to the requisite service period for the specific goals. Upon adoption of ASU 2016-09 as described above, excess tax benefits or deficiencies from share-based award activity are reflected in the consolidated statements of operations as a component of the provision for income taxes, whereas they were previously recognized as additional paid-in capital. Net Loss per Share of Common Stock Basic net loss per common share is calculated by dividing net loss by the weighted average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing net loss by the weighted average number of common shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, the Company’s restricted stock units and options to purchase shares of common stock are considered to be potentially dilutive securities. Because the Company has reported a net loss in all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) Codification Improvements to Topic 842, Leases Leases (Topic 842): Targeted Improvements) reviewed its lease portfolio and has initially assessed the potential accounting impact for some of its significant lease arrangements In March 2017, the FASB issued ASU No. 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. In February 2018, the FASB issued ASU No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220). In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740) In June 2018, the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718), Improvements to Nonemployee Share-based Payments

Revenue

Revenue	9 Months Ended
	Sep. 30, 2018
Revenue From Contract With Customer [Abstract]
Revenue	3. Revenue Adoption of ASC 606 On January 1, 2018, the Company adopted the new accounting standard ASC 606, Revenue from Contracts with Customers Revenue Recognition Under ASC 606, assuming all other revenue recognition criteria have been met, the Company will recognize revenue earlier for arrangements where the Company has satisfied its performance obligations but has not issued invoices. These amounts are recorded as unbilled receivables, which are included in accounts receivable on the consolidated balance sheet, as the Company has an unconditional right to payment at the end of the applicable period. The Company recognized the cumulative effect of initially applying ASC 606 as an adjustment to the opening balance of accumulated deficit. The cumulative effect of the changes made to the consolidated balance sheet as of January 1, 2018 for the adoption of ASC 606 were as follows (in thousands): Balance at Adjustments Due Balance at December 31, 2017 to ASC 606 January 1, 2018 Balance Sheet: Accounts receivable, net $ 67,287 $ 1,447 $ 68,734 Prepaid expenses and other current assets 6,463 (476 ) 5,987 Accumulated other comprehensive loss (1,242 ) 4 (1,238 ) Accumulated deficit (257,844 ) 967 (256,877 ) In accordance with ASC 606, the disclosure of the impact of adoption on the Consolidated Balance Sheet was as follows (in thousands): September 30, 2018 Balance Balance Without As Reported ASC 606 Adoption Effect of Change Balance Sheet: Accounts receivable, net $ 73,993 $ 72,833 $ 1,160 Inventories 93,606 93,713 (107 ) Prepaid expenses and other current assets 7,226 8,136 (910 ) In accordance with ASC 606, the disclosure of the impact of adoption on the Consolidated Statements of Operations was as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Balance Without Balance Without Balance As Reported ASC 606 Adoption Effect of Change Balance As Reported ASC 606 Adoption Effect of Change Statement of Operations: Revenue $ 95,630 $ 95,714 $ (84 ) $ 279,345 $ 279,626 $ (281 ) Cost of revenue 28,382 28,386 (4 ) 82,175 81,621 554 Revenue Recognition Revenue is recognized when obligations under the terms of a contract with customers are satisfied, which occurs with the transfer of control of the Company’s goods to its customers. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring the goods. For a majority of sales, where the Company’s sales representative delivers its product at the point of implantation at hospitals or medical facilities, the Company recognizes revenue upon completion of the procedure and authorization, which represents the point in time when control transfers to the customers. For the remaining sales, which are sent from the Company’s distribution centers directly to hospitals and medical facilities, as well as distributor sales, where product is ordered in advance of an implantation, the transfer of control occurs at the time of shipment of the product. These customers are obligated to pay within specified terms regardless of when or if they ever sell or use the products. The Company does not offer rights of return or price protection. Sales, value add, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The expected costs associated with warranty obligations continue to be recognized as expense when the products are sold (see Note 6). The Company periodically provides incentive offers, in the form of rebates, to customers based on their aggregate levels of purchases. Product revenue is recorded net of such incentive offers. The following table presents revenue by geography, based on the billing address of the customer (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 United States $ 79,624 $ 66,281 $ 230,159 $ 182,419 International 16,006 15,975 49,186 46,292 Total revenue $ 95,630 $ 82,256 $ 279,345 $ 228,711 Practical Expedients and Exemptions The Company recognizes revenue upon the transfer of control of the product and there are no material future performance obligations beyond such transfer. As a result, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed. The Company does not capitalize incremental costs when the amortization period of the asset is less than a year.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2018
Fair Value Disclosures [Abstract]
Fair Value Measurements	4. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability 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 defines a three-level valuation hierarchy for disclosure of fair value measurements as follows: • Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities. • Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Cash Equivalents and Short-Term Investments The Company’s cash equivalents are comprised of investments in money market funds that are classified as Level 1 of the fair value hierarchy. T he Company’s money market funds are classified within Level 1 of the fair value hierarchy and are valued based on quoted prices in active markets for identical securities. Balance as of September 30, 2018 Level 1 Level 2 Level 3 Total Assets: Money market funds (i) $ 8,204 $ — $ — $ 8,204 Commercial paper (ii) — 67,627 — 67,627 Corporate notes (ii) — 168,988 — 168,988 Total assets $ 8,204 $ 236,615 $ — $ 244,819 Balance as of December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Money market funds (i) $ 30,278 $ — $ — $ 30,278 Commercial paper (ii) — 61,086 — 61,086 Corporate notes (ii) — 165,381 — 165,381 Total assets $ 30,278 $ 226,467 $ — $ 256,745 (i) Included in cash and cash equivalents on the condensed consolidated balance sheets. (i i ) Included in short-term investments on the condensed consolidated balance sheets. Convertible Senior Notes As of September 30, 2018 and December 31, 2017, the fair value of the 1.75% convertible senior notes due 2021 was $171.2 million and $180.3 million, respectively. The fair value was determined on the basis of market prices observable for similar instruments and is considered Level 2 in the fair value hierarchy (See Note 7).

Balance Sheet Components

Balance Sheet Components	9 Months Ended
	Sep. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Balance Sheet Components	5. Balance Sheet Components Investments The fair value of the Company’s cash equivalents and short-term investments approximates their respective carrying amounts due to their short-term maturity. The following is a summary of the gross unrealized gains and unrealized losses on the Company’s investment securities, excluding investments in money market funds (in thousands): September 30, 2018 Amortized Cost Gross Unrealized Holding Gains Gross Unrealized Holding Losses Aggregate Fair Value Investment Securities Commercial paper $ 67,665 $ — $ (38 ) $ 67,627 Corporate notes 169,171 1 (184 ) 168,988 Total securities $ 236,836 $ 1 $ (222 ) $ 236,615 December 31, 2017 Amortized Cost Gross Unrealized Holding Gains Gross Unrealized Holding Losses Aggregate Fair Value Investment Securities Commercial paper $ 61,167 $ — $ (81 ) $ 61,086 Corporate notes 165,712 1 (332 ) 165,381 Total securities $ 226,879 $ 1 $ (413 ) $ 226,467 Realized gains or losses and other-than-temporary impairments, if any, on available-for-sale securities are reported in other income (expense), net as incurred. The cost of securities sold is determined based on the specific identification method. The amount of realized gains and realized losses on investments recorded for the periods presented has not been material. The contractual maturities of the Company’s investment securities as of September 30, 2018 were as follows (in thousands): Amortized Cost Fair Value Amounts maturing within one year $ 236,836 $ 236,615 Amounts maturing after one year through five years — — Total investment securities $ 236,836 $ 236,615 Inventories (in thousands) September 30, December 31, 2018 2017 Raw materials $ 37,698 $ 51,602 Finished goods 55,908 46,517 Total inventories $ 93,606 $ 98,119 Property and Equipment, Net (in thousands) September 30, December 31, 2018 2017 Laboratory equipment $ 2,821 $ 2,416 Computer equipment and software 7,771 5,076 Furniture and fixtures 3,866 2,241 Leasehold improvements 4,474 1,221 Construction in process 2,094 2,734 Total 21,026 13,688 Less: Accumulated depreciation and amortization (7,714 ) (4,869 ) Property and equipment, net $ 13,312 $ 8,819 The Company recognized depreciation and amortization expense on property and equipment as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Depreciation and amortization expense $ 1,078 $ 666 $ 2,845 $ 1,774 Accrued Liabilities (in thousands) September 30, December 31, 2018 2017 Accrued payroll and related expenses $ 21,986 $ 26,108 Accrued professional fees 2,857 4,734 Accrued taxes 2,193 2,827 Accrued clinical and research expenses 837 1,279 Accrued interest 998 243 Accrued warranty 1,093 708 Accrued other 3,554 3,491 Total accrued liabilities $ 33,518 $ 39,390

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments And Contingencies Disclosure [Abstract]
Commitments and Contingencies	6. Commitments and Contingencies Operating Leases In March 2015, the Company entered into a lease agreement for approximately 50,000 square feet of office space located in Redwood City, California for a period beginning on June 30, 2015 and ending in May 2022, with initial annual payments of approximately $2.0 million, increasing to $2.4 million annually during the final year of the lease term . In December 2016, the Company entered into a first amendment to the lease for an additional approximately 50,000 square feet of office space adjacent to the premises under the original lease (the Expansion Premises), with initial annual payments of $1.2 million, increasing to $2.9 million in the final year of the amended lease term. The lease for the Expansion Premises commenced on June 1, 2018. The first amendment also extends the lease term for the original premises to terminate on the same date as the amended lease, which is May 31, 2025. In August 2014, the Company entered into a facility lease for warehouse space beginning on August 21, 2014 through May 31, 2015. In March 2015, the Company extended the warehouse lease through February 2017, at which time the lease terminated. The Company entered into a separate non-cancellable facility lease for warehouse space beginning on March 1, 2017 through February 28, 2022, under which it is obligated to pay approximately $0.4 million in lease payments over the term of the lease. The Company recognized rent expense during the periods indicated as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Rent expense $ 1,238 $ 653 $ 2,742 $ 1,864 Warranty Obligations The Company warrants that its products will operate substantially in conformity with product specifications and has a limited one- to five-year warranty to most customers. Activities related to warranty obligations were as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Beginning balance $ 943 $ 656 $ 708 $ 645 Provision for warranty 597 352 1,681 945 Utilization (447 ) (405 ) (1,296 ) (987 ) Ending balance $ 1,093 $ 603 $ 1,093 $ 603 License Agreement In October 2006, the Company entered into an amended and restated license agreement with the Mayo Foundation for Medical Education and Research (Mayo) and the Venturi Group LLC (VGL), which provides the Company access to certain know-how and licensed patents owned by Mayo and VGL for treatment of central, autonomic and peripheral nervous system disorders, including pain, using devices to modulate nerve signaling. The licenses granted are exclusive and the Company has the right to sub-license. The agreement will terminate upon the expiration of (1) the last to expire of the licensed patents or (2) the Company’s obligations to pay royalties, whichever is later, unless terminated earlier. The agreement can be terminated by the Company, Mayo or VGL upon 60 days’ notice of a party’s material breach if such breach remains uncured after such 60-day period. Per the terms of the license, the Company is required to pay royalties based on the greater of earned royalties or a minimum royalty. The earned royalty is based on a percentage of net sales of licensed products either by the Company or the sub-licensee. The minimum royalty payment is based on royalty periods as defined in the agreement. In March 2011, the Company entered into a Phase II License Agreement with Mayo which provides the Company access to the certain know-how and licensed patents owned by Mayo. The licenses granted are exclusive and the Company has the right to sub-license. Per terms of the license, the Company is required to: • Pay a retainer fee of $40,000 per annum starting March 2011 and ending on February 2013; and • Pay royalties based on the greater of earned royalties or a minimum royalty. The earned royalties are based on a percentage of net sales of licensed products either by the Company or the sub-licensee. The minimum annual royalty payment is $200,000. The Company recognized royalty expense during the periods indicated as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Royalty expense $ 795 $ 665 $ 2,280 $ 1,831 Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business activities related to, for example, employment matters and patent issues. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There were no contingent liabilities requiring accrual at September 30, 2018 and December 31, 2017. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has director and officer insurance coverage that reduces the Company’s exposure and enables the Company to recover a portion of any future amounts paid. The Company believes the estimated fair value of these indemnification agreements in excess of applicable insurance coverage is minimal. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date. Legal Matters On November 28, 2016, the Company filed a lawsuit for patent infringement against Boston Scientific Corporation and Boston Scientific Neuromodulation Corporation (collectively, Boston Scientific). The lawsuit, filed in the United States District Court for the Northern District of California (the Court), asserts that Boston Scientific is infringing seven of the Company’s patents covering inventions relating to the Senza system and HF10 therapy. The lawsuit seeks preliminary and permanent injunctive relief against further infringement as well as damages and attorney’s fees. On July 24, 2018, the Court issued an order on claim construction and summary judgment. In the order, the Court ruled that six asserted method claims in three of the Company’s asserted patents were patent eligible and not invalid as indefinite. Specifically, the claims upheld in the ruling were claims 11, 21 and 23 of U.S. Patent No. 8,359,102; claim 18 of U.S. Patent No. 8,792,988; and claims 1 and 5 of U.S. Patent No. 8,768,472. Collectively, these six claims cover methods for delivering SCS therapy at frequencies between 1.5 kHz and 100 kHz. The Court, however, found that Boston Scientific is not currently infringing the six upheld method claims. Specifically, the Court found that Boston Scientific's sale of the Spectra WaveWriter systems for commercial use in the United States does not infringe the upheld method claims because the Spectra WaveWriter systems cannot be programmed to generate signals above 1.2 kHz. With regard to the use of the Spectra WaveWriter and the Precision with MultiWave systems in patients that have completed the ACCELERATE clinical trial, the Court found such use to fall within the safe harbor provision of 35 U.S.C. § 271(e). The Court further held that 35 U.S.C. § 271(f) does not apply to method claims, and therefore the sale of the Precision with MultiWave systems in Europe does not infringe the upheld method claims. The Court also found that the asserted system claims in four of the Company's asserted patents were invalid as indefinite. Specifically, the Court invalidated claims 18, 34, and 55 of U.S. Patent No. 9,327,125; claims 5 and 34 of U.S. Patent No. 9,333,357; claims 7, 12, 35, 37, and 58 of U.S. Patent No. 8,712,533; and claims 1 and 22 of U.S. Patent No. 9,480,842. On July 27, 2018, the parties submitted a joint statement to the Court wherein Boston Scientific asserted to the Court that, with respect to whether any U.S. launch of a high-rate product (such as the Precision with Multiwave and Spectra WaveWriter models used in the ACCELERATE study or any other system that is programmable at any frequency in the range 1.5 to 100 kHz) is imminent, Boston Scientific, as of now, has not decided whether to launch such a product; has not established a timeline for when such a decision might be made, if ever; and has not determined what frequencies would be enabled if it were to decide to launch such a product in the future. Boston Scientific further confirmed its public statements that the ACCELERATE study has been extended into 2019, with an estimated study completion date between April 2019 and November 2019. On the basis of the foregoing, the parties agreed to dismissal on ripeness grounds of Nevro’s declaratory judgment claims without prejudice, each side to bear its own fees and costs as to these claims, and jointly requested that the Court enter such a dismissal. The dismissal was thereafter entered as a court order on July 31, 2018. On that same day, the Company filed a Notice of Appeal with the intent of appealing portions of the Court’s July 24 th On December 9, 2016, Boston Scientific filed a patent infringement lawsuit alleging the Company’s manufacture, use and sale of the Senza system infringes certain of Boston Scientific’s patents covering spinal cord stimulation technology related to stimulation leads, rechargeable batteries and telemetry. The lawsuit, filed in the United States District Court for the District of Delaware, seeks unspecified damages and attorney’s fees, as well as preliminary and permanent injunctive relief against further infringement. inter partes inter partes inter partes inter partes inter partes inter partes inter partes inter partes inter partes On April 27, 2018, Boston Scientific filed a second patent lawsuit alleging patent infringement, theft of trade secrets and tortious interference with contract. The lawsuit, filed in the United States District Court for the District of Delaware, seeks unspecified damages and attorney’s fees, as well as preliminary and permanent injunctive relief against further infringement. As of this time, the Company is unable to determine an outcome or potential range of loss. On August 23, 2018, the Oklahoma Police Pension and Retirement System filed a putative securities class action complaint against the Company and certain individual officers alleging violations of Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 of the Exchange Act. The lawsuit, filed in the United States District Court for the Northern District of California, seeks unspecified damages and attorneys’ fees based on alleged misleading statements or omissions by the Company and the individual officers regarding the Company’s rights in technology underlying the Senza SCS systems and the termination of the Company’s former Vice President of Worldwide Sales. The Company is and may from time to time continue to be involved in various legal proceedings of a character normally incident to the ordinary course of its business, including several pending European patent oppositions at the European Patent Office (EPO) initiated by the Company’s competitors Medtronic and Boston Scientific, and an entitlement action filed by Boston Scientific in Germany, which the Company does not believe to be material to its business and consolidated financial statements at this stage.

Long-term Debt

Long-term Debt	9 Months Ended
	Sep. 30, 2018
Debt Disclosure [Abstract]
Long-term Debt	7. Long-term Debt 1.75% Convertible Senior Notes and Convertible Note Hedge and Warrant Transactions In June 2016, the Company issued $150.0 million aggregate principal amount of 1.75% convertible senior notes due 2021 in a registered underwritten public offering and an additional $22.5 million aggregate principal amount of such notes pursuant to the exercise in full of the over-allotment options of the underwriters (the 2021 Notes). The interest rates are fixed at 1.75% per annum and are payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2016. The total net proceeds from the debt offering, after deducting initial purchase discounts and debt issuance costs, were approximately $166.2 million. Each $1,000 principal amount of the 2021 Notes will initially be convertible into 10.3770 shares of the Company’s common stock, which is equivalent to an initial conversion price of approximately $96.37 per share, subject to adjustment upon the occurrence of specified events. The 2021 Notes will be convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding December 1, 2020, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2016 (and only during such calendar quarter), if the last reported sale price of the Company’s 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; (2) during the five business day period after any ten consecutive trading day period (the measurement period) in which the trading price (as defined in the indenture to the 2021 Notes) per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after December 1, 2020 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 2021 Notes at any time, regardless of the foregoing circumstances. If the Company undergoes a fundamental change prior to the maturity date, holders of the notes may require the Company to repurchase for cash all or any portion of their notes at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. It is the Company’s current intent and policy to settle conversions through combination settlement with a specified dollar amount per $1,000 principal amount of notes of $1,000. In accounting for the issuance of the convertible senior notes, the Company separated the 2021 Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar debt instrument that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was $32.9 million and was determined by deducting the fair value of the liability component from the par value of the 2021 Notes. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. The excess of the principal amount of the liability component over its carrying amount (“debt discount”) is amortized to interest expense over the term of the 2021 Notes expense at an effective interest rate of 6.29% over the contractual terms of the notes. In accounting for the debt issuance costs of $6.2 million related to the 2021 Notes, the Company allocated the total amount incurred to the liability and equity components of the 2021 Notes based on their relative values. Issuance costs attributable to the liability component were $5.0 million and will be amortized to interest expense using the effective interest method over the contractual terms of the 2021 Notes. The net carrying amount of the liability component of the 2021 Notes was as follows (in thousands): September 30, December 31, 2018 2017 Principal $ 172,500 $ 172,500 Unamortized discount (18,946 ) (23,737 ) Unamortized issuance cost (3,046 ) (3,744 ) Net carrying amount $ 150,508 $ 145,019 The net carrying amount of the equity component of the 2021 Notes was as follows (in thousands): September 30, December 31, 2018 2017 Debt discount related to value of conversion option $ 32,945 $ 32,945 Debt issuance cost (1,179 ) (1,179 ) Net carrying amount $ 31,766 $ 31,766 The following table sets forth the interest expense recognized related to the 2021 Notes (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Contractual interest expense $ 755 $ 755 $ 2,265 $ 2,264 Amortization of debt discount 1,625 1,528 4,791 4,504 Amortization of debt issuance costs 240 212 697 616 Total interest expense related to the 2021 Notes $ 2,620 $ 2,495 $ 7,753 $ 7,384 In connection with the offering of the 2021 Notes, the Company entered into convertible note hedge transactions with certain bank counterparties in which the Company has the option to purchase initially (subject to adjustment for certain specified events) a total of approximately 1.8 million shares of the Company’s common stock at a price of approximately $96.37 per share. The total cost of the convertible note hedge transactions was $45.1 million. In addition, the Company sold warrants to certain bank counterparties whereby the holders of the warrants have the option to purchase initially (subject to adjustment for certain specified events) a total of approximately 1.8 million shares of the Company’s common stock at a price of $127.28 per share. The Company received $33.1 million in cash proceeds from the sale of these warrants. Taken together, the purchase of the convertible note hedges and the sale of warrants are intended to offset any actual dilution from the conversion of these notes and to effectively increase the overall conversion price from $96.37 to $127.28 per share. As these transactions meet certain accounting criteria, the convertible note hedges and warrants are recorded in stockholders’ equity and are not accounted for as derivatives. The net cost of $12.0 million incurred in connection with the convertible note hedge and warrant transactions was recorded as a reduction to additional paid-in capital on the consolidated balance sheet.

Net Loss Per Share

Net Loss Per Share	9 Months Ended
	Sep. 30, 2018
Earnings Per Share [Abstract]
Net Loss Per Share	8. Net Loss Per Share The following table summarizes the computation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net loss, basic and diluted $ (11,265 ) $ (6,230 ) $ (39,598 ) $ (32,347 ) Weighted average shares outstanding 30,123,188 29,513,842 29,997,201 29,343,291 Less: weighted average shares subject to repurchase — — — (408 ) Weighted average shares used to compute basic and diluted net loss per share 30,123,188 29,513,842 29,997,201 29,342,883 Net loss per share, basic and diluted $ (0.37 ) $ (0.21 ) $ (1.32 ) $ (1.10 ) Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common shares and dilutive common stock equivalents outstanding for the period, if inclusion of these is dilutive. Since the Company expects to settle the principal amount of its outstanding convertible senior notes in cash, the Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share of common stock when the average market price of the Company’s common stock for a given period exceeds the conversion price of $96.37 per share for the 2021 Notes, which has not occurred as of September 30, 2018. In connection with the issuance of the 2021 Notes, the Company entered into convertible bond hedges. The convertible bond hedges are not included for purposes of calculating the number of diluted shares outstanding, as their effect would be anti-dilutive. The convertible bond hedges are generally expected, but not guaranteed, to reduce the potential dilution and/or offset the cash payments the Company is required to make upon conversion of the 2021 Notes. Because the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods. The following potentially dilutive securities outstanding at the end of the periods presented have been excluded from the computation of diluted shares outstanding, as the effect would be anti-dilutive: September 30, 2018 2017 Unreleased restricted stock 935,916 520,267 Options to purchase common stock 2,355,039 2,342,965 Convertible senior notes 1,790,033 1,790,033 Warrants related to the issuance of convertible senior notes 1,790,033 1,790,033 Total 6,871,021 6,443,298

Employee Benefit Plans

Employee Benefit Plans	9 Months Ended
	Sep. 30, 2018
Postemployment Benefits [Abstract]
Employee Benefit Plans	9. Employee Benefit Plans 401(k) Plan In 2007, the Company adopted a 401(k) plan for its employees whereby eligible employees may contribute up to the maximum amount permitted by the Internal Revenue Code. In June 2016, the Company adopted a policy to match a portion of employee contributions for all qualified employees participating in the 401(k) plan. The Company recorded an expense for matching contributions of $0.3 million and $2.4 million for the three and nine months ended September 30, 2018, respectively, and $0.4 million and $2.0 million for the three and nine months ended September 30, 2017, respectively. Employee Stock Purchase Plan The Company’s 2014 Employee Stock Purchase Plan (ESPP) allows eligible employees to purchase shares of the Company’s Class A common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to any plan limitations. The ESPP generally provides for six-month offering periods, and at the end of each offering period, employees are able to purchase shares at 85% of the lower of the fair market value of the Company’s Class A common stock on the first trading day of the offering period or on the last trading day of the offering period. There were zero and 53,824 shares of common stock issued under the ESPP for the three and nine months ended September 30, 2018, respectively. There were zero and 44,999 shares of common stock issued under the ESPP for the three and nine months ended September 30, 2017, respectively. Shares available for future purchase under the ESPP were 1,080,186 at September 30, 2018.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation These condensed consolidated financial statements have been prepared in accordance with U.S. GAAP. The condensed consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated.
Segments	Segments The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis, accompanied by information about revenue by geographic region, for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components below the consolidated unit level, other than revenue. Accordingly, the Company has determined that it has a single reportable and operating segment structure. The Company and its Chief Executive Officer evaluate performance based primarily on revenue in the geographic locations in which the Company operates. Revenue by geography is based on the billing address of the customer. The United States was the only country with revenue accounting for more than 10% of the total revenue in any of the periods presented, as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 United States 83 % 81 % 82 % 80 % Long-lived assets and operating income located outside the United States are not material; therefore, disclosures have been limited to revenue.
Foreign Currency Translation	Foreign Currency Translation The Company’s consolidated financial statements are prepared in U.S. dollars (USD). Its foreign subsidiaries use their local currency as their functional currency and maintain their records in the local currency. Accordingly, the assets and liabilities of these subsidiaries are translated into USD using the current exchange rates in effect at the balance sheet date and equity accounts are translated into USD using historical rates. Revenues and expenses are translated using the monthly average exchange rates during the period when the transaction occurs. The resulting foreign currency translation adjustments from this process are recorded in accumulated other comprehensive income (loss) on the consolidated balance sheets. Unrealized foreign exchange gains and losses from the remeasurement of assets and liabilities denominated in currencies other than the functional currency of the reporting entity are recorded in other income (expense), net. Additionally, realized gains and losses resulting from transactions denominated in currencies other than the local currency are recorded in other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. The Company recorded net unrealized and net realized foreign currency transaction gains (losses) during the periods presented as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net unrealized foreign currency gain (loss) $ (6 ) $ (223 ) $ (892 ) $ 1,092 Net realized foreign currency gain (loss) (75 ) 518 217 254 As the Company’s international operations grow, its risks associated with fluctuations in currency rates will become greater, and the Company will continue to reassess its approach to managing this risk. In addition, currency fluctuations or a weakening USD can increase the costs of the Company’s international expansion. To date, the Company has not entered into any foreign currency hedging contracts. Based on its current international structure, the Company does not plan on engaging in hedging activities in the near future.
Use of Estimates	Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Significant accounting estimates and management judgments reflected in the condensed consolidated financial statements include items such as allowances for doubtful accounts; warranty obligations; clinical accruals; stock-based compensation; depreciation and amortization periods; inventory valuation; valuation of investments; and accounting for income taxes. Estimates are based on historical experience, where applicable, and other assumptions believed to be reasonable by the management. Actual results may differ from those estimates under different assumptions or conditions.
Concentration of Credit Risk and Other Risks and Uncertainties	Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash, cash equivalents and investments. The majority of the Company’s cash is held by one financial institution in the United States and is in excess of federally insured limits. The Company maintained investments in money market funds that were not federally insured during the periods ended September 30, 2018 and December 31, 2017. The Company also held cash in foreign banks of approximately $3.4 million at September 30, 2018 and $4.5 million at December 31, 2017 that was not federally insured. The Company has not experienced any losses on its deposits of cash and cash equivalents. The Company’s convertible note hedge transactions, entered into in connection with the 2021 Notes, subject the Company to credit risk such that the counterparties may be unable to fulfill the terms of the transactions. The associated risk is mitigated by limiting the counterparties to major financial institutions. In the international markets in which the Company participates, the Company uses a combination of a direct sales force, sales agents and independent distributors to sell its products, while in the United States the Company utilizes a direct sales force. The Company performs ongoing credit evaluations of its direct customers and distributors, does not require collateral, and maintains allowances for potential credit losses on customer accounts when deemed necessary. During the three and nine months ended September 30, 2018 and 2017, no single customer accounted for 10% or more of the Company’s revenue. As of September 30, 2018 and December 31, 2017, no single customer accounted for 10% or more of the accounts receivable balance. The Company is subject to risks common to medical device companies, including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, product liability, manufacturing quality and scaling, continued reimbursement from third-party payors, There can be no assurance that the Company’s products or services will continue to be accepted in its existing marketplaces, nor can there be any assurance that any future products or services can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products or services will be successfully marketed, if at all. The Company may choose to raise additional funds to further enhance its research and development efforts, for product expansion opportunities or to acquire a new business or products that are complementary to its business. There can be no assurance that such financing will be available or will be at terms acceptable by the Company.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of certain of the Company’s financial instruments, including cash equivalents, short-term investments, accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all highly-liquid investments purchased with an original maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents include money market funds in the amount of $8.2 million and $30.3 million as of September 30, 2018 and December 31, 2017, respectively. At September 30, 2018 and December 31, 2017, the Company’s cash equivalents were held at institutions in the United States and include deposits in a money market fund which was unrestricted as to withdrawal or use.
Restricted Cash	Restricted Cash Restricted cash as of September 30, 2018 and December 31, 2017 consists of a letter of credit of $0.6 million representing collateral for the Company’s Redwood City, California building lease pursuant to an agreement dated March 5, 2015. Restricted cash additionally includes certificates of deposit of $0.2 million as of December 31, 2017, collateralizing payment of charges related to the Company’s credit cards.
Investment Securities	Investment Securities The Company classifies its investment securities as available-for-sale. Those investments with original maturities greater than three months at the date of purchase and remaining maturities of less than 12 months are considered short-term investments. Those investments with remaining maturities greater than 12 months at the date of purchase are also classified as short-term investments as management considers them to be available for current operations if needed. The Company’s investment securities classified as available-for-sale are recorded at fair value. Unrealized gains and losses, deemed temporary in nature, are reported as a separate component of accumulated comprehensive income (loss). A decline in the fair value of any security below cost that is deemed other than temporary results in a charge to earnings and the corresponding establishment of a new cost basis for the security. Premiums (discounts) are amortized (accreted) over the life of the related security as an adjustment to yield using the straight-line interest method. Dividend and interest income are recognized when earned. Realized gains and losses are included in earnings and are derived using the specific identification method for determining the cost of securities sold.
Inventories	Inventories Inventories are stated at the lower of cost to purchase or manufacture the inventory or the net realizable value of such inventory. Cost is determined using the standard cost method which approximates the first-in, first-out basis. Net realizable value is determined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. The Company writes down inventory that has become obsolete, inventory that has a cost basis in excess of its expected net realizable value, and inventory that is in excess of expected requirements. The estimate of excess quantities is subjective and primarily dependent on the Company’s estimates of future demand for a particular product. If the estimate of future demand is inaccurate based on actual sales, the Company may increase the write down for excess inventory for that component and record a charge to inventory impairment in the accompanying consolidated statements of operations and comprehensive loss. The Company periodically evaluates the carrying value of inventory on hand for potential excess amounts over demand using the same lower of cost or net realizable value approach that has been used to value inventory. The Company also periodically evaluates inventory quantities in consideration of actual loss experience. In addition, the Company determines at times that there may be certain inventory that does not meet its product requirements. As a result of these evaluations, the Company recognized total write downs of $0.5 million and $0.3 million for the three months ended September 30, 2018 and 2017, respectively, and $0.9 million and $3.7 million of its inventories for the nine months ended September 30, 2018 and 2017, respectively. The Company’s estimation of the future demand for any given particular component of the Senza product may vary and may result in changes in estimates of inventory values in any particular period.
Shipping and Handling Costs	Shipping and Handling Costs The Company has made the accounting policy election under ASC 606 to account for shipping and handling costs as a fulfillment activity. These costs are accrued when the related revenue is recognized.
Revenue Recognition	Revenue Recognition The Company has revenue arrangements that generally consist of a single performance obligation, although, in some instances, revenue arrangements may consist of two performance obligations. The Company recognizes revenue at the point in time when it transfers control of promised goods to its customers. Revenue is measured as the amount of consideration it expects to receive in exchange for transferring goods. See Note 3 for further discussion on Revenue Recognition. Adoption of ASC 606 On January 1, 2018, the Company adopted the new accounting standard ASC 606, Revenue from Contracts with Customers Revenue Recognition Under ASC 606, assuming all other revenue recognition criteria have been met, the Company will recognize revenue earlier for arrangements where the Company has satisfied its performance obligations but has not issued invoices. These amounts are recorded as unbilled receivables, which are included in accounts receivable on the consolidated balance sheet, as the Company has an unconditional right to payment at the end of the applicable period. Revenue Recognition Revenue is recognized when obligations under the terms of a contract with customers are satisfied, which occurs with the transfer of control of the Company’s goods to its customers. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring the goods. For a majority of sales, where the Company’s sales representative delivers its product at the point of implantation at hospitals or medical facilities, the Company recognizes revenue upon completion of the procedure and authorization, which represents the point in time when control transfers to the customers. For the remaining sales, which are sent from the Company’s distribution centers directly to hospitals and medical facilities, as well as distributor sales, where product is ordered in advance of an implantation, the transfer of control occurs at the time of shipment of the product. These customers are obligated to pay within specified terms regardless of when or if they ever sell or use the products. The Company does not offer rights of return or price protection. Sales, value add, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The expected costs associated with warranty obligations continue to be recognized as expense when the products are sold (see Note 6). The Company periodically provides incentive offers, in the form of rebates, to customers based on their aggregate levels of purchases. Product revenue is recorded net of such incentive offers. Practical Expedients and Exemptions The Company recognizes revenue upon the transfer of control of the product and there are no material future performance obligations beyond such transfer. As a result, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed. The Company does not capitalize incremental costs when the amortization period of the asset is less than a year.
Allowance for Doubtful Accounts	Allowance for Doubtful Accounts The Company makes estimates of the collectability of accounts receivable. In doing so, the Company analyzes historical bad debt trends, customer credit worthiness, current economic trends and changes in customer payment patterns when evaluating the adequacy of the allowance for doubtful accounts.
Warranty Obligations	Warranty Obligations The Company provides a limited one- to five-year warranty and warrants that its products will operate substantially in conformity with product specifications. The Company records an estimate for the provision for warranty claims in cost of revenue when the related revenues are recognized. This estimate is based on historical and anticipated rates of warranty claims, the cost per claim and the number of units sold. The Company regularly assesses the adequacy of its recorded warranty obligations and adjusts the amounts as necessary.
Property and Equipment	Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment, other than leasehold improvements, is computed using the straight-line method over the assets’ estimated useful lives of three to five years. Leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful life of the asset or the life of the lease. Upon retirement or sale, the cost and related accumulated depreciation are removed from the consolidated balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to operations as incurred.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group might not be recoverable. When such an event occurs, management determines whether there has been impairment by comparing the anticipated undiscounted future net cash flows to the related asset group’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is based either on discounted cash flows or appraised value, depending on the nature of the asset. There were no impairment charges or changes in estimated useful lives recorded through September 30, 2018.
Income Taxes	Income Taxes During the three and nine months ended September 30, 2018 and 2017, the Company calculated its interim tax provision to record taxes incurred on a discrete basis due to the variability of taxable income in the jurisdictions in which it operates. The provision for income taxes for the three and nine months ended September 30, 2018 and 2017 is primarily comprised of foreign and state taxes based upon income earned during the period with no tax benefit recorded for the loss jurisdictions. The Company records uncertain tax positions on the basis of a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company’s policy is to recognize interest and penalties related to income taxes as a component of income tax expense. No interest or penalties related to income taxes have been recognized in the statements of operations and comprehensive loss for the three and nine months ended September 30, 2018 and 2017. On December 22, 2017, the 2017 Tax Cuts and Jobs Act (the 2017 Tax Act) was enacted into law. The 2017 Tax Act contains several key tax law changes, including a reduction of the corporate income tax rate to 21% effective January 1, 2018, and a one-time mandatory transition tax on accumulated foreign earnings, among others. Consistent with guidance issued by the SEC, which provides for a measurement period of one year from the enactment date to finalize the accounting for effects of the 2017 Tax Act, as of December 31, 2017, the Company has made a reasonable estimate of the effects on its existing deferred taxes and related disclosures and the one-time transition tax. Due to its taxable losses and its federal valuation allowance position, the Company did not recognize any income tax expense or benefit as a result of the 2017 Tax Act. During the nine months ended September 30, 2018, the Company did not make any adjustments to its provisional amounts included in its consolidated financial statements for the year ended December 31, 2017. The Company will continue to complete its analysis of these provisional amounts, which are still subject to change during the measurement period, and anticipates further guidance on accounting interpretations from the FASB and application of the law from the Department of the Treasury. The accounting is expected to be completed when the 2017 U.S. corporate income tax return is filed in the fourth quarter of 2018. At September 30, 2018, the Company has not yet determined its policy election with respect to whether to record deferred taxes for basis differences expected to reverse as a result of the global intangible low-taxed income (GILTI) provisions in future periods or use the period cost method. The Company has, however, considered the potential effects of GILTI in estimating its tax provision for 2018. Due to its forecasted taxable losses for 2018 and its federal valuation allowance position, the Company is not forecasting any income tax expense or benefit as a result of the GILTI provisions.
Comprehensive Income (Loss)	Comprehensive Income (Loss) Comprehensive income (loss) represents all changes in the stockholders’ equity except those resulting from distributions to stockholders. The Company’s changes in unrealized gains and losses on available-for-sale investment securities and foreign currency translation adjustments represent the components of other comprehensive income (loss) that are excluded from the reported net loss and have been presented in the consolidated statements of operations and comprehensive loss.
Research and Development	Research and Development Research and development costs, including new product development, regulatory compliance and clinical research, are charged to operations as incurred in the consolidated statements of operations and comprehensive loss. Such costs include personnel-related costs, including stock-based compensation, supplies, services, depreciation, facilities and information services, clinical trial and related clinical manufacturing expenses, fees paid to investigative sites and other indirect costs.
Stock-Based Compensation	Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees in accordance with Accounting Standards Codification (ASC) 718, Compensation - Stock Compensation. In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-09, Stock Compensation (Topic 718): Improvements to Employee Shared-Based Payment Accounting The Company’s determination of the fair value of stock options on the date of grant utilizes the Black-Scholes option-pricing model, and is impacted by its common stock price as well as changes in assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the expected term that options will remain outstanding, the expected common stock price volatility over the term of the option awards, risk-free interest rates and expected dividends. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. The fair value of stock options is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period), on a straight-line basis. Stock-based compensation expense recognized at fair value includes the impact of estimated forfeitures. The Company estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company estimates the fair value of the rights to purchase shares by employees under the Employee Stock Purchase Plan using the Black-Scholes option pricing formula. The Employee Stock Purchase Plan provides for consecutive six-month offering periods and the Company uses its own historical volatility data in the valuation. Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustments as the underlying equity instruments vest. The fair value of options granted to consultants is expensed when vested. The Company accounts for stock-based compensation for the restricted stock units at their fair value, based on the closing market price of the Company’s common stock on the grant date. These costs are recognized on a straight-line basis over the requisite service period, which is generally the vesting term of four years. The Company also issues stock options and restricted stock units with vesting based upon completion of performance goals. The fair value for these performance-based awards is recognized over the period during which the goals are to be achieved. Stock-based compensation expense recognized at fair value includes the impact of estimated probability that the goals would be achieved, which is assessed prior to the requisite service period for the specific goals. Upon adoption of ASU 2016-09 as described above, excess tax benefits or deficiencies from share-based award activity are reflected in the consolidated statements of operations as a component of the provision for income taxes, whereas they were previously recognized as additional paid-in capital.
Net Loss per Share of Common Stock	Net Loss per Share of Common Stock Basic net loss per common share is calculated by dividing net loss by the weighted average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing net loss by the weighted average number of common shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, the Company’s restricted stock units and options to purchase shares of common stock are considered to be potentially dilutive securities. Because the Company has reported a net loss in all periods presented, diluted net loss per common share is the same as basic net loss per common share for those periods.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) Codification Improvements to Topic 842, Leases Leases (Topic 842): Targeted Improvements) reviewed its lease portfolio and has initially assessed the potential accounting impact for some of its significant lease arrangements In March 2017, the FASB issued ASU No. 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. In February 2018, the FASB issued ASU No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220). In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740) In June 2018, the FASB issued ASU No. 2018-07, Compensation-Stock Compensation (Topic 718), Improvements to Nonemployee Share-based Payments

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Schedule of Revenue by Major Customers by Geographic Area	The United States was the only country with revenue accounting for more than 10% of the total revenue in any of the periods presented, as follows: Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 United States 83 % 81 % 82 % 80 %
Net Unrealized and Net Realized Foreign Currency Transaction Gains (Losses)	The Company recorded net unrealized and net realized foreign currency transaction gains (losses) during the periods presented as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net unrealized foreign currency gain (loss) $ (6 ) $ (223 ) $ (892 ) $ 1,092 Net realized foreign currency gain (loss) (75 ) 518 217 254

Revenue (Tables)

Revenue (Tables)	9 Months Ended
	Sep. 30, 2018
Disaggregation Of Revenue [Line Items]
Summary of Revenue by Geography on Billing Address of Customer	The following table presents revenue by geography, based on the billing address of the customer (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 United States $ 79,624 $ 66,281 $ 230,159 $ 182,419 International 16,006 15,975 49,186 46,292 Total revenue $ 95,630 $ 82,256 $ 279,345 $ 228,711
ASC 606 [Member]
Disaggregation Of Revenue [Line Items]
Cumulative Effect of Changes to Consolidated Balance Sheet	The cumulative effect of the changes made to the consolidated balance sheet as of January 1, 2018 for the adoption of ASC 606 were as follows (in thousands): Balance at Adjustments Due Balance at December 31, 2017 to ASC 606 January 1, 2018 Balance Sheet: Accounts receivable, net $ 67,287 $ 1,447 $ 68,734 Prepaid expenses and other current assets 6,463 (476 ) 5,987 Accumulated other comprehensive loss (1,242 ) 4 (1,238 ) Accumulated deficit (257,844 ) 967 (256,877 )
Impact of Adoption on Consolidated Balance Sheet and Statement of Operations	In accordance with ASC 606, the disclosure of the impact of adoption on the Consolidated Balance Sheet was as follows (in thousands): September 30, 2018 Balance Balance Without As Reported ASC 606 Adoption Effect of Change Balance Sheet: Accounts receivable, net $ 73,993 $ 72,833 $ 1,160 Inventories 93,606 93,713 (107 ) Prepaid expenses and other current assets 7,226 8,136 (910 ) In accordance with ASC 606, the disclosure of the impact of adoption on the Consolidated Statements of Operations was as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Balance Without Balance Without Balance As Reported ASC 606 Adoption Effect of Change Balance As Reported ASC 606 Adoption Effect of Change Statement of Operations: Revenue $ 95,630 $ 95,714 $ (84 ) $ 279,345 $ 279,626 $ (281 ) Cost of revenue 28,382 28,386 (4 ) 82,175 81,621 554

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value Disclosures [Abstract]
Financial Instruments Measured at Fair Value on Recurring Basis	The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Balance as of September 30, 2018 Level 1 Level 2 Level 3 Total Assets: Money market funds (i) $ 8,204 $ — $ — $ 8,204 Commercial paper (ii) — 67,627 — 67,627 Corporate notes (ii) — 168,988 — 168,988 Total assets $ 8,204 $ 236,615 $ — $ 244,819 Balance as of December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Money market funds (i) $ 30,278 $ — $ — $ 30,278 Commercial paper (ii) — 61,086 — 61,086 Corporate notes (ii) — 165,381 — 165,381 Total assets $ 30,278 $ 226,467 $ — $ 256,745 (i) Included in cash and cash equivalents on the condensed consolidated balance sheets. (i i ) Included in short-term investments on the condensed consolidated balance sheets.

Balance Sheet Components (Table

Balance Sheet Components (Tables)	9 Months Ended
	Sep. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Summary of Gross Unrealized Gains and Unrealized Losses of Investment Securities Excluding Investments in Money Market Funds	The following is a summary of the gross unrealized gains and unrealized losses on the Company’s investment securities, excluding investments in money market funds (in thousands): September 30, 2018 Amortized Cost Gross Unrealized Holding Gains Gross Unrealized Holding Losses Aggregate Fair Value Investment Securities Commercial paper $ 67,665 $ — $ (38 ) $ 67,627 Corporate notes 169,171 1 (184 ) 168,988 Total securities $ 236,836 $ 1 $ (222 ) $ 236,615 December 31, 2017 Amortized Cost Gross Unrealized Holding Gains Gross Unrealized Holding Losses Aggregate Fair Value Investment Securities Commercial paper $ 61,167 $ — $ (81 ) $ 61,086 Corporate notes 165,712 1 (332 ) 165,381 Total securities $ 226,879 $ 1 $ (413 ) $ 226,467
Summary of Contractual Maturities of Investment Securities	The contractual maturities of the Company’s investment securities as of September 30, 2018 were as follows (in thousands): Amortized Cost Fair Value Amounts maturing within one year $ 236,836 $ 236,615 Amounts maturing after one year through five years — — Total investment securities $ 236,836 $ 236,615
Components of Inventories	Inventories (in thousands) September 30, December 31, 2018 2017 Raw materials $ 37,698 $ 51,602 Finished goods 55,908 46,517 Total inventories $ 93,606 $ 98,119
Schedule of Property and Equipment, Net and Depreciation and Amortization Expense	Property and Equipment, Net (in thousands) September 30, December 31, 2018 2017 Laboratory equipment $ 2,821 $ 2,416 Computer equipment and software 7,771 5,076 Furniture and fixtures 3,866 2,241 Leasehold improvements 4,474 1,221 Construction in process 2,094 2,734 Total 21,026 13,688 Less: Accumulated depreciation and amortization (7,714 ) (4,869 ) Property and equipment, net $ 13,312 $ 8,819 The Company recognized depreciation and amortization expense on property and equipment as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Depreciation and amortization expense $ 1,078 $ 666 $ 2,845 $ 1,774
Summary of Accrued Liabilities	Accrued Liabilities (in thousands) September 30, December 31, 2018 2017 Accrued payroll and related expenses $ 21,986 $ 26,108 Accrued professional fees 2,857 4,734 Accrued taxes 2,193 2,827 Accrued clinical and research expenses 837 1,279 Accrued interest 998 243 Accrued warranty 1,093 708 Accrued other 3,554 3,491 Total accrued liabilities $ 33,518 $ 39,390

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2018
Commitments And Contingencies Disclosure [Abstract]
Summary of Recognized Rent Expense	The Company recognized rent expense during the periods indicated as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Rent expense $ 1,238 $ 653 $ 2,742 $ 1,864
Schedule of Activities Related to Warranty Obligations	Activities related to warranty obligations were as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Beginning balance $ 943 $ 656 $ 708 $ 645 Provision for warranty 597 352 1,681 945 Utilization (447 ) (405 ) (1,296 ) (987 ) Ending balance $ 1,093 $ 603 $ 1,093 $ 603
Summary of Royalty Expense	The Company recognized royalty expense during the periods indicated as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Royalty expense $ 795 $ 665 $ 2,280 $ 1,831

Long-term Debt (Tables)

Long-term Debt (Tables)	9 Months Ended
	Sep. 30, 2018
Debt Instrument [Line Items]
Interest Expense Recognized Related to Convertible Notes	The following table sets forth the interest expense recognized related to the 2021 Notes (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Contractual interest expense $ 755 $ 755 $ 2,265 $ 2,264 Amortization of debt discount 1,625 1,528 4,791 4,504 Amortization of debt issuance costs 240 212 697 616 Total interest expense related to the 2021 Notes $ 2,620 $ 2,495 $ 7,753 $ 7,384
Debt, Liability Component [Member]
Debt Instrument [Line Items]
Net Carrying Amount of Convertible Debt	The net carrying amount of the liability component of the 2021 Notes was as follows (in thousands): September 30, December 31, 2018 2017 Principal $ 172,500 $ 172,500 Unamortized discount (18,946 ) (23,737 ) Unamortized issuance cost (3,046 ) (3,744 ) Net carrying amount $ 150,508 $ 145,019
Debt, Equity Component [Member]
Debt Instrument [Line Items]
Net Carrying Amount of Convertible Debt	The net carrying amount of the equity component of the 2021 Notes was as follows (in thousands): September 30, December 31, 2018 2017 Debt discount related to value of conversion option $ 32,945 $ 32,945 Debt issuance cost (1,179 ) (1,179 ) Net carrying amount $ 31,766 $ 31,766

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	9 Months Ended
	Sep. 30, 2018
Earnings Per Share [Abstract]
Computation of Basic and Diluted Net Loss per Share	The following table summarizes the computation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Net loss, basic and diluted $ (11,265 ) $ (6,230 ) $ (39,598 ) $ (32,347 ) Weighted average shares outstanding 30,123,188 29,513,842 29,997,201 29,343,291 Less: weighted average shares subject to repurchase — — — (408 ) Weighted average shares used to compute basic and diluted net loss per share 30,123,188 29,513,842 29,997,201 29,342,883 Net loss per share, basic and diluted $ (0.37 ) $ (0.21 ) $ (1.32 ) $ (1.10 )
Computation of Potentially Dilutive Securities Outstanding Excluded from Computation of Diluted Shares	The following potentially dilutive securities outstanding at the end of the periods presented have been excluded from the computation of diluted shares outstanding, as the effect would be anti-dilutive: September 30, 2018 2017 Unreleased restricted stock 935,916 520,267 Options to purchase common stock 2,355,039 2,342,965 Convertible senior notes 1,790,033 1,790,033 Warrants related to the issuance of convertible senior notes 1,790,033 1,790,033 Total 6,871,021 6,443,298

Formation and Business of the_2

Formation and Business of the Company - Additional Information (Detail) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Jun. 30, 2016	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Formation and Business of the Company [Line Items]
Net loss		$ 11,265	$ 6,230	$ 39,598	$ 32,347	$ 36,700
Cash used in operations				10,708	$ 11,830	14,300
Accumulated deficit		$ 296,475		$ 296,475		$ 257,844
1.75% Convertible Senior Notes due 2021 [Member]
Formation and Business of the Company [Line Items]
Debt instrument due year	2,021			2,021		2,021

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Additional Information (Detail)	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Jun. 30, 2016	Sep. 30, 2018USD ($)Customer	Sep. 30, 2017USD ($)Customer	Sep. 30, 2018USD ($)BusinessCustomer	Sep. 30, 2017USD ($)Customer	Dec. 31, 2017USD ($)Customer
Summary Of Significant Accounting Policies [Line Items]
Number of business activities | Business				1
Cash held in foreign banks		$ 3,400,000		$ 3,400,000		$ 4,500,000
Money market funds		8,200,000		8,200,000		30,300,000
Restricted cash		606,000		606,000		806,000
Write down of inventory		500,000	$ 300,000	$ 870,000	$ 3,675,000
Standard product warranty, description				Limited one- to five-year warranty
Impairment charges				$ 0
Interest or penalties recognized		0	$ 0	$ 0	$ 0
U.S. corporate income tax rate				21.00%
Employee stock purchase plan offering period				6 months
RSU's [Member]
Summary Of Significant Accounting Policies [Line Items]
Vesting term				4 years
Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life of property and equipment				3 years
Maximum [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated useful life of property and equipment				5 years
Letter of Credit [Member]
Summary Of Significant Accounting Policies [Line Items]
Restricted cash		$ 600,000		$ 600,000		600,000
Certificate of Deposit [Member]
Summary Of Significant Accounting Policies [Line Items]
Restricted cash						$ 200,000
Customer Concentration Risk [Member] | Revenue [Member]
Summary Of Significant Accounting Policies [Line Items]
Concentration risk, percentage		10.00%	10.00%	10.00%	10.00%
Number of customers accounted 10% or more concentration risk | Customer		0	0	0	0
Credit Concentration Risk [Member] | Accounts Receivable [Member]
Summary Of Significant Accounting Policies [Line Items]
Concentration risk, percentage				10.00%		10.00%
Number of customers accounted 10% or more concentration risk | Customer				0		0
1.75% Convertible Senior Notes due 2021 [Member]
Summary Of Significant Accounting Policies [Line Items]
Debt instrument due year	2,021			2,021		2,021

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Schedule of Revenue by Major Customers by Geographic Area (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenue [Member] | Geographic Concentration Risk [Member] | United States [Member]
Concentration Risk [Line Items]
Revenue	83.00%	81.00%	82.00%	80.00%

Summary of Significant Accoun_6

Summary of Significant Accounting Policies - Net Unrealized and Net Realized Foreign Currency Transaction Gains (Losses) (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Accounting Policies [Abstract]
Net unrealized foreign currency gain (loss)	$ (6)	$ (223)	$ (892)	$ 1,092
Net realized foreign currency gain (loss)	$ (75)	$ 518	$ 217	$ 254

Revenue - Cumulative Effect of

Revenue - Cumulative Effect of Changes to Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Jan. 01, 2018	Dec. 31, 2017
Revenue Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net	$ 73,993		$ 67,287
Prepaid expenses and other current assets	7,226		6,463
Accumulated other comprehensive loss	(948)		(1,242)
Accumulated deficit	(296,475)		$ (257,844)
ASC 606 [Member]
Revenue Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net		$ 68,734
Prepaid expenses and other current assets		5,987
Accumulated other comprehensive loss		(1,238)
Accumulated deficit		(256,877)
Adjustments Due to ASC 606 [Member] | ASC 606 [Member]
Revenue Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net	1,160	1,447
Prepaid expenses and other current assets	$ (910)	(476)
Accumulated other comprehensive loss		4
Accumulated deficit		$ 967

Revenue - Impact of Adoption on

Revenue - Impact of Adoption on Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Jan. 01, 2018	Dec. 31, 2017
Disaggregation Of Revenue [Line Items]
Accounts receivable, net	$ 73,993		$ 67,287
Inventories	93,606		98,119
Prepaid expenses and other current assets	7,226		$ 6,463
ASC 606 [Member]
Disaggregation Of Revenue [Line Items]
Accounts receivable, net		$ 68,734
Prepaid expenses and other current assets		5,987
Balance Without ASC 606 Adoption [Member] | ASC 606 [Member]
Disaggregation Of Revenue [Line Items]
Accounts receivable, net	72,833
Inventories	93,713
Prepaid expenses and other current assets	8,136
Adjustments Due to ASC 606 [Member] | ASC 606 [Member]
Disaggregation Of Revenue [Line Items]
Accounts receivable, net	1,160	1,447
Inventories	(107)
Prepaid expenses and other current assets	$ (910)	$ (476)

Revenue - Impact of Adoption _2

Revenue - Impact of Adoption on Consolidated Statement of Operations (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disaggregation Of Revenue [Line Items]
Revenue	$ 95,630	$ 82,256	$ 279,345	$ 228,711
Cost of revenue	28,382	$ 24,316	82,175	$ 70,530
Balance Without ASC 606 Adoption [Member] | ASC 606 [Member]
Disaggregation Of Revenue [Line Items]
Revenue	95,714		279,626
Cost of revenue	28,386		81,621
Adjustments Due to ASC 606 [Member] | ASC 606 [Member]
Disaggregation Of Revenue [Line Items]
Revenue	(84)		(281)
Cost of revenue	$ (4)		$ 554

Revenue - Summary of Revenue by

Revenue - Summary of Revenue by Geography on Billing Address of Customer (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disaggregation Of Revenue [Line Items]
Total revenue	$ 95,630	$ 82,256	$ 279,345	$ 228,711
United States [Member]
Disaggregation Of Revenue [Line Items]
Total revenue	79,624	66,281	230,159	182,419
International [Member]
Disaggregation Of Revenue [Line Items]
Total revenue	$ 16,006	$ 15,975	$ 49,186	$ 46,292

Revenue - Additional Informatio

Revenue - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2018
Revenue From Contract With Customer [Abstract]
Unsatisfied performance obligations description	The Company recognizes revenue upon the transfer of control of the product and there are no material future performance obligations beyond such transfer. As a result, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed. The Company does not capitalize incremental costs when the amortization period of the asset is less than a year.
Unsatisfied performance obligations period	1 year

Fair Value Measurements - Finan

Fair Value Measurements - Financial Instruments Measured at Fair Value on Recurring Basis (Detail) - Fair Value Measurements Recurring [Member] - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	$ 244,819	$ 256,745
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	8,204	30,278
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	236,615	226,467
Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	8,204	30,278
Money Market Funds [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	8,204	30,278
Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	67,627	61,086
Commercial Paper [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	67,627	61,086
Corporate Notes [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	168,988	165,381
Corporate Notes [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	$ 168,988	$ 165,381

Fair Value Measurements - Addit

Fair Value Measurements - Additional Information (Detail) - 1.75% Convertible Senior Notes due 2021 [Member] - USD ($) $ in Millions	1 Months Ended	9 Months Ended	12 Months Ended
	Jun. 30, 2016	Sep. 30, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt instrument interest rate	1.75%	1.75%	1.75%
Debt instrument due year	2,021	2,021	2,021
Fair value of notes		$ 171.2	$ 180.3

Balance Sheet Components - Summ

Balance Sheet Components - Summary of Gross Unrealized Gains and Unrealized Losses of Investment Securities Excluding Investments in Money Market Funds (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 236,836	$ 226,879
Gross Unrealized Holding Gains	1	1
Gross Unrealized Holding Losses	(222)	(413)
Aggregate Fair Value	236,615	226,467
Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	67,665	61,167
Gross Unrealized Holding Losses	(38)	(81)
Aggregate Fair Value	67,627	61,086
Corporate Notes [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	169,171	165,712
Gross Unrealized Holding Gains	1	1
Gross Unrealized Holding Losses	(184)	(332)
Aggregate Fair Value	$ 168,988	$ 165,381

Balance Sheet Components - Su_2

Balance Sheet Components - Summary of Contractual Maturities of Investment Securities (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Investments Debt And Equity Securities [Abstract]
Amortized Cost, Amounts maturing within one year	$ 236,836
Amortized Cost	236,836	$ 226,879
Fair Value, Amounts maturing within one year	236,615
Fair Value, Total investment securities	$ 236,615	$ 226,467

Balance Sheet Components - Comp

Balance Sheet Components - Components of Inventories (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw materials	$ 37,698	$ 51,602
Finished goods	55,908	46,517
Total inventories	$ 93,606	$ 98,119

Balance Sheet Components - Sche

Balance Sheet Components - Schedule of Property and Equipment, Net (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 21,026	$ 13,688
Less: Accumulated depreciation and amortization	(7,714)	(4,869)
Property and equipment, net	13,312	8,819
Laboratory Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	2,821	2,416
Computer Equipment and Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	7,771	5,076
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	3,866	2,241
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	4,474	1,221
Construction in Process [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 2,094	$ 2,734

Balance Sheet Components - Sc_2

Balance Sheet Components - Schedule of Property and Equipment, Depreciation and Amortization Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Property Plant And Equipment [Abstract]
Depreciation and amortization expense	$ 1,078	$ 666	$ 2,845	$ 1,774

Balance Sheet Components - Su_3

Balance Sheet Components - Summary of Accrued Liabilities (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Payables And Accruals [Abstract]
Accrued payroll and related expenses	$ 21,986		$ 26,108
Accrued professional fees	2,857		4,734
Accrued taxes	2,193		2,827
Accrued clinical and research expenses	837		1,279
Accrued interest	998		243
Accrued warranty	1,093	$ 943	708	$ 603	$ 656	$ 645
Accrued other	3,554		3,491
Total accrued liabilities	$ 33,518		$ 39,390

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail)

1 Months Ended

3 Months Ended

9 Months Ended

12 Months Ended

Apr. 30, 2017

Sep. 30, 2018USD ($)Petition

Sep. 30, 2017USD ($)

Sep. 30, 2018USD ($)Petition

Sep. 30, 2017USD ($)

Dec. 31, 2016USD ($)ft²

Dec. 31, 2017USD ($)

Nov. 10, 2017Petition

Nov. 03, 2017Petition

Nov. 02, 2017Petition

Aug. 11, 2017Petition

Jul. 31, 2017Petition

Jul. 21, 2017Petition

Mar. 31, 2015USD ($)ft²

Other Commitments [Line Items]

Standard product warranty, description

Limited one- to five-year warranty

Retainer fees

$ 12,478,000

$ 9,381,000

$ 34,979,000

$ 27,617,000

Contingent liabilities

0

0

$ 0

Indemnification Agreement [Member]

Other Commitments [Line Items]

Contingent liabilities

0

0

Licensing Agreement [Member]

Other Commitments [Line Items]

Annual royalty payment

$ 795,000

$ 665,000

$ 2,280,000

$ 1,831,000

Licensing Agreement [Member] | Mayo And VGL [Member]

Other Commitments [Line Items]

License agreement, terms

The agreement will terminate upon the expiration of (1) the last to expire of the licensed patents or (2) the Company’s obligations to pay royalties, whichever is later, unless terminated earlier. The agreement can be terminated by the Company, Mayo or VGL upon 60 days’ notice of a party’s material breach if such breach remains uncured after such 60-day period.

Licensing Agreement [Member] | Mayo Foundation [Member]

Other Commitments [Line Items]

Retainer fees

$ 40,000

Licensing Agreement [Member] | Mayo Foundation [Member] | Minimum [Member]

Other Commitments [Line Items]

Annual royalty payment

$ 200,000

USPTO [Member] | Boston Scientific Corporation [Member]

Other Commitments [Line Items]

Number of petitions | Petition

10

10

1

2

2

1

1

3

Redwood Office Agreement [Member]

Other Commitments [Line Items]

Lease agreement, commencement period

2015-03

Area of office space | ft²

50,000

Lease agreement, effective date

Jun. 30, 2015

Lease agreement, expiration period

2022-05

Lease expense, payment due

$ 2,000,000

Annual lease expense payable in final year of lease term

$ 2,400,000

Redwood Office Agreement Additional Expansion Premises [Member] | Amendment 1 [Member]

Other Commitments [Line Items]

Area of office space | ft²

50,000

Lease expense, payment due

$ 1,200,000

Annual lease expense payable in final year of lease term

$ 2,900,000

Commencement date description

The lease for the Expansion Premises commenced on June 1, 2018.

Lease commencement date

Jun. 1, 2018

Lease agreement, expiration date

May 31, 2025

Redwood Office Agreement Additional Expansion Premises [Member] | Amendment 2 [Member]

Other Commitments [Line Items]

Lease agreement, effective date

May 31, 2017

Lease agreement, expiration date

Jun. 1, 2018

Facility Lease Agreement, Original [Member]

Other Commitments [Line Items]

Lease agreement, commencement period

2014-08

Lease agreement, effective date

Aug. 21, 2014

Lease agreement, expiration date

May 31, 2015

Facility Lease Agreement, Extended [Member]

Other Commitments [Line Items]

Lease agreement, commencement period

2015-03

Lease agreement, expiration period

2017-02

Non-cancellable Facility Lease [Member]

Other Commitments [Line Items]

Lease agreement, effective date

Mar. 1, 2017

Lease agreement, expiration date

Feb. 28, 2022

Lease agreement, lease expense

$ 400,000

Commitments and Contingencies_2

Commitments and Contingencies - Summary of Recognized Rent Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Commitments And Contingencies Disclosure [Abstract]
Rent expense	$ 1,238	$ 653	$ 2,742	$ 1,864

Commitments and Contingencies_3

Commitments and Contingencies - Schedule of Activities Related to Warranty Obligations (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Commitments And Contingencies Disclosure [Abstract]
Beginning balance	$ 943	$ 656	$ 708	$ 645
Provision for warranty	597	352	1,681	945
Utilization	(447)	(405)	(1,296)	(987)
Ending balance	$ 1,093	$ 603	$ 1,093	$ 603

Commitments and Contingencies_4

Commitments and Contingencies - Summary of Royalty Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Licensing Agreement [Member]
Other Commitments [Line Items]
Royalty expense	$ 795	$ 665	$ 2,280	$ 1,831

Long-term Debt - Additional Inf

Long-term Debt - Additional Information (Detail) - 1.75% Convertible Senior Notes due 2021 [Member]	1 Months Ended	9 Months Ended	12 Months Ended
	Jun. 30, 2016USD ($)d$ / sharesshares	Sep. 30, 2018	Dec. 31, 2017
Debt Instrument [Line Items]
Aggregate principal amount of convertible senior notes	$ 150,000,000
Debt instrument interest rate	1.75%	1.75%	1.75%
Debt instrument due year	2,021	2,021	2,021
Additional aggregate principal amount of convertible senior notes	$ 22,500,000
Debt instrument frequency of payment		semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2016
Net proceeds from the debt offering after deducting transaction costs	166,200,000
Convertible notes principal amount	$ 1,000
Convertible notes, shares issued | shares	10.3770
Convertible notes, type of equity security issued		common stock
Convertible notes, conversion price | $ / shares	$ 96.37
Debt instrument convertible, percentage of conversion price	130.00%
Percentage of repurchase price, which is equal to principal amount of convertible notes	100.00%
Debt instrument combination settlement	$ 1,000
Debt conversion, converted instrument amount	$ 32,900,000
Debt instrument, effective interest rate	6.29%
Debt issuance costs attributable to the liability and equity component, total amount	$ 6,200,000
Debt issuance costs attributable to the liability component	$ 5,000,000
Number of shares purchased under convertible note hedge transactions | shares	1,800,000
Purchase price of the shares issued under convertible note hedge transactions | $ / shares	$ 96.37
Total cost of the convertible note hedge transactions	$ 45,100,000
Proceeds from issuance of warrants	33,100,000
Net cost of reduction to additional paid-in capital	$ 12,000,000
Warrant [Member]
Debt Instrument [Line Items]
Number of shares issued for warrants under convertible note hedge transactions | shares	1,800,000
Purchase price of the shares issued under convertible note hedge transactions | $ / shares	$ 127.28
130% for Applicable Conversion Price [Member]
Debt Instrument [Line Items]
Debt instrument convertible trading days | d	20
Debt instrument convertible consecutive trading days | d	30
98% Applicable Conversion Price [Member]
Debt Instrument [Line Items]
Debt instrument convertible trading days | d	5
Debt instrument convertible consecutive trading days | d	10
Maximum [Member]
Debt Instrument [Line Items]
Percentage of closing sale price of common stock	98.00%
Maximum [Member] | Warrant [Member]
Debt Instrument [Line Items]
Overall conversion price | $ / shares	$ 127.28
Minimum [Member] | Warrant [Member]
Debt Instrument [Line Items]
Overall conversion price | $ / shares	$ 96.37

Long-term Debt - Net Carrying A

Long-term Debt - Net Carrying Amount of Liability Component of Convertible Debt (Detail) - 1.75% Convertible Senior Notes due 2021 [Member] - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Jun. 30, 2016
Debt Instrument [Line Items]
Unamortized issuance cost			$ (5,000)
Debt, Liability Component [Member]
Debt Instrument [Line Items]
Principal	$ 172,500	$ 172,500
Unamortized discount	(18,946)	(23,737)
Unamortized issuance cost	(3,046)	(3,744)
Net carrying amount	$ 150,508	$ 145,019

Long-term Debt - Net Carrying_2

Long-term Debt - Net Carrying Amount of Equity Component of Convertible Debt (Detail) - 1.75% Convertible Senior Notes due 2021 [Member] - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Jun. 30, 2016
Debt Instrument [Line Items]
Net carrying amount			$ 32,900
Debt, Equity Component [Member]
Debt Instrument [Line Items]
Debt discount related to value of conversion option	$ 32,945	$ 32,945
Debt issuance cost	(1,179)	(1,179)
Net carrying amount	$ 31,766	$ 31,766

Long-term Debt - Interest Expen

Long-term Debt - Interest Expense Recognized Related to Convertible Notes (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Debt Instrument [Line Items]
Amortization of debt issuance costs			$ 5,494	$ 5,120
1.75% Convertible Senior Notes due 2021 [Member]
Debt Instrument [Line Items]
Contractual interest expense	$ 755	$ 755	2,265	2,264
Amortization of debt discount	1,625	1,528	4,791	4,504
Amortization of debt issuance costs	240	212	697	616
Total interest expense related to the 2021 Notes	$ 2,620	$ 2,495	$ 7,753	$ 7,384

Net Loss Per Share - Computatio

Net Loss Per Share - Computation of Basic and Diluted Net Loss per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Earnings Per Share [Abstract]
Net loss, basic and diluted	$ (11,265)	$ (6,230)	$ (39,598)	$ (32,347)	$ (36,700)
Weighted average shares outstanding	30,123,188	29,513,842	29,997,201	29,343,291
Less: weighted average shares subject to repurchase				(408)
Weighted average shares used to compute basic and diluted net loss per share	30,123,188	29,513,842	29,997,201	29,342,883
Net loss per share, basic and diluted	$ (0.37)	$ (0.21)	$ (1.32)	$ (1.10)

Net Loss Per Share - Additional

Net Loss Per Share - Additional Information (Detail)	Sep. 30, 2018$ / shares
1.75% Convertible Senior Notes due 2021 [Member]
Earnings Per Share Diluted [Line Items]
Convertible notes, conversion price	$ 96.37

Net Loss Per Share - Computat_2

Net Loss Per Share - Computation of Potentially Dilutive Securities Outstanding Excluded from Computation of Diluted Shares (Detail) - shares	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted shares outstanding	6,871,021	6,443,298
Unreleased Restricted Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted shares outstanding	935,916	520,267
Options to Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted shares outstanding	2,355,039	2,342,965
Convertible Senior Notes [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted shares outstanding	1,790,033	1,790,033
Warrants Related to the Issuance of Convertible Senior Notes [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted shares outstanding	1,790,033	1,790,033

Employee Benefit Plans - Additi

Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expense for matching contributions	$ 0.3	$ 0.4	$ 2.4	$ 2
ESPP offering period			6 months
Employee Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum employee subscription rate	15.00%		15.00%
Purchase price of common stock shares, lower of fair market value, percentage			85.00%
Shares of common stock issued	0	0	53,824	44,999
Shares available for future purchase	1,080,186		1,080,186