Interactive Intelligence 10-Q 7 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Jul. 31, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	Interactive Intelligence Group, Inc.
Entity Central Index Key	1,517,650
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		21,665,682
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2015

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 179,940	$ 36,168
Short-term investments	1,109	20,041
Accounts receivable, net of allowance for doubtful accounts of $1,136 at June 30, 2015 and $1,052 at December 31, 2014	85,225	87,413
Prepaid expenses	27,964	29,417
Other current assets	14,361	14,655
Total current assets	308,599	187,694
Long-term investments	3,864	5,495
Property and equipment, net	45,755	44,785
Capitalized software, net	45,449	33,598
Goodwill	42,643	43,732
Intangible assets, net	15,229	16,517
Other assets, net	6,805	6,902
Total assets	468,344	338,723
Current liabilities:
Accounts payable	10,193	10,236
Accrued liabilities	14,914	18,299
Accrued compensation and related expenses	19,291	19,211
Deferred license and hardware revenues	7,700	5,945
Deferred recurring revenues	75,244	76,647
Deferred services revenues	9,540	9,925
Total current liabilities	136,882	140,263
Convertible notes	114,930	0
Long-term deferred revenues	18,974	18,158
Deferred tax liabilities, net	2,348	2,437
Other long-term liabilities	7,571	7,135
Total liabilities	280,705	167,993
Shareholders' equity:
Common stock, $0.01 par value; 100,000,000 authorized; 21,620,400 issued and outstanding at June 30, 2015, 21,278,858 issued and outstanding at December 31, 2014	216	213
Additional paid-in capital	224,899	196,691
Accumulated other comprehensive loss, net of tax	(8,320)	(5,561)
Accumulated deficit	(29,156)	(20,613)
Total shareholders' equity	187,639	170,730
Total liabilities and shareholders' equity	$ 468,344	$ 338,723

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Accounts receivable, allowance for doubtful accounts	$ 1,136	$ 1,052
Shareholders' equity:
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	21,620,400	21,278,858
Common stock, shares outstanding (in shares)	21,620,400	21,278,858

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenues:
Recurring	$ 53,846	$ 44,617	$ 108,058	$ 88,026
License and hardware	27,010	21,548	48,631	44,394
Services	15,475	13,665	29,117	26,858
Total revenues	96,331	79,830	185,806	159,278
Costs of revenues:
Costs of recurring	19,253	15,322	37,997	29,380
Costs of license and hardware	6,552	6,690	13,081	13,523
Costs of services	11,514	11,298	22,765	21,815
Total costs of revenues	37,319	33,310	73,843	64,718
Gross profit	59,012	46,520	111,963	94,560
Operating expenses:
Sales and marketing	33,875	30,753	64,984	58,908
Research and development	16,694	15,906	30,531	29,705
General and administrative	12,204	11,374	24,980	22,273
Total operating expenses	62,773	58,033	120,495	110,886
Operating loss	(3,761)	(11,513)	(8,532)	(16,326)
Other income (expense):
Interest income (expense), net	(590)	275	(442)	557
Other expense	(232)	(190)	(559)	(386)
Total other income (expense)	(822)	85	(1,001)	171
Loss before income taxes	(4,583)	(11,428)	(9,533)	(16,155)
Income tax benefit (expense)	(501)	4,630	990	6,793
Net loss	$ (5,084)	$ (6,798)	$ (8,543)	$ (9,362)
Net loss per share:
Basic (in dollars per share)	$ (0.24)	$ (0.33)	$ (0.40)	$ (0.45)
Diluted (in dollars per share)	$ (0.24)	$ (0.33)	$ (0.40)	$ (0.45)
Shares used to compute net loss per share:
Basic (shares)	21,504	20,851	21,519	20,771
Diluted (shares)	21,504	20,851	21,519	20,771
Amounts include amortization of purchased intangibles from business combinations
Total intangible amortization expense	$ 619	$ 613	$ 1,245	$ 1,134
Amounts include stock-based compensation expense
Total stock-based compensation expense	3,876	3,696	6,869	6,936
Costs of license and hardware
Amounts include amortization of purchased intangibles from business combinations
Total intangible amortization expense	177	137	354	186
General and administrative
Amounts include amortization of purchased intangibles from business combinations
Total intangible amortization expense	442	476	891	948
Amounts include stock-based compensation expense
Total stock-based compensation expense	1,063	825	2,093	1,602
Costs of recurring revenues
Amounts include stock-based compensation expense
Total stock-based compensation expense	532	367	986	674
Costs of services revenues
Amounts include stock-based compensation expense
Total stock-based compensation expense	164	115	293	221
Sales and marketing
Amounts include stock-based compensation expense
Total stock-based compensation expense	1,154	1,037	1,715	2,133
Research and development
Amounts include stock-based compensation expense
Total stock-based compensation expense	$ 963	$ 1,352	$ 1,782	$ 2,306

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Statement of Comprehensive Income [Abstract]
Net loss	$ (5,084)	$ (6,798)	$ (8,543)	$ (9,362)
Other comprehensive loss:
Foreign currency translation adjustment	453	97	(2,809)	656
Net unrealized investment gain (loss) - net of tax	(9)	(9)	50	(26)
Comprehensive loss	$ (4,640)	$ (6,710)	$ (11,302)	$ (8,732)

Condensed Consolidated Stateme6

Condensed Consolidated Statement of Shareholders' Equity - 6 months ended Jun. 30, 2015 - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit
Beginning Balance at Dec. 31, 2014	$ 170,730	$ 213	$ 196,691	$ (5,561)	$ (20,613)
Beginning Balance (in shares) at Dec. 31, 2014	21,278,858	21,279,000
Stock-based compensation expense	$ 8,064		8,064
Exercise of stock options	2,166	$ 3	2,163
Exercise of stock options (shares)		118,000
Issuances of common stock	789		789
Issuances of common stock (in shares)		19,000
Tax withholding on restricted stock awards	(3,309)		(3,309)
Tax withholding on restricted stock awards (in shares)		144,000
Issuance of retirement plan shares	2,523		2,523
Issuance of retirement plan shares (in shares)		60,000
Equity component of convertible notes	31,756		31,756
Equity component of convertible notes issuance cost	(1,028)		(1,028)
Payment for capped call premiums	(12,750)		(12,750)
Net loss	(8,543)				(8,543)
Foreign currency translation adjustment	(2,809)			(2,809)
Net unrealized investment loss	50			50
Ending Balance at Jun. 30, 2015	$ 187,639	$ 216	$ 224,899	$ (8,320)	$ (29,156)
Ending Balance (in shares) at Jun. 30, 2015	21,620,400	21,620,000

Condensed Consolidated Stateme7

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Operating activities:
Net loss	$ (8,543)	$ (9,362)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	8,227	7,175
Amortization	2,804	1,134
Other non-cash items	(856)	363
Stock-based compensation expense	6,869	6,936
Deferred income taxes	(89)	(4,658)
Amortization (accretion) of investment premium (discount)	151	(161)
Loss on disposal of fixed assets	21	23
Amortization of convertible notes issuance costs	57	0
Amortization of convertible notes discount	455	0
Changes in operating assets and liabilities:
Accounts receivable	2,188	12,201
Prepaid expenses	1,453	(4,274)
Other current assets	294	(2,718)
Accounts payable	(43)	421
Accrued liabilities	(222)	2,793
Accrued compensation and related expenses	80	(3,652)
Deferred license and hardware revenues	1,945	(15)
Deferred recurring revenues	(1,520)	(3,804)
Deferred services revenues	358	(262)
Other assets and liabilities	533	1,702
Net cash provided by operating activities	14,162	3,842
Investing activities:
Sales of available-for-sale investments	20,462	22,785
Purchases of available-for-sale investments	0	(32,167)
Purchases of property and equipment	(10,659)	(13,078)
Capitalized software	(12,568)	(6,339)
Acquisitions, net of cash acquired	0	(9,297)
Unrealized loss on investment	0	18
Net cash used in investing activities	(2,765)	(38,078)
Financing activities:
Proceeds from issuance of convertible notes	150,000	0
Payment for convertible notes issuance costs	(4,521)	0
Payment for capped call premiums	(12,750)	0
Proceeds from stock options exercised	2,166	4,971
Proceeds from issuance of common stock	789	543
Tax withholding on restricted stock awards	(3,309)	(2,625)
Net cash provided by financing activities	132,375	2,889
Net increase (decrease) in cash and cash equivalents	143,772	(31,347)
Cash and cash equivalents, beginning of period	36,168	65,881
Cash and cash equivalents, end of period	179,940	34,534
Cash paid during the period for:
Interest	43	0
Income taxes	662	1,687
Other non-cash item:
Purchase of property and equipment payable at end of period	$ 105	$ 892

FINANCIAL STATEMENT PRESENTATIO

FINANCIAL STATEMENT PRESENTATION	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
FINANCIAL STATEMENT PRESENTATION	FINANCIAL STATEMENT PRESENTATION The accompanying unaudited condensed consolidated financial statements of Interactive Intelligence Group, Inc. (“the Company,” “we,” “us” and “our”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions for Form 10-Q and Article 10 of Regulation S-X for interim financial information. Accordingly, certain information and note disclosures normally included in the Company’s financial statements prepared in accordance with GAAP have been condensed, or omitted, pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). The preparation of the Company’s condensed consolidated financial statements requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, at the respective balance sheet dates, and the reported amounts of revenues and expenses during the respective reporting periods. Despite management’s best effort to establish good faith estimates and assumptions, actual results could differ from these estimates. In management’s opinion, the Company’s accompanying condensed consolidated financial statements include all adjustments necessary (which are of a normal and recurring nature, except as otherwise noted) for the fair presentation of the results of the interim periods presented. The Company’s accompanying condensed consolidated financial statements as of December 31, 2014 have been derived from the Company’s audited consolidated financial statements at that date but do not include all of the information and notes required by GAAP for complete financial statements. These accompanying condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2014 , included in the Company’s most recent Annual Report on Form 10-K as filed with the SEC on February 27, 2015. The Company’s results of operations for any interim period are not necessarily indicative of the results of operations for any other interim period or for a full fiscal year. Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after elimination of all significant intercompany accounts and transactions. Reclassifications and Adjustments During the third quarter of 2014, the Company reclassified certain personnel related expenses which were included in cost of recurring revenues in prior periods to sales and marketing expenses. For the three and six months ended June 30, 2014 , $602,000 and $1.3 million have been reclassified to sales and marketing expenses based on this new expense presentation. The reclassification did not have any impact on the overall results previously reported.

SUMMARY OF CERTAIN ACCOUNTING P

SUMMARY OF CERTAIN ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS	6 Months Ended
	Jun. 30, 2015
Accounting Changes and Error Corrections [Abstract]
SUMMARY OF CERTAIN ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS	SUMMARY OF CERTAIN ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS For a complete summary of the Company’s significant accounting policies and critical accounting estimates, refer to Note 2 of Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 . In April 2015, the Financial Accounting Standards Board ("FASB") issued FASB Accounting Standards Update ("ASU") No. 2015-05, Customer's Accounting for Fees Paid in a Cloud Computing Arrangement ("FASB ASU 2015-05") , which clarifies that if a cloud computing arrangement includes a software license, the customer should account for the license consistent with its accounting for other software licenses. If the arrangement does not include a software license, the customer should account for the arrangement as a service contract. Public business entities must apply the new requirement in fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. An entity can elect to adopt the amendments either prospectively for all arrangements entered into or materially modified after the effective date, or retrospectively. Early adoption is permitted for all entities. The Company is evaluating the effect that FASB ASU 2015-05 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the guidance on its ongoing financial reporting. In April 2015, the FASB issued FASB ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires an entity to present debt issuance costs on the balance sheet as a direct deduction from the debt liability instead of presenting the debt issuance costs as a separate asset. Public business entities must apply the new requirements in fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. All entities have the option of adopting the new requirements as of an earlier date for financial statements that have not been previously issued. The Company has elected to early adopt FASB ASU 2015-03 and has presented convertible notes issuance costs as a direct deduction from the convertible notes liability in the accompanying balance sheet as of June 30, 2015. In May 2014, the FASB issued FASB ASU No. 2014-9, Revenue from Contracts with Customers , which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. FASB ASU 2014-9 will replace most existing U.S. GAAP revenue recognition guidance when it becomes effective. As originally issued, the new standard was to become effective for the Company on January 1, 2017, and early adoption is not permitted. In July 2015, the FASB voted to approve a one-year deferral of the effective date of the new revenue recognition standard. As a result, the new standard will become effective for the Company beginning with the first quarter of 2018. This guidance permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that FASB ASU 2014-9 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the guidance on its ongoing financial reporting. The Company capitalizes costs related to its PureCloud Platform SM and certain projects described below for internal use in accordance with FASB Accounting Standards Codification (“ASC”) 350-40, Internal Use Software . Once a solution has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. The capitalization of costs ceases upon completion of all substantial testing. Costs incurred in the preliminary stages of development, maintenance and training costs are expensed as incurred. During the three and six months ended June 30, 2015 , the Company capitalized $5.2 million and $10.8 million , respectively, of costs related to the development of its PureCloud Platform, compared to the capitalization of $2.7 million and $4.5 million during the same periods in 2014. The Company began amortizing the development costs related to PureCloud Collaborate SM during the first quarter of 2015. The Company will begin amortizing the development costs related to PureCloud Communicate SM and PureCloud Engage SM during the third quarter of 2015. The Company will continue to capitalize development costs related to other services provided under the PureCloud Platform and will begin amortizing such costs once those services are released for general availability. Additionally, the Company is implementing new business systems to meet its internal business needs. The Company has no plans to market such software externally. During the three and six months ended June 30, 2015 , the Company capitalized $2.1 million and $3.0 million , respectively, of costs associated with development and implementation of these systems, compared to the capitalization of $0.8 million and $1.4 million during the same periods in 2014. During the three and six months ended June 30, 2015 , there were no other material changes to the Company’s significant accounting policies or critical accounting estimates.

NET LOSS PER SHARE

NET LOSS PER SHARE	6 Months Ended
	Jun. 30, 2015
Earnings Per Share [Abstract]
NET LOSS PER SHARE	NET LOSS PER SHARE Basic net loss per share is calculated based on the weighted-average number of common shares outstanding in accordance with FASB ASC Topic 260, Earnings per Share . Diluted net income per share is calculated based on the weighted-average number of common shares outstanding plus the effect of dilutive potential common shares. When the Company reports a net loss, the calculation of diluted net loss per share excludes potential common shares as the effect would be anti-dilutive. Potential common shares consist of shares of common stock issuable upon the exercise of stock options and vesting of restricted stock units (“RSUs”). The calculation of diluted net loss per share excludes shares underlying stock options outstanding that would be anti-dilutive. The following table sets forth the calculation of basic and diluted net loss per share (in thousands, except per share amounts): Three Months Ended Six Months Ended 2015 2014 2015 2014 Net loss, as reported (A) $ (5,084 ) $ (6,798 ) $ (8,543 ) $ (9,362 ) Weighted average shares of common stock outstanding (B) 21,504 20,851 21,519 20,771 Dilutive effect of employee stock options and RSUs — — — — Common stock and common stock equivalents (C) 21,504 20,851 21,519 20,771 Net loss per share: Basic (A/B) $ (0.24 ) $ (0.33 ) $ (0.40 ) $ (0.45 ) Diluted (A/C) (0.24 ) (0.33 ) (0.40 ) (0.45 ) The Company’s calculation of diluted net loss per share for the three and six months ended June 30, 2015 excludes RSUs and stock options to purchase approximately 269,000 and 370,000 shares of the Company’s common stock, respectively, compared to 969,000 and 1.1 million shares during the same periods in 2014.

INVESTMENTS

INVESTMENTS	6 Months Ended
	Jun. 30, 2015
Fair Value Disclosures [Abstract]
INVESTMENTS	INVESTMENTS FASB ASC Topic 820, Fair Value Measurement (“FASB ASC 820”), as amended, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. FASB ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes the following three levels of inputs that may be used to measure fair value: • Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted 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. The Company’s short-term investments all mature in less than one year and its long-term investments all mature within three years. Both short-term and long-term investments are considered available for sale. The Company’s assets that are measured at fair value on a recurring basis are classified within Level 1 or Level 2 of the fair value hierarchy. The types of instruments valued based on quoted market prices in active markets include money market securities and U.S government securities. Such instruments are classified within Level 1 of the fair value hierarchy. The Company invests in money market funds that are traded daily and does not adjust the quoted price for such instruments. The types of instruments valued based on quoted prices in less active markets, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency include corporate notes, agency bonds, commercial paper and certificates of deposit. Such instruments are classified within Level 2 of the fair value hierarchy. The Company uses consensus pricing, which is based on multiple pricing sources, to value its fixed income investments. The following table sets forth a summary of the Company’s financial assets, classified as cash and cash equivalents, short-term investments and long-term investments on its condensed consolidated balance sheets, measured at fair value as of June 30, 2015 and December 31, 2014 (in thousands): Fair Value Measurements at June 30, 2015 Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash & cash equivalents: Cash $ 119,785 $ 119,785 $ — $ — Money market funds 60,155 60,155 — — Total $ 179,940 $ 179,940 $ — $ — Short-term investments: Corporate notes $ 1,109 $ — $ 1,109 $ — Total $ 1,109 $ — $ 1,109 $ — Long-term investments: Corporate notes $ 3,864 $ — $ 3,864 $ — Total $ 3,864 $ — $ 3,864 $ — Fair Value Measurements at December 31, 2014 Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs Cash & cash equivalents: Cash $ 34,452 $ 34,452 $ — $ — Money market funds 1,716 1,716 — — Total $ 36,168 $ 36,168 $ — $ — Short-term investments: Corporate notes $ 19,241 $ — $ 19,241 $ — Commercial paper 800 — 800 — Total $ 20,041 $ — $ 20,041 $ — Long-term investments: U.S. government securities $ 1,000 $ 1,000 $ — $ — Corporate notes 4,495 $ — 4,495 — Total $ 5,495 $ 1,000 $ 4,495 $ —

ACCOUNTS RECEIVABLE AND CONCENT

ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK	6 Months Ended
	Jun. 30, 2015
Risks and Uncertainties [Abstract]
ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK	ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK The Company evaluates the creditworthiness of its customers and partners on a periodic basis and generally does not require collateral. The Company records unbilled accounts receivable, which represents amounts recognized as revenues for invoices that have not yet been sent to customers. This balance fluctuates depending on the contractual billing milestones and work performed related to projects specified in the contract. When the work performed is ahead of the billing milestones related to a services engagement, unbilled accounts receivable will be recorded. The balance of unbilled accounts receivable recorded within accounts receivable on the condensed consolidated balance sheets as of June 30, 2015 and December 31, 2014 was $9.3 million and $8.0 million , respectively. No customer or partner accounted for more than 10% of the Company’s accounts receivable as of June 30, 2015 or December 31, 2014 or for more than 10% of the Company’s revenues for the three and six months ended June 30, 2015 or 2014 . The Company’s top five partners collectively represented 14% and 17% of the Company’s accounts receivables balance at June 30, 2015 and December 31, 2014 , respectively.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	6 Months Ended
	Jun. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
STOCK-BASED COMPENSATION	STOCK-BASED COMPENSATION Stock Option Plan The Company’s 2006 Equity Incentive Plan, as amended and as assumed by Interactive Intelligence Group, Inc. (the “2006 Plan”) authorizes the Board of Directors or the Compensation Committee, as applicable, to grant incentive and nonqualified stock options, stock appreciation rights, restricted stock, RSUs, performance shares, performance units and other stock-based awards. After adoption of the 2006 Plan by the Company’s shareholders in May 2006, the Company may no longer make any grants under previous plans. At the Company’s 2013 Annual Meeting of Shareholders held on May 22, 2013, the Company’s shareholders approved an amendment to the 2006 Plan which increased the number of shares available for issuance under the 2006 Plan by 2,000,000 shares. A maximum of 9,050,933 shares are available for delivery under the 2006 Plan. The number of shares available under the 2006 Plan is subject to adjustment for certain changes in the Company’s capital structure. The exercise price of options granted under the 2006 Plan is equal to the closing price of the Company’s common stock, as reported by The NASDAQ Global Select Market, on the business day immediately preceding the date of grant. As of June 30, 2015 , there were 1,518,622 shares of stock available for issuance for equity compensation awards under the 2006 Plan. During 2014 and prior, the Company granted RSUs and three types of stock options. The first type of stock option was non-performance-based subject only to time-based vesting, and these stock options were granted by the Company as annual grants to executives, to certain new employees and to newly-elected non-employee directors. These stock options vest in four equal annual installments beginning one year after the grant date. The fair value of these option grants is determined on the date of grant and the related compensation expense is recognized for the entire award on a straight-line basis over the requisite service period. The second type of stock option granted by the Company was performance-based subject to cancellation if the specified performance targets are not met. If the applicable performance targets have been achieved, the options will vest in four equal annual installments beginning one year after the performance-related period has ended. The fair value of these stock option grants is determined on the date of grant and the related compensation expense is recognized over the related service period, including the initial period for which the specified performance targets must be met. The third type of stock option granted by the Company was director options granted to non-employee directors annually. These options were similar to the non-performance-based options described above except that the director options vest one year after the grant date. The fair value of these option grants is determined on the date of the grant and the related compensation expense is recognized over one year . These director options were generally granted at the Company’s Annual Meeting of Shareholders during the second quarter of each fiscal year. In 2015, the Company began granting RSUs in lieu of stock options. The Company grants performance-based and non-performance-based RSUs to directors, executives, certain key employees, and certain new employees, and the fair value of the RSUs is determined on the date of grant. Non-performance-based RSUs granted to executives, certain key employees, certain new employees and new non-employee directors vest in four equal annual installments beginning one year after the grant date. Non-performance-based RSUs granted annually to non-employee directors vest in full one year after the grant date. Performance-based RSUs vest in four equal annual installments once the individual has achieved the performance targets. RSUs are not included in issued and outstanding common stock until the shares are vested and settlement has occurred. The 2006 Plan may be terminated by the Company’s Board of Directors at any time. Stock-Based Compensation Expense Information The following table summarizes the allocation of stock-based compensation expense related to employee and director stock options and RSUs under FASB ASC Topic 718, Compensation – Stock Compensation (“FASB ASC 718”) for the three and six months ended June 30, 2015 and 2014 (in thousands): Three Months Ended Six Months Ended 2015 2014 2015 2014 Stock-based compensation expense by category: Costs of recurring revenues $ 532 $ 367 $ 986 $ 674 Costs of services revenues 164 115 293 221 Sales and marketing 1,154 1,037 1,715 2,133 Research and development 963 1,352 1,782 2,306 General and administrative 1,063 825 2,093 1,602 Total stock-based compensation expense $ 3,876 $ 3,696 $ 6,869 $ 6,936 Effect of stock-based compensation expense on net loss per share: Basic $ (0.18 ) $ (0.18 ) $ (0.32 ) $ (0.33 ) Diluted (0.18 ) (0.18 ) (0.32 ) (0.33 ) During the three and six months ended June 30, 2015 , the Company capitalized $570,000 and $1.2 million , respectively, of stock-based compensation expense related to capitalized software. No stock-based compensation expenses were capitalized during the three and six months ended June 30, 2014 . Stock Option and RSU Valuation The Company estimated the fair value of stock options using the Black-Scholes valuation model. There were no stock options granted during the first six months of 2015. The weighted-average estimated per option value of non-performance-based and performance-based options granted under the 2006 Plan during the six months ended June 30, 2014 used the following assumptions: Six Months Ended Valuation assumptions for non-performance-based options: 2014 Dividend yield — % Expected volatility 60.89 % Risk-free interest rate 1.17 % Expected life of option (in years) 4.00 Six Months Ended Valuation assumptions for performance-based options: 2014 Dividend yield — % Expected volatility 61.00 % Risk-free interest rate 1.39 % Expected life of option (in years) 4.50 Six Months Ended Valuation assumptions for annual director options: 2014 Dividend yield — % Expected volatility 61.70 % Risk-free interest rate 1.17 % Expected life of option (in years) 4.00 RSUs are valued using the fair market value of the Company’s stock on the date of grant and expense is recognized on a straight line basis taking into account an estimated forfeiture rate. Stock Option and RSU Activity The following table sets forth a summary of stock option activity for the six months ended June 30, 2015 : Options Weighted-Average Exercise Price Balances, beginning of year 1,350,799 $ 32.95 Options granted — — Options exercised (119,484 ) 18.17 Options cancelled, forfeited or expired (17,374 ) 44.90 Options outstanding 1,213,941 34.23 Option price range $ 6.66 - 66.39 Weighted-average fair value of options granted $ — Options exercisable 882,635 $ 29.89 The following table sets forth information regarding the Company’s stock options outstanding and exercisable as of June 30, 2015 : Options Outstanding Options Exercisable Range of Exercise Prices Number Weighted- Average Remaining Contractual Life Weighted Average Exercise Price Number Weighted $ 6.66 — $ 18.90 51,225 0.91 $ 13.17 51,225 $ 13.17 19.66 — 19.66 220,630 0.71 19.66 220,630 19.66 19.77 — 22.92 4,500 2.05 22.05 3,250 21.71 24.50 — 24.50 227,400 2.73 24.50 149,900 24.50 25.00 — 30.92 72,250 2.82 26.83 55,500 26.45 32.33 — 32.33 182,250 1.74 32.33 176,625 32.33 32.53 — 37.76 60,500 2.39 33.36 45,500 33.23 39.97 — 39.97 144,186 3.77 39.97 61,252 39.97 48.12 — 66.21 87,000 4.39 50.30 81,750 49.33 66.39 — 66.39 164,000 4.69 66.39 37,003 66.39 Total shares/average price 1,213,941 2.63 $ 34.23 882,635 $ 29.89 The total intrinsic value of options exercised during the quarter ended ended June 30, 2015 was $3.0 million . The aggregate intrinsic value of options outstanding as of June 30, 2015 was $16.5 million and the aggregate intrinsic value of options currently exercisable as of June 30, 2015 was $14.1 million . The aggregate intrinsic value represents the total intrinsic value, based on the Company’s closing stock price per share of $44.47 as of June 30, 2015 , which would have been realized by the option holders had all option holders exercised their options as of that date. The total number of in-the-money options exercisable as of June 30, 2015 represented approximately 763,882 shares with a weighted average exercise price of $26.04 . As of June 30, 2015 , there was $6.1 million of total unrecognized compensation expense related to non-vested stock options. This expense is expected to be recognized over the weighted average remaining vesting period of 1.71 years. The following table sets forth a summary of RSU activity for the six months ended June 30, 2015 : Awards Weighted- Average Grant Date Price Balances, beginning of year 592,364 $ 50.24 RSUs granted 439,399 43.23 RSUs vested (218,888 ) 46.47 RSUs forfeited (25,531 ) 52.14 RSUs outstanding 787,344 47.31 As of June 30, 2015 , there was $34.7 million of total unrecognized compensation expense related to non-vested RSUs. This expense is expected to be recognized over the weighted average remaining vesting period of 2.69 years.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jun. 30, 2015
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The Company’s effective tax rate, without the effect of discrete items, for the three and six months ended June 30, 2015 was 0.9% and (7.5)% , respectively, compared to 40.5% and 41.0% , respectively, for the same periods in 2014 . During the three months ended June 30, 2015 , the Company recorded $29,000 of expense related to discrete items. During the six months ended June 30, 2015 , the Company recorded a net credit of $1.7 million related to discrete items, including a net credit of $1.9 million recorded during the first quarter of 2015 to correct an error in the Company's valuation reserve for deferred tax assets. The error is not considered material to the current or previously reported results. During the six months ended June 30, 2014, the Company recorded a $150,000 credit related to a discrete item, with no discrete items recorded during the three months ended June 30, 2014. With the effects of these discrete items, the Company’s effective tax rate was (11.7)% and 10.4% for the three and six months ended June 30, 2015 , compared to 40.5% and 42.0% for the three and six months ended June 30, 2014. The Company’s effective tax rate for the three and six months ended June 30, 2015 was lower than the federal statutory tax rate of 35.0% primarily due to the allocation of book operating results between the US and foreign entities and the impact of permanent tax differences on pre-tax operating results during the three and six months ended June 30, 2015 .

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time, the Company has received notification from competitors and other technology providers claiming that the Company’s technology infringes upon their proprietary rights. The Company cannot assure you that these matters can be resolved amicably without litigation, or that the Company will be able to enter into licensing arrangements on terms and conditions that would not have a material adverse effect on its business, financial condition or results of operations. From time to time, the Company is also involved in certain legal proceedings in the ordinary course of conducting its business. While the ultimate liability pursuant to these actions cannot currently be determined, the Company believes these legal proceedings will not have a material adverse effect on its financial position or results of operations. Litigation, in general, and intellectual property litigation, in particular, can be expensive and disruptive to normal business operations. Moreover, the results of complex legal proceedings are difficult to predict. Guarantees The Company provides indemnifications of varying scope and amount to certain customers against claims of intellectual property infringement made by third parties arising from the use of its solutions. The Company’s direct software license agreements include certain provisions for indemnifying customers, in material compliance with their license agreement, against liabilities if the Company’s software products infringe upon a third party's intellectual property rights, over the life of the agreement. There is no maximum potential amount of future payments set under the guarantee. However, the Company may at any time and at its option and expense: (i) procure the right of the customer to continue to use the Company’s software that may infringe a third party’s rights; (ii) modify its software so as to avoid infringement; or (iii) require the customer to return its software and refund the customer the fee actually paid by the customer for its software less depreciation based on a five -year straight-line depreciation schedule. The customer’s failure to provide timely notice or reasonable assistance will relieve the Company of its obligations under this indemnification to the extent that it has been actually and materially prejudiced by such failure. To date, the Company has not incurred, nor does it expect to incur, any material related costs and, therefore, has not reserved for such liabilities, in accordance with FASB ASC Topic 460, Guarantees . The Company’s software license agreements also include a warranty that its software products will substantially conform to its software user documentation for a period of one year , provided the customer is in material compliance with the software license agreement. To date, the Company has not incurred any material costs associated with these product warranties, and as such, has not reserved for any such warranty liabilities in its operating results. Lease Commitments The Company’s world headquarters are located in approximately 425,000 square feet of space in four office buildings in Indianapolis, Indiana. In May 2014, the Company entered into new separate lease agreements with Duke Realty Limited Partnership for three of the office buildings, one of which expires in March 2018 and two of which expire on or after June 30, 2025. Also in May 2014, the Company entered into a lease agreement with Duke Construction Limited Partnership to expand its world headquarters to include a fourth, build-to-suit office building in Indianapolis, Indiana. The construction of the fourth office building was completed in June 2015 and the lease term expires in June 2025. The following amounts set forth in the table are as of June 30, 2015 (in thousands): Payments Due by Period Total Less than 1 Year 1-3 Years 3-5 Years More than 5 Years Contractual Obligations Convertible notes $ 159,405 $ 1,905 $ 3,750 $ 153,750 $ — Operating lease obligations 98,520 7,532 26,516 18,884 45,588 Purchase obligations 12,426 6,005 6,421 — — Other obligations 1,702 — — 1,702 — Total $ 272,053 $ 15,442 $ 36,687 $ 174,336 $ 45,588 As set forth in the Contractual Obligations table, the Company has operating lease obligations and purchase obligations that are not recorded in its consolidated financial statements. The operating lease obligations represent future payments on leases classified as operating leases and disclosed pursuant to FASB ASC Topic 840, Leases (“FASB ASC 840”). The obligations include the operating leases of the Company’s world headquarters, some of which extend to the year 2025, and the leases of several other locations for its offices in the United States and 20 other countries with initial lease terms of up to five years. The Company rents office space for sales, services, development and international offices under month-to-month leases. In accordance with FASB ASC 840, rental expense is recognized ratably over the lease period, including those leases containing escalation clauses. The convertible notes obligation set forth in the Contractual Obligations table includes principal payments and estimated interest payments based on the terms of the Company's 1.25% convertible senior notes due 2020. Other Contingencies The Company has received and may continue to receive certain payroll tax credits and real estate tax abatements that were granted to the Company based upon specified growth projections. If the Company’s actual performance is less than those projections, the Company may be subject to repayment of some or all of the tax credits or payment of additional real estate taxes in the case of the abatements. The Company does not believe that it will be subject to payment of any money related to these taxes; however, the Company cannot provide assurance as to the outcome.

ACQUISITIONS

ACQUISITIONS	6 Months Ended
	Jun. 30, 2015
Business Combinations [Abstract]
ACQUISITIONS	ACQUISITIONS OrgSpan Acquisition On May 14, 2014, the Company entered into a stock purchase agreement and acquired OrgSpan, Inc. (“OrgSpan”), a privately held provider of cloud-based enterprise social communications solutions. The Company purchased OrgSpan to leverage technology that provided efficient deployment of the Company’s PureCloud Platform. As previously disclosed, Donald E. Brown, the Company’s Chairman of the Board, President and Chief Executive Officer, was a founder and majority stockholder of OrgSpan. The Company purchased OrgSpan for approximately $14.1 million , partially funded with cash on hand, which included the repayment of OrgSpan’s outstanding debt of approximately $8.0 million . OrgSpan’s outstanding debt consisted primarily of operating loans provided by Dr. Brown bearing interest at a rate of 4.25% per annum. Approximately $1.4 million in cash was paid to OrgSpan’s stockholders (other than Dr. Brown) and to holders of vested OrgSpan stock options. In exchange for his shares of OrgSpan stock, Dr. Brown has the right to receive an aggregate of 98,999 shares of the Company’s common stock (the “Restricted Shares”), representing approximately $4.7 million of the purchase price, which Restricted Shares vest and are to be issued by the Company upon the achievement of certain performance-based conditions tied to the launch and sales of the Company’s PureCloud Platform, which incorporates certain OrgSpan products and technology. The difference between the $15.6 million purchase price previously disclosed in the Form 8-K filed on May 14, 2014 and the $14.1 million noted above is a result of the difference in the value of the 98,999 Restricted Shares received by Dr. Brown for accounting purposes. The Company also retained 38 OrgSpan employees as part of the transaction. With the first commercial release of its PureCloud Platform in June 2015, the Company met the first performance-based condition for the Restricted Shares set forth in the stock purchase agreement. As a result, the Company issued 32,999 of the Restricted Shares to Dr. Brown during July 2015, which shares were not registered under the Securities Act of 1933, as amended (the "Securities Act"), in reliance upon an exemption from registration provided by Section 4(a)(2) under the Securities Act. Any additional Restricted Shares issued to Dr. Brown will also be unregistered. The acquisition was accounted for using the acquisition method of accounting in accordance with FASB ASC Topic 805, Business Combinations (“FASB ASC 805”). The results of OrgSpan’s operations were included in the Company’s condensed consolidated financial statements commencing on the acquisition date. The purchase price allocations for the OrgSpan transaction were prepared by the Company’s management utilizing a third-party valuation report, which was prepared in accordance with the provisions of FASB ASC 805, and other tools available to the Company, including conversations with OrgSpan’s management and historical data from the Company’s other acquisitions. The following table summarizes the fair value of the intangible and other assets acquired and liabilities assumed at the date of the acquisition (in thousands): May 1, 2014 Cash and cash equivalents $ 61 Prepaid expenses 54 Property and equipment, net 144 Intangible assets, net 5,766 Goodwill 8,202 Total assets acquired 14,227 Accrued accounts payable (5 ) Other current liabilities (44 ) Other long-term liabilities (128 ) Net assets acquired $ 14,050 Professional fees related to this acquisition and recognized as of June 30, 2015 totaled $613,000 , and included transaction costs such as legal, accounting, and valuation services, which were expensed as incurred. These costs are included within general and administrative expenses on the condensed consolidated statements of operations for the periods incurred. All of these costs were incurred and recognized during 2014. The premium paid over the fair value of the net assets acquired in the purchase, or goodwill, was primarily attributed to OrgSpan’s existing trained workforce. The goodwill is expected to be deductible for tax purposes, as the Company made a Section 338(h)(10) election for this acquisition. Intangible assets acquired resulting from this acquisition consisted of technology, which is amortized on a straight-line basis. The following sets forth the current net book value of technology acquired and its original economic useful life (dollars in thousands): As of June 30, 2015 Gross Amount Accumulated Amortization Net Amount Economic Useful Life (in years) Technology $ 5,766 $ 673 $ 5,093 10 Pro Forma Results The Company has not furnished pro forma financial information related to its acquisition of OrgSpan because such information is not material individually or in the aggregate to the overall financial results of the Company.

DERIVATIVES

DERIVATIVES	6 Months Ended
	Jun. 30, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]
DERIVATIVES	DERIVATIVES The Company enters into derivative contracts to mitigate its foreign currency risk associated with transacting business internationally. The Company uses foreign currency forward contracts to hedge the revaluation exposure of its net monetary assets and liabilities including cash, accounts receivable, accounts payable and certain intercompany payables and receivables. These hedges are not designated under GAAP, and all realized and unrealized gains and losses are recorded as incurred within other income (expense) on the Company’s condensed consolidated statements of operations. The objective is to offset the gains and losses on the underlying exposures with the gains and losses from the forward contracts. The Company’s hedging policy prohibits entering into hedge contracts that are speculative in nature. The Company records the fair value of its outstanding hedge contracts in other current assets and accrued liabilities depending upon the market value of the forward contracts at each balance sheet date. The following table summarizes the notional amount and fair value of the Company’s outstanding currency contracts at June 30, 2015 and December 31, 2014 , respectively (in thousands): USD Equivalent Notional Amount June 30, December 31, Euro $ 3,001 $ 3,041 US Dollar 1,635 600 Japanese Yen 1,060 — Swedish Krona 283 249 Australian Dollar — 738 Total $ 5,979 $ 4,628 Fair Value USD (1) June 30, December 31, Derivative Asset $ 51 $ 17 ___________ (1) The fair value measurement of these derivative contracts falls within Level 2 of the fair value hierarchy as defined in FASB ASC 820. See Note 4 - Investments for further information. During the three and six months ended June 30, 2015 , the Company recorded a hedging loss of $57,000 and a hedging gain of $418,000 , respectively, compared to hedging losses of $208,000 and $387,000 for the same periods last year. In May 2015, the Company issued $150 million aggregate principal amount of its 1.25% convertible senior notes (the "Notes") due June 1, 2020, unless earlier purchased by the Company or converted. In connection with the pricing of the Notes, the Company entered into privately-negotiated capped call transactions (the "capped call transactions") with each of Morgan Stanley & Co. LLC, JPMorgan Chase Bank, National Association, London Branch and Royal Bank of Canada. The capped call transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of shares of the Company's common stock that underlie the Notes. The Company used approximately $12.8 million of the net proceeds from the issuance of the Notes to pay the cost of the capped call transactions. The strike price of the purchased call option is the same as the initial conversion price per share of the Notes of $61.24 . The capped call transactions have an initial cap price of $79.38 per share. These capped call transactions are recorded within equity on the condensed consolidated balance sheet as of June 30, 2015 and are not remeasured as long as they continue to meet the conditions for equity classification.

CONVERTIBLE NOTES

CONVERTIBLE NOTES	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
CONVERTIBLE NOTES	In May 2015, the Company issued $150 million aggregate principal amount of its Notes due June 1, 2020, unless earlier purchased by the Company or converted. Interest is payable semi-annually, in arrears, on June 1 and December 1 of each year. The Notes were sold in a private placement under a purchase agreement entered into by and among the Company and Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC and RBC Capital Markets, LLC, as representatives of the several initial purchasers named therein, for resale to qualified institutional buyers as defined in, and in reliance on, Rule 144A under the Securities Act. The Notes are governed by an indenture between the Company, as issuer, and U.S. Bank National Association, as trustee (the "indenture"). The Notes are unsecured and do not contain any financial covenants or any restrictions on the payment of dividends or the incurrence of senior debt or other indebtedness. In connection with the offering of the Notes, the Company and its directors and executive officers agreed to be subject to a 90-day lock-up that restricts their ability to offer, pledge, sell, transfer or otherwise dispose of shares of the Company's common stock through August 17, 2015. If converted, holders of the Notes will receive, at the Company's election, cash, shares of the Company's common stock, or a combination of cash and shares. The initial conversion terms are as follows: Initial Conversion Rate per $1,000 Principal Amount Initial Conversion Price per Share 1.25% Convertible Senior Notes 16.3303 $ 61.24 Throughout the term of the Notes, the conversion rate may be adjusted upon the occurrence of certain events. Except for certain circumstances set forth in the indenture, holders of the Notes will not receive any cash payment representing accrued and unpaid interest upon conversion of a Note. Accrued but unpaid interest will be deemed to be paid in full upon conversion rather than canceled, extinguished or forfeited. Holders may convert the Notes under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on September 30, 2015 (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; • during the five business day period after any 5 consecutive trading day period (the ‘‘measurement period’’) in which the trading price (as defined below) 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; • upon the occurrence of specified corporate transactions pursuant to the indenture; or • at any time on or after March 3, 2020. Holders of the Notes have the right to require the Company to repurchase for cash all or a portion of the Notes prior to maturity upon the occurrence of a fundamental change, including, among other things, a change of control, at a purchase 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. In addition, following certain corporate transactions that constitute a fundamental change, the Company is required to increase the conversion rate for a holder who elects to convert the Notes in connection with such change of control. In connection with the pricing of the Notes, the Company entered into capped call transactions. The capped call transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of shares of the Company's common stock that underlie the Notes. The Company used approximately $12.8 million of the net proceeds from the issuance of the Notes to pay the cost of the capped call transactions. The strike price of the purchased call option is the same as the initial conversion price per share of the Notes of $61.24 . The capped call transactions have an initial cap price of $79.38 per share. These capped call transactions are recorded within equity on the condensed consolidated balance sheet as of June 30, 2015 and are not remeasured as long as they continue to meet the conditions for equity classification. In accounting for the issuances of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the Notes as a whole. The excess of the principal amount of the liability component over its carrying amount (“convertible notes discount”) is amortized to interest expense over the term of the Notes using the effective interest rate method. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. Par Value Outstanding Equity Component Recorded at Issuance Liability Component of Par Value as of (In thousands) June 30, 2015 December 31, 2014 1.25% Convertible Senior Notes $ 150,000 $ 31,756 (1) $ 114,930 $ — ___________ (1) This amount represents the equity component recorded at the initial issuance of the Notes. In accounting for the transaction costs related to the issuance of the Notes, the Company allocated the total amount incurred to the liability and equity components based on their relative values. Transaction costs attributable to the liability component are being amortized to expense using the effective interest rate method over the term of the Notes, and transaction costs attributable to the equity component were netted with the equity component in shareholders’ equity. The Notes consisted of the following (in thousands): As of June 30, 2015 December 31, 2014 Liability component: 1.25% Convertible Senior Notes (1) $ 150,000 $ — Less: convertible notes discount, net (2) (31,301 ) — Less: convertible notes issuance costs (2) (3,769 ) — Net carrying amount $ 114,930 $ — ___________ (1) The effective interest rate of the Notes is 6.25% . The interest rate is based on the interest rates of similar liabilities at the time of issuance that did not have an associated convertible feature. (2) Included in the condensed consolidated balance sheet as of June 30, 2015 within convertible notes and is amortized over the term of the Notes using the effective interest rate method. The total estimated fair value of the Notes at June 30, 2015 was $145.7 million . The fair value was determined based on inputs that are observable in the market (Level 2) and was based on the closing trading price per $100 of the Notes as of the last day of trading for the second quarter of 2015. Based on the closing price of the Company’s common stock of $44.47 on June 30, 2015, the if-converted value of the Notes fell below the principal amount by approximately $41.1 million . Based on the terms of the Notes, the Notes were not convertible for the three months ended June 30, 2015.

SUMMARY OF CERTAIN ACCOUNTING19

SUMMARY OF CERTAIN ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS SUMMARY OF CERTAIN ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS (Policies)	6 Months Ended
	Jun. 30, 2015
Accounting Changes and Error Corrections [Abstract]
New Accounting Pronouncements	In April 2015, the Financial Accounting Standards Board ("FASB") issued FASB Accounting Standards Update ("ASU") No. 2015-05, Customer's Accounting for Fees Paid in a Cloud Computing Arrangement ("FASB ASU 2015-05") , which clarifies that if a cloud computing arrangement includes a software license, the customer should account for the license consistent with its accounting for other software licenses. If the arrangement does not include a software license, the customer should account for the arrangement as a service contract. Public business entities must apply the new requirement in fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. An entity can elect to adopt the amendments either prospectively for all arrangements entered into or materially modified after the effective date, or retrospectively. Early adoption is permitted for all entities. The Company is evaluating the effect that FASB ASU 2015-05 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the guidance on its ongoing financial reporting. In April 2015, the FASB issued FASB ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires an entity to present debt issuance costs on the balance sheet as a direct deduction from the debt liability instead of presenting the debt issuance costs as a separate asset. Public business entities must apply the new requirements in fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. All entities have the option of adopting the new requirements as of an earlier date for financial statements that have not been previously issued. The Company has elected to early adopt FASB ASU 2015-03 and has presented convertible notes issuance costs as a direct deduction from the convertible notes liability in the accompanying balance sheet as of June 30, 2015. In May 2014, the FASB issued FASB ASU No. 2014-9, Revenue from Contracts with Customers , which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. FASB ASU 2014-9 will replace most existing U.S. GAAP revenue recognition guidance when it becomes effective. As originally issued, the new standard was to become effective for the Company on January 1, 2017, and early adoption is not permitted. In July 2015, the FASB voted to approve a one-year deferral of the effective date of the new revenue recognition standard. As a result, the new standard will become effective for the Company beginning with the first quarter of 2018. This guidance permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that FASB ASU 2014-9 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the guidance on its ongoing financial reporting.
Internal Use Software	The Company capitalizes costs related to its PureCloud Platform SM and certain projects described below for internal use in accordance with FASB Accounting Standards Codification (“ASC”) 350-40, Internal Use Software . Once a solution has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. The capitalization of costs ceases upon completion of all substantial testing.

NET LOSS PER SHARE (Tables)

NET LOSS PER SHARE (Tables)	6 Months Ended
	Jun. 30, 2015
Earnings Per Share [Abstract]
Calculation Of Basic And Diluted Net Income Per Share	The following table sets forth the calculation of basic and diluted net loss per share (in thousands, except per share amounts): Three Months Ended Six Months Ended 2015 2014 2015 2014 Net loss, as reported (A) $ (5,084 ) $ (6,798 ) $ (8,543 ) $ (9,362 ) Weighted average shares of common stock outstanding (B) 21,504 20,851 21,519 20,771 Dilutive effect of employee stock options and RSUs — — — — Common stock and common stock equivalents (C) 21,504 20,851 21,519 20,771 Net loss per share: Basic (A/B) $ (0.24 ) $ (0.33 ) $ (0.40 ) $ (0.45 ) Diluted (A/C) (0.24 ) (0.33 ) (0.40 ) (0.45 )

INVESTMENTS (Tables)

INVESTMENTS (Tables)	6 Months Ended
	Jun. 30, 2015
Fair Value Disclosures [Abstract]
Financial Assets Measured At Fair Value	The following table sets forth a summary of the Company’s financial assets, classified as cash and cash equivalents, short-term investments and long-term investments on its condensed consolidated balance sheets, measured at fair value as of June 30, 2015 and December 31, 2014 (in thousands): Fair Value Measurements at June 30, 2015 Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash & cash equivalents: Cash $ 119,785 $ 119,785 $ — $ — Money market funds 60,155 60,155 — — Total $ 179,940 $ 179,940 $ — $ — Short-term investments: Corporate notes $ 1,109 $ — $ 1,109 $ — Total $ 1,109 $ — $ 1,109 $ — Long-term investments: Corporate notes $ 3,864 $ — $ 3,864 $ — Total $ 3,864 $ — $ 3,864 $ — Fair Value Measurements at December 31, 2014 Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs Cash & cash equivalents: Cash $ 34,452 $ 34,452 $ — $ — Money market funds 1,716 1,716 — — Total $ 36,168 $ 36,168 $ — $ — Short-term investments: Corporate notes $ 19,241 $ — $ 19,241 $ — Commercial paper 800 — 800 — Total $ 20,041 $ — $ 20,041 $ — Long-term investments: U.S. government securities $ 1,000 $ 1,000 $ — $ — Corporate notes 4,495 $ — 4,495 — Total $ 5,495 $ 1,000 $ 4,495 $ —

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	6 Months Ended
	Jun. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Allocation of Stock-Based Compensation Expense	The following table summarizes the allocation of stock-based compensation expense related to employee and director stock options and RSUs under FASB ASC Topic 718, Compensation – Stock Compensation (“FASB ASC 718”) for the three and six months ended June 30, 2015 and 2014 (in thousands): Three Months Ended Six Months Ended 2015 2014 2015 2014 Stock-based compensation expense by category: Costs of recurring revenues $ 532 $ 367 $ 986 $ 674 Costs of services revenues 164 115 293 221 Sales and marketing 1,154 1,037 1,715 2,133 Research and development 963 1,352 1,782 2,306 General and administrative 1,063 825 2,093 1,602 Total stock-based compensation expense $ 3,876 $ 3,696 $ 6,869 $ 6,936 Effect of stock-based compensation expense on net loss per share: Basic $ (0.18 ) $ (0.18 ) $ (0.32 ) $ (0.33 ) Diluted (0.18 ) (0.18 ) (0.32 ) (0.33 )
Schedule of Valuation Assumptions	The weighted-average estimated per option value of non-performance-based and performance-based options granted under the 2006 Plan during the six months ended June 30, 2014 used the following assumptions: Six Months Ended Valuation assumptions for non-performance-based options: 2014 Dividend yield — % Expected volatility 60.89 % Risk-free interest rate 1.17 % Expected life of option (in years) 4.00 Six Months Ended Valuation assumptions for performance-based options: 2014 Dividend yield — % Expected volatility 61.00 % Risk-free interest rate 1.39 % Expected life of option (in years) 4.50 Six Months Ended Valuation assumptions for annual director options: 2014 Dividend yield — % Expected volatility 61.70 % Risk-free interest rate 1.17 % Expected life of option (in years) 4.00
Summary of Stock Option Activity	The following table sets forth a summary of stock option activity for the six months ended June 30, 2015 : Options Weighted-Average Exercise Price Balances, beginning of year 1,350,799 $ 32.95 Options granted — — Options exercised (119,484 ) 18.17 Options cancelled, forfeited or expired (17,374 ) 44.90 Options outstanding 1,213,941 34.23 Option price range $ 6.66 - 66.39 Weighted-average fair value of options granted $ — Options exercisable 882,635 $ 29.89
Summary of Stock Options Outstanding and Exercisable	The following table sets forth information regarding the Company’s stock options outstanding and exercisable as of June 30, 2015 : Options Outstanding Options Exercisable Range of Exercise Prices Number Weighted- Average Remaining Contractual Life Weighted Average Exercise Price Number Weighted $ 6.66 — $ 18.90 51,225 0.91 $ 13.17 51,225 $ 13.17 19.66 — 19.66 220,630 0.71 19.66 220,630 19.66 19.77 — 22.92 4,500 2.05 22.05 3,250 21.71 24.50 — 24.50 227,400 2.73 24.50 149,900 24.50 25.00 — 30.92 72,250 2.82 26.83 55,500 26.45 32.33 — 32.33 182,250 1.74 32.33 176,625 32.33 32.53 — 37.76 60,500 2.39 33.36 45,500 33.23 39.97 — 39.97 144,186 3.77 39.97 61,252 39.97 48.12 — 66.21 87,000 4.39 50.30 81,750 49.33 66.39 — 66.39 164,000 4.69 66.39 37,003 66.39 Total shares/average price 1,213,941 2.63 $ 34.23 882,635 $ 29.89
Summary of RSU activity	The following table sets forth a summary of RSU activity for the six months ended June 30, 2015 : Awards Weighted- Average Grant Date Price Balances, beginning of year 592,364 $ 50.24 RSUs granted 439,399 43.23 RSUs vested (218,888 ) 46.47 RSUs forfeited (25,531 ) 52.14 RSUs outstanding 787,344 47.31

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
Schedule Of Contractual Obligations	The following amounts set forth in the table are as of June 30, 2015 (in thousands): Payments Due by Period Total Less than 1 Year 1-3 Years 3-5 Years More than 5 Years Contractual Obligations Convertible notes $ 159,405 $ 1,905 $ 3,750 $ 153,750 $ — Operating lease obligations 98,520 7,532 26,516 18,884 45,588 Purchase obligations 12,426 6,005 6,421 — — Other obligations 1,702 — — 1,702 — Total $ 272,053 $ 15,442 $ 36,687 $ 174,336 $ 45,588

ACQUISITIONS (Tables)

ACQUISITIONS (Tables)	6 Months Ended
	Jun. 30, 2015
Business Combinations [Abstract]
Fair Value Of The Intangible And Other Assets Acquired And Liabilities Assumed	The following table summarizes the fair value of the intangible and other assets acquired and liabilities assumed at the date of the acquisition (in thousands): May 1, 2014 Cash and cash equivalents $ 61 Prepaid expenses 54 Property and equipment, net 144 Intangible assets, net 5,766 Goodwill 8,202 Total assets acquired 14,227 Accrued accounts payable (5 ) Other current liabilities (44 ) Other long-term liabilities (128 ) Net assets acquired $ 14,050
Intangible Assets Acquired And Economic Useful Life	The following sets forth the current net book value of technology acquired and its original economic useful life (dollars in thousands): As of June 30, 2015 Gross Amount Accumulated Amortization Net Amount Economic Useful Life (in years) Technology $ 5,766 $ 673 $ 5,093 10

DERIVATIVES (Tables)

DERIVATIVES (Tables)	6 Months Ended
	Jun. 30, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Schedule Of Derivative Notional Amount And Fair Value	The following table summarizes the notional amount and fair value of the Company’s outstanding currency contracts at June 30, 2015 and December 31, 2014 , respectively (in thousands): USD Equivalent Notional Amount June 30, December 31, Euro $ 3,001 $ 3,041 US Dollar 1,635 600 Japanese Yen 1,060 — Swedish Krona 283 249 Australian Dollar — 738 Total $ 5,979 $ 4,628 Fair Value USD (1) June 30, December 31, Derivative Asset $ 51 $ 17 ___________ (1) The fair value measurement of these derivative contracts falls within Level 2 of the fair value hierarchy as defined in FASB ASC 820. See Note 4 - Investments for further information.

CONVERTIBLE NOTES (Tables)

CONVERTIBLE NOTES (Tables)	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
Schedule of Debt Conversions	If converted, holders of the Notes will receive, at the Company's election, cash, shares of the Company's common stock, or a combination of cash and shares. The initial conversion terms are as follows: Initial Conversion Rate per $1,000 Principal Amount Initial Conversion Price per Share 1.25% Convertible Senior Notes 16.3303 $ 61.24
Convertible Debt	Par Value Outstanding Equity Component Recorded at Issuance Liability Component of Par Value as of (In thousands) June 30, 2015 December 31, 2014 1.25% Convertible Senior Notes $ 150,000 $ 31,756 (1) $ 114,930 $ — ___________ (1) This amount represents the equity component recorded at the initial issuance of the Notes.
Schedule of Long-term Debt Instruments	The Notes consisted of the following (in thousands): As of June 30, 2015 December 31, 2014 Liability component: 1.25% Convertible Senior Notes (1) $ 150,000 $ — Less: convertible notes discount, net (2) (31,301 ) — Less: convertible notes issuance costs (2) (3,769 ) — Net carrying amount $ 114,930 $ — ___________ (1) The effective interest rate of the Notes is 6.25% . The interest rate is based on the interest rates of similar liabilities at the time of issuance that did not have an associated convertible feature. (2) Included in the condensed consolidated balance sheet as of June 30, 2015 within convertible notes and is amortized over the term of the Notes using the effective interest rate method.

FINANCIAL STATEMENT PRESENTAT27

FINANCIAL STATEMENT PRESENTATION (Narrative) (Details) - Jun. 30, 2014 - USD ($) $ in Thousands	Total	Total
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Amounts revised to sales and marketing expenses	$ 602	$ 1,300

SUMMARY OF CERTAIN ACCOUNTING28

SUMMARY OF CERTAIN ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Accounting Changes and Error Corrections [Abstract]
Capitalized costs related to development	$ 5.2	$ 2.7	$ 10.8	$ 4.5
Capitalized costs with development and implementation of business systems	$ 2.1	$ 0.8	$ 3	$ 1.4

NET LOSS PER SHARE (Details)

NET LOSS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Earnings Per Share [Abstract]
Net (loss), as reported	$ (5,084)	$ (6,798)	$ (8,543)	$ (9,362)
Weighted average shares of common stock outstanding (shares)	21,504	20,851	21,519	20,771
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements	0	0	0	0
Common stock and common stock equivalents (shares)	21,504	20,851	21,519	20,771
Basic (A/B) (in dollars per share)	$ (0.24)	$ (0.33)	$ (0.40)	$ (0.45)
Diluted (A/C) (in dollars per share)	$ (0.24)	$ (0.33)	$ (0.40)	$ (0.45)
Stock options excluded from diluted net income (loss) per share (shares)	269	969	370	1,100

INVESTMENTS (Financial Assets M

INVESTMENTS (Financial Assets Measured At Fair Value) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	$ 179,940	$ 36,168
Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Maturity period	1 year
Investments, Total	$ 1,109	20,041
Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Maturity period	3 years
Investments, Total	$ 3,864	5,495
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	179,940	36,168
Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	1,000
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	0	0
Significant Other Observable Inputs (Level 2) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	1,109	20,041
Significant Other Observable Inputs (Level 2) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	3,864	4,495
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	0	0
Significant Unobservable Inputs (Level 3) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	0
Significant Unobservable Inputs (Level 3) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	0
Cash
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	119,785	34,452
Cash | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	119,785	34,452
Cash | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	0	0
Cash | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	0	0
Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	60,155	1,716
Money market funds | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	60,155	1,716
Money market funds | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	0	0
Money market funds | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash & cash equivalents, Total	0	0
Corporate notes | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	1,109	19,241
Corporate notes | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	3,864	4,495
Corporate notes | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	0
Corporate notes | Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	0
Corporate notes | Significant Other Observable Inputs (Level 2) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	1,109	19,241
Corporate notes | Significant Other Observable Inputs (Level 2) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	3,864	4,495
Corporate notes | Significant Unobservable Inputs (Level 3) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	0	0
Corporate notes | Significant Unobservable Inputs (Level 3) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total	$ 0	0
Commercial paper | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		800
Commercial paper | Quoted Prices in Active Markets for Identical Assets (Level 1) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		0
Commercial paper | Significant Other Observable Inputs (Level 2) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		800
Commercial paper | Significant Unobservable Inputs (Level 3) | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		0
U.S. government securities | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		1,000
U.S. government securities | Quoted Prices in Active Markets for Identical Assets (Level 1) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		1,000
U.S. government securities | Significant Other Observable Inputs (Level 2) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		0
U.S. government securities | Significant Unobservable Inputs (Level 3) | Long-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Total		$ 0

ACCOUNTS RECEIVABLE AND CONCE31

ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK (Details) $ in Millions	3 Months Ended		6 Months Ended	12 Months Ended
	Jun. 30, 2015USD ($)	Jun. 30, 2014	Jun. 30, 2015USD ($)customer	Dec. 31, 2014USD ($)customer
Concentration Risk [Line Items]
Unbilled accounts receivable | $	$ 9.3		$ 9.3	$ 8
Accounts Receivable | Customer Concentration Risk
Concentration Risk [Line Items]
Number of customers or partners with significant holding			0	0
Percentage of concentration risk			10.00%	10.00%
Accounts Receivable | Top Five Partners
Concentration Risk [Line Items]
Number of customers or partners with significant holding			5	5
Percentage of concentration risk			14.00%	17.00%
Revenue | Customer Concentration Risk
Concentration Risk [Line Items]
Percentage of concentration risk	10.00%	10.00%	10.00%	10.00%

STOCK-BASED COMPENSATION (Detai

STOCK-BASED COMPENSATION (Details)	May. 22, 2013shares	Jun. 30, 2015USD ($)$ / sharesshares	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)item$ / sharesshares	Jun. 30, 2014USD ($)	Dec. 31, 2014itemstock_option_type
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of types of stock options | stock_option_type						3
Options granted (shares) | shares				0
Total intrinsic value of options exercised				$ 3,000,000
Aggregate intrinsic value of options outstanding		$ 16,500,000		16,500,000
Aggregate intrinsic value of options currently exercisable		$ 14,100,000		$ 14,100,000
Company's closing stock price per share | $ / shares		$ 44.47		$ 44.47
Total unrecognized compensation cost related to non-vested stock options		$ 6,100,000		$ 6,100,000
Weighted average remaining vesting period				1 year 8 months 16 days
Non-Performance-Based Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual installments | item						4
Award vesting period						1 year
Performance-Based Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual installments | item						4
Award vesting period						1 year
Director Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period						1 year
Period of recognizing compensation expense						1 year
Non Performance Based Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual installments | item				4
Award vesting period				1 year
Performance Based Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual installments | item				4
In the Money Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total number of in-the-money options exercisable | shares		763,882		763,882
Weighted average exercise price (dollars per share) | $ / shares		$ 26.04		$ 26.04
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted (shares) | shares				439,399
Weighted average remaining vesting period				2 years 8 months 9 days
Total unrecognized compensation cost related to non-vested RSUs		$ 34,700,000		$ 34,700,000
Capitalized software, net
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, capitalized amount		$ 570,000	$ 0	$ 1,200,000	$ 0
2006 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Additional shares available for issuance | shares	2,000,000
Shares available for delivery | shares	9,050,933
Shares of stock available for issuance for equity compensation awards | shares		1,518,622		1,518,622

STOCK-BASED COMPENSATION (Alloc

STOCK-BASED COMPENSATION (Allocation of Stock-Based Compensation Expense) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 3,876	$ 3,696	$ 6,869	$ 6,936
Effects of Stock-based compensation: Basic (dollars per share)	$ (0.18)	$ (0.18)	$ (0.32)	$ (0.33)
Effects of Stock-based compensation: Diluted (dollars per share)	$ (0.18)	$ (0.18)	$ (0.32)	$ (0.33)
Costs of recurring revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 532	$ 367	$ 986	$ 674
Costs of services revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	164	115	293	221
Sales and marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	1,154	1,037	1,715	2,133
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	963	1,352	1,782	2,306
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 1,063	$ 825	$ 2,093	$ 1,602

STOCK-BASED COMPENSATION (Sched

STOCK-BASED COMPENSATION (Schedule of Valuation Assumptions) (Details) - 6 months ended Jun. 30, 2014	Total
Non-Performance-Based Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Expected volatility	60.89%
Risk-free interest rate	1.17%
Expected life of option (in years)	4 years
Performance-Based Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Expected volatility	61.00%
Risk-free interest rate	1.39%
Expected life of option (in years)	4 years 6 months
Director Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Expected volatility	61.70%
Risk-free interest rate	1.17%
Expected life of option (in years)	4 years

STOCK-BASED COMPENSATION (Summa

STOCK-BASED COMPENSATION (Summary of Stock Option Activity) (Details) - Jun. 30, 2015 - $ / shares	Total
Options
Options granted (shares)	0
Stock Options
Options
Balances, beginning of year (shares)	1,350,799
Options granted (shares)	0
Exercise of stock options (shares)	(119,484)
Options cancelled, forfeited or expired (shares)	(17,374)
Options outstanding at end of year (shares)	1,213,941
Option price range, lower limit (dollars per share)	$ 6.66
Option price range, upper limit (dollars per share)	$ 66.39
Options exercisable (shares)	882,635
Weighted-Average Exercise Price
Weighted-Average Exercise Price, Balance, beginning of year (dollars per share)	$ 32.95
Weighted-Average Exercise Price, Options granted (dollars per share)	0
Weighted-Average Exercise Price, Options exercised (dollars per share)	18.17
Weighted-Average Exercise Price, Options cancelled, forfeited or expired (dollars per share)	44.90
Weighted-Average Exercise Price, Options outstanding (dollars per share)	34.23
Weighted-Average Exercise Price, Options exercisable (dollars per share)	$ 29.89

STOCK-BASED COMPENSATION (Sum36

STOCK-BASED COMPENSATION (Summary of Stock Options Outstanding and Exercisable) (Details) - Jun. 30, 2015 - $ / shares	Total
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options outstanding, number (shares)	1,213,941
Options outstanding, weighted-average remaining contractual life (in years)	2 years 7 months 17 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 34.23
Options exercisable, number	882,635
Options exercisable, weighted-average exercise price (dollars per share)	$ 29.89
Range 1
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	6.66
Option price range, upper limit (dollars per share)	$ 18.90
Options outstanding, number (shares)	51,225
Options outstanding, weighted-average remaining contractual life (in years)	10 months 28 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 13.17
Options exercisable, number	51,225
Options exercisable, weighted-average exercise price (dollars per share)	$ 13.17
Range 2
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	19.66
Option price range, upper limit (dollars per share)	$ 19.66
Options outstanding, number (shares)	220,630
Options outstanding, weighted-average remaining contractual life (in years)	8 months 16 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 19.66
Options exercisable, number	220,630
Options exercisable, weighted-average exercise price (dollars per share)	$ 19.66
Range 3
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	19.77
Option price range, upper limit (dollars per share)	$ 22.92
Options outstanding, number (shares)	4,500
Options outstanding, weighted-average remaining contractual life (in years)	2 years 18 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 22.05
Options exercisable, number	3,250
Options exercisable, weighted-average exercise price (dollars per share)	$ 21.71
Range 4
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	24.50
Option price range, upper limit (dollars per share)	$ 24.50
Options outstanding, number (shares)	227,400
Options outstanding, weighted-average remaining contractual life (in years)	2 years 8 months 23 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 24.50
Options exercisable, number	149,900
Options exercisable, weighted-average exercise price (dollars per share)	$ 24.50
Range 5
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	25
Option price range, upper limit (dollars per share)	$ 30.92
Options outstanding, number (shares)	72,250
Options outstanding, weighted-average remaining contractual life (in years)	2 years 9 months 26 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 26.83
Options exercisable, number	55,500
Options exercisable, weighted-average exercise price (dollars per share)	$ 26.45
Range 6
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	32.33
Option price range, upper limit (dollars per share)	$ 32.33
Options outstanding, number (shares)	182,250
Options outstanding, weighted-average remaining contractual life (in years)	1 year 8 months 27 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 32.33
Options exercisable, number	176,625
Options exercisable, weighted-average exercise price (dollars per share)	$ 32.33
Range 7
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	32.53
Option price range, upper limit (dollars per share)	$ 37.76
Options outstanding, number (shares)	60,500
Options outstanding, weighted-average remaining contractual life (in years)	2 years 4 months 21 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 33.36
Options exercisable, number	45,500
Options exercisable, weighted-average exercise price (dollars per share)	$ 33.23
Range 8
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	39.97
Option price range, upper limit (dollars per share)	$ 39.97
Options outstanding, number (shares)	144,186
Options outstanding, weighted-average remaining contractual life (in years)	3 years 9 months 7 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 39.97
Options exercisable, number	61,252
Options exercisable, weighted-average exercise price (dollars per share)	$ 39.97
Range 9
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	48.12
Option price range, upper limit (dollars per share)	$ 66.21
Options outstanding, number (shares)	87,000
Options outstanding, weighted-average remaining contractual life (in years)	4 years 4 months 21 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 50.30
Options exercisable, number	81,750
Options exercisable, weighted-average exercise price (dollars per share)	$ 49.33
Range 10
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Option price range, lower limit (dollars per share)	66.39
Option price range, upper limit (dollars per share)	$ 66.39
Options outstanding, number (shares)	164,000
Options outstanding, weighted-average remaining contractual life (in years)	4 years 8 months 9 days
Options outstanding, weighted-average exercise price (dollars per share)	$ 66.39
Options exercisable, number	37,003
Options exercisable, weighted-average exercise price (dollars per share)	$ 66.39

STOCK-BASED COMPENSATION (Sum37

STOCK-BASED COMPENSATION (Summary of RSU Activity) (Details) - 6 months ended Jun. 30, 2015 - $ / shares	Total
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
RSUs granted (shares)	0
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Balances, beginning of year (shares)	592,364
RSUs granted (shares)	439,399
RSUs vested (shares)	(218,888)
RSUs forfeited (shares)	(25,531)
Options outstanding at end of year (shares)	787,344
Weighted-Average Exercise Price, Balance, beginning of year (dollars per share)	$ 50.24
Weighted-Average Exercise Price, RSUs granted (dollars per share)	43.23
Weighted-Average Exercise Price, RSUs vested (dollars per share)	46.47
Weighted-Average Exercise Price, RSUs forfeited (dollars per share)	52.14
Weighted-Average Exercise Price, Options outstanding (dollars per share)	$ 47.31

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($)	3 Months Ended			6 Months Ended
	Jun. 30, 2015	Mar. 31, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Income Tax Disclosure [Abstract]
Effective tax rate without the effect of discrete item	0.90%		40.50%	(7.50%)	41.00%
Discrete items	$ 29,000	$ (1,900,000)	$ 0	$ (1,700,000)	$ (150,000)
Effective income tax rate	(11.70%)		40.50%	10.40%	42.00%
Federal statutory tax rate	35.00%			35.00%

COMMITMENTS AND CONTINGENCIES39

COMMITMENTS AND CONTINGENCIES (Narrative) (Details) ft² in Thousands	1 Months Ended	6 Months Ended
	May. 31, 2014building	Jun. 30, 2015ft²buildingcountry	May. 31, 2015
Operating Leased Assets [Line Items]
Amortization period		5 years
Warranty period		1 year
Size Of Building | ft²		425
Number Of Office Buildings		4
Number on countries in which there are leases | country		20
Convertible 1.25% Senior Notes | Convertible Debt
Operating Leased Assets [Line Items]
Interest rate			1.25%
International Locations
Operating Leased Assets [Line Items]
Lease term		5 years
Duke Realty Limited Partnership
Operating Leased Assets [Line Items]
Number Of Office Buildings	3
Duke Realty Limited Partnership | Expires March 2018
Operating Leased Assets [Line Items]
Number Of Office Buildings	1
Duke Realty Limited Partnership | Expires on or after June 2025
Operating Leased Assets [Line Items]
Number Of Office Buildings	2

COMMITMENTS AND CONTINGENCIES40

COMMITMENTS AND CONTINGENCIES (Schedule Of Contractual Obligations) (Details) $ in Thousands	Jun. 30, 2015USD ($)
Debt Instrument [Line Items]
Operating lease obligations	$ 98,520
Operating lease obligations, Less than 1 Year	7,532
Operating lease obligations, 1-3 Years	26,516
Operating lease obligations, 3-5 Years	18,884
Operating lease obligations, More than 5 Years	45,588
Purchase obligations	12,426
Purchase obligations, Less than 1 Year	6,005
Purchase obligations, 1-3 Years	6,421
Other obligations	1,702
Other obligations, 3-5 Years	1,702
Contractual Obligations	272,053
Contractual Obligations, Less than 1 Year	15,442
Contractual Obligations, 1-3 Years	36,687
Contractual Obligations, 3-5 Years	174,336
Contractual Obligations, More than 5 Years	45,588
Convertible Debt
Debt Instrument [Line Items]
Long-term convertible debt	159,405
Long-term convertible debt, Less than 1 Year	1,905
Long-term convertible debt, 1-3 Years	3,750
Long-term convertible debt, 3-5 Years	153,750
Long-term convertible debt, More than 5 years	$ 0

ACQUISITIONS (Details)

ACQUISITIONS (Details) - OrgSpan, Inc. $ in Thousands	May. 14, 2014USD ($)employeeshares	Jul. 31, 2015shares	Jun. 30, 2015USD ($)
Business Acquisition [Line Items]
Consideration transferred	$ 14,100
Outstanding debt	$ 8,000
Interest rate	4.25%
Cash paid for acquisition	$ 1,400
Equity interests issued and issuable, shares | shares	98,999
Shares exchanged for acquisition, value	$ 4,700
Preliminary purchase price	$ 15,600
Number of OrgSpan employees retained | employee	38
Recognized professional fees			$ 613
Restricted shares | Subsequent Event
Business Acquisition [Line Items]
Shares exchanged for acquisition | shares		32,999

ACQUISITIONS (Fair Value Of The

ACQUISITIONS (Fair Value Of The Intangible And Other Assets Acquired And Liabilities Assumed) (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014	May. 01, 2014
Business Acquisition [Line Items]
Goodwill	$ 42,643	$ 43,732
OrgSpan, Inc.
Business Acquisition [Line Items]
Cash and cash equivalents			$ 61
Prepaid expenses			54
Property and equipment, net			144
Intangible assets, net			5,766
Goodwill			8,202
Total assets acquired			14,227
Accrued accounts payable			(5)
Other current liabilities			(44)
Other long-term liabilities			(128)
Net assets acquired			$ 14,050

ACQUISITIONS (Intangible Assets

ACQUISITIONS (Intangible Assets Acquired And Economic Useful Life) (Details) - Jun. 30, 2015 - Technology - USD ($) $ in Thousands	Total
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Amount	$ 5,766
Accumulated Amortization	673
Net Amount	$ 5,093
Economic Useful Life (in years)	10 years

DERIVATIVES (Details)

DERIVATIVES (Details)	1 Months Ended	3 Months Ended		6 Months Ended
	May. 31, 2015USD ($)$ / shares$ / unit	Jun. 30, 2015USD ($)	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)	Jun. 30, 2014USD ($)
Derivative [Line Items]
Hedging gains (losses)		$ (57,000)	$ (208,000)	$ 418,000	$ (387,000)
Payment for capped call premiums				$ 12,750,000	$ 0
Convertible Debt | Convertible 1.25% Senior Notes
Derivative [Line Items]
Outstanding debt	$ 150,000,000
Interest rate	1.25%
Call Option | Convertible Debt | Convertible 1.25% Senior Notes
Derivative [Line Items]
Payment for capped call premiums	$ 12,800,000
Strike price (usd per share) | $ / shares	$ 61.24
Initial cap price (usd per share) | $ / unit	79.38

DERIVATIVES (Schedule Of Deriva

DERIVATIVES (Schedule Of Derivative Notional Amount And Fair Value) (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Derivatives, Fair Value [Line Items]
Notional Amount	$ 5,979	$ 4,628
Derivative Asset
Derivatives, Fair Value [Line Items]
Derivative Asset	51	17
Euro
Derivatives, Fair Value [Line Items]
Notional Amount	3,001	3,041
US Dollar
Derivatives, Fair Value [Line Items]
Notional Amount	1,635	600
Japanese Yen
Derivatives, Fair Value [Line Items]
Notional Amount	1,060
Swedish Krona
Derivatives, Fair Value [Line Items]
Notional Amount	$ 283	249
Australian Dollar
Derivatives, Fair Value [Line Items]
Notional Amount		$ 738

CONVERTIBLE NOTES (Details)

CONVERTIBLE NOTES (Details)	1 Months Ended	6 Months Ended
	May. 31, 2015USD ($)trading_days$ / shares$ / unit	Jun. 30, 2015USD ($)$ / shares	Jun. 30, 2014USD ($)
Debt Instrument [Line Items]
Payment for capped call premiums		$ 12,750,000	$ 0
Company's closing stock price per share | $ / shares		$ 44.47
Common Stock
Debt Instrument [Line Items]
Company's closing stock price per share | $ / shares		$ 44.47
Convertible Debt | Convertible 1.25% Senior Notes
Debt Instrument [Line Items]
Aggregate principal amount	$ 150,000,000
Redemption price in event of change of control, percentage	100.00%
If-converted value amount below principal		$ 41,100,000
Convertible Debt | Convertible 1.25% Senior Notes | Calendar quarter ending on September 30, 2015
Debt Instrument [Line Items]
Number of trading days, whether or not consecutive | trading_days	20
Number of consecutive trading days	30 days
Percentage of the conversion price	130.00%
Convertible Debt | Convertible 1.25% Senior Notes | Measurement period
Debt Instrument [Line Items]
Number of trading days, whether or not consecutive | trading_days	5
Number of consecutive trading days	5 days
Percentage of the conversion price	98.00%
Call Option | Convertible Debt | Convertible 1.25% Senior Notes
Debt Instrument [Line Items]
Payment for capped call premiums	$ 12,800,000
Strike price (usd per share) | $ / shares	$ 61.24
Initial cap price (usd per share) | $ / unit	79.38
Significant Other Observable Inputs (Level 2) | Convertible Debt | Convertible 1.25% Senior Notes
Debt Instrument [Line Items]
Fair value of notes		$ 145,700,000

CONVERTIBLE NOTES (Schedule of

CONVERTIBLE NOTES (Schedule of Debt Conversions) (Details) - May. 31, 2015 - Convertible Debt - Convertible 1.25% Senior Notes	$ / shares
Debt Instrument [Line Items]
Initial Conversion Rate per $1,000 Principal Amount	16.3303
Initial Conversion Price per Share (dollars per share)	$ 61.24

CONVERTIBLE NOTES (Convertible

CONVERTIBLE NOTES (Convertible Debt) (Details) - Convertible Debt - Convertible 1.25% Senior Notes - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Par Value Outstanding	$ 150,000	$ 0
Equity Component Recorded at Issuance	31,756
Liability Component of Par Value as of	$ 114,930	$ 0

CONVERTIBLE NOTES (Schedule o49

CONVERTIBLE NOTES (Schedule of Long-term Debt Instruments) (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Less: debt discount, net	$ (31,301)	$ 0
Less: debt issuance costs	(3,769)	0
Convertible notes	114,930	0
Convertible Debt | Convertible 1.25% Senior Notes
Debt Instrument [Line Items]
Par Value Outstanding	$ 150,000	$ 0
Effective interest rate	6.25%