Rapid7 (RPD) 10-Q 9 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Aug. 01, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2
Trading Symbol	RPD
Entity Registrant Name	RAPID7, INC.
Entity Central Index Key	1,560,327
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		42,074,697

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash	$ 84,755	$ 86,553
Accounts receivable, net of allowance for doubtful accounts of $998 and $730 at June 30, 2016 and December 31, 2015, respectively	38,663	44,164
Prepaid expenses and other current assets	7,183	6,148
Total current assets	130,601	136,865
Property and equipment, net	7,386	7,532
Goodwill	75,048	74,565
Intangible assets, net	10,219	11,385
Other assets	598	214
Total assets	223,852	230,561
Current liabilities:
Accounts payable	4,200	2,038
Accrued expenses	19,798	24,707
Deferred revenue, current portion	99,360	87,917
Other current liabilities	1,047	1,105
Total current liabilities	124,405	115,767
Deferred revenue, non-current portion	45,362	42,400
Other long-term liabilities	2,939	4,319
Total liabilities	172,706	162,486
Stockholders' equity:
Preferred stock, $0.01 par value per share; 10,000,000 shares authorized at June 30, 2016 and December 31, 2015; 0 shares issued at June 30, 2016 and December 31, 2015
Common stock, $0.01 par value per share; 100,000,000 shares authorized at June 30, 2016 and December 31, 2015; 42,512,882 and 41,942,026 shares issued at June 30, 2016 and December 31, 2015, respectively; 42,064,253 and 41,540,400 shares outstanding at June 30, 2016 and December 31, 2015, respectively	421	415
Additional paid-in-capital	424,249	411,524
Accumulated deficit	(369,370)	(340,338)
Treasury stock, at cost, 448,629 and 401,626 shares at June 30, 2016 and December 31, 2015, respectively	(4,154)	(3,526)
Total stockholders' equity	51,146	68,075
Total liabilities and stockholders' equity	$ 223,852	$ 230,561

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Net of allowance for doubtful accounts	$ 998	$ 730
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	42,512,882	41,942,026
Common stock, shares outstanding	42,064,253	41,540,400
Treasury Stock, shares	448,629	401,626

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenue:
Products	$ 21,456	$ 14,639	$ 41,601	$ 28,284
Maintenance and support	8,962	6,253	17,343	12,052
Professional services	6,850	4,898	13,120	9,025
Total revenue	37,268	25,790	72,064	49,361
Cost of revenue:
Products	2,687	1,339	5,285	2,885
Maintenance and support	1,758	1,412	3,439	2,622
Professional services	4,848	3,976	9,281	7,712
Total cost of revenue	9,293	6,727	18,005	13,219
Total gross profit	27,975	19,063	54,059	36,142
Operating expenses:
Research and development	12,932	8,131	25,274	14,545
Sales and marketing	21,680	14,457	44,448	27,687
General and administrative	6,644	5,048	13,237	9,101
Total operating expenses	41,256	27,636	82,959	51,333
Loss from operations	(13,281)	(8,573)	(28,900)	(15,191)
Other income (expense), net:
Interest income (expense), net	26	(737)	11	(1,422)
Other income (expense), net	(48)	163	148	(142)
Loss before income taxes	(13,303)	(9,147)	(28,741)	(16,755)
Provision for income taxes	149	97	291	171
Net loss	(13,452)	(9,244)	(29,032)	(16,926)
Accretion of preferred stock to redemption value		(23,788)		(35,061)
Net loss attributable to common stockholders	$ (13,452)	$ (33,032)	$ (29,032)	$ (51,987)
Net loss per share attributable to common stockholders, basic and diluted	$ (0.33)	$ (2.59)	$ (0.71)	$ (4.10)
Weighted-average common shares outstanding, basic and diluted	41,063,613	12,745,051	40,805,641	12,693,900

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net loss	$ (29,032)	$ (16,926)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	3,419	2,361
Amortization of debt discount		276
Non-cash interest expense	130	51
Stock-based compensation expense	9,160	1,406
Provision for doubtful accounts	394	376
Foreign currency re-measurement (gain) loss	(119)	53
Changes in assets and liabilities:
Accounts receivable	4,945	(840)
Prepaid expenses and other assets	(1,401)	(1,067)
Accounts payable	1,904	(1,368)
Accrued expenses	(3,462)	(1,082)
Deferred revenue	14,405	12,425
Other liabilities	(72)	82
Net cash provided by (used in) operating activities	271	(4,253)
Cash flows from investing activities:
Business acquisitions, net of cash acquired		(3,344)
Purchases of property and equipment	(1,842)	(1,195)
Net cash used in investing activities	(1,842)	(4,539)
Cash flows from financing activities:
Payments of initial public offering costs		(1,526)
Payments of capital lease obligations	(68)	(123)
Taxes paid related to net share settlement of equity awards	(3,760)
Proceeds from employee stock purchase plan	2,096
Proceeds from stock option exercises	1,431	705
Net cash used in financing activities	(301)	(944)
Effect of exchange rate changes on cash	74	(87)
Net decrease in cash	(1,798)	(9,823)
Cash, beginning of period	86,553	36,823
Cash, end of period	84,755	27,000
Supplemental cash flow information:
Cash paid for income taxes	334	91
Cash paid for interest	$ 1	1,107
Supplemental non-cash investing and financing information:
Common stock issued for acquisitions		99
Initial public offering costs incurred but not yet paid		$ 610

Description of Business and Bas

Description of Business and Basis of Presentation and Consolidation	6 Months Ended
	Jun. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business and Basis of Presentation and Consolidation	Note 1. Description of Business and Basis of Presentation and Consolidation Description of Business Rapid7, Inc. and subsidiaries (“we,” “us” or “our”) is a leading provider of security data and analytics solutions that enable organizations to implement an active, analytics-driven approach to cyber security. Our solutions empower organizations to prevent cyber attacks by providing visibility into vulnerabilities and to rapidly detect compromises, respond to breaches and correct the underlying causes of cyber attacks. Basis of Presentation and Consolidation The accompanying unaudited consolidated financial statements have been prepared by us in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) as well as pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Accordingly, certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC on March 10, 2016. The consolidated financial statements include our results of operations and those of our wholly-owned subsidiaries and reflect all adjustments (consisting solely of normal, recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods presented. All intercompany transactions and balances have been eliminated in consolidation. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740) – Balance Sheet Classification of Deferred Taxes In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805) – Simplifying the Accounting for Measurement-Period Adjustments In April 2015, the FASB issued ASU 2015-05, Intangibles -Goodwill and Other – Internal Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606)

Business Combinations

Business Combinations	6 Months Ended
	Jun. 30, 2016
Business Combinations [Abstract]
Business Combinations	Note 2. Business Combinations Prior Year Acquisitions RevelOps, Inc. On October 13, 2015, we acquired 100% of the outstanding equity of RevelOps, Inc. (d/b/a Logentries) for total consideration of $68.1 million. We made an initial payment of $36.2 million in cash, issued 1,252,627 shares of our common stock with an aggregate fair value of $27.4 million, inclusive of a discount from the quoted market price due to certain trading restrictions associated with the shares, and issued vested replacement options with respect to 221,759 shares of our common stock to certain continuing employees with an aggregate fair value of $4.5 million upon the closing of the acquisition. The fair value of the vested replacement options included in the purchase price was based on the fair value of the vested Logentries options on the acquisition date. The excess fair value when comparing the fair value of the new vested replacement options and the vested Logentries options of $0.3 million was expensed immediately in the post-combination financial statements of the combined entity. Assets acquired and liabilities assumed were recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the assets acquired and liabilities assumed was recorded as goodwill. The preliminary fair values of goodwill, intangible assets and net assets were $59.2 million, $9.4 million and $(0.5) million, respectively. These preliminary amounts are subject to subsequent adjustment as we obtain additional information to finalize certain components of working capital. Pro Forma Financial Information The unaudited pro forma financial information in the table below summarizes the combined results of our operations and Logentries, on a pro forma basis, as though we had acquired Logentries on January 1, 2014. The unaudited pro forma financial information for all periods presented also includes the effects of business combination accounting resulting from the acquisition, including amortization expense from acquired intangibles assets, reversal of acquisition related expenses and the stock-compensation expense recorded to retain certain employees. Three Six (in thousands) Total revenue $ 26,421 $ 50,498 Net loss $ (12,881 ) $ (23,357 ) NT OBJECTives, Inc. On April 30, 2015, we acquired 100% of the outstanding equity of NT OBJECTives, Inc. (NTO), a web application security testing company, expanding the web application testing capabilities of our threat exposure management offering. We acquired NTO for total consideration of $6.1 million. We made an initial payment of $3.4 million in cash and issued 9,091 shares of our common stock with an aggregate fair value of $0.1 million. We are obligated to pay $0.1 million in cash for the settlement of a working capital adjustment and are obligated to make two additional payments of $1.5 million each, less the amount of any indemnity claims. The net present value of these two additional payments, or $2.5 million, was included in the total purchase consideration paid. Assets acquired and liabilities assumed were recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the assets acquired and liabilities assumed was recorded as goodwill. The fair values of goodwill, intangible assets and net assets were $4.6 million, $2.1 million and $(0.6) million, respectively. Pro forma results of operations have not been included, as the acquisition of NTO was not material to our results of operations for any periods presented. In May 2015, we entered into loan agreements with certain retained employees of NTO. The terms of these agreements require the employees to pay us the total amount borrowed, with accrued interest at 1.7% per annum, within 18 months of the agreement date. The loan agreements are secured by restricted stock awards granted to the employees. The aggregate amount of these loans was $0.5 million and is currently classified as prepaid expenses and other current assets on our consolidated balance sheets.

Goodwill and Intangible Assets

Goodwill and Intangible Assets	6 Months Ended
	Jun. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets	Note 3. Goodwill and Intangible Assets The change in the carrying amount of goodwill for the six months ended June 30, 2016 was as follows: Amount (in thousands) Balance as of December 31, 2015 $ 74,565 Logentries acquisition accounting adjustments 483 Balance as of June 30, 2016 $ 75,048 Identifiable intangible assets consist of the following: Weighted- As of June 30, 2016 As of December 31, 2015 Gross Accumulated Net Book Gross Accumulated Net Book (in thousands) Intangible assets subject to amortization: Developed technology 5.9 $ 12,851 $ (3,847 ) $ 9,004 $ 12,851 $ (2,955 ) $ 9,896 Trade names 6.3 719 (526 ) 193 719 (389 ) 330 Customer relationships 6.7 1,000 (120 ) 880 1,000 (43 ) 957 Non-compete agreements 4.8 540 (398 ) 142 540 (338 ) 202 Total intangible assets $ 15,110 $ (4,891 ) $ 10,219 $ 15,110 $ (3,725 ) $ 11,385 Amortization expense was $0.6 million and $0.3 million for the three months ended June 30, 2016 and 2015, respectively, and $1.2 million and $0.5 million for the six months ended June 30, 2016 and 2015, respectively. Estimated future amortization expense of the acquired identifiable intangible assets as of June 30, 2016 is as follows (in thousands): 2016 (for the remaining six months) $ 1,119 2017 2,034 2018 1,915 2019 1,880 2020 1,837 2021 and thereafter 1,434 Total $ 10,219

Property and Equipment

Property and Equipment	6 Months Ended
	Jun. 30, 2016
Property, Plant and Equipment [Abstract]
Property and Equipment	Note 4. Property and Equipment Property and equipment are recorded at cost and consist of the following: As of As of (in thousands) Computer equipment and software $ 11,321 $ 9,858 Furniture and fixtures 2,653 2,409 Leasehold improvements 7,344 6,943 Total 21,318 19,210 Less accumulated depreciation (13,932 ) (11,678 ) Property and equipment, net $ 7,386 $ 7,532 Depreciation expense was $1.1 million and $1.0 million for the three months ended June 30, 2016 and 2015, respectively, and $2.2 million and $1.9 million for the six months ended June 30, 2016 and 2015, respectively.

Stock-Based Compensation Expens

Stock-Based Compensation Expense	6 Months Ended
	Jun. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-Based Compensation Expense	Note 5. Stock-Based Compensation Expense (a) General Stock-based compensation expense for restricted stock, restricted stock units, stock options and issuances of common stock pursuant to our employee stock purchase plan was classified in the accompanying consolidated statements of operations as follows: Three Months Six Months Ended 2016 2015 2016 2015 (in thousands) Stock-based compensation expense: Cost of revenue $ 142 $ 52 $ 279 $ 101 Research and development 1,524 266 3,017 410 Sales and marketing 1,224 195 4,125 310 General and administrative 751 318 1,739 585 Total stock-based compensation expense $ 3,641 $ 831 $ 9,160 $ 1,406 We recognize compensation cost of all awards on a straight-line basis over the applicable vesting period, which is generally four years. (b) Restricted Stock and Restricted Stock Units Restricted stock and restricted stock unit activity during the six months ended June 30, 2016 was as follows: Restricted Weighted Outstanding as of December 31, 2015 1,149,257 $ 19.34 Granted 697,537 12.94 Vested (359,401 ) 20.42 Forfeited (56,472 ) 14.13 Outstanding as of June 30, 2016 1,430,921 $ 16.15 As of June 30, 2016, the unrecognized compensation expense related to our unvested restricted stock and restricted stock units expected to vest was $16.6 million. This unrecognized compensation expense will be recognized over an estimated weighted-average amortization period of 2.7 years. During the three months ended June 30, 2016, we repurchased 47,003 shares of our common stock in settlement of employee tax withholding obligations due upon the vesting of restricted stock. (c) Stock Options Stock option activity during the six months ended June 30, 2016 was as follows: Shares Weighted Weighted Aggregate Outstanding as of December 31, 2015 4,246,525 $ 5.99 Granted 1,138,576 13.02 Exercised (335,368 ) 4.53 Forfeited/cancelled (283,413 ) 10.10 Outstanding as of June 30, 2016 4,766,320 7.53 7.5 $ 25,351 Vested and exercisable as of June 30, 2016 2,804,883 4.85 6.6 $ 21,785 Vested and expected to vest as of June 30, 2016 4,382,101 7.12 7.4 $ 24,942 As of June 30, 2016, the unrecognized compensation expense related to our unvested stock options expected to vest was $7.7 million. This unrecognized compensation expense will be recognized over an estimated weighted-average amortization period of 2.8 years. The total fair value of stock options vested in the six months ended June 30, 2016 was $1.6 million. The weighted-average grant date fair value of stock options granted in the six months ended June 30, 2016 was $6.19 per share. (d) Employee Stock Purchase Plan Under the 2015 Employee Stock Purchase Plan (ESPP), employees may set aside up to 15% of their gross earnings, on an after-tax basis, to purchase our common shares at a discounted price, which is calculated at 85% of the lesser of: (i) the market value of our common stock at the beginning of each offering period and (ii) the market value of our common stock on the applicable purchase date. On March 15, 2016, we issued 192,676 shares of common stock to employees for aggregate proceeds of $2.1 million. The purchase price of the shares of common stock was $10.88 per share, which was discounted in accordance with the terms of the ESPP from the closing price of our common stock on March 15, 2016 of $12.80.

Net Loss per Share

Net Loss per Share	6 Months Ended
	Jun. 30, 2016
Earnings Per Share [Abstract]
Net Loss per Share	Note 6. Net Loss per Share The following table summarizes the computation of basic and diluted net loss per share of our common stock for the three and six months ended June 30, 2016 and 2015: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except share and per share data) Numerator: Net loss $ (13,452 ) $ (9,244 ) $ (29,032 ) $ (16,926 ) Accretion of preferred stock to redemption value — (23,788 ) — (35,061 ) Net loss attributable to common stockholders, basic and diluted $ (13,452 ) $ (33,032 ) $ (29,032 ) $ (51,987 ) Denominator: Weighted-average 41,063,613 12,745,051 40,805,641 12,693,900 Net loss per share attributable to common stockholders, basic and diluted $ (0.33 ) $ (2.59 ) $ (0.71 ) $ (4.10 ) The following potentially dilutive securities outstanding, prior to the use of the treasury stock method or if-converted method, have been excluded from the computation of diluted weighted-average shares outstanding for the respective periods below because they would have been anti-dilutive: Three and Six Months 2016 2015 Options to purchase common stock 4,766,320 4,187,854 Restricted stock 811,681 398,779 Restricted stock units 619,240 — Warrants to purchase common stock — 200,000 Shares to be issued under ESPP 103,471 — Redeemable convertible preferred stock — 16,382,615 Total 6,300,712 21,169,248

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 7. Commitments and Contingencies (a) Warranty We provide limited product warranties. Historically, any payments made under these provisions have been immaterial. (b) Litigation and Claims From time to time, we are and may be a party to litigation and subject to claims incident to the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. (c) Indemnification Obligations We agree to standard indemnification provisions in the ordinary course of business. Pursuant to these provisions, we agree to indemnify, hold harmless and reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally our customers, in connection with any United States patent, copyright or other intellectual property infringement claim by any third party arising from the use of our products or services in accordance with the agreement or arising from our gross negligence, willful misconduct or violation of the law (provided that there is not gross or willful misconduct on the part of the other party) with respect to our products or services. The term of these indemnification provisions is generally perpetual from the time of execution of the agreement. We carry insurance that covers certain third-party claims relating to our services and limits our exposure. We have never incurred costs to defend lawsuits or settle claims related to these indemnification provisions.

Segment Information and Informa

Segment Information and Information about Geographic Areas	6 Months Ended
	Jun. 30, 2016
Segment Reporting [Abstract]
Segment Information and Information about Geographic Areas	Note 8. Segment Information and Information about Geographic Areas We operate in one segment. Our chief operating decision maker is our Chief Executive Officer, who makes operating decisions, assesses performance and allocates resources on a consolidated basis. Net revenues by geographic area presented based upon the location of the customer were as follows: Three Months Ended Six Months Ended 2016 2015 2016 2015 (in thousands) North America $ 32,287 $ 22,616 $ 62,419 $ 42,961 Other 4,981 3,174 9,645 6,400 Total $ 37,268 $ 25,790 $ 72,064 $ 49,361 Of the total net revenues generated in North America, 97% of the revenues were generated in the United States for the three and six months ended June 30, 2016, and 96% of the revenues were generated in the United States for the three and six months ended June 30, 2015. Property and equipment, net by geographic area was as follows: As of As of (in thousands) United States $ 6,364 $ 6,633 Other 1,022 899 Total $ 7,386 $ 7,532

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2016
Subsequent Events [Abstract]
Subsequent Events	Note 9. Subsequent Events On August 8, 2016, we announced that Steven Gatoff, Chief Financial Officer, will be transitioning out of the company for personal family reasons effective January 2017. In connection with Mr. Gatoff’s departure, we entered into a transition and release agreement with Mr. Gatoff, which was filed as Exhibit 10.1 to our Current Report on Form 8-K on August 8, 2016.

Description of Business and B15

Description of Business and Basis of Presentation and Consolidation (Policies)	6 Months Ended
	Jun. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation The accompanying unaudited consolidated financial statements have been prepared by us in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) as well as pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Accordingly, certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC on March 10, 2016. The consolidated financial statements include our results of operations and those of our wholly-owned subsidiaries and reflect all adjustments (consisting solely of normal, recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods presented. All intercompany transactions and balances have been eliminated in consolidation. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740) – Balance Sheet Classification of Deferred Taxes In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805) – Simplifying the Accounting for Measurement-Period Adjustments In April 2015, the FASB issued ASU 2015-05, Intangibles -Goodwill and Other – Internal Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606)

Business Combinations (Tables)

Business Combinations (Tables)	6 Months Ended
	Jun. 30, 2016
Logentries [Member]
Pro Forma Financial Information	The unaudited pro forma financial information for all periods presented also includes the effects of business combination accounting resulting from the acquisition, including amortization expense from acquired intangibles assets, reversal of acquisition related expenses and the stock-compensation expense recorded to retain certain employees. Three Months Ended Six Months Ended (in thousands) Total revenue $ 26,421 $ 50,498 Net loss $ (12,881 ) $ (23,357 )

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	6 Months Ended
	Jun. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Changes in Carrying Amount of Goodwill	The change in the carrying amount of goodwill for the six months ended June 30, 2016 was as follows: Amount (in thousands) Balance as of December 31, 2015 $ 74,565 Logentries acquisition accounting adjustments 483 Balance as of June 30, 2016 $ 75,048
Schedule of Identifiable Intangible Assets	Identifiable intangible assets consist of the following: As of June 30, 2016 As of December 31, 2015 Weighted- Gross Carrying Accumulated Net Book Value Gross Carrying Accumulated Net Book Value (in thousands) Intangible assets subject to amortization: Developed technology 5.9 $ 12,851 $ (3,847 ) $ 9,004 $ 12,851 $ (2,955 ) $ 9,896 Trade names 6.3 719 (526 ) 193 719 (389 ) 330 Customer relationships 6.7 1,000 (120 ) 880 1,000 (43 ) 957 Non-compete agreements 4.8 540 (398 ) 142 540 (338 ) 202 Total intangible assets $ 15,110 $ (4,891 ) $ 10,219 $ 15,110 $ (3,725 ) $ 11,385
Schedule of Estimated Amortization Expense	Estimated future amortization expense of the acquired identifiable intangible assets as of June 30, 2016 is as follows (in thousands): 2016 (for the remaining six months) $ 1,119 2017 2,034 2018 1,915 2019 1,880 2020 1,837 2021 and thereafter 1,434 Total $ 10,219

Property and Equipment (Tables)

Property and Equipment (Tables)	6 Months Ended
	Jun. 30, 2016
Property, Plant and Equipment [Abstract]
Summary of Property and Equipment	Property and equipment are recorded at cost and consist of the following: As of As of (in thousands) Computer equipment and software $ 11,321 $ 9,858 Furniture and fixtures 2,653 2,409 Leasehold improvements 7,344 6,943 Total 21,318 19,210 Less accumulated depreciation (13,932 ) (11,678 ) Property and equipment, net $ 7,386 $ 7,532

Stock-Based Compensation Expe19

Stock-Based Compensation Expense (Tables)	6 Months Ended
	Jun. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Stock-Based Compensation Expense	Stock-based compensation expense for restricted stock, restricted stock units, stock options and issuances of common stock pursuant to our employee stock purchase plan was classified in the accompanying consolidated statements of operations as follows: Three Months Six Months Ended 2016 2015 2016 2015 (in thousands) Stock-based compensation expense: Cost of revenue $ 142 $ 52 $ 279 $ 101 Research and development 1,524 266 3,017 410 Sales and marketing 1,224 195 4,125 310 General and administrative 751 318 1,739 585 Total stock-based compensation expense $ 3,641 $ 831 $ 9,160 $ 1,406
Summary of Restricted Stock and Restricted Stock Unit Activity	Restricted stock and restricted stock unit activity during the six months ended June 30, 2016 was as follows: Restricted Weighted Outstanding as of December 31, 2015 1,149,257 $ 19.34 Granted 697,537 12.94 Vested (359,401 ) 20.42 Forfeited (56,472 ) 14.13 Outstanding as of June 30, 2016 1,430,921 $ 16.15
Summary of Stock Option Activity	Stock option activity during the six months ended June 30, 2016 was as follows: Shares Weighted Weighted Aggregate Outstanding as of December 31, 2015 4,246,525 $ 5.99 Granted 1,138,576 13.02 Exercised (335,368 ) 4.53 Forfeited/cancelled (283,413 ) 10.10 Outstanding as of June 30, 2016 4,766,320 7.53 7.5 $ 25,351 Vested and exercisable as of June 30, 2016 2,804,883 4.85 6.6 $ 21,785 Vested and expected to vest as of June 30, 2016 4,382,101 7.12 7.4 $ 24,942

Net Loss per Share (Tables)

Net Loss per Share (Tables)	6 Months Ended
	Jun. 30, 2016
Earnings Per Share [Abstract]
Summary of Basic and Diluted Net Loss Per Share of Common Stock	The following table summarizes the computation of basic and diluted net loss per share of our common stock for the three and six months ended June 30, 2016 and 2015: Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except share and per share data) Numerator: Net loss $ (13,452 ) $ (9,244 ) $ (29,032 ) $ (16,926 ) Accretion of preferred stock to redemption value — (23,788 ) — (35,061 ) Net loss attributable to common stockholders, basic and diluted $ (13,452 ) $ (33,032 ) $ (29,032 ) $ (51,987 ) Denominator: Weighted-average 41,063,613 12,745,051 40,805,641 12,693,900 Net loss per share attributable to common stockholders, basic and diluted $ (0.33 ) $ (2.59 ) $ (0.71 ) $ (4.10 )
Anti-Dilutive Securities Excluded from Computation Diluted Weighted Average Shares Outstanding	The following potentially dilutive securities outstanding, prior to the use of the treasury stock method or if-converted method, have been excluded from the computation of diluted weighted-average shares outstanding for the respective periods below because they would have been anti-dilutive: Three and Six Months 2016 2015 Options to purchase common stock 4,766,320 4,187,854 Restricted stock 811,681 398,779 Restricted stock units 619,240 — Warrants to purchase common stock — 200,000 Shares to be issued under ESPP 103,471 — Redeemable convertible preferred stock — 16,382,615 Total 6,300,712 21,169,248

Segment Information and Infor21

Segment Information and Information about Geographic Areas (Tables)	6 Months Ended
	Jun. 30, 2016
Segment Reporting [Abstract]
Net Revenues of Customer by Geographic Area	Net revenues by geographic area presented based upon the location of the customer were as follows: Three Months Ended Six Months Ended 2016 2015 2016 2015 (in thousands) North America $ 32,287 $ 22,616 $ 62,419 $ 42,961 Other 4,981 3,174 9,645 6,400 Total $ 37,268 $ 25,790 $ 72,064 $ 49,361
Property and Equipment, Net By Geographic Area	Property and equipment, net by geographic area was as follows: As of As of (in thousands) United States $ 6,364 $ 6,633 Other 1,022 899 Total $ 7,386 $ 7,532

Business Combinations - Additio

Business Combinations - Additional Information (Detail) - USD ($) $ in Thousands	Oct. 13, 2015	Apr. 30, 2015	May 31, 2015	Jun. 30, 2016	Dec. 31, 2015
Business Acquisition [Line Items]
Fair value of goodwill				$ 75,048	$ 74,565
Percentage of accrued interest			1.70%
Related party transaction maturity period			18 months
Aggregate loan amount			$ 500
RevelOps, Inc [Member]
Business Acquisition [Line Items]
Percentage of shares outstanding acquired	100.00%
Total consideration	$ 68,100
Cash consideration	$ 36,200
Number of shares issued as part of acquisition	1,252,627
Fair value of shares issued as part of acquisition	$ 27,400
Value of shares issued and vested with replacement options	$ 4,500
RevelOps, Inc [Member] | Replacement Options [Member]
Business Acquisition [Line Items]
Number of shares issued as part of acquisition	221,759
Logentries [Member]
Business Acquisition [Line Items]
Fair value in excess of vested options expensed	$ 300
Fair value of goodwill	59,200
Fair value of intangible assets	9,400
Net assets acquired	$ (500)
NT OBJECTives, Inc. [Member]
Business Acquisition [Line Items]
Percentage of shares outstanding acquired		100.00%
Total consideration		$ 6,100
Cash consideration		$ 3,400
Number of shares issued as part of acquisition		9,091
Fair value of goodwill		$ 4,600
Fair value of intangible assets		2,100
Net assets acquired		(600)
Shares issued in connection with business acquisition, value		100
Additional payment		3,000
Future cash payment		2,500
Additional payment		$ 100

Business Combinations - Busines

Business Combinations - Business acquisition, pro forma information (Detail) - Logentries [Member] - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2015
Business Acquisition Pro Forma Information [Line Items]
Total revenue	$ 26,421	$ 50,498
Net loss	$ (12,881)	$ (23,357)

Goodwill and Intangible Asset24

Goodwill and Intangible Assets - Schedule of Change in Carrying Amount of Goodwill (Detail) $ in Thousands	6 Months Ended
	Jun. 30, 2016USD ($)
Goodwill And Intangible Assets [Line Items]
Goodwill, beginning balance	$ 74,565
Goodwill, ending balance	75,048
Logentries [Member]
Goodwill And Intangible Assets [Line Items]
Acquisition	$ 483

Goodwill and Intangible Asset25

Goodwill and Intangible Assets - Schedule of Identifiable Intangible Assets (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross Carrying Amount	$ 15,110	$ 15,110
Intangible assets, Accumulated Amortization	(4,891)	(3,725)
Intangible assets, Net Book Value	$ 10,219	11,385
Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Weighted- Average Life	6 years 3 months 18 days
Intangible assets, Gross Carrying Amount	$ 719	719
Intangible assets, Accumulated Amortization	(526)	(389)
Intangible assets, Net Book Value	$ 193	330
Developed Technology [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Weighted- Average Life	5 years 10 months 24 days
Intangible assets, Gross Carrying Amount	$ 12,851	12,851
Intangible assets, Accumulated Amortization	(3,847)	(2,955)
Intangible assets, Net Book Value	$ 9,004	9,896
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Weighted- Average Life	6 years 8 months 12 days
Intangible assets, Gross Carrying Amount	$ 1,000	1,000
Intangible assets, Accumulated Amortization	(120)	(43)
Intangible assets, Net Book Value	$ 880	957
Non-compete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Weighted- Average Life	4 years 9 months 18 days
Intangible assets, Gross Carrying Amount	$ 540	540
Intangible assets, Accumulated Amortization	(398)	(338)
Intangible assets, Net Book Value	$ 142	$ 202

Goodwill and Intangible Asset26

Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 0.6	$ 0.3	$ 1.2	$ 0.5

Goodwill and Intangible Asset27

Goodwill and Intangible Assets - Schedule of Estimated Amortization Expense (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]
2016 (for the remaining six months)	$ 1,119
2,017	2,034
2,018	1,915
2,019	1,880
2,020	1,837
2021 and thereafter	1,434
Intangible assets, Net Book Value	$ 10,219	$ 11,385

Property and Equipment - Summar

Property and Equipment - Summary of Property and Equipment (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 21,318	$ 19,210
Less accumulated depreciation	(13,932)	(11,678)
Net property and equipment	7,386	7,532
Computer Equipment and Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	11,321	9,858
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	2,653	2,409
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 7,344	$ 6,943

Property and Equipment - Additi

Property and Equipment - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 1.1	$ 1	$ 2.2	$ 1.9

Stock-Based Compensation Expe30

Stock-Based Compensation Expense - Schedule of Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	$ 3,641	$ 831	$ 9,160	$ 1,406
Cost of Revenue [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	142	52	279	101
Research and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	1,524	266	3,017	410
Sales and Marketing [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	1,224	195	4,125	310
General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total stock-based compensation expense	$ 751	$ 318	$ 1,739	$ 585

Stock-Based Compensation Expe31

Stock-Based Compensation Expense - Additional Information (Detail) - USD ($)	Mar. 15, 2016	Jun. 30, 2016	Jun. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			4 years
Number of common stock repurchased		47,003
Purchase price of common stock by employees			85.00%
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock Issued During Period, Shares, Employee Stock Purchase Plans	192,676
Stock Issued During Period, Value, Employee Stock Purchase Plans	$ 2,100,000
Share issued, price per share	$ 10.88
Closing price of shares issued	$ 12.80
Employee Stock Purchase Plan [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee withholding percentage			15.00%
Restricted Stock And Restricted Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, restricted stock		$ 16,600,000	$ 16,600,000
Unrecognized compensation expense, recognition period			2 years 8 months 12 days
Options to Purchase Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, recognition period			2 years 9 months 18 days
Unrecognized compensation cost, stock options		$ 7,700,000	$ 7,700,000
Stock options vested, fair value			$ 1,600,000
Stock options granted, weighted-average grant date fair value			$ 6.19

Stock-Based Compensation Expe32

Stock-Based Compensation Expense - Summary of Restricted Stock and Restricted Stock Unit Activity (Detail) - Restricted Stock [Member]	6 Months Ended
	Jun. 30, 2016$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted shares outstanding, Beginning balance | shares	1,149,257
Restricted stock granted, Shares | shares	697,537
Restricted stock vested, Shares | shares	(359,401)
Restricted stock forfeited, Shares | shares	(56,472)
Restricted shares outstanding, Ending balance | shares	1,430,921
Weighted-average grant date fair value, Beginning balance | $ / shares	$ 19.34
Weighted-average grant date fair value, Restricted stock granted | $ / shares	12.94
Weighted-average grant date fair value, Restricted stock vested | $ / shares	20.42
Weighted-average grant date fair value, Restricted stock forfeited | $ / shares	14.13
Weighted-average grant date fair value, Ending Balance | $ / shares	$ 16.15

Stock-Based Compensation Expe33

Stock-Based Compensation Expense - Summary of Stock Option Activity (Detail) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2016USD ($)$ / sharesshares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Number of shares under stock option, Beginning balance | shares	4,246,525
Number of shares Granted | shares	1,138,576
Number of shares Exercised | shares	(335,368)
Number of shares forfeited/cancelled | shares	(283,413)
Number of shares under stock option, Ending balance | shares	4,766,320
Number of stock options, Vested and exercisable | shares	2,804,883
Number of stock options, Vested or expected to vest | shares	4,382,101
Weighted average exercise price, Beginning balance | $ / shares	$ 5.99
Weighted average exercise price, Stock options granted | $ / shares	13.02
Weighted average exercise price, Stock options exercised | $ / shares	4.53
Weighted average exercise price, Stock options forfeited/cancelled | $ / shares	10.10
Weighted average exercise price, Ending balance | $ / shares	7.53
Weighted average exercise price, Vested and exercisable | $ / shares	4.85
Weighted average exercise price, Vested and expected to vest | $ / shares	$ 7.12
Weighted Average Remaining Contractual Life, Outstanding	7 years 6 months
Weighted Average Remaining Contractual Life, Vested and exercisable	6 years 7 months 6 days
Weighted Average Remaining Contractual Life, Vested and expected to vest	7 years 4 months 24 days
Stock options aggregate intrinsic value, Outstanding | $	$ 25,351
Stock options aggregate intrinsic value, Exercisable | $	21,785
Stock options aggregate intrinsic value, Vested and expected to vest | $	$ 24,942

Net Loss Per Share - Summary of

Net Loss Per Share - Summary of Basic and Diluted Net Loss Per Share of Common Stock (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share [Abstract]
Net loss	$ (13,452)	$ (9,244)	$ (29,032)	$ (16,926)
Accretion of preferred stock to redemption value		(23,788)		(35,061)
Net loss attributable to common stockholders, basic and diluted	$ (13,452)	$ (33,032)	$ (29,032)	$ (51,987)
Weighted-average common shares outstanding, basic and diluted	41,063,613	12,745,051	40,805,641	12,693,900
Net loss per share attributable to common stockholders, basic and diluted	$ (0.33)	$ (2.59)	$ (0.71)	$ (4.10)

Net Loss Per Share - Summary 35

Net Loss Per Share - Summary of Antidilutive Securities Excluded From Computation Diluted Weighted Average Shares Outstanding (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount	6,300,712	21,169,248	6,300,712	21,169,248
Restricted Stock [Member]
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount	811,681	398,779	811,681	398,779
Restricted Stock Units (RSUs) [Member]
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount	619,240		619,240
Warrants to Purchase Common Stock [Member]
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount		200,000		200,000
Employee Stock Purchase Plan [Member]
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount	103,471		103,471
Redeemable Convertible Preferred Stock [Member]
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount		16,382,615		16,382,615
Options to Purchase Common Stock [Member]
Schedule Of Calculation Of Numerator And Denominator In Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share amount	4,766,320	4,187,854	4,766,320	4,187,854

Segment Information and Infor36

Segment Information and Information about Geographic Areas - Additional Information (Detail) - Segment	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Segment Reporting Information [Line Items]
Number of operating segment			1
United States [Member]
Segment Reporting Information [Line Items]
Percentage of net revenues	97.00%	96.00%	97.00%	96.00%

Segment Information and Infor37

Segment Information and Information about Geographic Areas - Net Revenues of Customer by Geographic Area (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Entity Wide Portfolio Carrying Amount, Major Customer [Line Items]
Net revenues, Total	$ 37,268	$ 25,790	$ 72,064	$ 49,361
North America [Member]
Entity Wide Portfolio Carrying Amount, Major Customer [Line Items]
Net revenues, Total	32,287	22,616	62,419	42,961
Other [Member]
Entity Wide Portfolio Carrying Amount, Major Customer [Line Items]
Net revenues, Total	$ 4,981	$ 3,174	$ 9,645	$ 6,400

Segment Information and Infor38

Segment Information and Information about Geographic Areas - Property and Equipment, Net By Geographic Area (Detail) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	$ 7,386	$ 7,532
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	6,364	6,633
Other [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	$ 1,022	$ 899