Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2016 | Jan. 31, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | ZEN | ||
Entity Registrant Name | Zendesk, Inc. | ||
Entity Central Index Key | 1,463,172 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 97,007,795 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 1.8 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 93,677 | $ 216,226 |
Marketable securities | 131,190 | 29,414 |
Accounts receivable, net of allowance for doubtful accounts of $1,269 and $763 as of December 31, 2016 and 2015, respectively | 37,343 | 26,168 |
Prepaid expenses and other current assets | 17,608 | 11,423 |
Total current assets | 279,818 | 283,231 |
Marketable securities, noncurrent | 75,168 | 22,336 |
Property and equipment, net | 62,731 | 56,540 |
Goodwill and intangible assets, net | 53,296 | 57,050 |
Other assets | 4,272 | 3,529 |
Total assets | 475,285 | 422,686 |
Current liabilities: | ||
Accounts payable | 4,555 | 9,332 |
Accrued liabilities | 19,106 | 9,742 |
Accrued compensation and related benefits | 20,281 | 14,115 |
Deferred revenue | 123,276 | 84,210 |
Total current liabilities | 167,218 | 117,399 |
Deferred revenue, noncurrent | 1,257 | 1,405 |
Other liabilities | 7,382 | 10,592 |
Total liabilities | 175,857 | 129,396 |
Commitments and contingencies (Note 8) | ||
Stockholders’ equity: | ||
Preferred stock, par value $0.01 per share: no shares issued or outstanding; 10.0 million shares authorized as of December 31, 2016 and 2015 | 0 | 0 |
Common stock, par value $0.01 per share: 400.0 million shares authorized; 97.2 million and 90.9 million shares issued; 96.7 million and 90.3 million shares outstanding as of December 31, 2016 and 2015, respectively (including 0.1 million and 0.3 million shares subject to repurchase, legally issued and outstanding as of December 31, 2016 and 2015, respectively) | 971 | 905 |
Additional paid-in capital | 624,026 | 511,183 |
Accumulated other comprehensive loss | (5,197) | (2,225) |
Accumulated deficit | (319,720) | (215,921) |
Treasury stock, at cost; 0.5 million shares as of December 31, 2016 and 2015 | (652) | (652) |
Total stockholders’ equity | 299,428 | 293,290 |
Total liabilities and stockholders’ equity | $ 475,285 | $ 422,686 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 1,269 | $ 763 |
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 97,200,000 | 90,900,000 |
Common stock, shares outstanding (in shares) | 96,700,000 | 90,300,000 |
Common stock shares outstanding, subject to repurchase (in shares) | 100,000 | 300,000 |
Treasury stock, shares (in shares) | 500,000 | 500,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Income Statement [Abstract] | ||||
Revenue | $ 311,999 | $ 208,768 | $ 127,049 | |
Cost of revenue | [1] | 93,900 | 67,184 | 46,047 |
Gross profit | 218,099 | 141,584 | 81,002 | |
Operating expenses: | ||||
Research and development | [1] | 91,067 | 62,615 | 36,403 |
Sales and marketing | [1] | 166,987 | 114,052 | 77,875 |
General and administrative | [1] | 64,371 | 47,902 | 32,869 |
Total operating expenses | [1] | 322,425 | 224,569 | 147,147 |
Operating loss | (104,326) | (82,985) | (66,145) | |
Other income (expense), net | 1,520 | (729) | (1,533) | |
Loss before provision for (benefit from) income taxes | (102,806) | (83,714) | (67,678) | |
Provision for (benefit from) income taxes | 993 | 338 | (263) | |
Net loss | (103,799) | (84,052) | (67,415) | |
Accretion of redeemable convertible preferred stock | 0 | 0 | (18) | |
Net loss attributable to common stockholders | $ (103,799) | $ (84,052) | $ (67,433) | |
Net loss per share attributable to common stockholders, basic and diluted (usd per share) | $ (1.11) | $ (0.99) | $ (1.26) | |
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares) | 93,161 | 84,926 | 53,571 | |
[1] | Includes share-based compensation expense as follows as of December 31, 2016, 2015, and 2014:Cost of revenue: $7,045, $4,541, $2,464Research and development: $27,083, $19,414, $10,918Sales and marketing: $23,043, $14,759, $10,680General and administrative: $16,608, $13,842, $8,077 |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based compensation expense | $ 73,779 | $ 52,556 | $ 32,139 |
Cost of Revenue | |||
Share-based compensation expense | 7,045 | 4,541 | 2,464 |
Research and Development | |||
Share-based compensation expense | 27,083 | 19,414 | 10,918 |
Sales and Marketing | |||
Share-based compensation expense | 23,043 | 14,759 | 10,680 |
General and Administrative | |||
Share-based compensation expense | $ 16,608 | $ 13,842 | $ 8,077 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (103,799) | $ (84,052) | $ (67,415) |
Other comprehensive loss, net of tax | |||
Net change in unrealized loss on available-for-sale investments | (213) | (44) | (71) |
Foreign currency translation loss | (488) | (942) | (467) |
Net change in unrealized loss on derivative instruments | (2,271) | (711) | 0 |
Comprehensive loss | $ (106,771) | $ (85,749) | $ (67,953) |
CONSOLIDATED STATEMENTS OF REDE
CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Redeemable Convertible Preferred Stock |
Balances at Dec. 31, 2013 | $ (46,276) | $ 229 | $ 18,591 | $ (652) | $ 10 | $ (64,454) | $ 71,369 |
Balances (in shares) at Dec. 31, 2013 | 23,710 | (535) | 23,598 | ||||
Issuance of common stock upon initial public offering, net of issuance costs | 103,090 | $ 128 | 102,962 | ||||
Issuance of common stock upon initial public offering, net of issuance costs (in shares) | 12,778 | ||||||
Accretion of redeemable convertible preferred stock | (18) | (18) | $ 18 | ||||
Conversion of preferred stock to common stock upon initial public offering | 71,387 | $ 343 | 71,044 | $ (71,387) | |||
Conversion of preferred stock to common stock upon initial public offering (in shares) | 34,323 | (23,598) | |||||
Issuance of common stock for acquisition of Zopim | 10,892 | $ 9 | 10,883 | ||||
Issuance of common stock for acquisition of Zopim (in shares) | 902 | ||||||
Issuance of common stock upon exercise of stock options | 4,970 | $ 32 | 4,938 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 3,207 | ||||||
Issuance of common stock for settlement of restricted stock units (RSUs) | 0 | $ 5 | (5) | ||||
Issuance of common stock for settlement of restricted stock units (RSUs) (in shares) | 517 | ||||||
Shares withheld related to net share settlement of RSUs | (2,118) | $ (1) | (2,117) | ||||
Shares withheld related to net share settlement of RSUs (in shares) | (147) | ||||||
Issuance of common stock upon early exercise of stock options (in shares) | 309 | ||||||
Vesting of early exercised stock options | 1,512 | $ 5 | 1,507 | ||||
Issuance of common stock in connection with employee stock purchase plans | 3,271 | $ 4 | 3,267 | ||||
Issuance of common stock in connection with employee stock purchase plans (in shares) | 428 | ||||||
Issuance of common stock upon exercise of warrants | 0 | $ 1 | (1) | ||||
Issuance of common stock upon exercise of warrants (in shares) | 111 | ||||||
Repurchase of common stock (in shares) | (4) | ||||||
Share-based compensation | 34,615 | 34,615 | |||||
Tax benefit from share-based award activity | 334 | 334 | |||||
Other comprehensive loss, net of income taxes | (538) | (538) | |||||
Net loss | (67,415) | (67,415) | |||||
Balances at Dec. 31, 2014 | 113,706 | $ 755 | 246,000 | $ (652) | (528) | (131,869) | $ 0 |
Balances (in shares) at Dec. 31, 2014 | 76,134 | (535) | 0 | ||||
Issuance of common stock upon initial public offering, net of issuance costs | 190,096 | $ 88 | 190,008 | ||||
Issuance of common stock upon initial public offering, net of issuance costs (in shares) | 8,780 | ||||||
Issuance of common stock upon exercise of stock options | 10,613 | $ 33 | 10,580 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 3,275 | ||||||
Issuance of common stock for settlement of restricted stock units (RSUs) | (609) | $ 17 | (626) | ||||
Issuance of common stock for settlement of restricted stock units (RSUs) (in shares) | 1,655 | ||||||
Vesting of early exercised stock options | 1,046 | 1,046 | |||||
Issuance of common stock in connection with employee stock purchase plans | 9,375 | $ 12 | 9,363 | ||||
Issuance of common stock in connection with employee stock purchase plans (in shares) | 1,019 | ||||||
Repurchase of common stock (in shares) | (2) | ||||||
Share-based compensation | 54,363 | 54,363 | |||||
Tax benefit from share-based award activity | 449 | 449 | |||||
Other comprehensive loss, net of income taxes | (1,697) | (1,697) | |||||
Net loss | (84,052) | (84,052) | |||||
Balances at Dec. 31, 2015 | 293,290 | $ 905 | 511,183 | $ (652) | (2,225) | (215,921) | $ 0 |
Balances (in shares) at Dec. 31, 2015 | 90,861 | (535) | 0 | ||||
Issuance of common stock upon exercise of stock options | $ 25,435 | $ 29 | 25,406 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 2,924 | 2,924 | |||||
Issuance of common stock for settlement of restricted stock units (RSUs) | $ (803) | $ 29 | (832) | ||||
Issuance of common stock for settlement of restricted stock units (RSUs) (in shares) | 2,894 | ||||||
Vesting of early exercised stock options | 629 | $ 1 | 628 | ||||
Issuance of common stock in connection with employee stock purchase plans | $ 10,892 | $ 7 | 10,885 | ||||
Issuance of common stock in connection with employee stock purchase plans (in shares) | 554 | ||||||
Repurchase of common stock (in shares) | (38) | (38) | |||||
Share-based compensation | $ 76,419 | 76,419 | |||||
Tax benefit from share-based award activity | 337 | 337 | |||||
Other comprehensive loss, net of income taxes | (2,972) | (2,972) | |||||
Net loss | (103,799) | ||||||
Balances at Dec. 31, 2016 | $ 299,428 | $ 971 | $ 624,026 | $ (652) | $ (5,197) | $ (319,720) | $ 0 |
Balances (in shares) at Dec. 31, 2016 | 97,195 | (535) | 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities | |||
Net loss | $ (103,799) | $ (84,052) | $ (67,415) |
Adjustments to reconcile net loss to net cash provided by operating activities | |||
Depreciation and amortization | 27,506 | 19,744 | 11,456 |
Share-based compensation | 73,779 | 52,556 | 32,139 |
Excess tax benefit from share-based award activity | (337) | (449) | (334) |
Other | 3,106 | 1,457 | 337 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (11,808) | (14,989) | (3,846) |
Prepaid expenses and other current assets | (6,286) | (5,510) | (1,444) |
Other assets and liabilities | (3,887) | (3,204) | 1,742 |
Accounts payable | (3,486) | 2,017 | 947 |
Accrued liabilities | 5,261 | 2,204 | 351 |
Accrued compensation and related benefits | 6,055 | 1,706 | 5,767 |
Deferred revenue | 38,418 | 33,853 | 22,390 |
Net cash provided by operating activities | 24,522 | 5,333 | 2,090 |
Cash flows from investing activities | |||
Purchases of property and equipment | (20,647) | (22,989) | (21,665) |
Internal-use software development costs | (6,310) | (4,705) | (8,013) |
Purchases of marketable securities | (249,048) | (70,303) | (54,330) |
Proceeds from maturities of marketable securities | 39,690 | 36,982 | 10,450 |
Proceeds from sale of marketable securities | 53,951 | 32,152 | 4,004 |
Decrease in restricted cash | 0 | 0 | 153 |
Net cash used in investing activities | (182,364) | (72,721) | (71,297) |
Cash flows from financing activities | |||
Proceeds from initial public offering, net of issuance costs | 0 | 0 | 103,090 |
Proceeds from follow-on public offering, net of issuance costs | 0 | 190,094 | 0 |
Proceeds from exercise of employee stock options | 25,412 | 10,609 | 7,229 |
Proceeds from employee stock purchase plan | 11,004 | 9,526 | 4,404 |
Taxes paid related to net share settlement of equity awards | (803) | (609) | (2,117) |
Excess tax benefit from share-based award activity | 337 | 449 | 334 |
Principal payments on debt | (323) | (6,952) | (20,748) |
Proceeds from issuance of debt | 0 | 0 | 3,940 |
Principal payments on capital lease obligations | 0 | (10) | (364) |
Net cash provided by financing activities | 35,627 | 203,107 | 95,768 |
Effect of exchange rates changes on cash and cash equivalents | (334) | 242 | (21) |
Net increase (decrease) in cash and cash equivalents | (122,549) | 135,961 | 26,540 |
Cash and cash equivalents at the beginning of period | 216,226 | 80,265 | 53,725 |
Cash and cash equivalents at the end of period | 93,677 | 216,226 | 80,265 |
Supplemental cash flow data: | |||
Cash paid for interest and income taxes | 1,678 | 793 | 1,056 |
Non-cash investing and financing activities: | |||
Issuance of common stock for the acquisition of Zopim | 0 | 0 | 10,892 |
Vesting of early exercised stock options | 628 | 1,048 | 1,512 |
Balance of property and equipment in accounts payable and accrued expenses | 3,610 | 3,179 | 484 |
Property and equipment acquired through tenant improvement allowances | 237 | 174 | 3,932 |
Share-based compensation capitalized in internal-use software development costs | 2,365 | 2,085 | 2,476 |
We Are Cloud, Inc | |||
Cash flows from investing activities | |||
Cash paid for the acquisition, net of cash acquired | 0 | (42,758) | 0 |
Zopim | |||
Cash flows from investing activities | |||
Cash paid for the acquisition, net of cash acquired | $ 0 | $ (1,100) | $ (1,896) |
Organization
Organization | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Zendesk was founded in Denmark in 2007 and reincorporated in Delaware in April, 2009 . We are a software development company that provides SaaS products that are intended to help organizations and their customers build better relationships. With our origins in customer service, we have evolved our offerings over time to a family of products that work together to help organizations understand their customers, improve communications, and engage where and when it’s needed most. Our product family is built upon a modern architecture that enables us and our customers to rapidly innovate, adapt our technology in novel ways, and easily integrate with other products and applications. References to Zendesk, the “Company”, “our”, or “we” in these notes refer to Zendesk, Inc. and its subsidiaries on a consolidated basis. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements have been prepared in accordance with GAAP. The consolidated financial statements include the accounts of Zendesk, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. Initial Public Offering In May 2014, we completed our initial public offering, or IPO, in which we issued and sold 12.8 million shares of common stock at a public offering price of $9.00 per share. We received net proceeds of $103.1 million after deducting underwriting discounts and commissions of $8.1 million and other offering expenses of $3.8 million . Upon the closing of the IPO, all shares of our then-outstanding redeemable convertible preferred stock automatically converted into an aggregate of 34.3 million shares of common stock. Follow-On Public Offering In March 2015, we completed a follow-on public offering, in which we issued and sold 8.8 million shares of our common stock at a public offering price of $22.75 per share. We received net proceeds of $190.1 million after deducting underwriting discounts and commissions of $8.7 million and other offering expenses of $0.9 million . Reclassification Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reported periods. Significant items subject to such estimates and assumptions include the fair value of our common stock (through the date of our IPO) and share-based awards, fair value of acquired intangible assets, goodwill, unrecognized tax benefits, useful lives of acquired intangible assets and property and equipment, the capitalization and estimated useful life of our capitalized internal-use software, and financial forecasts used in currency hedging. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ from those estimates. Segment Information Our chief operating decision maker reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating our financial performance. Accordingly, we have determined that we operate in a single operating segment. Revenue Recognition We generate substantially all of our revenue from subscription services, which are comprised of subscription fees from customer accounts on Zendesk Support and, to a lesser extent, Chat and Talk. In addition, we generate revenue by providing additional features to certain of our subscription plans for a fee that is incremental to the base subscription rate for such plan. Arrangements with customers do not provide the customer with the right to take possession of the software supporting our products at any time, and are therefore accounted for as service contracts. Subscription service arrangements are generally non-cancelable and do not provide for refunds to customers in the event of cancellations or any other right of return. We record revenue net of sales and excise taxes. We commence revenue recognition when all of the following conditions are met: • There is persuasive evidence of an arrangement; • The service has been or is being provided to the customer; • The collection of the fees is reasonably assured; and • The amount of fees to be paid by the customer is fixed or determinable. Subscription revenue is recognized on a straight-line basis over the contractual term of the arrangement beginning on the date that our service is made available to the customer. Payments received in advance of services being rendered are recorded as deferred revenue and recognized on a straight-line basis over the requisite service period. Certain customers have arrangements that provide for a maximum number of users over the contract term, with usage measured monthly. Revenue for these arrangements is recognized ratably over the contract terms until such time as a better pattern of recognition is evident. Incremental fees are incurred when the maximum number of users is exceeded, and any incremental fees are recognized as revenue ratably over the remaining contractual term. We derive an immaterial amount of revenue from implementation, Talk usage, and training services, for which we recognize revenue upon completion. Deferred Revenue Deferred revenue consists primarily of customer billings in advance of revenue being recognized. We invoice customers for subscriptions to our products in monthly, quarterly, or annual installments. Deferred revenue that is anticipated to be recognized during the succeeding 12-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent deferred revenue. Deferred revenue associated with implementation, Talk usage, and training services was immaterial as of December 31, 2016 and 2015 . Cost of Revenue Cost of revenue consists primarily of personnel costs (including salaries, share-based compensation, and benefits) for employees associated with our infrastructure and our product support organizations, depreciation, hosting, and other expenses associated with our data centers, amortization expense associated with capitalized internal-use software, payment processing fees, amortization expense associated with acquired intangible assets, third party license fees, and allocated shared costs, including facilities, information technology, and security costs. Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents. Cash and cash equivalents are recorded at fair value and consist primarily of bank deposits and money market funds. As of December 31, 2016 , our restricted cash balance was $2.5 million , consisting of $1.1 million cash collateral related to our cash flow hedges, $1.0 million pledged for charitable donation, and $0.4 million related to a deposit for a leased building. As of December 31, 2015, our restricted cash balance was $1.3 million , consisting of $0.9 million pledged for charitable donation, and $0.4 million related to a deposit for a leased building. Restricted cash is included within other assets on our consolidated balance sheet. Marketable Securities Marketable securities consist of corporate bonds, asset-backed securities, U.S. Treasury securities, commercial paper, agency securities, and money market funds. We classify marketable securities as available-for-sale at the time of purchase and reevaluate such classification as of each balance sheet date. All marketable securities are recorded at their estimated fair value. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive loss. We evaluate our investments to assess whether those with unrealized loss positions are other than temporarily impaired. Impairments are considered other than temporary if they are related to deterioration in credit risk or if it is likely we will sell the securities before the recovery of their cost basis. Realized gains and losses and declines in value determined to be other than temporary are determined based on the specific identification method and are reported in other expense, net in the consolidated statements of operations. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of allowance for doubtful accounts. The allowance is based upon historical loss patterns, the age of each past due invoice, and an evaluation of the potential risk of loss associated with delinquent accounts. Accounts receivable deemed uncollectable are charged against the allowance for doubtful accounts when identified. The allowance for doubtful accounts consists of the following activity (in thousands): Year Ended December 31, 2016 2015 Allowance for doubtful accounts, beginning balance $ 763 $ 264 Additions 2,029 1,281 Write-offs (1,523 ) (782 ) Allowance for doubtful accounts, ending balance $ 1,269 $ 763 Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of assets. Maintenance and repair costs are charged to expense as incurred. The estimated useful lives of our property and equipment are as follows: Furniture and fixtures 5 years Hosting equipment 3 years Computer equipment and software 3 years Leasehold improvements Shorter of the lease term or estimated useful life Depreciation expense of assets acquired through capital leases is included in depreciation and amortization expense in the accompanying consolidated statements of operations. Derivative Instruments and Hedging We enter into foreign currency forward contracts with certain financial institutions to mitigate the impact of foreign currency fluctuations on our future cash flows and earnings. All of our foreign currency forward contracts are designated as cash flow hedges. Our foreign currency forward contracts generally have maturities of fifteen months or less. We recognize all forward contracts on our balance sheet at fair value as either assets or liabilities. The effective portion of the gain or loss on each forward contract is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings to revenue, cost of revenue or operating expense in the same period, or periods, during which the hedged transaction affects earnings. The ineffective portion of the gains or losses, if any, is recorded immediately in other income (expense), net. The change in time value related to our cash flow hedges is excluded from the assessment of hedge effectiveness and is recorded immediately in other income (expense), net. We evaluate the effectiveness of our cash flow hedges on a quarterly basis. We have a master netting agreement with each of our counterparties, which permits net settlement of multiple, separate derivative contracts with a single payment. We may also be required to exchange cash collateral with certain of our counterparties on a regular basis. As of December 31, 2016 , we have a restricted cash balance of $1.1 million associated with cash collateral exchanged. ASC 815 permits companies to present the fair value of derivative instruments on a net basis according to master netting arrangements. We have elected to present our derivative instruments on a gross basis in our consolidated financial statements. We do not enter into any derivative contracts for trading or speculative purposes. Fair Value Measurements We measure certain financial instruments at fair value using a fair value hierarchy. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Other inputs that are directly or indirectly observable in the marketplace. Level 3—Unobservable inputs that are supported by little or no market activity. Our marketable securities are classified within either Level 1 or Level 2 and our foreign currency forward contracts are classified within Level 2. We have no financial assets or liabilities measured using Level 3 inputs. The fair value of our Level 1 marketable securities is based on quoted market prices of identical underlying securities. The fair value of our Level 2 marketable securities is based on indirect or directly observable market data, including readily available pricing sources for identical underlying securities that may not be actively traded. The fair value of our foreign currency forward contracts is based on quoted prices and market observable data of similar instruments in active markets, such as currency spot rates, forward rates, and LIBOR. For certain other financial instruments, including accounts receivable, accounts payable and other current liabilities, the carrying amounts approximate their fair value due to the relatively short maturity of these balances. Based on borrowing rates available to us for loans with similar terms and maturities, the carrying value of borrowings approximates fair value within Level 2 of the fair value hierarchy. Capitalized Internal-Use Software Costs We capitalize certain development costs incurred in connection with software development for our platform and software used in operations. Costs incurred in the preliminary stages of development are expensed as incurred. Once software 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. Capitalization ceases upon completion of all substantial testing. We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Capitalized costs are recorded as part of property and equipment. Maintenance and training costs are expensed as incurred. Capitalized internal-use software is amortized on a straight-line basis over its estimated useful life and recorded in cost of revenue within the accompanying consolidated statements of operations. The weighted-average useful life of our capitalized internal-use software was 3.3 years as of December 31, 2016 . Business Combinations When we acquire businesses, we allocate the purchase price to the net tangible and identifiable intangible assets. Any residual purchase price is recorded as goodwill. The allocation of the purchase price requires management to make significant estimates in determining the fair values of assets acquired and liabilities assumed, especially with respect to intangible assets. These estimates can include, but are not limited to, the cash flows that an asset is expected to generate in the future, the appropriate weighted-average cost of capital, and the cost savings expected to be derived from acquiring an asset. These estimates are inherently uncertain and unpredictable. Goodwill, Acquired Intangible Assets, and Impairment Assessment of Long-Lived Assets Goodwill. Goodwill represents the excess purchase consideration of an acquired business over the fair value of the net tangible and identifiable intangible assets. Goodwill is evaluated for impairment annually in the third quarter, and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Triggering events that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate or a significant decrease in expected cash flows. No impairment charges were recorded during the years ended December 31, 2016 and 2015 . Acquired Intangible Assets. Acquired intangible assets consist of identifiable intangible assets, primarily developed technology and customer relationships, resulting from our acquisitions. Intangible assets are recorded at fair value on the date of acquisition and amortized over their estimated useful lives. Impairment of Long-Lived Assets. The carrying amounts of our long-lived assets, including property and equipment, capitalized internal-use software, and acquired intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable or that the useful life is shorter than originally estimated. Recoverability of assets to be held and used is measured by comparing the carrying amount of an asset to future undiscounted net cash flows the asset is expected to generate over its remaining life. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. If the useful life is shorter than originally estimated, we amortize the remaining carrying value over the new shorter useful life. There were no material impairments for the years ended December 31, 2016 and 2015 . Share-Based Compensation Share-based compensation expense to employees is measured based on the fair value of the awards on the grant date and recognized in our consolidated statements of operations over the period during which the employee is required to perform services in exchange for the award (generally the vesting period of the award, which is typically 4 years ). We estimate the fair value of stock options granted using the Black-Scholes option valuation model. We measure the fair value of restricted stock units, or RSUs, based on the fair value of the underlying shares on the date of grant. Compensation expense for awards with only service conditions is recognized over the vesting period of the applicable award using the straight-line method. All RSUs and certain options granted to employees prior to our IPO vest upon the satisfaction of both a service condition and a performance condition. These RSUs and stock options with both a service condition and performance condition are collectively referred to as “Performance Awards” in the following discussion. The service condition for substantially all of these awards is satisfied over four years . The performance condition was satisfied upon the occurrence of a qualifying liquidity event which occurred upon the effectiveness of the registration statement related to our IPO. No share-based compensation expense was recognized for the Performance Awards prior to the IPO as the performance condition had not been deemed probable to have been met. Upon the satisfaction of the performance condition in May 2014, we recognized a cumulative share-based compensation expense for the portion of the Performance Awards that had met the service condition. The remaining unrecognized share-based compensation expense was recorded over the remaining requisite service period using the accelerated attribution method, net of estimated forfeitures. For the years ended December 31, 2016 , 2015 , and 2014, share-based compensation expense related to the Performance Awards was $2.8 million , $6.1 million and $12.7 million , respectively. As of December 31, 2016 , we had a total of $173.4 million in future period share-based compensation expense related to all equity awards, net of estimated forfeitures, to be recognized over a weighted average period of 2.7 years. Advertising Expense Advertising is expensed as incurred. For the years ended December 31, 2016 , 2015 , and 2014 , advertising expense was $23.9 million , $16.5 million , and $12.7 million , respectively. Government Grants We have obtained government grants in certain jurisdictions where we operate. We receive the grant funds as we meet certain commitments, including targeted levels of employment and/or spending within the local jurisdictions. If we fail to maintain these commitments, we may be required to repay grant funds received or be ineligible to receive future funding. We recognize grant proceeds to offset costs to which the grants relate on a straight-line basis when it is reasonably assured that the applicable commitments have been met. For the year ended December 31, 2016 , we recognized grant proceeds of $1.2 million in our consolidated statements of operations. We did not receive grant proceeds in 2015 or 2014. Income Taxes We record income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in our consolidated financial statements or tax returns. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized. We recognize tax benefits from uncertain tax positions if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and results of operations. We have elected to record interest accrued and penalties related to unrecognized tax benefits in our consolidated financial statements as a component of provision for income taxes. Foreign Currency The functional currency of our foreign subsidiaries, with the exception of our Singapore subsidiary, is the U.S. dollar. Accordingly, monetary balance sheet accounts are remeasured using exchange rates in effect at the balance sheet dates and non-monetary items are remeasured at historical exchange rates. Expenses are generally remeasured at the average exchange rates for the period. Foreign currency remeasurement and transaction gains and losses are included in other expense, net on the statements of operations and were not material for the periods presented. The functional currency of our Singapore subsidiary is the Singapore dollar. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet dates. Revenue and expenses are translated at the average exchange rates for the period. Amounts classified in stockholders’ equity are translated at historical exchange rates. Translation gains and losses are recorded in accumulated other comprehensive loss income as a component of stockholders' equity. Concentrations of Risk Financial instruments potentially exposing us to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, marketable securities, accounts receivable and derivative instruments. We place our cash and cash equivalents with high-credit-quality financial institutions. However, we maintain balances in excess of the FDIC insurance limits. We do not require our customers to provide collateral to support accounts receivable and maintain an allowance for doubtful accounts receivable balances. We seek to mitigate counterparty credit risk related to our derivative instruments by transacting with major financial institutions with high credit ratings. At December 31, 2016 and 2015 , there were no customers that represented more than 10% of our accounts receivable balance. There were no customers that individually exceeded 10% of our revenue in any of the periods presented. Recently Issued and Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or the FASB, issued new revenue guidance that provides principles for recognizing revenue to which an entity expects to be entitled for the transfer of promised goods or services to customers. As currently issued and amended, the new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, though early adoption is permitted for annual reporting periods beginning after December 15, 2016. The guidance may be applied retrospectively to each prior period presented (full retrospective method), or with the cumulative effect recognized as of the date of initial adoption (modified retrospective method). We currently intend to adopt using the full retrospective approach, however our decision has not been finalized. We continue to assess the impact of the new guidance on our existing revenue arrangements. As a result of adoption, we also expect to capitalize a significant portion of our sales commissions and other incremental costs to acquire contracts, which we historically expensed as incurred, which will result in an increase in deferred costs recognized on our balance sheet. We have not yet concluded the useful life of our capitalized costs, which will affect the classification and magnitude of the deferred costs at each reporting period. We continue to quantify the effect of these changes on our consolidated financial statements. In April 2015, the FASB issued ASU 2015-05, “ Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement, ” which amended the existing accounting standards for intangible assets. The amendments provide explicit guidance to customers in determining the accounting for fees paid in a cloud computing arrangement, wherein the arrangements that do not convey a software license to the customer are accounted for as service contracts. We adopted this guidance in our first quarter of 2016. The adoption of this new standard did not have a material effect on our consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, “ Simplifying the Accounting for Measurement-Period Adjustments ,” which requires that an acquirer in a business combination recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The new standard is required to be adopted prospectively. We adopted this guidance in the first quarter of 2016. The adoption of this standard did not have a material effect on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, regarding ASC Topic 842 “ Leases. ” This new standard requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets and eliminates certain real estate-specific provisions. The new guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. Early adoption is permitted. We are currently evaluating the effect of this standard on our consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, regarding ASC Topic 718 “ Compensation - Stock Compensation. ” This amendment changes certain aspects of accounting for share-based compensation to employees, including the recognition of income tax effects of awards when the awards vest or are settled, requirements on net share settlement to cover tax withholding, and accounting for forfeitures. The new guidance is effective for annual reporting periods beginning after December 15, 2016. We plan to adopt this standard in our first quarter of 2017. Under the new guidance, we intend to recognize forfeitures as they occur, rather than applying an estimated forfeiture rate. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, regarding ASC Topic 230 “ Statement of Cash Flows. ” This update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, “ Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory ,” which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The new guidance is effective for annual reporting periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual reporting period. The new standard must be adopted using a modified retrospective transition method, with the cumulative effect recognized as of the date of initial adoption. We plan to early adopt this standard in our first quarter of 2017. The adoption of this new guidance is not expected to have a material effect on our consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, “ Statement of Cash Flows - Restricted Cash ,” which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. The standard is effective for fiscal years beginning after December 15, 2017, however early adoption is permitted. The new standard must be adopted retrospectively. We are currently evaluating the effect of this standard on our consolidated statements of cash flows. In January 2017, the FASB issued ASU 2017-01, “ Business Combinations - Clarifying the Definition of a Business ,” which clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The standard is effective for fiscal years beginning after December 15, 2017, however early adoption is permitted. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, regarding ASC Topic 350 “ Simplifying the Test for Goodwill Impairment, ” which simplifies the required methodology to calculate an impairment charge for goodwill. The standard is effective for fiscal years beginning after December 15, 2019, however early adoption is permitted. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations We Are Cloud SAS On October 13, 2015, we completed the acquisition of WAC, the maker of BIME Analytics software. We acquired 100 percent of the outstanding shares of WAC in exchange for purchase consideration of $46.4 million in cash, including working capital adjustments. As partial security for standard indemnification obligations, $7.0 million of the consideration was held in escrow for a period of up to 18 months , a portion of which was released 12 months following the closing of the acquisition. We incurred transaction costs of $1.0 million in connection with the acquisition. The transaction costs were expensed as incurred and recognized within general and administrative expenses. In 2016, we finalized our purchase accounting for the acquisition. The total purchase price was allocated to the assets acquired and liabilities assumed as set forth below (in thousands). The excess of the purchase price over the net assets acquired was recorded as goodwill. Goodwill generated from the acquisition is primarily attributable to expected synergies, including cost savings from integrating the analytics technology with our infrastructure and the opportunity to sell the analytics software alongside our existing products. Goodwill is not deductible for income tax purposes. Goodwill will not be amortized but instead will be tested for impairment at least annually and more frequently if certain indicators of impairment are present. Net tangible assets acquired $ 2,140 Net deferred tax liability recognized (1,979 ) Identifiable intangible assets: Developed technology 8,800 Customer relationships 500 Goodwill 36,896 Total purchase price $ 46,357 The developed technology and customer relationship intangible assets were each assigned useful lives of 4.5 years . In connection with the acquisition, we entered into retention arrangements with certain employees of WAC, pursuant to which we issued RSUs for approximately 0.5 million shares of our common stock, most of which vest in three annual installments from the date of acquisition. The expense related to the RSUs will be accounted for as share-based compensation expense over the required service periods and was not included in the purchase consideration. The results of operations of WAC have been included in our consolidated financial statements from the date of the acquisition. The following unaudited pro forma information presents the combined results of operations as if the acquisition had been completed on January 1, 2014, the beginning of the comparable prior annual reporting period. The unaudited pro forma results include: (i) recognition of the post-acquisition share-based compensation and other compensation expense; (ii) amortization associated with the acquired intangible assets, based on preliminary estimates of fair value; (iii) acquisition-related costs incurred by Zendesk and WAC; (iv) the impact of fair value adjustments to deferred revenue and capitalized software; (v) the income tax benefit associated with WAC’s historical loss before income taxes, and the pro forma adjustments. The unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies or the effect of the incremental costs incurred in integrating the two companies. Accordingly, the unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations (in thousands): Year Ended December 31, 2015 2014 Revenue $ 210,647 $ 127,932 Net loss attributable to common stockholders (87,348 ) (74,670 ) Zopim Technologies On March 21, 2014, we completed the acquisition of Zopim, a software development company that provides a SaaS live chat service. The total adjusted acquisition date fair value of consideration transferred was $15.8 million , including $4.9 million of cash and $10.9 million of our common stock, all of which was issued on the acquisition date. The total purchase price was allocated to assets acquired and liabilities assumed as set forth below (in thousands). The excess of the purchase price over the net assets acquired was recorded as goodwill. Goodwill generated from the acquisition is attributable to expected synergies from future growth and potential future monetization opportunities, and is not deductible for tax purposes. Net tangible liabilities assumed $ (385 ) Intangible assets 6,560 Goodwill 9,594 Total purchase price $ 15,769 In connection with the acquisition, we also established a retention plan pursuant to which we issued RSUs for 0.9 million shares of our common stock, which vest in three annual installments from the date of acquisition. In addition, we agreed to pay cash in an aggregate amount of $3.0 million in two annual installments from the date of acquisition to Zopim employees in connection with their continued employment, which is recorded as compensation expense over the associated service periods of such employees. As of December 31, 2016 , RSUs for 0.6 million shares of our common stock have vested pursuant to the terms of the retention plan, and we have paid the cash retention bonus of $3.0 million . Pro forma revenue and results of operations have not been presented because the historical results of Zopim were not material to our consolidated financial statements in any period presented. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Financial Instruments | Financial Instruments Investments The following tables present information about our financial assets measured at fair value on a recurring basis as of December 31, 2016 and 2015 based on the three-tier fair value hierarchy (in thousands): Fair Value Measurement at Level 1 Level 2 Total Description Corporate bonds $ — 124,930 $ 124,930 Asset-backed securities — 32,567 32,567 U.S. treasury securities — 30,585 30,585 Commercial paper — 9,787 9,787 Agency securities — 8,489 8,489 Money market funds $ 3,545 $ — $ 3,545 Total $ 3,545 $ 206,358 $ 209,903 Included in cash and cash equivalents $ 3,545 Included in marketable securities $ 206,358 Fair Value Measurement at Level 1 Level 2 Total Description Corporate bonds $ — $ 31,761 $ 31,761 Money market funds 21,338 — 21,338 Asset-backed securities — 7,998 7,998 Commercial paper — 5,992 5,992 U.S. treasury securities — 4,001 4,001 Agency securities $ — $ 1,998 $ 1,998 Total $ 21,338 $ 51,750 $ 73,088 Included in cash and cash equivalents $ 21,338 Included in marketable securities $ 51,750 There were no transfers between fair value measurement levels during the years ended December 31, 2016 or 2015 . Gross unrealized gains or losses for cash equivalents and marketable securities as of December 31, 2016 and 2015 were no t material. As of December 31, 2016 and 2015 , there were no securities that were in an unrealized loss position for more than twelve months. The following table classifies our marketable securities by contractual maturity as of December 31, 2016 and 2015 (in thousands): December 31, December 31, Due in one year or less $ 131,190 $ 29,414 Due after one year 75,168 22,336 Total $ 206,358 $ 51,750 Derivative Instruments and Hedging Our foreign currency exposures typically arise from expenditures associated with foreign operations and sales in foreign currencies for subscriptions to our products. In September 2015, we implemented a hedging program to mitigate the effect of foreign currency fluctuations on our future cash flows and earnings. We enter into foreign currency forward contracts with certain financial institutions and designate those contracts as cash flow hedges. Our foreign currency forward contracts generally have maturities of 15 months or less. As of December 31, 2016 , the balance of accumulated other comprehensive loss included an unrealized loss of $3.0 million related to the effective portion of changes in the fair value of foreign currency forward contracts designated as cash flow hedges. As of December 31, 2016 , we have posted cash collateral related to our cash flow hedges of $1.1 million . We expect to reclassify $2.8 million from accumulated other comprehensive loss into earnings over the next 12 months associated with our cash flow hedges. The following table presents information about our derivative instruments on the consolidated balance sheet as of December 31, 2016 and 2015 (in thousands): December 31, 2016 Asset Derivatives Liability Derivatives Derivative Instrument Balance Sheet Location Fair Value Balance Sheet Location Fair Value Foreign currency forward contracts Other current assets $ 868 Accrued liabilities $ 4,280 Total $ 868 $ 4,280 December 31, 2015 Asset Derivatives Liability Derivatives Derivative Instrument Balance Sheet Location Fair Value Balance Sheet Location Fair Value Foreign currency forward contracts Other current assets $ 408 Accrued liabilities $ 1,081 Total $ 408 $ 1,081 Our foreign currency forward contracts had a total notional value of $79.6 million and $60.8 million as of December 31, 2016 and 2015 , respectively. The following table presents information about our derivative instruments on the statement of operations for the year ended December 31, 2016 and 2015 (in thousands): Year Ended December 31, 2016 Year Ended December 31, 2015 Derivative Instrument Location of Loss Reclassified into Earnings Loss Recognized in AOCI Loss Reclassified from AOCI into Earnings Loss Recognized in AOCI Loss Reclassified from AOCI into Earnings Foreign currency forward contracts Revenue, cost of revenue, operating expenses $ (3,174 ) $ (903 ) $ (794 ) $ (84 ) Total $ (3,174 ) $ (903 ) $ (794 ) $ (84 ) All derivatives have been designated as hedging instruments. Amounts recognized in earnings related to excluded time value and hedge ineffectiveness were not material for the year ended December 31, 2016 . |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment consists of the following (in thousands): December 31, 2016 December 31, 2015 Hosting equipment $ 35,018 $ 26,920 Capitalized internal-use software 25,773 22,418 Leasehold improvements 25,396 19,577 Computer equipment and software 11,879 7,682 Furniture and fixtures 8,014 5,739 Construction in progress 7,993 4,157 Total 114,073 86,493 Less accumulated depreciation and amortization (51,342 ) (29,953 ) Property and equipment, net $ 62,731 $ 56,540 Depreciation expense was $16.2 million , $11.2 million , and $6.1 million for the years ended December 31, 2016 , 2015 , and 2014 , respectively. Amortization expense of capitalized internal-use software totaled $7.4 million , $6.2 million , and $3.8 million during the years ended December 31, 2016 , 2015 , and 2014 , respectively. The carrying value of capitalized internal-use software at December 31, 2016 and 2015 was $15.4 million and $14.1 million , respectively, including $5.4 million and $1.5 million in construction in progress, respectively. |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets The changes in the carrying amount of goodwill for the year ended December 31, 2016 are as follows (in thousands): Balance as of December 31, 2014 $ 9,240 Goodwill acquired 36,730 Goodwill adjustments — Foreign currency translation adjustments (624 ) Balance as of December 31, 2015 45,346 Goodwill acquired — Goodwill adjustments 166 Foreign currency translation adjustments (165 ) Balance as of December 31, 2016 $ 45,347 The following tables present information about our acquired intangible assets subject to amortization as of December 31, 2016 and 2015 (in thousands): As of December 31, 2016 Cost Accumulated Foreign Currency Translation Adjustments Net Remaining Useful Life (In years) Developed technology $ 14,000 $ (6,584 ) $ (169 ) $ 7,247 2.9 Customer relationships 1,800 (1,044 ) (53 ) 703 2.3 $ 15,800 $ (7,628 ) $ (222 ) $ 7,950 As of December 31, 2015 Cost Accumulated Foreign Currency Translation Adjustments Net Remaining Useful Life (In years) Developed technology $ 14,000 $ (3,133 ) $ (279 ) $ 10,587 3.7 Customer relationships 1,800 (606 ) (78 ) 1,117 3.1 $ 15,800 $ (3,740 ) $ (356 ) $ 11,704 During 2015, the trade name associated with our acquisition of Zopim became fully amortized and was removed from our consolidated balance sheet. Amortization expense of acquired intangible assets for the year ended December 31, 2016 and 2015 was $3.9 million and $2.3 million , respectively. Estimated future amortization expense as of December 31, 2016 is as follows (in thousands): 2017 $ 3,241 2018 2,129 2019 2,068 2020 512 $ 7,950 |
Credit Facility
Credit Facility | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Credit Facility | Credit Facility Until its termination in June 2015, we had a credit facility with Silicon Valley Bank consisting of a $20.0 million revolving line of credit and a $10.0 million equipment line of credit. The revolving line of credit bore interest at the prime rate plus 2.0% per annum prior to our IPO and was reduced to the prime rate upon the consummation of our IPO. Borrowings on the equipment line of credit bore interest of 2.5% per annum. In June 2014, we repaid all outstanding principal and accrued interest under the revolving line of credit. In June 2015, we repaid all outstanding principal and interest under the equipment line of credit and terminated the Silicon Valley Bank credit facility. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases We lease office space under noncancelable operating leases with various expiration dates. Certain of the office space lease agreements contain rent holidays or rent escalation provisions. Rent holiday and rent escalation provisions are considered in determining the straight-line expense to be recorded over the lease term. The lease term begins on the date of initial possession of the leased property for purposes of recognizing lease expense on a straight-line basis over the term of the lease. For the years ended December 31, 2016 , 2015 , and 2014 , rent expense was $9.9 million , $7.5 million , and $6.8 million , respectively. Deferred rent of $6.5 million and $6.9 million as of December 31, 2016 and 2015 , respectively, is included in other liabilities. We leased computer equipment from various parties under capital lease agreements that expired in March 2015 . As of December 31, 2016 , the future minimum lease payments by year under noncancelable operating leases are as follows for the years ending December 31 (in thousands): 2017 $ 11,071 2018 10,582 2019 9,758 2020 6,450 2021 4,571 Thereafter 2,472 Total minimum lease payments $ 44,904 Letters of Credit As of December 31, 2016 and 2015 , we had a total of $2.7 million and $3.7 million , respectively in unsecured letters of credit outstanding primarily related to our leased office space in San Francisco. These letters of credit renew annually and mature at various dates through October 31, 2022 . Litigation and Loss Contingencies We accrue estimates for resolution of legal and other contingencies when losses are probable and estimable. From time to time, we may become a party to litigation and subject to claims incident to the ordinary course of business, including intellectual property claims, labor and employment claims, and threatened claims, breach of contract claims, tax, and other matters. We currently have no material pending litigation. We are not currently aware of any litigation matters or loss contingencies that would be expected to have a material adverse effect on our business, consolidated balance sheets, results of operations, comprehensive loss, or cash flows. Indemnifications In the ordinary course of business, we enter into contractual arrangements under which we agree to provide indemnification of varying scope and terms to customers, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, intellectual property infringement claims made by third parties, and other liabilities relating to or arising from our products, or our acts or omissions. In these circumstances, payment may be conditional on the other party making a claim pursuant to the procedures specified in the particular contract. Further, our obligations under these agreements may be limited in terms of time and/or amount, and in some instances, we may have recourse against third parties for certain payments. In addition, we have indemnification agreements with our directors and executive officers that require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The terms of such obligations may vary. To date, we have not incurred any material costs, and we have not accrued any liabilities in the accompanying consolidated financial statements, as a result of these obligations. Certain of our product offerings include service-level agreements warranting defined levels of uptime reliability and performance and permitting those customers to receive credits for future services in the event that we fail to meet those levels. To date, we have not accrued for any significant liabilities in the accompanying consolidated financial statements as a result of these service-level agreements. |
Common Stock and Stockholders'
Common Stock and Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Common Stock and Stockholders' Equity (Deficit) | Common Stock and Stockholders’ Equity Common Stock Upon the completion of our IPO, we increased the number of shares authorized for issuance from 125 million to 400 million with a par value of $0.01 per share. Convertible Preferred Stock Upon the completion of the IPO, all outstanding convertible preferred stock was converted into 34.3 million shares of common stock. Preferred Stock As of December 31, 2016 and 2015 , 10 million shares of preferred stock were authorized for issuance with a par value of $0.01 per share and no shares of preferred stock were issued or outstanding. Employee Equity Plans Employee Stock Purchase Plan Our board of directors adopted the Employee Stock Purchase Plan, or ESPP, in February 2014, which became effective in May 2014 upon the effectiveness of the registration statement related to our IPO. Under the ESPP, eligible employees are granted options to purchase shares of our common stock through payroll deductions. The ESPP provides for eighteen-month offering periods, which include three six-month purchase periods. At the end of each purchase period, employees are able to purchase shares at 85% of the lower of the fair market value of our common stock at the beginning of an offering period or the fair market value of our common stock at the end of the purchase period. For the year ended December 31, 2016 and 2015 , 0.6 million and 1.0 million shares of common stock were purchased under the ESPP. Pursuant to the terms of the ESPP, the number of shares reserved under the ESPP increased by 1.0 million shares and 0.9 million shares on January 1, 2017 and 2016, respectively. As of December 31, 2016 , 3.3 million shares of common stock were available for issuance under the ESPP. Stock Option and Grant Plans Our board of directors adopted the 2009 Stock Option and Grant Plan, or the 2009 Plan, in July 2009. The 2009 Plan was terminated in connection with our IPO, and accordingly, no shares are available for issuance under this plan. The 2009 Plan continues to govern outstanding awards granted thereunder. Our 2014 Stock Option and Incentive Plan, or the 2014 Plan, serves as the successor to our 2009 Plan. Pursuant to the terms of the 2014 Plan, the number of shares reserved for issuance under the 2014 Plan increased by 4.8 million and 4.5 million shares on January 1, 2017 and 2016, respectively. As of December 31, 2016 , we had 6.0 million shares of common stock available for future grants under the 2014 Plan. On May 6, 2016, the compensation committee of our board of directors granted equity awards representing 1.2 million shares. These awards were granted outside of the 2014 Plan pursuant to an exemption provided for “employment inducement awards” within the meaning of Section 303A.08 of the New York Stock Exchange Listed Company Manual and accordingly did not require approval from our stockholders. A summary of our stock option and RSU activity for the year ended December 31, 2016 is as follows (in thousands, except per share information): Options Outstanding RSUs Outstanding Shares Number of Weighted Weighted Aggregate Outstanding Weighted (In years) Outstanding — January 1, 2016 4,323 10,778 $ 11.94 7.96 $ 156,262 6,417 $ 19.54 Increase in authorized shares 5,716 Stock options granted (1,413 ) 1,413 23.72 RSUs granted (4,216 ) 4,216 21.05 Stock options exercised (2,924 ) 8.70 RSUs vested (2,894 ) 18.51 Unvested shares repurchased 38 Stock options forfeited or canceled 788 (788 ) 17.37 RSUs forfeited or canceled 803 (803 ) 20.18 Outstanding — December 31, 2016 6,039 8,479 $ 14.52 7.49 $ 66,449 6,936 $ 20.81 Options vested and expected to vest as of December 31, 2016 8,001 $ 14.24 7.43 $ 64,639 Options vested and exercisable as of December 31, 2016 3,698 $ 11.47 6.91 $ 38,609 The total intrinsic value of stock options exercised during the year ended December 31, 2016 was $49.2 million and during each of the years ended December 31, 2015 and 2014 was $66.2 million . Aggregate intrinsic value for options exercised represents the difference between the exercise price and the market value on the date of exercise. The weighted-average grant date fair value of stock options granted during the years ended December 31, 2016 , 2015 , and 2014 was $11.34 , $12.44 , and $7.22 respectively. Aggregate intrinsic value for options outstanding represents the difference between the closing stock price of our common stock and the exercise price of outstanding, in-the-money options. Zendesk’s closing stock price as reported on the New York Stock Exchange as of December 31, 2016 was $21.20 . Share-Based Compensation Expense All share-based awards to employees and members of our board of directors are measured based on the grant date fair value of the awards and recognized in the consolidated statements of operations over the period during which the employee is required to perform services in exchange for the award (generally the vesting period of the award, which is typically four years). We record share-based compensation expense for service-based equity awards using the straight-line attribution method. We record share-based compensation expense for performance-based equity awards using the accelerated attribution method. We estimate the fair value of stock options granted using the Black-Scholes option valuation model, which requires assumptions, including the fair value of our underlying common stock, expected term, expected volatility, risk-free interest rate and dividend yield of our common stock. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, our share-based compensation expense could be materially different in the future. These assumptions are estimated as follows: • Expected Term . We determine the expected term based on the average period the stock options are expected to remain outstanding generally calculated as the midpoint of the stock options vesting term and contractual expiration period, as we do not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. • Expected Volatility . We determine the price volatility factor using a combination of the historical volatility of publicly traded industry peers and our own common stock. To determine our peer group of companies, we consider public companies in the technology industry and select those that are similar to us in size, stage of life cycle, and financial leverage. We do not rely on implied volatilities of traded options in our industry peers’ common stock because the volume of activity is relatively low. We intend to continue to consistently apply this methodology using the same or similar public companies combined with our own volatility until a sufficient amount of historical information regarding the volatility of our own common stock price becomes available, or unless circumstances change such that the identified companies are no longer similar to us, in which case, more suitable companies whose share prices are publicly available would be utilized in the calculation. • Risk-Free Interest Rate . We base the risk-free interest rate used in the Black-Scholes valuation model on the yield available on U.S. Treasury zero-coupon issues with an equivalent remaining term of the stock options for each stock option group. • Dividend Yield . We have not paid and do not anticipate paying any cash dividends in the foreseeable future and, therefore, use an expected dividend yield of zero. The assumptions used to estimate the fair value of stock options granted to employees are as follows: Year Ended December 31, 2016 2015 2014 Expected volatility 47% - 49% 49% - 54% 54% - 56% Dividend rate 0% 0% 0% Risk-free interest rate 1.1% - 2.0% 1.4% - 2.0% 1.75% - 2.02% Expected term (in years) 6.02 - 6.08 6.02 - 6.08 6.02 - 6.50 The assumptions used to estimate the fair value of ESPP awards are as follows: Year Ended December 31, 2016 Year Ended December 31, 2015 Expected volatility 42% - 48% 37% - 43% Dividend rate 0% 0% Risk-free interest rate 0.38% - 0.90% 0.09% - 0.69% Expected term (in years) 0.50 -1.50 0.50 -1.50 In addition to the assumptions used in the Black-Scholes option valuation model, we have also estimated forfeiture rates to calculate the share-based compensation expense for our awards. Our forfeiture rates are based on an analysis of our actual historical forfeitures. Changes in the estimated forfeiture rate can have a significant impact on our share-based compensation expense as the cumulative effect of adjusting the rate is recognized in the period the forfeiture estimate is changed. If a revised forfeiture rate is higher than the previously estimated forfeiture rate, an adjustment is made that will result in a decrease to the share-based compensation expense recognized in our financial statements. If a revised forfeiture rate is lower than the previously estimated forfeiture rate, an adjustment is made that will result in an increase to the share-based compensation expense recognized in our financial statements. We will continue to use judgment in evaluating the expected volatility and expected term utilized in our share-based compensation expense calculations on a prospective basis. As we continue to accumulate additional data related to our common stock, we may refine our estimates of expected volatility and expected term, which could materially impact our future share-based compensation expense. In the first quarter of 2017, we intend to recognize forfeitures as they occur, rather than applying an estimated forfeiture rate, as permitted by ASU 2016-09. Refer to Note 2 for additional information regarding the adoption of this standard. In the year ended December 31, 2016 and 2015 , we recorded $0.7 million and none of share-based compensation expense related to accelerated vesting of share-based awards for terminated employees, respectively. Early Exercise of Stock Options and Purchase of Unvested Stock Awards Certain of our stock options permit early exercise. Common stock purchased pursuant to an early exercise of stock options or unvested stock awards is not deemed to be outstanding for financial reporting purposes until those shares vest. Therefore, cash received in exchange for unvested shares is recorded as a liability and is transferred into common stock and additional paid-in capital as the shares vest. Upon termination of service, we may, at our discretion, repurchase unvested shares acquired through early exercise of stock options or purchase of unvested stock awards at a price equal to the price per share paid upon the exercise of such options or the purchase of such unvested stock awards. As of December 31, 2016 and 2015 there were 0.1 million and 0.3 million shares outstanding as a result of early exercise of stock options and purchase of unvested stock awards by our employees and directors that were classified as accrued liabilities for an aggregated amount of $0.4 million and $1.0 million , respectively. |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share We compute net loss per share of common stock in conformity with the two-class method required for participating securities. We considered all series of the redeemable convertible preferred stock to be participating securities as the holders of the preferred stock were entitled to receive a non-cumulative dividend on a pari passu basis in the event that a dividend is paid on common stock. We also consider shares of common stock issued upon the early exercise of stock options subject to repurchase to be participating securities, because holders of such shares have non-forfeitable dividend rights in the event a dividend is paid on common stock. The holders of all series of the redeemable convertible preferred stock and the holders of shares of common stock acquired upon early exercise of stock options do not have a contractual obligation to share in our losses. As such, our net losses for the years ended December 31, 2016 , 2015 , and 2014 were not allocated to these participating securities. Upon the closing of the IPO in May 2014, all shares of our then-outstanding redeemable convertible preferred stock automatically converted into our common stock. Basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period, less the weighted-average unvested common stock subject to repurchase. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including common stock issuable upon conversion of the redeemable convertible preferred stock, outstanding share-based awards, and outstanding warrants, to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential common stock outstanding would have been anti-dilutive. The following table presents the calculation of basic and diluted net loss per share for the periods presented (in thousands, except per share data): Year Ended 2016 2015 2014 Net loss $ (103,799 ) $ (84,052 ) $ (67,415 ) Less: Accretion of redeemable convertible preferred stock — — (18 ) Net loss attributable to common stockholders $ (103,799 ) $ (84,052 ) $ (67,433 ) Basic shares: Weighted-average common shares outstanding 93,307 85,238 54,383 Less: Weighted-average common shares subject to repurchase (146 ) (312 ) (812 ) Weighted-average common shares used to compute basic net loss per share 93,161 84,926 53,571 Diluted shares: Weighted-average common shares used to compute diluted net loss per share 93,161 84,926 53,571 Net loss per share attributable to common stockholders: Basic and diluted $ (1.11 ) $ (0.99 ) $ (1.26 ) The anti-dilutive securities excluded from the shares used to calculate the diluted net loss per share are as follows (in thousands): As of December 31, 2016 2015 2014 Shares subject to outstanding common stock options and employee stock purchase plan 8,556 10,844 12,178 Restricted stock units 6,936 6,417 3,064 15,492 17,260 15,242 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of loss before provision for income taxes are as follows (in thousands): Year Ended December 31, 2016 2015 2014 U.S. $ (107,685 ) $ (85,928 ) $ (66,755 ) Foreign 4,879 2,214 (923 ) Total $ (102,806 ) $ (83,714 ) $ (67,678 ) The income tax provision is composed of the following (in thousands): Year Ended December 31, 2016 2015 2014 Current tax provision: Federal $ — $ 1 $ 2 State 74 (3 ) 1 Foreign 3,096 1,693 567 3,170 1,691 570 Deferred tax provision: Federal (49 ) (16 ) — State — — — Foreign (2,128 ) (1,337 ) (833 ) Total provision for (benefit from) income taxes $ 993 $ 338 $ (263 ) Significant components of deferred tax assets are as follows (in thousands): As of December 31, 2016 2015 Deferred tax assets: Tax credit carryforward $ 762 $ 266 Net operating loss carryforward 73,611 53,237 Share-based compensation 13,306 10,733 Accrued liabilities and reserves 4,877 3,840 Other 5,325 2,609 Total deferred tax assets 97,881 70,685 Less: valuation allowance (92,125 ) (65,371 ) Deferred tax assets, net of valuation allowance 5,756 5,314 Deferred tax liabilities: Depreciation and amortization (4,474 ) (6,335 ) Net deferred tax assets (liabilities) $ 1,282 $ (1,021 ) The following is a reconciliation of the statutory federal income tax rate and the effective tax rates: Year Ended December 31, 2016 2015 2014 Tax at federal statutory rate 34.0 % 34.0 % 34.0 % State tax provision, net of federal benefit — — — % Share-based compensation (6.1 ) (5.5 ) (5.5 ) Valuation allowance (23.3 ) (29.2 ) (27.9 ) Intercompany dividend (5.9 ) — — Other 0.3 0.3 (0.2 ) Effective tax rate (1.0 )% (0.4 )% 0.4 % We have not provided U.S. income taxes and foreign withholding taxes on the undistributed earnings of foreign subsidiaries as of December 31, 2016 because we intend to permanently reinvest such earnings outside of the U.S. If these foreign earnings were to be repatriated in the future, the related U.S. tax liability may be reduced by any foreign income taxes previously paid on these earnings. As of December 31, 2016 , the cumulative amount of earnings upon which U.S. income taxes have not been provided is approximately $12.0 million . Determination of the amount of unrecognized deferred tax liability related to these earnings is not practicable. As of December 31, 2016 , we had net operating loss carryforwards of approximately $342.9 million for federal income taxes and $145.8 million for state income taxes. If not utilized, these carryforwards will begin to expire in 2029 for federal purposes and 2031 for state purposes. As of December 31, 2016 , we had research and development credit carryforwards of approximately, $5.5 million and $6.0 million for federal and state income taxes, respectively. If not utilized, the federal carryforwards will begin to expire in 2029 . The state tax credit can be carried forward indefinitely. Internal Revenue Code Section 382 limits the use of net operating loss and tax credit carryforwards in certain situations where changes occur in the stock ownership of a company. In the event that we had a change of ownership, utilization of the net operating loss and tax credit carryforwards may be restricted. In addition, we have $7.7 million of net operating loss carryforwards in France, of which approximately $3.0 million were obtained as part of our acquisition of WAC. These carryforward losses do not expire, however, utilization of these carryforwards may be subject to annual limitations. In addition, the right to the carryforward losses could be challenged if the French tax authorities determined that a significant change in the company’s actual business has occurred. We account for income taxes under an asset and liability approach. Deferred income taxes reflect the impact of temporary differences between assets and liabilities recognized for financial reporting purposes and such amounts recognized for income tax reporting purposes, net operating loss carryforwards, and other tax credits measured by applying currently enacted tax laws. Realization of deferred tax assets is dependent on future earnings, if any, the timing and amount of which are uncertain. We regularly assess the need for a valuation allowance against our deferred tax assets by considering both positive and negative evidence to determine whether it is more-likely-than-not that some or all of the deferred tax assets will not be realized. We recorded a valuation allowance to fully offset our U.S. deferred tax assets, as we consider our cumulative loss in recent years to be strong negative evidence for retaining the valuation allowance. The valuation allowance increased by $26.8 million during the twelve months ended December 31, 2016 . We will continue to assess the future realization of our deferred tax assets in each applicable jurisdiction and adjust the valuation allowance accordingly. A share option exercise may result in a tax deduction prior to the actual recognition of the related excess tax benefit because we have a net operating loss carryforward. Our net operating losses include $141.7 million of excess stock option benefits that will be creditable to additional paid in capital when realized. A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and penalties) is as follows (in thousands): Balance at December 31, 2014 $ 5,955 Decrease from tax positions related to the prior year (57 ) Additions from tax positions related to the current year 2,605 Lapse of statutes of limitations — Balance at December 31, 2015 8,503 Additions from tax positions related to the prior year 279 Additions from tax positions related to the current year 3,639 Decrease related to settlements with taxing authorities (621 ) Lapse of statutes of limitations (14 ) Balance at December 31, 2016 $ 11,786 As of December 31, 2016 , we had $0.2 million of interest and penalties related to the uncertain tax positions. We have elected to record interest and penalties in the financial statements as a component of income taxes. Included in the balance of unrecognized tax benefits at December 31, 2016 and 2015 are potential benefits of $0.4 million and $1.0 million , respectively, which if recognized, would affect the effective tax rate. In April 2009, Zendesk’s entity in Denmark, or Zendesk Denmark, transferred certain assets to Zendesk’s U.S. entity. In April 2015, the Danish Tax Authority, or SKAT, issued a letter of intent in contemplation of adjusting the value of the reported asset transfer. In September 2016, SKAT and Zendesk Denmark settled the dispute over the price of the transferred assets and the company paid the settlement amount of $0.9 million which included income tax and interest, and released the associated reserve for the uncertain tax position. We are currently unaware of any uncertain tax positions that could result in significant additional payments, accruals, or other material deviation in this estimate over the next 12 months. Our 2012 - 2015 tax years remain subject to examination by the taxing authorities for U.S. federal, state, and foreign tax purposes. |
Geographic Information
Geographic Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Geographic Information | Geographic Information Revenue The following table presents our revenue by geographic area, as determined based on the billing address of our customers (in thousands): Year Ended December 31, 2016 2015 2014 United States $ 168,479 $ 116,220 $ 72,217 EMEA 87,360 59,047 35,856 Other 56,160 33,501 18,976 Total $ 311,999 $ 208,768 $ 127,049 Long-Lived Assets The following table presents our long-lived assets by geographic area (in thousands): As of As of United States $ 26,372 $ 26,696 EMEA: Republic of Ireland 5,703 5,171 Other EMEA 6,834 5,180 Total EMEA 12,537 10,351 APAC: Australia 3,414 4,544 Other APAC 4,943 788 Total APAC 8,357 5,332 Total $ 47,266 $ 42,379 The carrying values of capitalized internal-use software and intangible assets are excluded from the balance of long-lived assets presented in the table above. |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2016 | |
Postemployment Benefits [Abstract] | |
Retirement Plans | Retirement Plans We have a 401(k) retirement and savings plan made available to all United States employees. The 401(k) plan allows each participant to contribute up to an amount not to exceed an annual statutory maximum. We may, at our discretion, make matching contributions to the 401(k) plan. We are responsible for the administrative costs of the 401(k) plan. We have not made any contributions to the 401(k) plan since inception. |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared in accordance with GAAP. The consolidated financial statements include the accounts of Zendesk, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. |
Reclassification | Reclassification Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reported periods. Significant items subject to such estimates and assumptions include the fair value of our common stock (through the date of our IPO) and share-based awards, fair value of acquired intangible assets, goodwill, unrecognized tax benefits, useful lives of acquired intangible assets and property and equipment, the capitalization and estimated useful life of our capitalized internal-use software, and financial forecasts used in currency hedging. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ from those estimates. |
Segment Information | Segment Information Our chief operating decision maker reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating our financial performance. Accordingly, we have determined that we operate in a single operating segment. |
Revenue Recognition | Revenue Recognition We generate substantially all of our revenue from subscription services, which are comprised of subscription fees from customer accounts on Zendesk Support and, to a lesser extent, Chat and Talk. In addition, we generate revenue by providing additional features to certain of our subscription plans for a fee that is incremental to the base subscription rate for such plan. Arrangements with customers do not provide the customer with the right to take possession of the software supporting our products at any time, and are therefore accounted for as service contracts. Subscription service arrangements are generally non-cancelable and do not provide for refunds to customers in the event of cancellations or any other right of return. We record revenue net of sales and excise taxes. We commence revenue recognition when all of the following conditions are met: • There is persuasive evidence of an arrangement; • The service has been or is being provided to the customer; • The collection of the fees is reasonably assured; and • The amount of fees to be paid by the customer is fixed or determinable. Subscription revenue is recognized on a straight-line basis over the contractual term of the arrangement beginning on the date that our service is made available to the customer. Payments received in advance of services being rendered are recorded as deferred revenue and recognized on a straight-line basis over the requisite service period. Certain customers have arrangements that provide for a maximum number of users over the contract term, with usage measured monthly. Revenue for these arrangements is recognized ratably over the contract terms until such time as a better pattern of recognition is evident. Incremental fees are incurred when the maximum number of users is exceeded, and any incremental fees are recognized as revenue ratably over the remaining contractual term. We derive an immaterial amount of revenue from implementation, Talk usage, and training services, for which we recognize revenue upon completion. |
Deferred Revenue | Deferred Revenue Deferred revenue consists primarily of customer billings in advance of revenue being recognized. We invoice customers for subscriptions to our products in monthly, quarterly, or annual installments. Deferred revenue that is anticipated to be recognized during the succeeding 12-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent deferred revenue. |
Cost of Revenue | Cost of Revenue Cost of revenue consists primarily of personnel costs (including salaries, share-based compensation, and benefits) for employees associated with our infrastructure and our product support organizations, depreciation, hosting, and other expenses associated with our data centers, amortization expense associated with capitalized internal-use software, payment processing fees, amortization expense associated with acquired intangible assets, third party license fees, and allocated shared costs, including facilities, information technology, and security costs. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents. Cash and cash equivalents are recorded at fair value and consist primarily of bank deposits and money market funds. |
Marketable Securities | Marketable Securities Marketable securities consist of corporate bonds, asset-backed securities, U.S. Treasury securities, commercial paper, agency securities, and money market funds. We classify marketable securities as available-for-sale at the time of purchase and reevaluate such classification as of each balance sheet date. All marketable securities are recorded at their estimated fair value. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive loss. We evaluate our investments to assess whether those with unrealized loss positions are other than temporarily impaired. Impairments are considered other than temporary if they are related to deterioration in credit risk or if it is likely we will sell the securities before the recovery of their cost basis. Realized gains and losses and declines in value determined to be other than temporary are determined based on the specific identification method and are reported in other expense, net in the consolidated statements of operations. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of allowance for doubtful accounts. The allowance is based upon historical loss patterns, the age of each past due invoice, and an evaluation of the potential risk of loss associated with delinquent accounts. Accounts receivable deemed uncollectable are charged against the allowance for doubtful accounts when identified. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of assets. Maintenance and repair costs are charged to expense as incurred. The estimated useful lives of our property and equipment are as follows: Furniture and fixtures 5 years Hosting equipment 3 years Computer equipment and software 3 years Leasehold improvements Shorter of the lease term or estimated useful life Depreciation expense of assets acquired through capital leases is included in depreciation and amortization expense in the accompanying consolidated statements of operations. |
Derivative Instruments and Hedging | Derivative Instruments and Hedging We enter into foreign currency forward contracts with certain financial institutions to mitigate the impact of foreign currency fluctuations on our future cash flows and earnings. All of our foreign currency forward contracts are designated as cash flow hedges. Our foreign currency forward contracts generally have maturities of fifteen months or less. We recognize all forward contracts on our balance sheet at fair value as either assets or liabilities. The effective portion of the gain or loss on each forward contract is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings to revenue, cost of revenue or operating expense in the same period, or periods, during which the hedged transaction affects earnings. The ineffective portion of the gains or losses, if any, is recorded immediately in other income (expense), net. The change in time value related to our cash flow hedges is excluded from the assessment of hedge effectiveness and is recorded immediately in other income (expense), net. We evaluate the effectiveness of our cash flow hedges on a quarterly basis. We have a master netting agreement with each of our counterparties, which permits net settlement of multiple, separate derivative contracts with a single payment. We may also be required to exchange cash collateral with certain of our counterparties on a regular basis. As of December 31, 2016 , we have a restricted cash balance of $1.1 million associated with cash collateral exchanged. ASC 815 permits companies to present the fair value of derivative instruments on a net basis according to master netting arrangements. We have elected to present our derivative instruments on a gross basis in our consolidated financial statements. We do not enter into any derivative contracts for trading or speculative purposes. |
Fair Value Measurements | Fair Value Measurements We measure certain financial instruments at fair value using a fair value hierarchy. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Other inputs that are directly or indirectly observable in the marketplace. Level 3—Unobservable inputs that are supported by little or no market activity. Our marketable securities are classified within either Level 1 or Level 2 and our foreign currency forward contracts are classified within Level 2. We have no financial assets or liabilities measured using Level 3 inputs. The fair value of our Level 1 marketable securities is based on quoted market prices of identical underlying securities. The fair value of our Level 2 marketable securities is based on indirect or directly observable market data, including readily available pricing sources for identical underlying securities that may not be actively traded. The fair value of our foreign currency forward contracts is based on quoted prices and market observable data of similar instruments in active markets, such as currency spot rates, forward rates, and LIBOR. For certain other financial instruments, including accounts receivable, accounts payable and other current liabilities, the carrying amounts approximate their fair value due to the relatively short maturity of these balances. Based on borrowing rates available to us for loans with similar terms and maturities, the carrying value of borrowings approximates fair value within Level 2 of the fair value hierarchy. |
Capitalized Internal-Use Software Costs | Capitalized Internal-Use Software Costs We capitalize certain development costs incurred in connection with software development for our platform and software used in operations. Costs incurred in the preliminary stages of development are expensed as incurred. Once software 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. Capitalization ceases upon completion of all substantial testing. We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Capitalized costs are recorded as part of property and equipment. Maintenance and training costs are expensed as incurred. Capitalized internal-use software is amortized on a straight-line basis over its estimated useful life and recorded in cost of revenue within the accompanying consolidated statements of operations. The weighted-average useful life of our capitalized internal-use software was 3.3 years as of December 31, 2016 . |
Business Combinations | Business Combinations When we acquire businesses, we allocate the purchase price to the net tangible and identifiable intangible assets. Any residual purchase price is recorded as goodwill. The allocation of the purchase price requires management to make significant estimates in determining the fair values of assets acquired and liabilities assumed, especially with respect to intangible assets. These estimates can include, but are not limited to, the cash flows that an asset is expected to generate in the future, the appropriate weighted-average cost of capital, and the cost savings expected to be derived from acquiring an asset. These estimates are inherently uncertain and unpredictable. |
Goodwill, Acquired Intangible Assets, and Impairment Assessment of Long-Lived Assets | Goodwill, Acquired Intangible Assets, and Impairment Assessment of Long-Lived Assets Goodwill. Goodwill represents the excess purchase consideration of an acquired business over the fair value of the net tangible and identifiable intangible assets. Goodwill is evaluated for impairment annually in the third quarter, and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Triggering events that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate or a significant decrease in expected cash flows. No impairment charges were recorded during the years ended December 31, 2016 and 2015 . Acquired Intangible Assets. Acquired intangible assets consist of identifiable intangible assets, primarily developed technology and customer relationships, resulting from our acquisitions. Intangible assets are recorded at fair value on the date of acquisition and amortized over their estimated useful lives. Impairment of Long-Lived Assets. The carrying amounts of our long-lived assets, including property and equipment, capitalized internal-use software, and acquired intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable or that the useful life is shorter than originally estimated. Recoverability of assets to be held and used is measured by comparing the carrying amount of an asset to future undiscounted net cash flows the asset is expected to generate over its remaining life. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. If the useful life is shorter than originally estimated, we amortize the remaining carrying value over the new shorter useful life. There were no material impairments for the years ended December 31, 2016 and 2015 . |
Share Based Compensation | Share-Based Compensation Share-based compensation expense to employees is measured based on the fair value of the awards on the grant date and recognized in our consolidated statements of operations over the period during which the employee is required to perform services in exchange for the award (generally the vesting period of the award, which is typically 4 years ). We estimate the fair value of stock options granted using the Black-Scholes option valuation model. We measure the fair value of restricted stock units, or RSUs, based on the fair value of the underlying shares on the date of grant. Compensation expense for awards with only service conditions is recognized over the vesting period of the applicable award using the straight-line method. All RSUs and certain options granted to employees prior to our IPO vest upon the satisfaction of both a service condition and a performance condition. These RSUs and stock options with both a service condition and performance condition are collectively referred to as “Performance Awards” in the following discussion. The service condition for substantially all of these awards is satisfied over four years . The performance condition was satisfied upon the occurrence of a qualifying liquidity event which occurred upon the effectiveness of the registration statement related to our IPO. No share-based compensation expense was recognized for the Performance Awards prior to the IPO as the performance condition had not been deemed probable to have been met. Upon the satisfaction of the performance condition in May 2014, we recognized a cumulative share-based compensation expense for the portion of the Performance Awards that had met the service condition. The remaining unrecognized share-based compensation expense was recorded over the remaining requisite service period using the accelerated attribution method, net of estimated forfeitures. |
Advertising Expense | Advertising Expense Advertising is expensed as incurred. |
Government Grants | Government Grants We have obtained government grants in certain jurisdictions where we operate. We receive the grant funds as we meet certain commitments, including targeted levels of employment and/or spending within the local jurisdictions. If we fail to maintain these commitments, we may be required to repay grant funds received or be ineligible to receive future funding. We recognize grant proceeds to offset costs to which the grants relate on a straight-line basis when it is reasonably assured that the applicable commitments have been met. |
Income Taxes | Income Taxes We record income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in our consolidated financial statements or tax returns. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized. We recognize tax benefits from uncertain tax positions if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and results of operations. We have elected to record interest accrued and penalties related to unrecognized tax benefits in our consolidated financial statements as a component of provision for income taxes. |
Foreign Currency | Foreign Currency The functional currency of our foreign subsidiaries, with the exception of our Singapore subsidiary, is the U.S. dollar. Accordingly, monetary balance sheet accounts are remeasured using exchange rates in effect at the balance sheet dates and non-monetary items are remeasured at historical exchange rates. Expenses are generally remeasured at the average exchange rates for the period. Foreign currency remeasurement and transaction gains and losses are included in other expense, net on the statements of operations and were not material for the periods presented. The functional currency of our Singapore subsidiary is the Singapore dollar. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet dates. Revenue and expenses are translated at the average exchange rates for the period. Amounts classified in stockholders’ equity are translated at historical exchange rates. Translation gains and losses are recorded in accumulated other comprehensive loss income as a component of stockholders' equity. |
Concentrations of Risk | Concentrations of Risk Financial instruments potentially exposing us to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, marketable securities, accounts receivable and derivative instruments. We place our cash and cash equivalents with high-credit-quality financial institutions. However, we maintain balances in excess of the FDIC insurance limits. We do not require our customers to provide collateral to support accounts receivable and maintain an allowance for doubtful accounts receivable balances. We seek to mitigate counterparty credit risk related to our derivative instruments by transacting with major financial institutions with high credit ratings. |
Recently Issued and Adopted Accounting Pronouncements | Recently Issued and Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or the FASB, issued new revenue guidance that provides principles for recognizing revenue to which an entity expects to be entitled for the transfer of promised goods or services to customers. As currently issued and amended, the new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, though early adoption is permitted for annual reporting periods beginning after December 15, 2016. The guidance may be applied retrospectively to each prior period presented (full retrospective method), or with the cumulative effect recognized as of the date of initial adoption (modified retrospective method). We currently intend to adopt using the full retrospective approach, however our decision has not been finalized. We continue to assess the impact of the new guidance on our existing revenue arrangements. As a result of adoption, we also expect to capitalize a significant portion of our sales commissions and other incremental costs to acquire contracts, which we historically expensed as incurred, which will result in an increase in deferred costs recognized on our balance sheet. We have not yet concluded the useful life of our capitalized costs, which will affect the classification and magnitude of the deferred costs at each reporting period. We continue to quantify the effect of these changes on our consolidated financial statements. In April 2015, the FASB issued ASU 2015-05, “ Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement, ” which amended the existing accounting standards for intangible assets. The amendments provide explicit guidance to customers in determining the accounting for fees paid in a cloud computing arrangement, wherein the arrangements that do not convey a software license to the customer are accounted for as service contracts. We adopted this guidance in our first quarter of 2016. The adoption of this new standard did not have a material effect on our consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, “ Simplifying the Accounting for Measurement-Period Adjustments ,” which requires that an acquirer in a business combination recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The new standard is required to be adopted prospectively. We adopted this guidance in the first quarter of 2016. The adoption of this standard did not have a material effect on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, regarding ASC Topic 842 “ Leases. ” This new standard requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets and eliminates certain real estate-specific provisions. The new guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. Early adoption is permitted. We are currently evaluating the effect of this standard on our consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, regarding ASC Topic 718 “ Compensation - Stock Compensation. ” This amendment changes certain aspects of accounting for share-based compensation to employees, including the recognition of income tax effects of awards when the awards vest or are settled, requirements on net share settlement to cover tax withholding, and accounting for forfeitures. The new guidance is effective for annual reporting periods beginning after December 15, 2016. We plan to adopt this standard in our first quarter of 2017. Under the new guidance, we intend to recognize forfeitures as they occur, rather than applying an estimated forfeiture rate. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, regarding ASC Topic 230 “ Statement of Cash Flows. ” This update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, “ Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory ,” which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The new guidance is effective for annual reporting periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual reporting period. The new standard must be adopted using a modified retrospective transition method, with the cumulative effect recognized as of the date of initial adoption. We plan to early adopt this standard in our first quarter of 2017. The adoption of this new guidance is not expected to have a material effect on our consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, “ Statement of Cash Flows - Restricted Cash ,” which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. The standard is effective for fiscal years beginning after December 15, 2017, however early adoption is permitted. The new standard must be adopted retrospectively. We are currently evaluating the effect of this standard on our consolidated statements of cash flows. In January 2017, the FASB issued ASU 2017-01, “ Business Combinations - Clarifying the Definition of a Business ,” which clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The standard is effective for fiscal years beginning after December 15, 2017, however early adoption is permitted. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, regarding ASC Topic 350 “ Simplifying the Test for Goodwill Impairment, ” which simplifies the required methodology to calculate an impairment charge for goodwill. The standard is effective for fiscal years beginning after December 15, 2019, however early adoption is permitted. We do not expect the adoption of this standard to have a material effect on our consolidated financial statements. |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Allowance for Doubtful Accounts | The allowance for doubtful accounts consists of the following activity (in thousands): Year Ended December 31, 2016 2015 Allowance for doubtful accounts, beginning balance $ 763 $ 264 Additions 2,029 1,281 Write-offs (1,523 ) (782 ) Allowance for doubtful accounts, ending balance $ 1,269 $ 763 |
Schedule Of Property Plant And Equipment Estimated Useful Lives Table [Table Text Block] | The estimated useful lives of our property and equipment are as follows: Furniture and fixtures 5 years Hosting equipment 3 years Computer equipment and software 3 years Leasehold improvements Shorter of the lease term or estimated useful life |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Acquisition, Pro Forma Information | Accordingly, the unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations (in thousands): Year Ended December 31, 2015 2014 Revenue $ 210,647 $ 127,932 Net loss attributable to common stockholders (87,348 ) (74,670 ) |
We Are Cloud, Inc | |
Schedule of Purchase Price Allocation for Acquisitions | Net tangible assets acquired $ 2,140 Net deferred tax liability recognized (1,979 ) Identifiable intangible assets: Developed technology 8,800 Customer relationships 500 Goodwill 36,896 Total purchase price $ 46,357 |
Zopim | |
Schedule of Purchase Price Allocation for Acquisitions | Net tangible liabilities assumed $ (385 ) Intangible assets 6,560 Goodwill 9,594 Total purchase price $ 15,769 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Assets Measured at Fair Value on Recurring Basis | The following tables present information about our financial assets measured at fair value on a recurring basis as of December 31, 2016 and 2015 based on the three-tier fair value hierarchy (in thousands): Fair Value Measurement at Level 1 Level 2 Total Description Corporate bonds $ — 124,930 $ 124,930 Asset-backed securities — 32,567 32,567 U.S. treasury securities — 30,585 30,585 Commercial paper — 9,787 9,787 Agency securities — 8,489 8,489 Money market funds $ 3,545 $ — $ 3,545 Total $ 3,545 $ 206,358 $ 209,903 Included in cash and cash equivalents $ 3,545 Included in marketable securities $ 206,358 Fair Value Measurement at Level 1 Level 2 Total Description Corporate bonds $ — $ 31,761 $ 31,761 Money market funds 21,338 — 21,338 Asset-backed securities — 7,998 7,998 Commercial paper — 5,992 5,992 U.S. treasury securities — 4,001 4,001 Agency securities $ — $ 1,998 $ 1,998 Total $ 21,338 $ 51,750 $ 73,088 Included in cash and cash equivalents $ 21,338 Included in marketable securities $ 51,750 |
Schedule of Marketable Securities Classified by Contractual Maturities | The following table classifies our marketable securities by contractual maturity as of December 31, 2016 and 2015 (in thousands): December 31, December 31, Due in one year or less $ 131,190 $ 29,414 Due after one year 75,168 22,336 Total $ 206,358 $ 51,750 |
Schedule of Derivative Instruments on Consolidated Balance Sheet | The following table presents information about our derivative instruments on the consolidated balance sheet as of December 31, 2016 and 2015 (in thousands): December 31, 2016 Asset Derivatives Liability Derivatives Derivative Instrument Balance Sheet Location Fair Value Balance Sheet Location Fair Value Foreign currency forward contracts Other current assets $ 868 Accrued liabilities $ 4,280 Total $ 868 $ 4,280 December 31, 2015 Asset Derivatives Liability Derivatives Derivative Instrument Balance Sheet Location Fair Value Balance Sheet Location Fair Value Foreign currency forward contracts Other current assets $ 408 Accrued liabilities $ 1,081 Total $ 408 $ 1,081 |
Schedule of Derivative Instruments on Statement of Operations | The following table presents information about our derivative instruments on the statement of operations for the year ended December 31, 2016 and 2015 (in thousands): Year Ended December 31, 2016 Year Ended December 31, 2015 Derivative Instrument Location of Loss Reclassified into Earnings Loss Recognized in AOCI Loss Reclassified from AOCI into Earnings Loss Recognized in AOCI Loss Reclassified from AOCI into Earnings Foreign currency forward contracts Revenue, cost of revenue, operating expenses $ (3,174 ) $ (903 ) $ (794 ) $ (84 ) Total $ (3,174 ) $ (903 ) $ (794 ) $ (84 ) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Components of Property and Equipment | Property and equipment consists of the following (in thousands): December 31, 2016 December 31, 2015 Hosting equipment $ 35,018 $ 26,920 Capitalized internal-use software 25,773 22,418 Leasehold improvements 25,396 19,577 Computer equipment and software 11,879 7,682 Furniture and fixtures 8,014 5,739 Construction in progress 7,993 4,157 Total 114,073 86,493 Less accumulated depreciation and amortization (51,342 ) (29,953 ) Property and equipment, net $ 62,731 $ 56,540 |
Goodwill and Acquired Intangi27
Goodwill and Acquired Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the year ended December 31, 2016 are as follows (in thousands): Balance as of December 31, 2014 $ 9,240 Goodwill acquired 36,730 Goodwill adjustments — Foreign currency translation adjustments (624 ) Balance as of December 31, 2015 45,346 Goodwill acquired — Goodwill adjustments 166 Foreign currency translation adjustments (165 ) Balance as of December 31, 2016 $ 45,347 |
Summary of Intangible Assets Acquired | The following tables present information about our acquired intangible assets subject to amortization as of December 31, 2016 and 2015 (in thousands): As of December 31, 2016 Cost Accumulated Foreign Currency Translation Adjustments Net Remaining Useful Life (In years) Developed technology $ 14,000 $ (6,584 ) $ (169 ) $ 7,247 2.9 Customer relationships 1,800 (1,044 ) (53 ) 703 2.3 $ 15,800 $ (7,628 ) $ (222 ) $ 7,950 As of December 31, 2015 Cost Accumulated Foreign Currency Translation Adjustments Net Remaining Useful Life (In years) Developed technology $ 14,000 $ (3,133 ) $ (279 ) $ 10,587 3.7 Customer relationships 1,800 (606 ) (78 ) 1,117 3.1 $ 15,800 $ (3,740 ) $ (356 ) $ 11,704 |
Summary of Estimated Future Amortization Expense | Estimated future amortization expense as of December 31, 2016 is as follows (in thousands): 2017 $ 3,241 2018 2,129 2019 2,068 2020 512 $ 7,950 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments by Year under Noncancelable Operating Leases | As of December 31, 2016 , the future minimum lease payments by year under noncancelable operating leases are as follows for the years ending December 31 (in thousands): 2017 $ 11,071 2018 10,582 2019 9,758 2020 6,450 2021 4,571 Thereafter 2,472 Total minimum lease payments $ 44,904 |
Common Stock and Stockholders29
Common Stock and Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Summary of Stock Option and RSU Activity | A summary of our stock option and RSU activity for the year ended December 31, 2016 is as follows (in thousands, except per share information): Options Outstanding RSUs Outstanding Shares Number of Weighted Weighted Aggregate Outstanding Weighted (In years) Outstanding — January 1, 2016 4,323 10,778 $ 11.94 7.96 $ 156,262 6,417 $ 19.54 Increase in authorized shares 5,716 Stock options granted (1,413 ) 1,413 23.72 RSUs granted (4,216 ) 4,216 21.05 Stock options exercised (2,924 ) 8.70 RSUs vested (2,894 ) 18.51 Unvested shares repurchased 38 Stock options forfeited or canceled 788 (788 ) 17.37 RSUs forfeited or canceled 803 (803 ) 20.18 Outstanding — December 31, 2016 6,039 8,479 $ 14.52 7.49 $ 66,449 6,936 $ 20.81 Options vested and expected to vest as of December 31, 2016 8,001 $ 14.24 7.43 $ 64,639 Options vested and exercisable as of December 31, 2016 3,698 $ 11.47 6.91 $ 38,609 |
Assumptions Used to Estimate Fair Value of Stock Options Granted to Employees | The assumptions used to estimate the fair value of stock options granted to employees are as follows: Year Ended December 31, 2016 2015 2014 Expected volatility 47% - 49% 49% - 54% 54% - 56% Dividend rate 0% 0% 0% Risk-free interest rate 1.1% - 2.0% 1.4% - 2.0% 1.75% - 2.02% Expected term (in years) 6.02 - 6.08 6.02 - 6.08 6.02 - 6.50 |
Assumptions Used to Estimate Fair Value of ESPP Awards | The assumptions used to estimate the fair value of ESPP awards are as follows: Year Ended December 31, 2016 Year Ended December 31, 2015 Expected volatility 42% - 48% 37% - 43% Dividend rate 0% 0% Risk-free interest rate 0.38% - 0.90% 0.09% - 0.69% Expected term (in years) 0.50 -1.50 0.50 -1.50 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Net Loss per Share | The following table presents the calculation of basic and diluted net loss per share for the periods presented (in thousands, except per share data): Year Ended 2016 2015 2014 Net loss $ (103,799 ) $ (84,052 ) $ (67,415 ) Less: Accretion of redeemable convertible preferred stock — — (18 ) Net loss attributable to common stockholders $ (103,799 ) $ (84,052 ) $ (67,433 ) Basic shares: Weighted-average common shares outstanding 93,307 85,238 54,383 Less: Weighted-average common shares subject to repurchase (146 ) (312 ) (812 ) Weighted-average common shares used to compute basic net loss per share 93,161 84,926 53,571 Diluted shares: Weighted-average common shares used to compute diluted net loss per share 93,161 84,926 53,571 Net loss per share attributable to common stockholders: Basic and diluted $ (1.11 ) $ (0.99 ) $ (1.26 ) |
Schedule of Anti-Dilutive Securities Excluded from the Diluted per Share Calculation | The anti-dilutive securities excluded from the shares used to calculate the diluted net loss per share are as follows (in thousands): As of December 31, 2016 2015 2014 Shares subject to outstanding common stock options and employee stock purchase plan 8,556 10,844 12,178 Restricted stock units 6,936 6,417 3,064 15,492 17,260 15,242 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of Loss Before Provision for Income Taxes | The components of loss before provision for income taxes are as follows (in thousands): Year Ended December 31, 2016 2015 2014 U.S. $ (107,685 ) $ (85,928 ) $ (66,755 ) Foreign 4,879 2,214 (923 ) Total $ (102,806 ) $ (83,714 ) $ (67,678 ) |
Schedule of Income Tax Provision | The income tax provision is composed of the following (in thousands): Year Ended December 31, 2016 2015 2014 Current tax provision: Federal $ — $ 1 $ 2 State 74 (3 ) 1 Foreign 3,096 1,693 567 3,170 1,691 570 Deferred tax provision: Federal (49 ) (16 ) — State — — — Foreign (2,128 ) (1,337 ) (833 ) Total provision for (benefit from) income taxes $ 993 $ 338 $ (263 ) |
Schedule of Significant Components of Deferred Tax Assets | Significant components of deferred tax assets are as follows (in thousands): As of December 31, 2016 2015 Deferred tax assets: Tax credit carryforward $ 762 $ 266 Net operating loss carryforward 73,611 53,237 Share-based compensation 13,306 10,733 Accrued liabilities and reserves 4,877 3,840 Other 5,325 2,609 Total deferred tax assets 97,881 70,685 Less: valuation allowance (92,125 ) (65,371 ) Deferred tax assets, net of valuation allowance 5,756 5,314 Deferred tax liabilities: Depreciation and amortization (4,474 ) (6,335 ) Net deferred tax assets (liabilities) $ 1,282 $ (1,021 ) |
Schedule of Reconciliation of the Statutory Federal Income Tax Rate and the Effective Tax Rates | The following is a reconciliation of the statutory federal income tax rate and the effective tax rates: Year Ended December 31, 2016 2015 2014 Tax at federal statutory rate 34.0 % 34.0 % 34.0 % State tax provision, net of federal benefit — — — % Share-based compensation (6.1 ) (5.5 ) (5.5 ) Valuation allowance (23.3 ) (29.2 ) (27.9 ) Intercompany dividend (5.9 ) — — Other 0.3 0.3 (0.2 ) Effective tax rate (1.0 )% (0.4 )% 0.4 % |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and penalties) is as follows (in thousands): Balance at December 31, 2014 $ 5,955 Decrease from tax positions related to the prior year (57 ) Additions from tax positions related to the current year 2,605 Lapse of statutes of limitations — Balance at December 31, 2015 8,503 Additions from tax positions related to the prior year 279 Additions from tax positions related to the current year 3,639 Decrease related to settlements with taxing authorities (621 ) Lapse of statutes of limitations (14 ) Balance at December 31, 2016 $ 11,786 |
Geographic Information (Tables)
Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographic Areas | The following table presents our revenue by geographic area, as determined based on the billing address of our customers (in thousands): Year Ended December 31, 2016 2015 2014 United States $ 168,479 $ 116,220 $ 72,217 EMEA 87,360 59,047 35,856 Other 56,160 33,501 18,976 Total $ 311,999 $ 208,768 $ 127,049 |
Schedule of Long-Lived Assets by Geographic Areas | The following table presents our long-lived assets by geographic area (in thousands): As of As of United States $ 26,372 $ 26,696 EMEA: Republic of Ireland 5,703 5,171 Other EMEA 6,834 5,180 Total EMEA 12,537 10,351 APAC: Australia 3,414 4,544 Other APAC 4,943 788 Total APAC 8,357 5,332 Total $ 47,266 $ 42,379 |
Organization - Additional Infor
Organization - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Year founded | 2,007 |
Reincorporated date | Apr. 30, 2009 |
Summary of Significant Accoun34
Summary of Significant Accounting Policies - Additional Information (Details) $ / shares in Units, shares in Millions | 1 Months Ended | 12 Months Ended | |||
Mar. 31, 2015USD ($)$ / sharesshares | May 31, 2014USD ($)$ / sharesshares | Dec. 31, 2016USD ($)Customer$ / shares | Dec. 31, 2015USD ($)Customer | Dec. 31, 2014USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Share price (usd per share) | $ / shares | $ 21.20 | ||||
Proceeds from initial public offering, net of underwriting discounts and commissions and other offering expenses | $ 0 | $ 0 | $ 103,090,000 | ||
Number of shares of common stock issued upon automatic conversion of convertible preferred stock (in shares) | shares | 34.3 | ||||
Proceeds from follow-on public offering, net of issuance costs | 0 | 190,094,000 | 0 | ||
Restricted cash | 2,500,000 | 1,300,000 | |||
Cash collateral | $ 1,100,000 | ||||
Weighted average useful life of capitalized internal use software | 3 years 3 months 18 days | ||||
Impairment of goodwill | $ 0 | 0 | |||
Impairment of long lived asset | $ 0 | 0 | |||
Service condition for performance awards | 4 years | ||||
Future period share-based compensation expense | $ 173,400,000 | ||||
Future period share-based compensation expense, period to recognized | 2 years 8 months 2 days | ||||
Advertising expense | $ 23,900,000 | $ 16,500,000 | 12,700,000 | ||
Grant proceeds | $ 1,200,000 | ||||
Customer Concentration Risk | Accounts Receivable | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Number of customers | Customer | 0 | 0 | |||
Customer Concentration Risk | Accounts Receivable | Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Percentage of total revenue or receivables | 10.00% | 10.00% | |||
Customer Concentration Risk | Revenue | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Number of customers | Customer | 0 | 0 | |||
Customer Concentration Risk | Revenue | Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Percentage of total revenue or receivables | 10.00% | 10.00% | |||
Performance Awards | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Service condition for performance awards | 4 years | ||||
Share-based compensation expense | $ 2,800,000 | $ 6,100,000 | $ 12,700,000 | ||
Charitable Donation | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Restricted cash | 1,000,000 | 900,000 | |||
Leased Building | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Restricted cash | $ 400,000 | ||||
IPO | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shares of common stock sold in initial public offering (in shares) | shares | 12.8 | ||||
Share price (usd per share) | $ / shares | $ 9 | ||||
Proceeds from initial public offering, net of underwriting discounts and commissions and other offering expenses | $ 103,100,000 | ||||
Underwriting discounts and commission on IPO | 8,100,000 | ||||
Offering expenses | $ 3,800,000 | ||||
Number of shares of common stock issued upon automatic conversion of convertible preferred stock (in shares) | shares | 34.3 | ||||
Follow On Public Offering | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shares of common stock sold in initial public offering (in shares) | shares | 8.8 | ||||
Share price (usd per share) | $ / shares | $ 22.75 | ||||
Underwriting discounts and commission on IPO | $ 8,700,000 | ||||
Offering expenses | 900,000 | ||||
Proceeds from follow-on public offering, net of issuance costs | $ 190,100,000 | ||||
Prior to IPO | Performance Awards | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Share-based compensation expense | $ 0 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies - Schedule of Allowance for Doubtful Accounts - (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Allowance for doubtful accounts, beginning balance | $ 763 | $ 264 |
Additions | 2,029 | 1,281 |
Write-offs | (1,523) | (782) |
Allowance for doubtful accounts, ending balance | $ 1,269 | $ 763 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies - Estimated Useful Lives of Property and Equipment - (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of property and equipment | 3 years 3 months 18 days |
Furniture and fixtures | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of property and equipment | 5 years |
Hosting equipment | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of property and equipment | 3 years |
Computer equipment and software | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of property and equipment | 3 years |
Leasehold improvements | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives of property and equipment | Shorter of the lease term or estimated useful life |
Foreign currency forward contracts | |
Property Plant And Equipment [Line Items] | |
Foreign currency forward contract maturity | 15 months |
Business Combinations - Additio
Business Combinations - Additional Information (Details) - USD ($) $ in Millions | Oct. 13, 2015 | Mar. 21, 2014 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||
RSUs issued pursuant to retention plan, in connection with the acquisition (in shares) | 4,216,000 | ||
Vesting period | 4 years | ||
RSUs vested (in shares) | 2,894,000 | ||
We Are Cloud, Inc | |||
Business Acquisition [Line Items] | |||
Percent of outstanding shares acquired | 100.00% | ||
Business acquisition, fair value of consideration transferred, cash | $ 46.4 | ||
Cash portion of fair value consideration transferred | $ 7 | ||
Number of months consideration held in escrow, to be released | 12 months | ||
Business acquisition, transaction costs incurred | $ 1 | ||
We Are Cloud, Inc | Restricted Stock Units | |||
Business Acquisition [Line Items] | |||
RSUs issued pursuant to retention plan, in connection with the acquisition (in shares) | 500,000 | ||
Vesting period | 3 years | ||
We Are Cloud, Inc | Developed technology | |||
Business Acquisition [Line Items] | |||
Acquired intangible assets, useful lives | 4 years 6 months | ||
We Are Cloud, Inc | Customer relationships | |||
Business Acquisition [Line Items] | |||
Acquired intangible assets, useful lives | 4 years 6 months | ||
We Are Cloud, Inc | Maximum | |||
Business Acquisition [Line Items] | |||
Number of months consideration were held in escrow | 18 months | ||
Zopim | |||
Business Acquisition [Line Items] | |||
Business acquisition, fair value of consideration transferred, cash | $ 4.9 | ||
Consideration transferred | 15.8 | ||
Consideration transferred, common stock | 10.9 | ||
Cash to be paid pursuant to retention plan | $ 3 | $ 3 | |
Zopim | Restricted Stock Units | |||
Business Acquisition [Line Items] | |||
RSUs issued pursuant to retention plan, in connection with the acquisition (in shares) | 0.9 | ||
RSUs vested (in shares) | 600,000 |
Business Combinations - Schedul
Business Combinations - Schedule of Purchase Price Allocation for Acquisitions (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Oct. 13, 2015 | Dec. 31, 2014 | Mar. 21, 2014 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 45,347 | $ 45,346 | $ 9,240 | ||
We Are Cloud, Inc | |||||
Business Acquisition [Line Items] | |||||
Net tangible assets acquired | $ 2,140 | ||||
Net deferred tax liability recognized | (1,979) | ||||
Goodwill | 36,896 | ||||
Total purchase price | 46,357 | ||||
We Are Cloud, Inc | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 8,800 | ||||
We Are Cloud, Inc | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 500 | ||||
Zopim | |||||
Business Acquisition [Line Items] | |||||
Net tangible liabilities assumed | $ (385) | ||||
Intangible assets | 6,560 | ||||
Goodwill | $ 9,594 | ||||
Total purchase price | $ 15,769 |
Business Combinations Business
Business Combinations Business Combinations - Pro Forma Information (Details) - We Are Cloud, Inc - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Business Acquisition [Line Items] | ||
Revenue | $ 210,647 | $ 127,932 |
Net loss attributable to common stockholders | $ (87,348) | $ (74,670) |
Financial Instruments - Financi
Financial Instruments - Financial Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Included in marketable securities | $ 206,358 | $ 51,750 |
Fair Value Measurements, Recurring | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 209,903 | 73,088 |
Included in cash and cash equivalents | 3,545 | 21,338 |
Included in marketable securities | 206,358 | 51,750 |
Fair Value Measurements, Recurring | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 3,545 | 21,338 |
Fair Value Measurements, Recurring | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 206,358 | 51,750 |
Fair Value Measurements, Recurring | Corporate bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 124,930 | 31,761 |
Fair Value Measurements, Recurring | Corporate bonds | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 0 | 0 |
Fair Value Measurements, Recurring | Corporate bonds | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 124,930 | 31,761 |
Fair Value Measurements, Recurring | Asset-backed securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 32,567 | 7,998 |
Fair Value Measurements, Recurring | Asset-backed securities | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 0 | 0 |
Fair Value Measurements, Recurring | Asset-backed securities | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 32,567 | 7,998 |
Fair Value Measurements, Recurring | U.S. treasury securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 30,585 | 4,001 |
Fair Value Measurements, Recurring | U.S. treasury securities | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 0 | 0 |
Fair Value Measurements, Recurring | U.S. treasury securities | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 30,585 | 4,001 |
Fair Value Measurements, Recurring | Commercial paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 9,787 | 5,992 |
Fair Value Measurements, Recurring | Commercial paper | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 0 | 0 |
Fair Value Measurements, Recurring | Commercial paper | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 9,787 | 5,992 |
Fair Value Measurements, Recurring | Agency securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 8,489 | 1,998 |
Fair Value Measurements, Recurring | Agency securities | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 0 | 0 |
Fair Value Measurements, Recurring | Agency securities | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 8,489 | 1,998 |
Fair Value Measurements, Recurring | Money market funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 3,545 | 21,338 |
Fair Value Measurements, Recurring | Money market funds | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | 3,545 | 21,338 |
Fair Value Measurements, Recurring | Money market funds | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total fair value of financial assets | $ 0 | $ 0 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Gross unrealized gains or losses for cash equivalent and marketable securities | $ 0 | $ 0 |
Securities that were in an unrealized loss position for more than 12 months. | 0 | 0 |
Cash collateral posted | 1,100,000 | |
Foreign currency forward contracts | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Unrealized losses related to effective portion of changes in fair value of foreign currency forward contracts | 3,000,000 | |
Reclassification from accumulated other comprehensive loss into earnings over next 12 month | 2,800,000 | |
Notional value | $ 79,600,000 | $ 60,800,000 |
Financial Instruments - Marketa
Financial Instruments - Marketable Securities by Contractual Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Financial Instruments, Owned, at Fair Value [Abstract] | ||
Due in one year or less | $ 131,190 | $ 29,414 |
Due after one year | 75,168 | 22,336 |
Total | $ 206,358 | $ 51,750 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Derivative Instruments on Consolidated Balance Sheet (Details) - Level 2 - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Derivatives Fair Value [Line Items] | ||
Asset Derivatives, Fair Value | $ 868 | $ 408 |
Liability Derivatives, Fair Value | 4,280 | 1,081 |
Foreign currency forward contracts | Other current assets | ||
Derivatives Fair Value [Line Items] | ||
Asset Derivatives, Fair Value | 868 | 408 |
Foreign currency forward contracts | Accrued liabilities | ||
Derivatives Fair Value [Line Items] | ||
Liability Derivatives, Fair Value | $ 4,280 | $ 1,081 |
Financial Instruments - Sched44
Financial Instruments - Schedule of Derivative Instruments on Statement of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments Gain Loss [Line Items] | ||
Loss Recognized in AOCI | $ (3,174) | $ (794) |
Loss Reclassified from AOCI into Earnings | (903) | (84) |
Revenue, cost of revenue, operating expenses | Foreign currency forward contracts | ||
Derivative Instruments Gain Loss [Line Items] | ||
Loss Recognized in AOCI | (3,174) | (794) |
Loss Reclassified from AOCI into Earnings | $ (903) | $ (84) |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 114,073 | $ 86,493 |
Less accumulated depreciation and amortization | (51,342) | (29,953) |
Property and equipment, net | 62,731 | 56,540 |
Hosting equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 35,018 | 26,920 |
Capitalized internal-use software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 25,773 | 22,418 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 25,396 | 19,577 |
Computer equipment and software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 11,879 | 7,682 |
Furniture and fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 8,014 | 5,739 |
Construction in progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 7,993 | $ 4,157 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 16.2 | $ 11.2 | $ 6.1 |
Amortization expense of capitalized internal-use software | 7.4 | 6.2 | $ 3.8 |
Carrying value of capitalized internal-use software | 15.4 | 14.1 | |
Capitalized internal-use software included in construction in progress | $ 5.4 | $ 1.5 |
Goodwill and Acquired Intangi47
Goodwill and Acquired Intangible Assets - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 45,346 | $ 9,240 |
Goodwill acquired | 0 | 36,730 |
Goodwill adjustments | 166 | 0 |
Foreign currency translation adjustments | (165) | (624) |
Ending balance | $ 45,347 | $ 45,346 |
Goodwill and Acquired Intangi48
Goodwill and Acquired Intangible Assets - Acquired Intangible Assets Subject to Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite Lived Intangible Assets [Line Items] | ||
Cost | $ 15,800 | $ 15,800 |
Accumulated Amortization | (7,628) | (3,740) |
Foreign Currency Translation Adjustments | (222) | (356) |
Net | 7,950 | 11,704 |
Developed technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Cost | 14,000 | 14,000 |
Accumulated Amortization | (6,584) | (3,133) |
Foreign Currency Translation Adjustments | (169) | (279) |
Net | $ 7,247 | $ 10,587 |
Remaining Useful Life | 2 years 10 months 24 days | 3 years 8 months 2 days |
Customer relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Cost | $ 1,800 | $ 1,800 |
Accumulated Amortization | (1,044) | (606) |
Foreign Currency Translation Adjustments | (53) | (78) |
Net | $ 703 | $ 1,117 |
Remaining Useful Life | 2 years 3 months 2 days | 3 years 1 month 2 days |
Goodwill and Acquired Intangi49
Goodwill and Acquired Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 3.9 | $ 2.3 |
Goodwill and Acquired Intangi50
Goodwill and Acquired Intangible Assets - Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,017 | $ 3,241 | |
2,018 | 2,129 | |
2,019 | 2,068 | |
2,020 | 512 | |
Net | $ 7,950 | $ 11,704 |
Credit Facility - Additional In
Credit Facility - Additional Information (Details) - Silicon Valley Bank | 1 Months Ended |
Jun. 30, 2015USD ($) | |
Revolving Line of Credit | |
Line Of Credit Facility [Line Items] | |
Credit facility | $ 20,000,000 |
Percentage of interest rate above the prime rate | 2.00% |
Equipment Line of Credit | |
Line Of Credit Facility [Line Items] | |
Credit facility | $ 10,000,000 |
Credit facility interest rate | 2.50% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Other Commitments [Line Items] | |||
Rent expense | $ 9.9 | $ 7.5 | $ 6.8 |
Deferred rent | 6.5 | 6.9 | |
Letters of credit outstanding amount | $ 2.7 | $ 3.7 | |
Letters of credit expiry date | Oct. 31, 2022 | ||
Capital Lease Agreements | |||
Other Commitments [Line Items] | |||
Lease expiration date | Mar. 31, 2015 |
Commitments and Contingencies53
Commitments and Contingencies - Schedule of Future Minimum Lease Payments by Year under Noncancelable Operating Leases (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 11,071 |
2,018 | 10,582 |
2,019 | 9,758 |
2,020 | 6,450 |
2,021 | 4,571 |
Thereafter | 2,472 |
Total minimum lease payments | $ 44,904 |
Common Stock and Stockholders54
Common Stock and Stockholders' Equity - Additional Information (Details) - USD ($) | Jan. 01, 2017 | May 06, 2016 | Jan. 01, 2016 | May 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Class Of Stock [Line Items] | |||||||
Common stock, shares authorized (in shares) | 125,000,000 | 400,000,000 | 400,000,000 | ||||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Number of shares of common stock issued upon automatic conversion of convertible preferred stock (in shares) | 34,300,000 | ||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | |||||
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 | |||||
Preferred stock, shares issued (in shares) | 0 | 0 | |||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | |||||
Increase in authorized shares (in shares) | 5,716,000 | ||||||
Shares of common stock available for issuance (in shares) | 6,039,000 | 4,323,000 | |||||
Intrinsic value of options exercised | $ 49,200,000 | $ 66,200,000 | $ 66,200,000 | ||||
Weighted-average grant date fair value of stock options (usd per share) | $ 11.34 | $ 12.44 | $ 7.22 | ||||
Share price (usd per share) | $ 21.20 | ||||||
Vesting period | 4 years | ||||||
Shares outstanding as a result of early exercise of stock options and purchase of unvested stock awards | 100,000 | 300,000 | |||||
Accrued liability for shares outstanding as a result of early exercise of stock options and purchase of unvested stock awards | $ 400,000 | $ 1,000,000 | |||||
Shares repurchased as treasury shares (in shares) | 38,000 | ||||||
Stock options granted (in shares) | 1,200,000 | 1,413,000 | |||||
Employee Stock Option | |||||||
Class Of Stock [Line Items] | |||||||
Share based compensation related to accelerated vesting | $ 700,000 | $ 0 | |||||
2009 Stock Option and Grant Plan | |||||||
Class Of Stock [Line Items] | |||||||
Shares of common stock available for issuance (in shares) | 0 | ||||||
2014 Plan | Employee Stock Option | |||||||
Class Of Stock [Line Items] | |||||||
Increase in authorized shares (in shares) | 4,500,000 | ||||||
Shares of common stock available for issuance (in shares) | 6,000,000 | ||||||
Subsequent Event | 2014 Plan | Employee Stock Option | |||||||
Class Of Stock [Line Items] | |||||||
Increase in authorized shares (in shares) | 4,800,000 | ||||||
Employee Stock Purchase Plan | |||||||
Class Of Stock [Line Items] | |||||||
Percentage of purchase price of shares lower of the fair market value of common stock employees are able to purchase shares | 85.00% | ||||||
Common shares purchased (in shares) | 600,000 | 1,000,000 | |||||
Increase in authorized shares (in shares) | 900,000 | ||||||
Shares of common stock available for issuance (in shares) | 3,300,000 | ||||||
Employee Stock Purchase Plan | Subsequent Event | |||||||
Class Of Stock [Line Items] | |||||||
Increase in authorized shares (in shares) | 1,000,000 |
Common Stock and Stockholders55
Common Stock and Stockholders' Equity - Summary of Stock Option and RSU Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | May 06, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Shares Available for Grant | |||
Balance at the beginning of the period (in shares) | 4,323 | ||
Increase in authorized shares (in shares) | 5,716 | ||
Stock options granted (in shares) | (1,200) | (1,413) | |
RSUs granted (in shares) | (4,216) | ||
Unvested shares repurchased (in shares) | 38 | ||
Stock options forfeited or canceled (in shares) | 788 | ||
RSUs forfeited or cancelled (in shares) | 803 | ||
Balance at the end of the period (in shares) | 6,039 | 4,323 | |
Number of Shares | |||
Balance at the beginning of the period (in shares) | 10,778 | ||
Stock options granted (in shares) | 1,200 | 1,413 | |
Stock options exercised (in shares) | (2,924) | ||
Stock options forfeited or canceled (in shares) | (788) | ||
Balance at the end of the period (in shares) | 8,479 | 10,778 | |
Options vested and expected to vest at the end of the period (in shares) | 8,001 | ||
Options vested and exercisable at the end of the period (in shares) | 3,698 | ||
Weighted-Average Exercise Price | |||
Balance at the beginning of the period (usd per share) | $ 11.94 | ||
Stock options granted (usd per share) | 23.72 | ||
Stock options exercised (usd per share) | 8.70 | ||
Stock options forfeited or canceled (usd per share) | 17.37 | ||
Balance at the end of the period (usd per share) | 14.52 | $ 11.94 | |
Options vested and expected to vest at the end of the period (usd per share) | 14.24 | ||
Options vested and exercisable at the end of the period (usd per share) | $ 11.47 | ||
Weighted Average Remaining Contractual Term | |||
Options outstanding, weighted-average remaining contractual term | 7 years 5 months 27 days | 7 years 11 months 16 days | |
Options vested and expected to vest, weighted-average remaining contractual term | 7 years 5 months 5 days | ||
Options vested and exercisable, weighted-average remaining contractual term | 6 years 10 months 28 days | ||
Aggregate Intrinsic Value | |||
Options outstanding, aggregate intrinsic value, balance at beginning of period | $ 156,262 | ||
Options outstanding, aggregate intrinsic value, balance at end of period | 66,449 | $ 156,262 | |
Options vested and expected to vest, aggregate intrinsic value, balance at end of period | 64,639 | ||
Options vested and exercisable, aggregate intrinsic value, balance at end of period | $ 38,609 | ||
Outstanding RSUs | |||
Balance at the beginning of the period (in shares) | 6,417 | ||
RSUs issued pursuant to retention plan, in connection with the acquisition (in shares) | 4,216 | ||
RSUs vested (in shares) | (2,894) | ||
RSUs forfeited or cancelled (in shares) | (803) | ||
Balance at the end of the period (in shares) | 6,936 | 6,417 | |
Weighted-Average Grant Date Fair Value | |||
Balance at the beginning of the period (usd per share) | $ 19.54 | ||
RSUs granted (usd per share) | 21.05 | ||
RSUs vested (usd per share) | 18.51 | ||
RSUs forfeited or cancelled (usd per share) | 20.18 | ||
Balance at the end of the period (usd per share) | $ 20.81 | $ 19.54 |
Common Stock and Stockholders56
Common Stock and Stockholders' Equity - Assumptions Used to Estimate Fair Value of Stock Options Granted to Employees (Details) - Stock Options | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Dividend rate | 0.00% | 0.00% | 0.00% |
Minimum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected volatility | 47.00% | 49.00% | 54.00% |
Risk-free interest rate | 1.10% | 1.40% | 1.75% |
Expected term (in years) | 6 years 7 days | 6 years 7 days | 6 years 7 days |
Maximum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected volatility | 49.00% | 54.00% | 56.00% |
Risk-free interest rate | 2.00% | 2.00% | 2.02% |
Expected term (in years) | 6 years 29 days | 6 years 29 days | 6 years 6 months |
Common Stock and Stockholders57
Common Stock and Stockholders' Equity - Assumptions Used to Estimate Fair Value of ESPP Awards (Details) - ESPP Awards | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Dividend rate | 0.00% | 0.00% |
Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected volatility | 42.00% | 37.00% |
Risk-free interest rate | 0.38% | 0.09% |
Expected term (in years) | 6 months | 6 months |
Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected volatility | 48.00% | 43.00% |
Risk-free interest rate | 0.90% | 0.69% |
Expected term (in years) | 1 year 6 months | 1 year 6 months |
Net Loss per Share - Computatio
Net Loss per Share - Computation of Basic and Diluted Net Loss per Share of Common Stock (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings Per Share [Abstract] | |||
Net loss | $ (103,799) | $ (84,052) | $ (67,415) |
Less: Accretion of redeemable convertible preferred stock | 0 | 0 | (18) |
Net loss attributable to common stockholders | $ (103,799) | $ (84,052) | $ (67,433) |
Basic shares: | |||
Weighted-average common shares outstanding (in shares) | 93,307 | 85,238 | 54,383 |
Less: Weighted-average common shares subject to repurchase (in shares) | (146) | (312) | (812) |
Weighted-average common shares used to compute basic net loss per share (in shares) | 93,161 | 84,926 | 53,571 |
Net loss per share attributable to common stockholders: | |||
Basic and diluted (usd per share) | $ (1.11) | $ (0.99) | $ (1.26) |
Diluted shares: | |||
Weighted-average common shares used to compute diluted net loss per share (in shares) | 93,161 | 84,926 | 53,571 |
Net Loss per Share - Schedule o
Net Loss per Share - Schedule of Anti-Dilutive Securities Excluded from the Diluted per Share Calculation (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 15,492 | 17,260 | 15,242 |
Shares subject to outstanding common stock options and employee stock purchase plan | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 8,556 | 10,844 | 12,178 |
Restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 6,936 | 6,417 | 3,064 |
Income Taxes - Components of Lo
Income Taxes - Components of Loss Before Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ (107,685) | $ (85,928) | $ (66,755) |
Foreign | 4,879 | 2,214 | (923) |
Loss before provision for (benefit from) income taxes | $ (102,806) | $ (83,714) | $ (67,678) |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current tax provision: | |||
Federal | $ 0 | $ 1 | $ 2 |
State | 74 | (3) | 1 |
Foreign | 3,096 | 1,693 | 567 |
Total current tax provision | 3,170 | 1,691 | 570 |
Deferred tax provision: | |||
Federal | (49) | (16) | 0 |
State | 0 | 0 | 0 |
Foreign | (2,128) | (1,337) | (833) |
Total provision for (benefit from) income taxes | $ 993 | $ 338 | $ (263) |
Income Taxes - Schedule of Sign
Income Taxes - Schedule of Significant Components of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Tax credit carryforward | $ 762 | $ 266 |
Net operating loss carryforward | 73,611 | 53,237 |
Share-based compensation | 13,306 | 10,733 |
Accrued liabilities and reserves | 4,877 | 3,840 |
Other | 5,325 | 2,609 |
Total deferred tax assets | 97,881 | 70,685 |
Less: valuation allowance | (92,125) | (65,371) |
Deferred tax assets, net of valuation allowance | 5,756 | 5,314 |
Deferred tax liabilities: | ||
Depreciation and amortization | (4,474) | (6,335) |
Net deferred tax assets (liabilities) | $ 1,282 | $ (1,021) |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of the Statutory Federal Income Tax Rate and the Effective Tax Rates (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Tax at federal statutory rate | 34.00% | 34.00% | 34.00% |
State tax provision, net of federal benefit | 0.00% | 0.00% | 0.00% |
Share-based compensation | (6.10%) | (5.50%) | (5.50%) |
Valuation allowance | (23.30%) | (29.20%) | (27.90%) |
Singapore dividend | (5.90%) | (0.00%) | (0.00%) |
Other | 0.30% | 0.30% | (0.20%) |
Effective tax rate | (1.00%) | (0.40%) | 0.40% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | |
Income Tax Examination [Line Items] | |||
Cumulative amount of earnings | $ 12 | ||
Valuation allowance, deferred tax asset, Increase (Decrease), amount | 26.8 | ||
Excess stock option benefits creditable to additional paid in capital | 141.7 | ||
Interest and penalties related to uncertain tax positions | 0.2 | ||
Potential benefits, which if recognized, would affect the effective tax rate. | 0.4 | $ 1 | |
We Are Cloud, Inc | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 3 | ||
FRANCE | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 7.7 | ||
Domestic Tax Authority | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 342.9 | ||
Research and development credit carryforwards | 5.5 | ||
State and Local Jurisdiction | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforwards | 145.8 | ||
Research and development credit carryforwards | $ 6 | ||
Danish Tax Authority [Member] | |||
Income Tax Examination [Line Items] | |||
Income tax examination, settlement amount | $ 0.9 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Unrecognized tax benefits, Beginning balance | $ 8,503 | $ 5,955 |
Decrease from tax positions related to the prior year | (57) | |
Additions from tax positions related to the prior year | 279 | |
Additions from tax positions related to the current year | 3,639 | 2,605 |
Decrease related to settlements with taxing authorities | (621) | |
Lapse of statutes of limitations | (14) | 0 |
Unrecognized tax benefits, Ending balance | $ 11,786 | $ 8,503 |
Geographic Information - Schedu
Geographic Information - Schedule of Revenue by Geographic Areas (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Revenue | $ 311,999 | $ 208,768 | $ 127,049 |
United States | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Revenue | 168,479 | 116,220 | 72,217 |
EMEA | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Revenue | 87,360 | 59,047 | 35,856 |
Other | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Revenue | $ 56,160 | $ 33,501 | $ 18,976 |
Geographic Information - Sche67
Geographic Information - Schedule of Long-Lived Assets by Geographic Areas (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | $ 47,266 | $ 42,379 |
United States | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | 26,372 | 26,696 |
EMEA | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | 12,537 | 10,351 |
Republic of Ireland | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | 5,703 | 5,171 |
Other EMEA Countries | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | 6,834 | 5,180 |
APAC: | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | 8,357 | 5,332 |
AUSTRALIA | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | 3,414 | 4,544 |
Other APAC Countries | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Long-lived assets | $ 4,943 | $ 788 |