Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of income tax Benefit (provisions) from continuing operations

Income tax provisions from continuing operations consisted of the following:



	Year Ended December 31,
	2017			2016			2015
	(In thousands)
Income (loss) from continuing operations before provisions for income taxes	$	(44,811	)	$	(14,509	)	$	4,449
Provision for income taxes from continuing operations	(480		)	(25,521		)	(1,591		)
Effective tax rate	(1.1		)%	(175.9		)%	35.8		%

Details of pre-tax book income (loss) from continuing operations

The Company reported pre-tax book income or loss from continuing operations of:



	Year Ended December 31,
	2017			2016			2015
	(In thousands)
Domestic	$	(23,994	)	$	(14,656	)	$	21,160
Foreign	(20,817		)	147			(16,711		)
Total	$	(44,811	)	$	(14,509	)	$	4,449

Summary of benefit (provision) for income taxes from continuing operations

The benefit or (provisions) for income taxes from continuing operations consisted of the following:



	Year Ended December 31,
	2017			2016			2015
	(In thousands)
Current:
United States federal	$	—		$	(1,649	)	$	(1,426	)
State and local	(5		)	859			(12		)
Foreign	(448		)	(442		)	(389		)
Total current	$	(453	)	$	(1,232	)	$	(1,827	)
Deferred:
United States federal	—			(24,261		)	585
State and local	—			—			—
Foreign	(27		)	(28		)	(349		)
Total deferred	(27		)	(24,289		)	236
	$	(480	)	$	(25,521	)	$	(1,591	)

Details of significant components of net deferred tax assets and liabilities

Significant components of the net deferred tax assets and liabilities consisted of:



	December 31,
	2017			2016
	(In thousands)
Deferred tax assets:
Net operating loss carryforwards	$	13,394		$	15,337
State income taxes	1			1
Deferred revenue	5,349			458
Research and development and other credits	11,447			11,418
Reserves and accruals recognized in different periods	3,088			5,397
Basis difference in investment	583			969
Capitalized R&D expenses	3,623			4,569
Depreciation and amortization	413			585
Deferred rent	183			306
Other	—			2
Total deferred tax assets	38,081			39,042
Valuation allowance	(37,680		)	(38,683		)
Net deferred tax assets	401			359
Foreign credits	(43		)	(33		)
Net deferred tax liabilities	(43		)	(33		)
Net deferred taxes	$	358		$	326

Reconciliation between benefit (provision) for income taxes at statutory rate and effective tax rate

For purposes of the reconciliation between the provision for income taxes at the statutory rate and the effective tax rate, a national U.S. 35% rate is applied as follows:



	2017		2016		2015
Federal statutory tax rate	35.0	%	35.0	%	35.0	%
Sale of IP rights to foreign subsidiary	—	%	(13.8	)%	22.5	%
Benefit from foreign losses	—	%	—	%	7.8	%
Foreign withholding	(0.2	)%	(1.2	)%	0.5	%
Stock compensation expense	(2.0	)%	(6.6	)%	5.8	%
Meals & entertainment	—	%	—	%	0.1	%
Foreign rate differential	(17.0	)%	(1.2	)%	(24.0	)%
Prior year true-up items	(0.1	)%	(0.3	)%	1.7	%
Tax reserves	(0.1	)%	1.8	%	3.9	%
Loss on foreign share transfer	—	%	—	%	5.9	%
Credits	0.4	%	1.6	%	(35.5	)%
State Refunds	—	%	3.8	%	—	%
Other	—	%	(1.6	)%	3.9	%
2017 Tax Act impact - federal rate change	(28.7	)%	—	%	—	%
Valuation allowance	11.6	%	(193.4	)%	8.2	%
Effective tax rate	(1.1	)%	(175.9	)%	35.8	%

Details of beginning and ending amount of gross unrecognized tax benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:



	2017			2016			2015
	(In thousands)
Balance at beginning of year	$	6,232		$	6,285		$	1,744
Gross increases for tax positions of prior years	—			—			141
Gross decreases for federal tax rate change for tax positions of prior years	(1,670		)	(22		)	(15		)
Gross increases for tax positions of current year	110			111			4,415
Lapse of statute of limitations	—			(142		)	—
Balance at end of year	$	4,672		$	6,232		$	6,285