Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Domestic and Foreign Income (Loss) from Continuing Operations Before Income Taxes

The following table summarizes our U.S. and foreign income (loss) from continuing operations before income taxes:

	Year Ended December 31,
	2014		2013		2012
	(In thousands)
U.S.	$	176,820	$	26,888	$	(20,097	)
Foreign		287,821		273,805		370,154
Total	$	464,641	$	300,693	$	350,057

Components of Income Tax Expense Attributable to Continuing Operations

The following table summarizes our provision for income taxes from continuing operations:

	Year Ended December 31,
	2014			2013			2012
				(In thousands)
Current income tax expense:
Federal	$	120,541		$	38,209		$	56,501
State		6,645			(402	)		(24	)
Foreign		43,536			47,300			45,721
Current income tax expense		170,722			85,107			102,198
Deferred income tax (benefit) expense:
Federal	$	(47,390	)	$	12,371		$	(33,724	)
State		(2,419	)		445			578
Foreign		(29,222	)		(13,588	)		(21,974	)
Deferred income tax (benefit) expense:		(79,031	)		(772	)		(55,120	)
Income tax expense	$	91,691		$	84,335		$	47,078

Components of Deferred Tax Assets and Deferred Tax Liabilities

As of December 31, 2014 and 2013, the significant components of our deferred tax assets and deferred tax liabilities were as follows:

	December 31,
	2014			2013
	(In thousands)
Deferred tax assets:
Provision for accrued expenses	$	71,546		$	54,986
Loyalty rewards reserve		84,373			49,310
Occupancy tax reserve		22,813			18,222
Net operating loss and tax credit carryforwards		49,091			33,979
Stock-based compensation		39,344			33,262
Other		39,952			28,224
Total deferred tax assets		307,119			217,983
Less valuation allowance		(50,748	)		(32,942	)
Net deferred tax assets	$	256,371		$	185,041
Deferred tax liabilities:
Prepaid merchant bookings and prepaid expenses	$	(61,737	)	$	(62,082	)
Intangible assets		(386,979	)		(392,002	)
Investment in subsidiaries		(1,320	)		(7,913	)
Unrealized gains		(5,783	)		(8,999	)
Property and equipment		(73,010	)		(65,215	)
Other		(1,178	)		(2,081	)
Total deferred tax liabilities	$	(530,007	)	$	(538,292	)
Net deferred tax liability	$	(273,636	)	$	(353,251	)

Schedule of Statutory Federal Income Tax Rate to Income from Continuing Operations before Income Taxes

A reconciliation of amounts computed by applying the federal statutory income tax rate to income from continuing operations before income taxes to total income tax expense is as follows:

	Year Ended December 31,
	2014			2013			2012
				(In thousands)
Income tax expense at the federal statutory rate of 35%	$	162,624		$	105,243		$	122,520
Foreign tax rate differential		(81,371	)		(87,729	)		(78,094	)
State income taxes, net of effect of federal tax benefit		2,720			3,994			1,280
Unrecognized tax benefits and related interest		(1,625	)		12,096			16,038
Change in valuation allowance		13,914			19,167			(11,838	)
Pay-to-play penalties		1,322			14,404			—
trivago acquisition stock-based compensation		—			19,825			—
Other, net		(5,893	)		(2,665	)		(2,828	)
Income tax expense	$	91,691		$	84,335		$	47,078

Income Tax Reconciliation 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:

	2014			2013			2012
				(In thousands)
Balance, beginning of year	$	109,712		$	102,305		$	81,682
Increases to tax positions related to the current year		28,416			21,899			20,453
Increases to tax positions related to prior years		4,469			5,064			4,837
Decreases to tax positions related to prior years		—			(3,732	)		(304	)
Reductions due to lapsed statute of limitations		(23,709	)		(4,134	)		(5,061	)
Settlements during current year		—			(8,957	)		(607	)
Interest and penalties		(8,327	)		(2,733	)		1,305
Balance, end of year	$	110,561		$	109,712		$	102,305