INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of Income (Loss) before Income Taxes

The following table presents domestic and foreign components of income (loss) before income taxes for the periods presented (in thousands):



	Year Ended December 31,
	2018			2017			2016
United States	$	44,856		$	194,376		$	4,638
Foreign	(4,850		)	(9,890		)	(4,964		)
Total income (loss) before income taxes	$	40,006		$	184,486		$	(326	)

Tax Provision

The income tax provision is composed of the following (in thousands):



	Year Ended December 31,
	2018			2017			2016
Current:
Federal	$	(819	)	$	25,785		$	—
State	384			5,069			35
Foreign	560			354			86
Total current tax	$	125		$	31,208		$	121
Deferred:
Federal	$	(10,032	)	$	(28	)	$	106
State	(6,491		)	15			13
Foreign	1,054			296			1,145
Total deferred tax	(15,469		)	283			1,264
Total (benefit from) provision for income taxes	$	(15,344	)	$	31,491		$	1,385

Reconciliation of Effective Income Tax Rate

The following table presents a reconciliation of the statutory federal rate and the Company’s effective tax rate for the periods presented:



	Year Ended December 31,
	2018		2017		2016
Income tax at federal statutory rate	21.00	%	35.00	%	35.00	%
State tax, net of federal tax effect	3.24		3.54		175.83
Foreign income tax rate differential	(0.54	)	0.50		(15.49	)
Stock-based compensation	(16.80	)	(4.82	)	105.69
Income tax credits	(35.83	)	(5.39	)	1,649.82
Change in valuation allowance	(25.08	)	(30.23	)	(1,549.03	)
Change in uncertain tax positions	4.48		0.98		(0.04	)
Gain on disposal of a business unit	—		17.42		—
Meals and entertainment	4.87		0.24		(139.38	)
Other non-deductible expenses	5.14		0.12		(62.03	)
Deferred adjustments	2.24		(0.12	)	(118.87	)
Expiration of deferred tax benefit	—		—		(510.98	)
Other	(1.07	)	(0.18	)	4.86
Effective tax rate	(38.35	)%	17.06	%	(424.62	)%

Schedule of Deferred Tax Assets and Liabilities

The following table presents the significant components of the Company’s deferred tax assets and liabilities for the periods presented (in thousands):



	As of December 31,
	2018			2017
Deferred tax assets:
Reserves and others	$	14,223		$	10,869
Stock-based compensation	19,689			19,556
Net operating loss carryforward	5,956			8,115
Tax credit carryforward	23,073			14,183
Gross deferred tax assets	62,941			52,723
Valuation allowance	(18,381		)	(28,566		)
Total deferred tax assets	44,560			24,157
Deferred tax liabilities:
Depreciation and amortization	(16,666		)	(12,813		)
Disposal of a business unit	(7,454		)	(7,152		)
Deferred contract costs	(3,201		)	(2,329		)
Total deferred tax liabilities	(27,321		)	(22,294		)
Net deferred tax assets (liabilities)	$	17,239		$	1,863

Schedule of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized benefits is as follows (in thousands):



	Year Ended December 31,
	2018			2017			2016
Balance at the beginning of the year	$	18,215		$	10,340		$	5,049
Increase (decrease) based on tax positions related to the prior year	3,654			667			1,381
Increase based on tax positions related to the current year	11,485			7,209			4,131
Lapse of statute of limitations	(247		)	(1		)	(221		)
Balance at the end of the year	$	33,107		$	18,215		$	10,340