Financial Instruments

3 Months Ended

Mar. 31, 2016

Financial Instruments Owned At Fair Value [Abstract]

Financial Instruments

Note 3. Financial Instruments

Investments

The following tables present information about our cash equivalents and marketable securities measured at fair value on a recurring basis as of March 31, 2016 and December 31, 2015 based on the three-tier fair value hierarchy (in thousands):

	Fair Value Measurement at
	March 31, 2016
	Level 1		Level 2		Total
Description
Corporate securities	$	—	$	29,696	$	29,696
Money market funds		18,556		—		18,556
Asset-backed securities		—		10,025		10,025
U.S. treasury securities		—		9,211		9,211
Commercial paper		—		3,985		3,985
Agency securities		—		2,001		2,001
Total	$	18,556	$	54,918	$	73,474
Included in cash and cash equivalents					$	18,556
Included in marketable securities					$	54,918

	Fair Value Measurement at
	December 31, 2015
	Level 1		Level 2		Total
Description
Corporate securities	$	—	$	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

As of March 31, 2016 and December 31, 2015, there were no securities within Level 3 of the fair value hierarchy.  There were no transfers between fair value measurement levels during the three months ended March 31, 2016.  Gross unrealized gains or losses for cash equivalents and marketable securities as of March 31, 2016 and December 31, 2015 were not material. As of March 31, 2016 and December 31, 2015, there were no securities that were in an unrealized loss position for more than 12 months.

The following table classifies our marketable securities by contractual maturity as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Due in one year or less	$	36,531	$	29,414
Due after one year		18,387		22,336
Total	$	54,918	$	51,750

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.

Derivative Instruments and Hedging

Our foreign currency exposures typically arise from foreign operations and sales in foreign currencies for subscriptions to our customer service platform. In September 2015, we implemented a hedging program to mitigate the impact 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 hedges as cash flow hedges. Our foreign currency forward contracts generally have maturities of 15 months or less but can extend up to 24 months. As of March 31, 2016, the balance of other accumulated comprehensive income included an unrealized gain of $1.9 million related to the effective portion of changes in the fair value of foreign currency forward contracts designated as cash flow hedges. We expect to reclassify $1.1 million from accumulated other comprehensive income into earnings over the next 12 months associated with our cash flow hedges.

The following tables present information about derivative instruments on our consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Balance Sheet Location	Fair Value (Level 2)		Balance Sheet Location	Fair Value (Level 2)
Foreign currency forward contracts	Other current assets		1,867	Accrued liabilities		740
Foreign currency forward contracts	Other assets		719	Other liabilities		6
Total		$	2,586		$	746

	December 31, 2015
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Balance Sheet Location	Fair Value (Level 2)		Balance Sheet Location	Fair Value (Level 2)
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 $99.9 million and $60.8 million as of March 31, 2016 and December 31, 2015, respectively.

The following table presents information about our derivative instruments on the statement of operations for the three months ended March 31, 2016 (in thousands):

		Three Months Ended March 31, 2016
Hedging Instrument	Location of Gain (Loss) Reclassified into Earnings	Gain Recognized in AOCI		Loss Reclassified from AOCI into Earnings
Foreign currency forward contracts	Revenue, cost of revenue, operating expenses		2,348		(262	)
Total		$	2,348	$	(262	)

There were no gains or losses on derivative instruments for the three months ended March 31, 2015.

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 three months ended March 31, 2016.