Equity Award Plan Activities

9 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Total stock-based compensation expense related to options, restricted stock awards, employee stock purchases, restricted stock units and stock purchase rights granted were allocated as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Cost of revenue	$	955	$	786	$	2,616	$	2,206
Research and development	8,010		7,037		23,062		18,344
Sales and marketing	3,947		2,864		11,374		8,138
General and administrative	2,204		1,591		5,656		3,637
Total stock-based compensation	$	15,116	$	12,278	$	42,708	$	32,325

Stock Option Activities

The following table summarizes the option and RSA (Restricted Stock Award) activity under our equity stock plans and related information:



	Options and RSAs Outstanding
	Number of Shares Underlying Outstanding Options and RSAs (in thousands)		Weighted- Average Exercise Price per Share		Weighted- Average Remaining Contractual Term (Years) of Stock Options	Aggregate Intrinsic Value of Stock Options Outstanding (in thousands)
Outstanding—December 31, 2015	11,630		$	24.49	7.6	$	620,802
Options granted	440		56.88
Options exercised	(1,583	)	9.85
Options canceled	(314	)	30.22
Outstanding—September 30, 2016	10,173		$	28.00	7.1	$	580,661
Vested and exercisable—September 30, 2016	3,685		$	14.38	6.3	$	260,514
Vested and expected to vest—September 30, 2016	9,658		$	27.39	7.1	$	557,170

As of September 30, 2016, the total unrecognized stock-based compensation expense related to unvested stock options, net of expected forfeitures, was $95.4 million, which is expected to be recognized over a weighted-average period of 3.9 years.

Restricted Stock Unit (RSU) Activities

A summary of the RSU activity under our stock plans during the reporting period and a summary of information related to RSUs expected to vest are presented below (in thousands, except per share and year amounts):



	Number of Shares		Weighted- Average Grant Date Fair Value Per Share		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Unvested balance—December 31, 2015	893		$	70.14	1.9	$	69,509
RSUs granted	440		63.80
RSUs vested	(178	)	69.66
RSUs forfeited	(72	)	67.06
Unvested balance—September 30, 2016	1,083		$	67.85	1.7	$	92,120
Vested and expected to vest—September 30, 2016	1,015		$	67.86	1.7	$	86,357

As of September 30, 2016, there was $61.4 million of unrecognized stock-based compensation cost related to unvested RSUs, net of estimated forfeitures. This amount is expected to be recognized over a weighted-average period of 3.3 years.

Employee Stock Purchase Plan Activities

During the nine months ended September 30, 2016, we issued 256,223 shares at a weighted average purchase price of $40.30 under the 2014 Employee Stock Purchase Plan ("ESPP"). On February 17, 2015, the board authorized an increase to shares available for future issuance under the ESPP. Per the ESPP, the increase is determined based on the lesser of 1% of total shares outstanding as of the first day of each fiscal year, or January 1, 2016, 2,500,000 shares or such amount as determined by our board of directors. The approved increase for 2016 amounted to 681,315 shares. As of September 30, 2016, there remain 1,483,846 shares available for issuance under the ESPP.

As of September 30, 2016, the total unrecognized stock-based compensation expense related to unvested ESPP options, net of expected forfeitures, was $6.1 million, which is expected to be recognized over a weighted-average period of 1.8 years.

Shares Available for Grant

The following table presents the stock activity and the total number of shares available for grant as of September 30, 2016 (in thousands):




	Number of Shares
Balance—December 31, 2015	10,495
Authorized	2,044
Options granted	(440	)
RSUs granted	(440	)
Options canceled	314
Options repurchased	5
RSUs forfeited	72
Shares traded for taxes	11
Balance—September 30, 2016	12,061