Stock-based Compensation

3 Months Ended

Mar. 31, 2017

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

Stock-based Compensation

Stock-based Compensation

Total compensation expense by award type and line item in our consolidated financial statements were as follows (in thousands):

	For the Three
	Months Ended
	March 31,
	2017		2016
Award Type
Stock options	$	4,053	$	3,818
Performance-based stock options	110		25
RSUs	941		492
Total	$	5,104	$	4,335
Line Item
Cost of revenue	$	349	$	444
Selling, general and
administrative expenses	4,755		3,891
Total	$	5,104	$	4,335

No stock-based compensation in the totals above was capitalized as software development costs for the three months ended March 31, 2017 and 2016, respectively.

Stock-based awards granted were as follows:

	For the Three
	Months Ended
	March 31,
	2017	2016
Stock options	866,849	857,130
Performance-based stock options	—	267,770
RSUs	387,597	385,713

As discussed in Note2, the Company elected to early adopt ASU 2016-09 effective January 1, 2016, resulting in a reduction to stock compensation expense of approximately$0.1 millionfor the three months ended March 31, 2016.ASU 2016-09 requires that certain amendments resulting from the adoption of the new pronouncement be applied using a modified-retrospective transition method by means of a cumulative-effect adjustment to retained earnings as of the beginning of the period in which the guidance is adopted. Thus, the Company decreased beginning retained earnings by approximately $0.5 million on January 1, 2016, for amendments related to an accounting policy election to recognize share-based award forfeitures as they occur rather than applying an estimated forfeiture rate.

In addition, the adoption of ASU 2016-09 changed how the Company recognizes excess tax benefits (“windfalls”) or deficiencies (“shortfalls”) related to share-based compensation. Prior to the adoption of ASU 2016-09, these windfalls and shortfalls were credited or charged, respectively, to additional paid-in capital in the Company’s Consolidated Balance Sheets when the amount of cash taxes paid was impacted by the windfalls and shortfalls. Under the revised standard, these windfalls and shortfalls are recognized prospectively as discrete tax benefit or discrete tax expense, respectively, in the Company’s Consolidated Statements of Operations without regard to the impact on cash taxes paid. For the three months ended March 31, 2017 and 2016, the Company recognized an immaterial discrete tax benefit related to net windfall tax benefits from share-based compensation, which increased the net operating loss (“NOL”) deferred tax asset and our valuation allowance.