Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

United States and Foreign Components of Income Before Income Taxes

The United States and foreign components of income before income taxes are as follows:



	2018		2017		2016
	(In thousands)
United States	$	174,519	$	78,897	$	59,344
Foreign	454,936		471,449		468,426
Total	$	629,455	$	550,346	$	527,770

Components of the Provision for Income Taxes

The components of the provision for income taxes are as follows:



	2018			2017			2016
	(In thousands)
Current:
Federal	$	(19,461	)	$	374,602		$	18,832
Foreign	70,146			56,526			52,978
State	16,259			3,075			7,759
Total current	66,944			434,203			79,569
Deferred:
Federal	1,899			52,842			(7,688		)
Foreign	(14,804		)	(5,468		)	(3,139		)
State	(251		)	46,784			(10,827		)
Total deferred	(13,156		)	94,158			(21,654		)
Total provision	$	53,788		$	528,361		$	57,915

Components of Deferred Tax Assets and Liabilities

The following table presents the breakdown of net deferred tax assets:



	December 31,
	2018			2017
	(In thousands)
Deferred tax assets	$	136,998		$	152,362
Deferred tax liabilities	(15,075		)	(237		)
Total net deferred tax assets	$	121,923		$	152,125

The significant components of the Company’s deferred tax assets and liabilities consisted of the following:



	December 31,
	2018			2017
	(In thousands)
Deferred tax assets:
Accruals and reserves	$	27,022		$	30,317
Deferred revenue	62,085			65,016
Tax credits	81,720			80,772
Net operating losses	54,747			36,674
Stock based compensation	30,936			21,714
Depreciation and amortization	—			4,939
Valuation allowance	(85,400		)	(76,789		)
Total deferred tax assets	171,110			162,643
Deferred tax liabilities:
Acquired technology	(15,681		)	(2,882		)
Depreciation and amortization	(5,044		)	—
Prepaid expenses	(23,213		)	(7,414		)
Other	(5,249		)	(222		)
Total deferred tax liabilities	(49,187		)	(10,518		)
Total net deferred tax assets	$	121,923		$	152,125

Reconciliation of The Company's Effective Tax Rate to The Statutory Federal Rate

A reconciliation of the Company’s effective tax rate to the statutory federal rate is as follows:



	Year Ended December 31,
	2018		2017		2016
Federal statutory taxes	21.0	%	35.0	%	35.0	%
State income taxes, net of federal tax benefit	0.7		2.1		0.8
Foreign operations	(5.4	)	(20.0	)	(21.6	)
Permanent differences	2.0		2.6		3.2
The 2017 Tax Act - tax rate impact on deferred taxes	(0.7	)	11.8		—
The 2017 Tax Act - transition tax	(3.5	)	66.3		—
Change in valuation allowance reserve	0.4		8.8		—
Change in deferred tax liability related to acquired intangibles	(0.1	)	0.3		(0.8	)
Tax credits	(5.8	)	(7.6	)	(7.9	)
Stock-based compensation	(1.9	)	(3.6	)	0.3
Change in accruals for uncertain tax positions	1.8		0.3		2.2
Other	—		—		(0.2	)
	8.5	%	96.0	%	11.0	%

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2018 and 2017 is as follows (in thousands):



Balance at December 31, 2016	$	69,801
Additions based on tax positions related to the current year	9,293
Additions for tax positions of prior years	7,656
Reductions related to audit settlements	(137		)
Reductions related to the expiration of statutes of limitations	(8,764		)
Balance at December 31, 2017	77,849
Additions based on tax positions related to the current year	10,168
Additions for tax positions of prior years	10,325
Reductions related to the expiration of statutes of limitations	(8,436		)
Balance at December 31, 2018	$	89,906