INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Components of (Loss) Income before (Benefit) Provision from Income Taxes

The components of (loss) income before (benefit) provision from income taxes are:

(in thousands)	2018			2017		2016
Domestic	$	(27,494	)	$	57,493	$	39,559
Foreign	15,951			28,742		15,776
(Loss) income before (benefit) provision from income taxes	$	(11,543	)	$	86,235	$	55,335

Components of Provision for Income Taxes

The components of the provision for income taxes are:

(in thousands)	2018			2017			2016
Current:
Federal	$	(1,862	)	$	(18,109	)	$	7,389
State	287			97			3,081
Foreign	10,313			8,479			4,248
Total current provision (benefit)	8,738			(9,533		)	14,718
Deferred:
Federal	(18,939		)	(2,049		)	(1,125		)
State	(3,702		)	(214		)	(466		)
Foreign	(8,257		)	(517		)	(2,807		)
Total deferred benefit	(30,898		)	(2,780		)	(4,398		)
(Benefit) provision from income taxes	$	(22,160	)	$	(12,313	)	$	10,320

Reconciliation of Effective Income Tax Rate from Statutory Federal Income Tax Rate

The effective income tax rate differed from the statutory federal income tax rate due to the following ⁽¹⁾:

	2018		2017		2016
Statutory federal income tax rate	21.0	%	35.0	%	35.0	%
Valuation allowance	(4.4	)%	0.5	%	0.2	%
Transaction costs	—	%	—	%	0.7	%
State income taxes, net of federal benefit and tax credits	28.9	%	(0.5	)%	2.5	%
Permanent differences	(11.2	)%	1.1	%	1.4	%
GILTI, FDII, and BEAT	(3.5	)%	—	%	—	%
Federal research and experimentation credits	60.6	%	(3.9	)%	(1.5	)%
Tax effects of foreign activities	3.5	%	(0.9	)%	(5.6	)%
Tax-exempt income	1.2	%	(0.1	)%	(0.2	)%
Provision to return adjustments	(2.2	)%	(2.1	)%	—	%
Non-deductible compensation	(8.9	)%	2.1	%	4.0	%
Expiration of statutes and changes in estimates	4.5	%	0.3	%	(1.2	)%
Excess tax benefits related to share-based compensation	117.3	%	(28.4	)%	(12.8	)%
Domestic Production Activities	—	%	—	%	(2.0	)%
Deferred tax asset adjustment	(14.2	)%	(17.9	)%	(0.3	)%
Other	(0.6	)%	0.5	%	(1.5	)%
Effective income tax rate	192.0	%	(14.3	)%	18.7	%

⁽¹⁾ In periods of loss before incomes taxes, income tax benefits are reflected as a positive in this table.

Components of Net Deferred Tax Assets and Liabilities

Significant components of net deferred tax assets and liabilities are:

	December 31,
(in thousands)	2018			2017
Deferred tax assets:
Net operating loss carryforwards	$	40,736		$	52,311
Accruals and reserves	17,576			14,668
Software revenue	—			—
Depreciation	2,874			2,558
Tax credit carryforwards	14,896			13,056
Other	176			52
Total deferred tax assets	76,258			82,645
Valuation allowances	(27,954		)	(27,994		)
Total net deferred tax assets	48,304			54,651
Deferred tax liabilities:
Software revenue	(36,510		)	(70,347		)
Intangibles	(5,748		)	(8,527		)
Total deferred tax liabilities	(42,258		)	(78,874		)
Deferred income taxes	$	6,046		$	(24,223	)

Summary of Operating Loss Carryforwards

At December 31, 2018 the Company’s net operating losses and credit carryforwards are:

(in thousands)	Federal		State
Net operating losses (1)	$	81,206	$	2,210
Net operating losses due to acquisitions	$	81,206	$	665
Credit carryforwards (2)	$	7,480	$	1,937
Credit carryforwards due to acquisitions	$	640	$	324

⁽¹⁾ Excludes federal and state net operating losses of $60.2 million and $0.8 million, respectively, and federal and state tax credits of $0.1 million and $7.4 million, respectively, that the Company expects will expire unutilized,

⁽²⁾ Carryforward losses and credits expire between 2019 and 2037 except for $0.9 million of state credits that have an unlimited carryforward period.

Summary of Credit Carryforwards

At December 31, 2018 the Company’s net operating losses and credit carryforwards are:

(in thousands)	Federal		State
Net operating losses (1)	$	81,206	$	2,210
Net operating losses due to acquisitions	$	81,206	$	665
Credit carryforwards (2)	$	7,480	$	1,937
Credit carryforwards due to acquisitions	$	640	$	324

⁽¹⁾ Excludes federal and state net operating losses of $60.2 million and $0.8 million, respectively, and federal and state tax credits of $0.1 million and $7.4 million, respectively, that the Company expects will expire unutilized,

⁽²⁾ Carryforward losses and credits expire between 2019 and 2037 except for $0.9 million of state credits that have an unlimited carryforward period.

Reconciliation of Beginning and Ending Balances of Gross Unrecognized Tax Benefits

A rollforward of the Company’s gross unrecognized tax benefits is:

(in thousands)	2018			2017			2016
Balance as of January 1,	$	19,150		$	22,671		$	23,972
Additions based on tax positions related to the current year	978			452			80
Additions for tax positions of prior years	174			238			110
Additions for acquired uncertain tax benefits	—			—			387
Reductions for change in U.S. federal tax rate	—			(2,424		)	—
Reductions for tax positions of prior years	(2,145		)	(1,500		)	(1,541		)
Reductions for a lapse of the applicable statute of limitations	—			(287		)	(337		)
Balance as of December 31,	$	18,157		$	19,150		$	22,671