Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of Components of Income (Loss) Before Income Taxes

Components of income (loss) before income taxes (in thousands):



	Years ended December 31,
	2018			2017			2016
United States operations	$	(16,144	)	$	(15,731	)	$	(34,100	)
Foreign operations	(6,643		)	(4,461		)	(2,897		)
Income (loss) before income taxes	$	(22,787	)	$	(20,192	)	$	(36,997	)

Schedule of Components of Income Tax Expense (Benefit)

Components of income tax expense (benefit) (in thousands):



	Years ended December 31,
	2018		2017			2016
Current:
United States federal	$	612	$	683		$	712
State and local	53		42			59
Foreign	367		368			(125		)
Total current	1,032		1,093			646
Deferred:
United States federal	338		(3,643		)	3
State and local	—		2			1
Foreign	832		(230		)	126



Total deferred	1,170		(3,871		)	130
Total income tax expense (benefit)	$	2,202	$	(2,778	)	$	776

Schedule of Effective Income Tax Rate Reconciliation

Income tax expense differs from “expected” income tax expense (computed by applying the U.S. federal income tax rate of 21% in 2018 and 35% in 2017 and 2016) due to the following (in thousands):



	Years ended December 31,
	2018			2017			2016
United States federal tax expense (benefit) at statutory rate	$	(4,785	)	$	(7,067	)	$	(12,949	)
State taxes, net of United States federal tax expense (benefit)	(694		)	(273		)	(533		)
Change in valuation allowance	5,804			1,133			13,148
Non-deductible stock compensation	448			587			144
Impact of non-U.S. jurisdictional tax rate difference	(117		)	603			335
Research and development tax credit	(12		)	—			(338		)
Increase (reversal) of unrecognized tax benefits	—			—			135
Basis difference in investment	159			1,397			538
Non-U.S. withholding tax	470			435			452
Change in indefinite reinvestment assertion	998			—			—
Other	(69		)	407			(156		)
Total income tax expense (benefit)	$	2,202		$	(2,778	)	$	776

Schedule of Net Deferred Tax Assets

Net deferred tax assets, which are recorded at December 31, 2018 and December 31, 2017 using a 21% tax rate in the U.S. following the passage of the Tax Act, are comprised of the following (in thousands):



	December 31,
	2018			2017
Deferred tax assets:
United States federal net operating loss carryforwards	$	62,983		$	59,457
Deferred expenses	660			926
Research and development tax credit carryforwards	24,523			24,499
Net unrealized loss on investments	62			62
Accrued loss on excess office facilities	291			489
Stock-based compensation	2,603			2,738
State net operating loss carryforwards	11,971			13,746
Foreign net operating loss carryforwards	31,254			32,759
Deferred revenue	67			108
Equipment, software, and leasehold improvements	2,642			3,119
Intangibles	13			2
Net unrealized gains and basis differences on investments	1,193			1,188
Other	486			183
Gross deferred tax assets	138,748			139,276
Less valuation allowance	137,246			137,117
Gross deferred tax assets, net of valuation allowance	$	1,502		$	2,159
Deferred tax liabilities:
Other intangible assets	$	(155	)	$	(62	)
Undistributed foreign earnings	(1,001		)	—
Other	(479		)	(814		)
Prepaid expenses	(184		)	(254		)
Gross deferred tax liabilities	(1,819		)	(1,130		)
Net deferred tax assets (liabilities)	$	(317	)	$	1,029

Schedule of Unrecognized Tax Benefits

Reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits (in thousands):



	Years ended December 31,
	2018		2017			2016
Balance, beginning of year	$	358	$	493		$	320
Increases related to prior year tax positions	8		—			38
Decreases related to prior year tax positions	—		(135		)	—
Increases related to current year tax positions	8		—			135
Balance, end of year	$	374	$	358		$	493