Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2012

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

Schedule of Stock Based Compensation Expense

The following table summarizes the components of total stock-based compensation expense included in the Company’s consolidated statements of operations for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	For the Years Ended December 31,
	2012			2011			2010
Stock-based compensation expense by type of award:
Stock options	$	14,244		$	13,533		$	15,154
Deferred stock units	1,885			1,885			1,885
Restricted stock units	77,882			47,807			62,928
Shares issued under the 1999 ESPP	5,850			5,553			4,319
Amounts capitalized as internal-use software	(9,276		)	(7,473		)	(7,818		)
Total stock-based compensation before income taxes	90,585			61,305			76,468
Less: Income tax benefit	(33,126		)	(21,212		)	(26,566		)
Total stock-based compensation, net of taxes	$	57,459		$	40,093		$	49,902
Effect of stock-based compensation on income by line item:
Cost of revenues	$	2,871		$	2,360		$	2,806
Research and development expense	17,275			11,125			14,539
Sales and marketing expense	42,760			27,990			35,525
General and administrative expense	27,679			19,830			23,598
Provision for income taxes	(33,126		)	(21,212		)	(26,566		)
Total cost related to stock-based compensation, net of taxes	$	57,459		$	40,093		$	49,902

Schedule of Stock Options Granted Black Scholes

The grant-date fair values of Akamai’s stock option awards granted during the years ended December 31, 2012, 2011 and 2010 were estimated using the Black-Scholes option pricing model with the following weighted-average assumptions:

	For the Years Ended December 31,
	2012	2011	2010
Expected life (years)	4.2	4.2	4.2
Risk-free interest rate (%)	0.6	1.3	1.4
Expected volatility (%)	50.8	48.9	50.9
Dividend yield (%)	—	—	—

Schedule of ESPP Granted Black Scholes

The grant-date fair values of Akamai’s ESPP awards granted during the years ended December 31, 2012, 2011 and 2010 were estimated using the Black-Scholes option pricing model with the following weighted-average assumptions:

	For the Years Ended December 31,
	2012	2011	2010
Expected life (years)	0.5	0.5	0.5
Risk-free interest rate (%)	0.1	0.1	0.2
Expected volatility (%)	51.0	43.7	51.2
Dividend yield (%)	—	—	—

Schedule of Summary of Stock Option Activity

The following table summarizes stock option activity during the years ended December 31, 2012, 2011 and 2010:

	Shares (in thousands)		Weighted Average Exercise Price
Outstanding at December 31, 2009	10,022		$	19.34
Granted	1,577		39.72
Exercised	(2,366	)	14.21
Forfeited and expired	(287	)	39.69
Outstanding at December 31, 2010	8,946		23.63
Granted	656		37.33
Exercised	(1,044	)	12.09
Forfeited and expired	(541	)	43.96
Outstanding at December 31, 2011	8,017		24.89
Granted	954		16.81
Exercised	(2,105	)	13.23
Forfeited and expired	(643	)	37.37
Outstanding at December 31, 2012	6,223		$	26.30
Exercisable at December 31, 2012	4,814		$	25.60

Schedule of Stock Options Outstanding Expected to Vest and Exercisable

The following table summarizes stock options that are outstanding and expected to vest and stock options exercisable at December 31, 2012:

Range of Exercise Price ($)	Options Outstanding and Expected to Vest						Options Exercisable
	Number of Options	Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Aggregate Intrinsic Value		Number of Options	Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Aggregate Intrinsic Value
	(In thousands)	(In years)			(In thousands)		(In thousands)	(In years)			(In thousands)
0.20-0.31	23	1.7	$	0.31	$	948	23	1.7	$	0.31	$	948
0.82	50	7.0	0.82		2,020		20	7.1	0.82		812
1.33-1.49	20	0.2	1.39		774		20	0.2	1.39		774
2.77-4.10	287	8.1	2.81		10,944		79	7.0	2.90		2,984
4.29-5.56	265	0.7	4.98		9,530		265	0.7	4.98		9,530
7.47-11.20	46	4.9	9.38		1,443		29	2.8	10.51		874
12.14-18.01	1,901	2.4	14.87		49,493		1,866	2.4	14.83		48,660
18.49-26.95	1,027	4.0	24.83		16,515		779	3.7	24.80		12,552
28.13-42.10	1,319	5.1	35.48		7,282		788	4.7	34.33		5,245
43.08-56.60	1,194	3.4	49.32		—		945	3.1	50.05		—
	6,132	3.7	$	26.43	$	98,949	4,814	3.1	$	25.60	$	82,379
Expected forfeitures	91
Total options outstanding	6,223

Schedule Of Deferred Stock Units Activity

The following table summarizes the DSU activity for the years ended December 31, 2012, 2011 and 2010:

	Units (in thousands)		Weighted Average Grant-Date Fair Value
Outstanding at December 31, 2009	287		$	21.04
Granted	47		39.95
Vested and distributed	(77	)	18.40
Outstanding at December 31, 2010	257		25.31
Granted	58		32.48
Vested and distributed	(15	)	33.78
Forfeited	(1	)	39.95
Outstanding at December 31, 2011	299		26.25
Granted	65		29.17
Vested and distributed	(79	)	29.76
Outstanding at December 31, 2012	285		$	25.93

Schedule of Restricted Stock Units by Type

The following table summarizes the different types of RSUs granted by the Company (in thousands):

	For the Years Ended December 31,
	2012	2011	2010
RSUs with service-based vesting conditions	2,782	3,003	1,597
RSUs with performance-based vesting conditions	369	550	1,124
Total	3,151	3,553	2,721

Schedule of Restricted Stock Units Activity

The following table summarizes the RSU activity for the years ended December 31, 2012, 2011 and 2010:

	Units (in thousands)		Weighted Average Grant-Date Fair Value
Outstanding at December 31, 2009	6,863		$	27.63
Granted	2,721		26.56
Vested	(1,971	)	23.97
Forfeited	(1,406	)	47.47
Outstanding at December 31, 2010	6,207		23.76
Granted	3,553		33.75
Vested	(1,931	)	23.15
Forfeited	(1,312	)	30.62
Outstanding at December 31, 2011	6,517		27.95
Granted	3,150		35.82
Vested	(2,732	)	26.14
Forfeited	(989	)	27.91
Outstanding at December 31, 2012	5,946		$	32.97