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Stock-Based Compensation (Tables)
6 Months Ended
Jun. 30, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Employee stock-based compensation
Employee stock-based compensation is included in the condensed consolidated statements of operations as follows:

 
Three Months Ended
 
Six months ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in thousands)
Cost of revenues
$
158

 
$
101

 
$
307

 
$
194

Research and development
510

 
226

 
945

 
434

Sales and marketing
705

 
158

 
1,278

 
441

General and administrative
992

 
457

 
1,765

 
792

Total employee stock-based compensation
$
2,365

 
$
942

 
$
4,295

 
$
1,861

Fair value assumptions of options granted to employees
The fair value of each option granted to employees is estimated on the date of grant using the Black-Scholes option-pricing model based on the following assumptions:

 
Three Months Ended
 
Six months ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
Expected term (in years)
5.3 to 5.9
 
5.4 to 6.1
 
5.3 to 5.9
 
5.4 to 6.1
Volatility
49% to 50%
 
52%
 
49% to 52%
 
52% to 53%
Risk-free interest rate
1.65% to 1.67%
 
0.7% to 1.1%
 
1.52% to 1.67%
 
0.7% to 1.1%
Dividend yield
 
 
 
Stock option activity
A summary of the Company’s stock option activity is as follows:

 
Outstanding Shares
 
Weighted Average Exercise Price
 
Weighted Average Remaining Contractual Life (Years)
 
Aggregate Intrinsic Value
 
 
 
 
 
 
 
(in thousands)
Balance as of December 31, 2013
7,039,093

 
$
7.17

 
6.5
 
$
112,312

Granted
1,399,400

 
23.65

 
 
 
 
Exercised
(598,670
)
 
5.10

 
 
 
 
Canceled
(529,268
)
 
16.81

 
 
 
 
Balance as of June 30, 2014
7,310,555

 
9.80

 
6.4
 
116,943

Vested and expected to vest - June 30, 2014
6,802,381

 
9.18

 
6.3
 
112,981

Exercisable - June, 2014
4,870,019

 
4.70

 
5.3
 
102,123