Stockholders' Equity

9 Months Ended

Sep. 30, 2013

Equity [Abstract]

Stockholders' Equity

11. Stockholders’ Equity

We recorded stock-based expense related to grants of employee and consultant stock options, warrants, restricted stock and ZSUs in our consolidated statements of operations as follows (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Cost of revenue	$	(645	)	$	1,080		$	(351	)	$	11,098
Research and development		10,119			41,853			46,907			185,245
Sales and marketing		2,941			(3,977	)		8,327			21,156
General and administrative		(3,159	)		(1,139	)		10,183			49,625
Total stock-based expense	$	9,256		$	37,817		$	65,066		$	267,124

The following table shows stock option activity for the nine months ended September 30, 2013 (in thousands, except weighted-average exercise price and weighted-average contractual term):

	Outstanding Options
				Weighted-		Aggregate		Weighted-
				Average		Intrinsic Value of		Average
				Exercise		Stock Options		Contractual Term
	Stock Options			Price		Outstanding		(in years)
Balance as of December 31, 2012		80,819		$	1.52	$	100,225		7.43
Granted		7,357			3.55
Forfeited and cancelled		(14,847	)		2.75
Exercised		(17,272	)		0.37
Balance as of September 30, 2013		56,057		$	1.81	$	116,834		7.02

The following table shows a summary of ZSU activity for the nine months ended September 30, 2013 (in thousands, except weighted-average grant date fair value):

	Outstanding ZSUs
				Weighted-		Aggregate
				Average Grant Date		Intrinsic Value of
				Fair		Unvested
	Shares			Value		ZSUs
Unvested as of December 31, 2012		56,648		$	9.56	$	133,690
Granted		65,545			3.22
Vested		(18,762	)		9.03
Forfeited and cancelled		(34,513	)		6.35
Unvested as of September 30, 2013		68,918		$	5.28	$	252,998

Shares unvested as of September 30, 2013 include approximately 9.7 million performance-based ZSUs granted as part of our executive compensation plan with vesting that is dependent on the achievement of certain 2013 annual performance metrics in addition to the passage of time. We recorded $2.4 million of stock-based expense related to this plan in the nine months ended September 30, 2013, which includes a reversal of $3.7 million in the third quarter of 2013 due to forfeitures and our current assessment of the most likely achievement against annual metrics.

The following table shows a summary of changes in accumulated other comprehensive income by component for the three and nine months ended September 30, 2013 (in thousands):

	Foreign currency translation			Unrealized gains (losses) on available- for-sale securities			Unrealized gains (losses) on derivative instruments			Total
Balance as of June 30, 2013	$	(1,130	)	$	(781	)	$	—		$	(1,911	)
Other comprehensive income before reclassifications		177			1,184			—			1,361
Amounts reclassified from accumulated other comprehensive income		—			5			—			5
Net current-period other comprehensive income		177			1,189			—			1,366
Balance as of September 30, 2013	$	(953	)	$	408		$	—		$	(545	)
	Foreign currency translation			Unrealized gains (losses) on available- for-sale securities			Unrealized gains (losses) on derivative instruments			Total
Balance as of December 31, 2012	$	327		$	649		$	(2,423	)	$	(1,447	)
Other comprehensive income before reclassifications		(1,280	)		(207	)		(15	)		(1,502	)
Amounts reclassified from accumulated other comprehensive income		—			(34	)		2,438			2,404
Net current-period other comprehensive income		(1,280	)		(241	)		2,423			902
Balance as of September 30, 2013	$	(953	)	$	408		$	—		$	(545	)

In October 2012, our Board authorized a program for the repurchase of our common stock in an amount of up to $200 million. During the nine months ended September 30, 2013, we repurchased approximately 3.4 million shares of our common stock for $9.3 million under our 2012 program, and as of September 30, 2013, the remaining authorized amount of stock repurchases that may be made under the program was $178.9 million.

During the three months ended March 31, 2013, our Board approved the retirement of approximately 31.3 million shares of treasury stock. Accordingly, we reclassified our treasury stock balance of $297.6 million, as a reduction to retained earnings.