Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

The domestic and foreign components of pre-tax loss were as follows:

The components of our income tax (benefit) expense were as follows:

	Year Ended December 31,
	2016			2017			2018
				(in thousands)
Current:
Federal	$	—		$	—		$	—
State		3			(1,784	)		106
Foreign		869			932			2,824
Total current income tax (benefit) expense		872			(852	)		2,930
Deferred:
Federal		(6,364	)		(12,287	)		(15	)
State		(780	)		303			(40	)
Foreign		(808	)		(5,506	)		(328	)
Total deferred income tax (benefit) expense		(7,952	)		(17,490	)		(383	)
Income tax (benefit) expense	$	(7,080	)	$	(18,342	)	$	2,547

The following is a reconciliation of the statutory federal income tax rate to our effective tax rate:

	Year Ended December 31,
	2016			2017			2018
Tax benefit (expense) computed at the federal statutory rate		34.0	%		34.0	%		21.0	%
State tax benefit (expense), net of federal benefit		1.3			3.0			5.1
Change in valuation allowance		(34.6	)		(25.4	)		(28.4	)
U.S. corporate tax rate reduction		—			(11.4	)		0.2
Differences between U.S. and foreign tax rates on foreign income		—			(2.4	)		(0.9	)
Stock-based compensation benefit (expense)		(0.4	)		1.1			(1.2	)
U.S. federal research & development credit benefit		1.2			1.4			5.2
Other benefits (expenses)		(0.1	)		0.2			(1.2	)
Total income tax benefit (expense)		1.4	%		0.5	%		(0.2	)%

The significant components of net deferred tax balances were as follows:

	Year Ended December 31,
	2017			2018
	(in thousands)
Deferred tax assets:
Accrued expenses	$	10,534		$	21,056
Deferred revenue		2,142			976
Intangible assets		140,771			140,494
Stock-based compensation		396,604			254,255
Net operating losses		473,110			849,224
Tax credit carryforwards		124,078			235,300
Property and equipment		—			203
Other		2,015			322
Total deferred tax assets	$	1,149,254		$	1,501,830
Deferred tax liabilities:
Property and equipment	$	(5,883	)	$	—
Total deferred tax liabilities		(5,883	)		—
Total net deferred tax assets before valuation allowance		1,143,371			1,501,830
Valuation allowance		(1,144,543	)		(1,502,346	)
Net deferred taxes	$	(1,172	)	$	(516	)

The following table summarizes the activity related to our gross unrecognized tax benefits during the years ended December 31, 2018 and 2017:

	Year Ended December 31,
	2017			2018
	(in thousands)
Beginning balance of unrecognized tax benefits	$	243,862		$	203,177
Additions for current year tax positions		42,209			43,197
Additions for prior year tax positions		2,158			7,615
Reductions for prior year tax positions		(568	)		(1,965	)
Changes due to foreign currency translation adjustments		163			(216	)
Remeasurement of uncertain tax positions due to the Tax Act		(84,647	)		—
Ending balance of unrecognized tax benefits (excluding interest and penalties)	$	203,177		$	251,808
Interest and penalties associated with unrecognized tax benefits		80			260
Ending balance of unrecognized tax benefits (including interest and penalties)	$	203,257		$	252,068