View Filing Data

Print Document View Excel Document

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2014	Feb. 28, 2015	Jun. 30, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	Enphase Energy, Inc.
Entity Central Index Key	0001463101
Document Type	10-K
Document Period End Date	Dec. 31, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		43,914,728
Entity Well-Known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float			$ 143.2

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 42,032	$ 38,190
Accounts receivable, net of allowances of $569 and $2,000 at December 31, 2014 and 2013, respectively	45,119	32,084
Inventory	21,590	16,580
Prepaid expenses and other	6,155	3,655
Total current assets	114,896	90,509
Property and equipment, net	30,824	24,853
Goodwill	3,745	0
Intangibles, net	1,811	286
Other assets	916	1,021
Total assets	152,192	116,669
Current liabilities:
Accounts payable	22,316	7,363
Accrued liabilities	26,036	14,780
Deferred revenues	2,747	2,773
Warranty obligations, current portion (includes $1,125 and $0 measured at fair value at December 31, 2014 and 2013, respectively)	7,607	4,942
Current portion of term loans	0	3,507
Total current liabilities	58,706	33,365
Long-term liabilities:
Deferred revenues, noncurrent	16,612	11,284
Warranty obligations, noncurrent (includes $2,437 and $0 measured at fair value at December 31, 2014 and 2013, respectively)	26,333	25,490
Other liabilities	3,589	1,154
Term loans, noncurrent	0	5,170
Total long-term liabilities	46,534	43,098
Total liabilities	105,240	76,463
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.00001 par value, 10,000 shares authorized; none issued and outstanding	0	0
Common stock, $0.00001 par value, 100,000 shares authorized; 43,756 and 42,123 shares issued and outstanding at December 31, 2014 and 2013, respectively	0	0
Additional paid-in capital	208,022	192,916
Accumulated deficit	(160,991)	(152,939)
Accumulated other comprehensive income (loss)	(79)	229
Total stockholders’ equity	46,952	40,206
Total liabilities and stockholders’ equity	$ 152,192	$ 116,669

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Allowances, accounts receivable	$ 569	$ 2,000
Warrant obligations at fair value, current	1,125	0
Warrant obligations at fair value, noncurrent	$ 2,437	$ 0
Preferred stock, par value (usd per share)	$ 0.00001	$ 0.00001
Preferred stock, shares authorized (shares)	10,000,000	10,000,000
Preferred stock, shares issued (shares)	0	0
Preferred stock, shares outstanding (shares)	0	0
Common stock, par value (usd per share)	$ 0.00001	$ 0.00001
Common stock, shares authorized (shares)	100,000,000	100,000,000
Common stock, shares issued (shares)	43,756,000	42,123,000
Common stock, shares outstanding (shares)	43,756,000	42,123,000

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income Statement [Abstract]
Net revenues	$ 343,904	$ 232,846	$ 216,678
Cost of revenues	230,861	165,430	161,390
Gross profit	113,043	67,416	55,288
Operating expenses:
Research and development	45,386	34,524	35,601
Sales and marketing	41,003	31,080	25,973
General and administrative	31,083	23,970	24,875
Total operating expenses	117,472	89,574	86,449
Loss from operations	(4,429)	(22,158)	(31,161)
Other income (expense), net:
Interest expense	(1,863)	(2,055)	(6,436)
Other income (expense)	(994)	(837)	30
Total other expense, net	(2,857)	(2,892)	(6,406)
Loss before income taxes	(7,286)	(25,050)	(37,567)
Provision for income taxes	(766)	(863)	(651)
Net loss attributable to common stockholders	$ (8,052)	$ (25,913)	$ (38,218)
Net loss per share attributable to common stockholders, basic and diluted (usd per share)	$ (0.19)	$ (0.62)	$ (1.24)
Shares used in computing net loss per share attributable to common stockholders, basic and diluted (shares)	42,903	41,647	30,740

Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Statement of Comprehensive Income [Abstract]
Net loss attributable to common stockholders	$ (8,052)	$ (25,913)	$ (38,218)
Other comprehensive income (loss):
Foreign currency translation adjustments	(308)	177	(31)
Other comprehensive income (loss):	(308)	177	(31)
Comprehensive loss attributable to common stockholders	$ (8,360)	$ (25,736)	$ (38,249)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Consolidated Statement of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)	Convertible Preferred Stock
BALANCE, Beginning at Dec. 31, 2011	$ 13,974	$ 0	$ 9,103	$ (88,808)	$ 83	$ 93,596
BALANCE, Beginning (shares) at Dec. 31, 2011		1,698				22,221
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under employee stock plans	255		255
Issuance of common stock under employee stock plans (shares)		138
Stock-based compensation	4,766		4,766
Common stock issued upon initial public offering (“IPO”), net of offering costs	53,826		53,826
Common stock issued upon initial public offering (“IPO”), net of offering costs (shares)		10,315
Conversion of convertible preferred stock into common stock upon IPO	0		93,596			$ (93,596)
Conversion of convertible preferred stock into common stock upon IPO (shares)		25,171				(22,221)
Conversion of convertible notes and paid-in-kind interest into common stock upon IPO	21,204		21,204
Conversion of convertible notes and paid-in-kind interest into common stock upon IPO (shares)		3,534
Reclassification of preferred stock warrant liability to APIC upon IPO	879		879
Issuance of common stock upon exercise of warrants	21,204
Net loss	(38,218)			(38,218)
Foreign currency translation adjustment	(31)				(31)
BALANCE, Ending at Dec. 31, 2012	56,655	$ 0	183,629	(127,026)	52	$ 0
BALANCE, Ending (shares) at Dec. 31, 2012		40,856				0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under employee stock plans	2,438		2,438
Issuance of common stock under employee stock plans (shares)		1,255
Stock-based compensation	6,849		6,849
Issuance of common stock upon exercise of warrants	0
Issuance of common stock upon exercise of warrants (shares)		12
Net loss	(25,913)			(25,913)
Foreign currency translation adjustment	177				177
BALANCE, Ending at Dec. 31, 2013	40,206	$ 0	192,916	(152,939)	229	$ 0
BALANCE, Ending (shares) at Dec. 31, 2013		42,123				0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under employee stock plans	5,366		5,366
Issuance of common stock under employee stock plans (shares)		1,577
Stock-based compensation	9,740		9,740
Issuance of common stock upon exercise of warrants	0
Issuance of common stock upon exercise of warrants (shares)		56
Net loss	(8,052)			(8,052)
Foreign currency translation adjustment	(308)				(308)
BALANCE, Ending at Dec. 31, 2014	$ 46,952	$ 0	$ 208,022	$ (160,991)	$ (79)	$ 0
BALANCE, Ending (shares) at Dec. 31, 2014		43,756				0

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities:
Net loss	$ (8,052)	$ (25,913)	$ (38,218)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	8,259	6,981	5,568
Provision for doubtful accounts	711	678	1,068
Net loss on disposal of assets	249	82	120
Non-cash interest expense	483	429	4,777
Stock-based compensation	9,740	6,849	4,766
Change in fair value of convertible preferred stock warrants	0	0	(520)
Changes in operating assets and liabilities (net of acquisition):
Accounts receivable	(13,746)	(5,019)	(11,040)
Inventory	(5,010)	3,263	(8,615)
Prepaid expenses and other assets	(2,547)	(1,450)	(711)
Accounts payable, accrued and other liabilities	25,325	(1,453)	4,174
Warranty obligations	3,508	9,094	12,600
Deferred revenues	5,302	5,587	(18,614)
Net cash provided by (used in) operating activities	24,222	(872)	(44,645)
Cash flows from investing activities:
Purchases of property and equipment	(13,249)	(6,257)	(12,990)
Purchase of patents	(750)	0	0
Acquisition of a business	(2,235)	0	0
Change in restricted cash (See Note 5)	(300)	0	0
Net cash used in investing activities	(16,534)	(6,257)	(12,990)
Cash flows from financing activities:
Principal payments under capital leases	0	(40)	(96)
Proceeds from borrowings under term loans	0	0	10,000
Repayments of term loans	(8,708)	(2,447)	(14,103)
Proceeds from issuance of common stock under employee stock plans	5,366	2,429	255
Proceeds from issuance of common stock in IPO, net of underwriting discounts and commissions	0	0	58,609
Net cash (used in) provided by financing activities	(3,342)	(58)	51,436
Effect of exchange rate changes on cash	(504)	83	(31)
Net increase (decrease) in cash and cash equivalents	3,842	(7,104)	(6,230)
Cash and cash equivalents — Beginning of period	38,190	45,294	51,524
Cash and cash equivalents — End of period	42,032	38,190	45,294
Supplemental disclosures of cash flow information:
Cash paid for interest	1,389	1,391	1,681
Cash paid for income taxes	472	899	0
Non-cash financing and investing activities:
Purchases of property and equipment included in accounts payable	1,840	837	772
Conversion of convertible notes into common stock upon IPO	0	0	21,204
Acquisition-related contingent consideration liability	2,300	0	0
Reclassification of convertible preferred stock warrant liability to additional paid-in capital upon IPO	0	0	879
Common Stock
Cash flows from financing activities:
Payment of offering costs	0	0	(2,198)
Debt, excluding convertible debt
Cash flows from financing activities:
Payments of financing costs	$ 0	$ 0	$ (1,031)

Description of Business	12 Months Ended
Description of Business	Dec. 31, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS	DESCRIPTION OF BUSINESS Enphase Energy, Inc. and subsidiaries (the “Company”) designs, develops, and sells microinverter systems for the solar photovoltaic industry. The Company was incorporated in 2006 and began selling its products in 2008. The Company’s microinverter system consists of (i) an Enphase microinverter and related accessories that convert direct current (“DC”) power to grid-compliant alternating current (“AC”) power; (ii) an Envoy communications gateway device that collects and transmits performance information from each solar module to the Company’s hosted data center; and (iii) the Enlighten web-based software platform that collects and processes this information to enable customers to monitor and manage their solar power systems. The Company sells microinverter systems primarily to distributors who resell them to solar installers. The Company also sells directly to large installers as well as through original equipment manufacturers (“OEMs”) and strategic partners. The Company also offers operations and maintenance services for photovoltaic (“PV”) systems including preventive and corrective maintenance, solar panel cleaning and solar system commissioning.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Consolidation

The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Certain amounts in the prior years' consolidated financial statements have been reclassified to conform to the current year presentation, including separately presenting balances for “Warranty obligations” in current liabilities on the consolidated balance sheets and under changes in operating assets and liabilities on the consolidated statements of cash flows. In addition, the balance for “Intangibles, net” which was combined with other current assets on the consolidated balance sheets in the prior year has been reclassified to a separate line item to conform with the current year presentation.

Use of Estimates

The preparation of the Company’s consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ materially from management’s estimates using different assumptions or under different conditions.

Revenue Recognition

The Company generates revenue from sales of its microinverter systems, which include microinverter units and related accessories, an Envoy communications gateway device, and an Enlighten web-based monitoring service, to distributors, large installers, OEMs and strategic partners. Enlighten service revenue represented less than 1% of the total revenues for all periods presented.

Revenues from sales of microinverters and related accessories, and communication gateways are recognized when: (i) persuasive evidence of an arrangement exists; (ii) delivery of the products has occurred in accordance with the terms of the sales agreement and title and risk of loss have passed to the customer; (iii) the sale price is fixed or determinable; and (iv) collection is reasonably assured. Provisions for rebates, sales incentives, and discounts to customers are accounted for as reductions in revenue in the same period the related sales are recorded.

Sales of an Envoy communications gateway device include the Enlighten web-based monitoring service. The allocation of revenue between the two deliverables is based on the Company’s best estimate of selling price determined by considering multiple factors including, internal costs, gross margin and historical pricing practices. After allocating the overall consideration from such sale to each deliverable using a best estimate of the selling price, (i) revenue from the sale of Envoy devices is recognized upon shipment, assuming all other revenue recognition criteria have been met and (ii) revenue from the web-based monitoring service is recognized ratably over the estimated economic life of the related Envoy devices of 10 years.

Deferred revenues consist of payments received from customers in advance of revenue recognition for the Company’s products and services described above. As of December 31, 2014 and 2013, deferred revenues consist entirely of Enlighten service revenue.

Cost of Revenues

The Company includes the following in cost of revenues: product costs, warranty, manufacturing personnel and logistics costs, freight costs, inventory write-downs, hosting services costs related to the Company’s Enlighten service offering, and depreciation and amortization of manufacturing test equipment.

Cash and Cash Equivalents

The Company considers all highly liquid investments, such as certificates of deposit and money market instruments with maturities of three months or less at the time of acquisition to be cash equivalents. For all periods presented, its cash balances consist of amounts held in non-interest-bearing deposits and money market accounts.

Fair Value of Financial Instruments

The carrying amounts of the Company’s cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of the short maturity of those instruments.

Foreign Currency Forward Contracts

The Company operates and conducts business in foreign countries where its foreign entities use the local currency as their respective functional currency. As a result, the Company is exposed to movements in foreign currency exchange rates. The Company utilizes foreign currency forward contracts to reduce the impact of foreign currency fluctuations related to anticipated cash receipts from expected future revenues denominated in Euros and British Pounds as well as from intercompany transaction gains or losses. The foreign currency forward contracts are accounted for as derivatives whereby the fair value of the contracts is reported as other current assets or current liabilities in the accompanying consolidated balance sheets, and gains and losses resulting from changes in the fair value are reported in other income (expense), net, in the accompanying consolidated statements of operations.

Allowances for Doubtful Accounts

The Company maintains allowances for doubtful accounts for uncollectible accounts receivable. Management estimates anticipated losses from doubtful accounts based on days past due, collection history and the financial health of customers. The allowance for doubtful accounts was $0.6 million and $2.0 million at December 31, 2014 and 2013, respectively. The following table sets forth activities in the allowance for doubtful accounts for the periods indicated:



	December 31,
	2014			2013		2012
Balance, at beginning of year	$	2,000		$	1,177	$	144
Net charges to expenses	196			678		1,068
Write-offs, net of recoveries	(1,627		)	145		(35		)
Balance, at end of year	$	569		$	2,000	$	1,177

Inventory

Inventory is valued at the lower of cost or market. The Company determines cost on a first-in first-out basis. Certain factors could affect the realizable value of its inventory, including customer demand and market conditions. Management assesses the valuation on a quarterly basis and writes down the value for any excess and obsolete inventory based upon expected demand, anticipated sales price, effect of new product introductions, product obsolescence, customer concentrations, product merchantability and other factors. Inventory write-downs are equal to the difference between the cost of inventories and their estimated net realizable market value.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation. Cost includes amounts paid to acquire or construct the asset as well as any expenditure that substantially adds to the value of or significantly extends the useful life of an existing asset. Repair and maintenance costs are expensed as incurred. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years. Leasehold improvements are amortized over the shorter of the lease term or expected useful life of the improvements.

Capitalized Software Costs

Internally used software, whether purchased or developed, is capitalized and amortized on a straight-line basis over its estimated useful life. Costs associated with internally developed software are expensed until the point at which the project has reached the development stage. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they provide additional functionality. Software maintenance and training costs are expensed in the period in which they are incurred. The capitalization of software requires judgment in determining when a project has reached the development stage and the period over which the Company expects to benefit from the use of that software.

Long-Lived Assets

Property, plant and equipment, including capitalized software costs, are recorded at cost. Property, plant and equipment amounts are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (asset group) may not be recoverable. An impairment loss would be recognized when the carrying amount of an asset exceeds the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition. The amount of the impairment loss to be recorded is calculated by the excess of the asset's carrying value over its fair value. Fair value is generally determined using a discounted cash flow analysis. The Company did not record any significant impairments in any of the years presented.

Business Combinations

The Company allocates the fair value of purchase consideration (including contingent consideration) to the assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. The excess of the fair value of purchase consideration over the fair value of these assets acquired and liabilities assumed in the acquisition is recorded as goodwill. The primary items that generate goodwill include the value of the synergies between the acquiree and the Company and the value of the acquired assembled workforce, neither of which qualifies for recognition as an intangible asset. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. The results of operations of NPS have been included in the Company’s consolidated results prospectively from the date of acquisition. See Note 5, “Business Combination, Goodwill and Intangible Assets” to the consolidated financial statements for further discussion.

Goodwill

Goodwill is not amortized, but is assessed for potential impairment at least annually during the fourth quarter of each fiscal year or between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired.

Intangible Assets

Intangible assets include patents, customer relationships and other purchased intangible assets. Intangible assets with finite lives are amortized on a straight-line basis, with estimated useful lives ranging from 3 to 5 years. Indefinite-lived intangible assets are tested for impairment annually, and are tested for impairment between annual tests if an event occurs or circumstances change that would indicate that the carrying amount may be impaired. Intangible assets with a finite lives are tested for impairment whenever events or circumstances indicate that the carrying amount of an asset (asset group) may not be recoverable. An impairment loss is recognized when the carrying amount of an asset exceeds the estimated undiscounted cash flows used in determining the fair value of the asset. The amount of the impairment loss to be recorded is calculated by the excess of the asset's carrying value over its fair value. Fair value is generally determined using a discounted cash flow analysis. There has been no impairment of intangible assets in any of the years presented.

Warranty Obligations

Microinverters Sold Through December 31, 2013

The Company’s warranty accrual provides for the replacement of microinverter units that fail during the product’s warranty term (15 years for first and second generation microinverters and up to 25 years for third and fourth generation microinverters). On a quarterly basis, the Company employs a consistent, systematic and rational methodology to assess the adequacy of its warranty liability. This assessment includes updating all key estimates and assumptions for each generation of product, based on historical results, trends and the most current data available as of the filing date. The key estimates and assumptions used in the warranty liability are thoroughly reviewed by management on a quarterly basis. The key estimates used by the Company to estimate its warranty liability are: (1) the number of units expected to fail over time (i.e. failure rate); (2) the number of failed units expected to result in warranty claims over time (i.e. claim rate); and (3) the per unit cost of replacement units, including outbound shipping and limited labor costs, expected to be incurred to replace failed units over time (i.e. replacement cost).

Estimated Failure Rates—The Company’s Quality and Reliability department has primary responsibility to determine the estimated failure rates for each generation of microinverter. To establish initial failure rate estimates for each generation of microinverter, the Company’s quality engineers use a combination of industry standard MTBF (Mean Time Between Failure) estimates for individual components contained in its microinverters, third party data collected on similar equipment deployed in outdoor environments similar to those in which the Company’s microinverters are installed, and rigorous long term reliability and accelerated life cycle testing which simulates the service life of the microinverter in a short period of time. As units are deployed into operating environments, the Company continues to monitor product performance via its Enlighten monitoring platform. It typically takes three to nine months between the date of sale and date of end-user installation. Consequently, the Company’s ability to monitor actual failures of units sold similarly lags by three to nine months. When a microinverter fails and is returned, the Company performs diagnostic root cause failure analysis to understand and isolate the underlying mechanism(s) causing the failure. The Company then uses the results of this analysis (combined with the actual, cumulative performance data collected on those units prior to failure via Enlighten) to draw conclusions with respect to how or if the identified failure mechanism(s) will impact the remaining units deployed in the installed base.

Estimated Claim Rates—Warranty claim rate estimates are based upon assumptions with respect to expected customer behavior over the warranty period. As the vast majority of the Company’s microinverters have been sold to end users for residential applications, the Company believes that warranty claim rates will be affected by changes over time in residential home ownership because the Company expects that subsequent homeowners are less likely to file claims than the homeowners who originally purchase the microinverters.

Estimated Replacement Costs—Three factors are considered in the Company’s analysis of estimated replacement cost: (1) the estimated cost of replacement microinverters; (2) the estimated cost to ship replacement microinverters to end users; and (3) the estimated labor reimbursement expected to be paid to third party installers performing replacement services for the end user. Because the Company’s warranty provides for the replacement of defective microinverters over long periods of time (either 15 or 25 years, depending on the generation of product purchased), the estimated per unit cost of current and future product generations is considered in the estimated replacement cost. Estimated costs to ship replacement units are based on observable, market-based shipping costs paid by the Company to third party freight carriers. The Company has a separate program that allows third-party installers to claim fixed-dollar reimbursements for labor costs they incur to replace failed microinverter units for a limited time from the date of original installation. Included in the Company’s estimated replacement cost is an analysis of the number of fixed-dollar labor reimbursements expected to be claimed by third party installers over the limited offering period.

If actual failure rates, claim rates, or replacement costs differ from the Company’s estimates in future periods, changes to these estimates would be required, resulting in increases or decreases in the Company’s warranty obligations. Such increases or decreases could be material.

Fair Value Option for Microinverters Sold Since January 1, 2014

The Company’s warranty obligations related to microinverters sold since January 1, 2014 provide the Company the right, but not the requirement, to assign its warranty obligations to a third-party. Under Accounting Standards Codification (“ASC”) 825—Financial Instruments, (“fair value option”), an entity may choose to elect the fair value option for such warranties at the time it first recognizes the eligible item. The Company made an irrevocable election to account for all eligible warranty obligations associated with microinverters sold since January 1, 2014 at fair value. This election was made to reflect the underlying economics of the time value of money for an obligation that will be settled over an extended period of up to 25 years.

The Company estimates the fair value of warranty obligations by calculating the warranty obligations in the same manner as for sales prior to January 1, 2014 and applying an expected present value technique to that result. The expected present value technique, an income approach, converts future amounts into a single current discounted amount. In addition to the key estimates of failure rates, claim rates and replacement costs, the Company used certain inputs that are unobservable and significant to the overall fair value measurement. Such additional assumptions included compensation comprised of a profit element and risk premium required of a market participant to assume the obligation and a discount rate based on the Company’s credit-adjusted risk-free rate. See Note 8, (“Fair Value Measurements”) for additional information.

Warranty obligations initially recorded at fair value at the time of sale will be subsequently re-measured to fair value at each reporting date. In addition, the fair value of the liability will be accreted over the corresponding term of the warranty of up to 25 years using the interest method. Any changes in fair value of the liability from period-to-period, including accretion expense, will be recognized in cost of revenues. As of December 31, 2014, warranty obligations associated with sales prior to January 1, 2014 were $30.0 million and warranty obligations associated with sales since January 1, 2014 were $3.9 million, of which $3.6 million were eligible for fair value accounting. The portion of warranty obligations arising from sales since January 1, 2014 that was not eligible for fair value accounting relates to sales of non-microinverter products. Periodic adjustments necessitated by actual experience of claims and any future changes in estimates to amounts not eligible for fair value accounting will continue to be accounted for on an undiscounted basis.

Research and Development Costs

The Company expenses research and development costs as incurred. Research and development costs totaled $45.4 million, $34.5 million and $35.6 million in 2014, 2013 and 2012, respectively.

Stock-Based Compensation

Share-based payments are required to be recognized in the Company’s consolidated statements of operations based on their fair values and the estimated number of shares expected to vest. The Company measures stock-based compensation expense for all share-based payment awards, including stock options made to employees and directors, based on the estimated fair values on the date of the grant. The fair value of stock options granted is estimated using the Black-Scholes option valuation model. The fair value of restricted stock units granted is determined based on the price of the Company’s common stock on the date of grant. Stock-based compensation, net of estimated forfeitures, is recognized on a straight-line basis over the requisite service period, which is typically four years.

Comprehensive Loss

Comprehensive loss consists of two components, net loss and other comprehensive income (loss). Other comprehensive income (loss) refers to gains and losses that are recorded as an element of stockholders’ equity but are excluded from net income. The Company’s other comprehensive income (loss) consists of foreign currency translation adjustments for all periods presented.

Income Taxes

The Company records income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected tax consequences of temporary differences between the tax bases of assets and liabilities for financial reporting purposes and amounts recognized for income tax purposes. In estimating future tax consequences, generally all expected future events other than enactments or changes in the tax law or rates are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company operates in various tax jurisdictions and is subject to audit by various tax authorities. The Company follows accounting for uncertainty in income taxes which requires that the tax effects of a position be recognized only if it is “more likely than not” to be sustained based solely on its technical merits as of the reporting date. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes.

Contingent Consideration Liability

The estimated fair value of the contingent consideration liability, initially measured and recorded on the acquisition date, is reviewed at each reporting period and revalued to its then fair value until the contingency is resolved. Increases or decreases in the fair value of the contingent consideration liability subsequent to the acquisition date can result from changes in the assumed probabilities applied to the achievement of certain revenue targets and the corresponding payout amounts. These changes in the fair value will be recognized in the consolidated statements of operations for the period in which the estimated fair value changes.

Recent Accounting Pronouncements Not Yet Effective

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 (Topic 606), Revenue from Contracts with Customers, which will replace most existing revenue recognition guidance under US GAAP. The updated standard’s core principle is that revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services. The standard generally requires an entity to identify performance obligations in its contracts, estimate the amount of variable consideration to be received in the transaction price, allocate the transaction price to each separate performance obligation, and recognize revenue as obligations are satisfied. In addition, the updated standard requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. ASU 2014-09 is effective for annual and interim periods beginning after December 15, 2016. Early adoption is not permitted. Accordingly, the ASU will be effective for the Company beginning in the first quarter of 2017. The Company is currently evaluating the impact of the adoption on its consolidated financial statements.

Inventory

12 Months Ended

Dec. 31, 2014

Inventory Disclosure [Abstract]

INVENTORY

Inventory as of December 31, 2014 and 2013, consists of the following (in thousands):



	December 31,
	2014		2013
Raw materials	$	3,429	$	1,428
Finished goods	18,161		15,152
Total inventory	$	21,590	$	16,580

Property and Equipment, Net

12 Months Ended

Dec. 31, 2014

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT, NET

As of December 31, 2014 and 2013, property and equipment consists of the following (in thousands):



	Estimated Useful Life (Years)	December 31,
	Estimated Useful Life (Years)	2014			2013
Equipment and machinery	5	$	28,923		$	21,853
Furniture and fixtures	5–7	3,032			2,837
Computer equipment	3–5	2,194			1,842
Capitalized software	3–5	8,905			7,343
Leasehold improvements	4–10	6,636			5,881
Construction in progress		4,911			1,703
Total		54,601			41,459
Less accumulated depreciation and amortization		(23,777		)	(16,606		)
Property and equipment, net		$	30,824		$	24,853

Depreciation and amortization expense for property and equipment was $8.1 million, $7.0 million and $5.6 million, in 2014, 2013 and 2012, respectively.

As of December 31, 2014 and 2013, unamortized capitalized software costs were $3.3 million and $3.6 million, respectively.

Business Combination, Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2014

Business Combinations [Abstract]

BUSINESS COMBINATION, GOODWILL AND INTANGIBLE ASSETS

Acquisition

On December 12, 2014, the Company acquired substantially all of the assets of NPS. Founded in 2009 and based in Berkeley, California, NPS is a provider of services designed specifically for the solar industry. The acquisition is expected to complement the Company’s existing asset management and operations and maintenance service offering.

The following table summarizes the allocation of the total purchase price to acquired tangible and identifiable intangible assets based on their estimated fair values as of the date of acquisition (in thousands):



Cash consideration	$	2,535
Contingent consideration	2,300
Total purchase consideration	$	4,835

Property and equipment	$	190
Customer relationships	900
Goodwill	3,745
Net assets acquired	$	4,835

This acquisition has been accounted for as a business combination. The total purchase consideration of $4.8 million consisted of $2.5 million in cash (of which $0.3 million was held back for potential breaches of representations and warranties) and $2.3 million of contingent consideration (described below). The indemnity hold back will be paid one year from the date of closing of the acquisition subject to any deductions for indemnity conditions and was recorded as restricted cash with an offsetting obligation in other accrued liabilities.

The fair values assigned to the net assets acquired are based on management’s estimates and assumptions. The goodwill of $3.7 million is attributable to the value of the synergies expected to arise upon the integration of NPS into the Company’s operations and the value of the acquired workforce. A portion of goodwill related to this acquisition is deductible for income tax purposes.

The fair value of the acquired customer relationships was calculated by discounting the projected discrete after-tax cash flows from these existing customers (less an anticipated customer attrition rate) to its present value.

The purchase consideration includes a contingent consideration arrangement that requires additional cash payments by the Company based on certain defined 2015 and 2016 revenue targets. Amounts are payable in early 2016 and 2017. The range of the undiscounted amounts the Company could pay under the contingent consideration arrangement is between zero and $5.5 million. The fair value of the contingent consideration was estimated based on significant inputs not observed in the market and thus represents a Level 3 input as defined in connection with the fair value hierarchy. See Note 8, “Fair Value Measurements” for further discussion. Any future change in the estimated fair value of the contingent consideration will be recognized in the consolidated statements of operations for the period in which the estimated fair value changes.

The acquisition was not material to the Company’s financial position or results of operations, and therefore proforma operating results for NPS have not been presented. The results of operations of NPS have been included in the Company’s consolidated results prospectively from the date of acquisition. The Company recognized approximately $0.2 million of acquisition related costs in 2014, which were recorded in general and administrative expenses in the Company’s consolidated statements of operations.

Goodwill and Intangible Assets



	December 31, 2014							December 31, 2013
	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization		Net
Goodwill	$	3,745	$	—		$	3,745	$	—	$	—	$	—

Other indefinite-lived intangibles	$	286	$	—		$	286	$	286	$	—	$	286
Intangibles assets with finite lives:
Customer relationships	900		—			900		—		—		—
Patents	750		(125		)	625		—		—		—
Total purchased intangibles	$	1,936	$	(125	)	$	1,811	$	286	$	—	$	286

In July 2014, the Company purchased certain patents related to system interconnection and photovoltaic AC module construction. The patents are being amortized over their legal life of 3 years. The customer relationship intangible resulted from the Company’s NPS acquisition and is being amortized on a straight-line basis over its estimated useful life of 5 years.

As of December 31, 2014, estimated future amortization expense related to finite-lived intangible assets was as follows:



Year	(In thousands)
2015	$	430
2016	430
2017	305
2018	180
2019	180
Total	$	1,525

Accrued Liabilities

12 Months Ended

Dec. 31, 2014

Payables and Accruals [Abstract]

ACCRUED LIABILITIES

Accrued liabilities consisted of the following (in thousands):



	December 31,
	2014		2013
Salaries, commissions, incentive compensation and benefits	$	14,871	$	6,499
Customer rebates and sales incentives	5,083		2,818
Other	6,082		5,463
Total	26,036		14,780

Warranty Obligations

12 Months Ended

Dec. 31, 2014

Product Warranties Disclosures [Abstract]

WARRANTY OBLIGATIONS

The Company’s warranty activities during 2014, 2013 and 2012 were as follows (in thousands):



	December 31,
	2014			2013			2012
Balance, at beginning of year	$	30,432		21,338			$	8,738
Accruals for warranties issued during the year	4,309			6,303			8,218
Changes in estimates	8,391			10,303			7,607
Settlements	(8,793		)	(7,512		)	(3,225		)
Increase due to accretion expense	195			—			—
Fair value adjustments	(594		)	—			—
Balance, at end of year	33,940			30,432			21,338
Less current portion	(7,607		)	(4,942		)	(6,078		)
Long-term portion	$	26,333		$	25,490		$	15,260

The Company sold approximately 1.0 million second generation microinverters from 2009 through mid-2012. The Company has sold approximately 3.9 million third generation microinverters since mid-2012 and continues to sell such third generation microinverters. The Company has sold 2.3 million fourth generation microinverters since mid-2013.

Changes in Estimates

On a quarterly basis, the Company uses the best and most complete underlying information available, following a consistent, systematic and rational methodology to determine its warranty obligations. The Company considers all available evidence to assess the reasonableness of all key assumptions underlying its estimated warranty obligations for each generation of microinverter. The changes in estimates discussed below arose from new information available to management and subsequent developments, and accordingly, from better insight and improved judgment. Changes in estimates included in the table above were comprised of the following:

2014

In 2014, primarily in the second and fourth quarters, the Company experienced actual failures of its second generation microinverters that exceeded its then current failure rate estimate. Based on continuing analysis of field performance data and diagnostic root-cause failure analysis performed on returned units, the Company concluded that it was necessary to increase the estimated failure rates for its second generation product and recorded additional warranty expense $8.6 million in 2014. In addition, net changes in estimates related to replacement costs reduced warranty expense for all product generations by $0.2 million and were comprised of increased estimates of certain labor reimbursement costs expected to be paid to third party installers performing replacement services for its second generation product of $1.3 million, offset by a $1.5 million decrease to estimated costs of replacement microinverter units for all product generations.

2013

In 2013, primarily in the second, third and fourth quarters, the Company experienced actual failures of its second generation microinverters that exceeded its then current failure rate estimate. Based on continuing analysis of field performance data and diagnostic root-cause failure analysis performed on returned units, the Company concluded that it was necessary to increase the estimated failure rates for its second generation product and recorded additional warranty expense of $19.5 million in 2013. During the third quarter of 2013, the Company recorded a reduction to warranty expense of $3.1 million related to a decrease in the expected failure rate of the Company’s third generation product. The Company concluded that there was sufficient historical data of actual field performance of previously sold third generation products to support a lower estimated failure rate.

In addition, the Company updated its estimated claim rates for its second and third generation products resulting in a decrease to warranty expense of $4.2 million. The revision to estimated claim rates was based on the Company’s observed historical end user behavior and assumptions with respect to expected customer behavior over the 15 or 25 year warranty term.

Also, the Company decreased warranty expense by $1.9 million primarily to reflect estimated lower costs to produce fourth generation microinverters to fulfill warranty obligations for second and third generation microinverters.

2012

In 2012, primarily in the third and fourth quarters, the Company experienced actual failures of its second generation microinverters that exceeded its then current failure rate estimate. Based on continuing analysis of field performance data and diagnostic root-cause failure analysis performed on returned units, the Company concluded that it was necessary to increase the estimated failure rates for its second generation product and recorded additional warranty expense of $10.2 million in 2012.

In the fourth quarter of 2012, the Company revised its claim rate estimate to reflect a decrease in the percentage of end users who are able to access their system’s performance data using the Enlighten monitoring service. Approximately 80 to 90 percent of end users have purchased systems that include Enlighten. End users who have not purchased Enlighten do not have access to the same inverter-level performance data as end users using Enlighten and, consequently are less likely to make warranty claims. In 2012, based on observation of historical results, the Company confirmed that non-Enlighten end users had a lower claim rate than originally estimated. As a result, warranty expense decreased by $0.5 million to reflect this information.

In addition, the Company recorded a reduction to warranty expense of $2.1 million related to replacement costs, primarily comprised of a $1.9 million reduction in shipping costs. Beginning in the third quarter of 2012, the Company revised its business practice to utilize non-expedited shipping terms for future replacement units, resulting in the reduction in estimated future replacement costs.

Fair Value Measurements

12 Months Ended

Dec. 31, 2014

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

The accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An asset’s or liability’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value:


•	Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of such assets or liabilities do not entail a significant degree of judgment.


•	Level 2—Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.


•	Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The following table presents the Company’s assets and liabilities that were measured at fair value on a recurring basis and its categorization within the fair value hierarchy at December 31, 2014 and 2013 (in thousands):



	Fair Value Hierarchy	December 31, 2014		December 31, 2013
Assets:
Foreign currency forward contracts	Level 2	$	76	$	325

Liabilities:
Foreign currency forward contracts	Level 2	$	—	$	605
Warranty obligations	Level 3	3,562		—
Contingent consideration	Level 3	2,300		—

Foreign Currency Forward Contracts

The Company utilizes foreign currency forward contracts from time to time to reduce the impact of foreign currency fluctuations arising from both sales and purchases denominated in Euros and the British Pound Sterling.

As of December 31, 2014 and 2013, the aggregate gross notional amounts of outstanding foreign currency forward contracts, all with maturities of less than one year, were $1.5 million and $12.5 million, respectively.

The Company recorded $0.3 million of net gains in 2014 and $0.4 million and $0.5 million of net losses in 2013 and 2012, respectively, related to foreign currency forward contracts.

Fair Value Option for Warranty Obligations Related to Microinverters Sold Since January 1, 2014

The Company estimates the fair value of warranty obligations by calculating the warranty obligations in the same manner as for sales prior to January 1, 2014 and applying an expected present value technique to that result. The expected present value technique, an income approach, converts future amounts into a single current discounted amount. In addition to the key estimates of failure rates, claim rates and replacement costs, the Company used certain Level 3 inputs which are unobservable and significant to the overall fair value measurement. Such additional assumptions included a discount rate based on the Company’s credit-adjusted risk-free rate and compensation comprised of a profit element and risk premium required of a market participant to assume the obligation.

The following table provides a reconciliation of the beginning and ending balances of warranty obligations measured at fair value for the periods indicated (in thousands):



Balance—December 31, 2013	$	—
Accruals for warranties issued during period	3,989
Changes in estimates	26
Settlements	(54		)
Increase due to accretion expense	195
Fair value adjustments	(594		)
Balance—December 31, 2014	$	3,562

Contingent Consideration

The fair value of the contingent consideration recognized on the acquisition date of $2.3 million was estimated by applying the income approach. That measure is based on significant Level 3 inputs not observable in the market. Key assumptions include (1) probability adjusted level of revenues between $2.6 million and $17.0 million and the resultant payout; and (2) a risk-adjusted discount rate was estimated using a capital asset pricing model, which reflects an expected rate of return required by a market participant holding a similarly risky asset.

The following table provides a reconciliation of the beginning and ending balances of contingent consideration measured at fair value for the periods indicated (in thousands):



Balance—December 31, 2013	$	—
Fair value of contingent consideration—acquisition of NPS	2,300
Fair value adjustment to contingent consideration	—
Balance—December 31, 2014	$	2,300

Quantitative and Qualitative Information about Level 3 Fair Value Measurements

As of December 31, 2014, the significant unobservable inputs used in the fair value measurement of the Company’s liabilities designated as Level 3 are as follows:



Item Measured at Fair Value	Valuation Technique	Description of Significant Unobservable Input	Percent Used (Weighted-Average)
Warranty obligations for microinverters sold since January 1, 2014	Discounted cash flows	Profit element and risk premium	18%
	Discounted cash flows	Credit-adjusted risk-free rate	18%

Contingent consideration	Probability-weighted discounted cash flows	Risk-adjusted discount rate	18%

Sensitivity of Level 3 Inputs

Warranty Obligations

Each of the significant unobservable inputs is independent of the other. The profit element and risk premium are estimated based on requirements of a third-party participant willing to assume the Company’s warranty obligations. The discount rate is determined by reference to the Company’s own credit standing at the fair value measurement date. Increasing (decreasing) the profit element and risk premium input by 100 basis points would not have a material impact on the fair value measurement of the liability. Increasing (decreasing) the discount rate by 100 basis points would result in a ($138,000) $152,000 (decrease) increase, respectively, to the fair value measurement of the liability.

Contingent Consideration

Changes in assumed probability adjustments with respect to achievement of target metric can materially impact the fair value measurement of contingent consideration as of the acquisition date and for each subsequent period. Assumptions about the probability and amount of payout will require less subjectivity over the course of the earnout period as management refines estimates based on actual events. Due to the short duration of the earnout period of two years, increasing (decreasing) the risk-adjusted discount rate by 100 basis points would not have a material impact on the fair value measurement of contingent consideration.

Debt and Revolving Credit Facility

12 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

DEBT AND REVOLVING CREDIT FACILITY

The Company’s debt obligations were comprised of the following at December 31, 2014 and 2013 (in thousands):



	December 31,
	2014		2013
Term loan	$	—	$	7,400
Equipment financing facility, net of unamortized discount of $0 and $94, respectively	—		3,661
Total debt	—		11,061
Less current portion	—		(2,384		)
Long-term portion	$	—	$	8,677

Revolving Credit Facility

The Company has a $50.0 million revolving credit facility (the “Revolver”) with Wells Fargo Bank, N.A. (“Wells Fargo”) that was entered into in November 2012 and subsequently amended in February 2014 to extend the maturity date to November 2016. The amount of loans available to be drawn under the Revolver is subject to a borrowing base calculation that limits availability to a percentage of eligible domestic accounts receivable plus a percentage of the value of eligible domestic inventory, less certain reserves. Loans under the Revolver bear interest in cash at an annual rate equal to, at the Company’s option, either LIBOR or a “base rate” that is comprised of, among other things, the prime rate, plus a margin that is between 1.5% and 4.25% depending on the currency borrowed and the specific term of repayment. The Revolver contains customary affirmative and negative covenants and events of default, and requires the Company to maintain at least $15.0 million of liquidity at all times, of which at least $5.0 million must be undrawn availability. To date, the Company has not drawn on the Revolver and approximately $37.6 million was available for borrowing as of December 31, 2014 based on eligible accounts receivable and inventory balances pursuant to the agreement.

Full Repayment of Term Loan

On November 7, 2012, the Company entered into a Loan and Security Agreement (“Loan Agreement”) with Hercules Technology Growth Capital, Inc. (“Hercules”) and made an initial draw of $7.4 million. In addition, the Loan Agreement provided $15.6 million in additional borrowing capacity, which expired undrawn on March 31, 2014. Borrowings under the Loan Agreement bore interest at an annual rate equal to the higher of (i) the prime rate plus 8.25% or (b) 11.5%. Payments for the first 15 months were for interest-only and equal monthly payments thereafter through the maturity date of August 1, 2016 were for interest and principal. The Loan Agreement included a fixed $0.6 million back-end fee due on the earlier of prepayment in full or upon expiration of the Loan Agreement. Borrowings under the Loan Agreement were secured by a pledge of substantially all of the Company’s assets other than intellectual property. The Loan Agreement did not include any financial covenants.

On December 8, 2014, the Company repaid all of the $5.8 million in outstanding indebtedness including accrued interest and related fees thereon and terminated the Loan Agreement, which was scheduled to mature on August 1, 2016.

Full Repayment of Equipment Financing Facility

On June 13, 2011, the Company entered into a $5.0 million equipment financing facility with Hercules with a three year term. Borrowings under the equipment financing facility had a variable interest rate set at the higher of 5.75% above the prime lending rate and 9.0% annually. Borrowings were secured by the financed equipment and restricts the Company’s ability to pay dividends and take on certain types of additional liens. On July 1, 2014, the equipment financing facility expired in accordance with its terms and all remaining amounts outstanding were repaid in full.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

Operating Leases—The Company leases office facilities under noncancelable operating leases that expire on various dates through 2022. The terms of the lease agreements generally provide for rental payments on a graduated basis, and certain leases require the Company to pay its portion of executory costs such as taxes, insurance, and operating expenses. The Company recognizes rent expense on a straight-line basis over the lease term.

Rent expense for 2014, 2013 and 2012 was $2.6 million, $2.6 million and $2.4 million, respectively.

The Company’s minimum lease payments under noncancelable operating leases, exclusive of executory costs, as of December 31, 2014 are as follows (in thousands):



2015	$	1,980
2016	2,120
2017	1,918
2018	1,973
2019	2,032
Thereafter	5,051
Total minimum lease payments	$	15,074

Purchase Obligations—The Company has contractual obligations to purchase goods and services, which specify fixed or minimum quantities to be purchased; fixed, minimum, or variable price provisions; and the approximate timing of the transaction. Purchase obligations do not include contracts that may be canceled without significant penalty. As of December 31, 2014, the Company had purchase obligations with third party manufacturers and suppliers totaling approximately $36.8 million.

Contingencies —From time to time, the Company may be involved in litigation relating to claims arising out of its operations. The Company is not currently involved in any material legal proceedings. The Company may, however, be involved in material legal proceedings in the future. Such matters are subject to uncertainty and there can be no assurance that such legal proceedings will not have a material adverse effect on its business, results of operations, financial position or cash flows.

Stockholders' Equity	12 Months Ended
Stockholders' Equity	Dec. 31, 2014
Equity [Abstract]
STOCKHOLDERS' EQUITY	STOCKHOLDERS' EQUITY Initial Public Offering On April 4, 2012, the Company completed its initial public offering (“IPO”), issuing 10,315,151 shares of common stock at an offering price of $6.00 per share. The net proceeds from the sale of the shares were $53.8 million, after deducting the underwriters’ discounts and commissions of $3.3 million and other offering costs of $4.8 million. Upon consummation of the IPO, the Company’s 22,220,856 outstanding shares of convertible preferred stock ($93.6 million carrying value) were automatically converted into 25,171,017 shares of common stock, and the $21.2 million outstanding balance of principal and accrued paid-in-kind interest in convertible notes were automatically converted into 3,533,988 shares of common stock at a conversion price equal to the IPO price of $6.00 per share. As a result, the Company recorded a charge of $2.8 million to interest expense in 2012 for the extinguishment of debt related to the unamortized debt issuance costs and debt discounts. Common Stock Warrants Prior to its IPO, the Company issued convertible preferred stock warrants in connection with several financing transactions. These warrants automatically converted into warrants to purchase common stock upon the consummation of the IPO. As of December 31, 2014, warrants to purchase 111,183 shares of the Company’s common stock remained outstanding with a weighted average exercise price of $5.27. Such warrants are exercisable at any time and have expiration dates in 2016.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(d),(e))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB TOPIC 4.E)
-URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74512-122707

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.29-31)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 4
-Subparagraph (SAB TOPIC 4.C)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187143-122770

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 30
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph d
-Article 4

Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 29, 30, 31
-Article 5

Reference 16: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section E

Reference 17: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Article 4

Reference 18: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section C

Reference 19: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 04
-Article 3

+ Details

Stock-Based Compensation

12 Months Ended

Dec. 31, 2014

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

STOCK-BASED COMPENSATION

Description of Equity Incentive Plans

2006 Plan

Under the Company’s 2006 Equity Incentive Plan (the “2006 Plan”), equity awards granted generally vest over a four-year period from the date of grant with a contractual term of up to 10 years. As of December 31, 2014, there were 4.5 million shares of common stock outstanding under the 2006 Plan. No further stock options or other stock awards may be granted under the 2006 Plan.

2011 Plan

Under the 2011 Equity Incentive Plan (the “2011 Plan”), the Company may, initially, issue up to 2,643,171 shares of its common stock pursuant to stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards, and other forms of equity compensation, or collectively, stock awards, all of which may be granted to employees, including officers, and to non-employee directors and consultants. Options granted under the 2011 Plan before August 1, 2012 generally expire 10 years after the grant date and options granted thereafter generally expire 7 years after the grant date. Equity awards granted under the 2011 Plan generally vest over a four-year period from the date of grant based on continued employment. The number of shares of the Company’s common stock authorized for issuance under the 2011 Plan will automatically increase, on each January 1, by 4.5% of the total number of shares of the Company’s common stock outstanding on December 31 of the preceding calendar year, or such lesser number of shares of common stock as determined by the board of directors. As of December 31, 2014, 208,485 shares of common stock remained available for issuance pursuant to future grants under the 2011 Plan. On January 1, 2015, the shares authorized for issuance under the 2011 Plan automatically increased by 1,968,909 shares.

2011 Employee Stock Purchase Plan

The 2011 Employee Stock Purchase Plan (“ESPP”) became effective immediately upon the execution and delivery of the underwriting agreement for the Company’s IPO on March 29, 2012. The ESPP initially authorizes the issuance of 669,603 shares of the Company’s common stock pursuant to purchase rights granted to employees. The number of shares of common stock reserved for issuance will automatically increase, on each January 1, by 330,396 shares of the Company’s common stock or a lesser number of shares of common stock as determined by the Company’s board of directors.

The ESPP is implemented by concurrent offering periods and each offering period may contain up to four interim purchase periods. In general, offering periods consists of the 24 months periods commencing on each May 1 and November 1 of a calendar year.

Generally, all full time employees, including executive officers, are eligible to participate in the ESPP. The ESPP permits eligible employees to purchase the Company’s common stock through payroll deductions, which may not exceed 15% of the employee’s total compensation subject to certain limits. Stock may be purchased under the plan at a price equal to 85% of the fair market value of the Company’s stock on either the date of purchase or the first day of an offering period, whichever is lower. A two year look-back feature in the Company’s ESPP causes an offering period to reset if the fair value of the Company’s common stock on a purchase date is less than that on the initial offering date for that offering period. The reset feature, when triggered, will be accounted for as a modification to the original offering, resulting in additional expense to be recognized over the 24-month period of the new offering. During any calendar year, participants may not purchase shares of common stock having a value greater than $25,000, based on the fair market value per share of the common stock at the beginning of an offering period.

As of December 31, 2014, there were 534,674 shares of the Company’s common stock available for issuance under the ESPP. On January 1, 2015, the shares authorized for issuance under the ESPP automatically increased by 330,396 shares.

Valuation of Equity Awards

Stock Options

The fair value of each option granted was estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions:

•

Expected term—The expected term of the option awards represents the period of time between the grant date of the option awards and the date the option awards are either exercised, converted or canceled, including an estimate for those option awards still outstanding. The Company used the simplified method, as permitted by the SEC for companies with a limited history of stock option exercise activity, to determine the expected term for its option grants.

•

Expected volatility—The expected stock price volatility for option awards granted prior to March 31, 2014 was determined based on an average of the historical volatilities of the common stock of several peer companies with characteristics similar to those of the Company. For option awards granted after March 31, 2014, the Company used a blended volatility estimate consisting of its own historical share price volatility (as the Company had at least two years of historical stock price data) augmented with historical volatility of peer companies for periods preceding the Company’s initial public offering such that the time period over which historical volatility data used was at least equal to the expected term of the option award.


•	Risk-free interest rate—The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of grant and with a maturity that approximated the Company’s expected term.


•	Dividend yield—The dividend yield was based on the Company’s dividend history and the anticipated dividend payout over its expected term.

A summary of the weighted-average assumptions used to estimate the fair values of the stock options granted during the periods presented is as follows:



	Years Ended December 31,
	2014			2013			2012
Expected term (in years)	4.5			4.4			5.7
Expected volatility	67.7		%	68.4		%	74.5		%
Annual risk-free rate of return	1.4		%	1.0		%	0.9		%
Dividend yield	—		%	—		%	—		%
Weighted-average fair value on grant date	$	5.64		$	3.84		$	4.69

Restricted Stock Units

The fair value of restricted stock units granted is determined based on the price of the Company’s common stock on the date of grant.

Stock-Based Compensation Expense

The Compensation cost for all stock-based awards expected to vest is measured at fair value on the date of grant and recognized ratably over the requisite service period. The following table summarizes the components of total stock-based compensation expense included in the consolidated statements of operations for the periods presented (in thousands):



	Years Ended December 31,
	2014		2013		2012
Cost of revenues	$	816	$	438	$	196
Research and development	3,127		2,110		1,728
Sales and marketing	2,487		1,812		1,254
General and administrative	3,310		2,489		1,588
Total stock-based compensation expense	$	9,740	$	6,849	$	4,766

A summary of stock-based compensation expense associated with each type of award for the periods presented is as follows (in thousands):



	Years Ended December 31,
	2014		2013		2012
Stock options and restricted stock units	$	8,845	$	6,314	$	4,519
ESPP	895		535		247
Total stock-based compensation expense	$	9,740	6,849		$	4,766

As of December 31, 2014, there was approximately $20.4 million of total unrecognized compensation cost related to unvested equity awards, net of expected forfeitures, which is expected to be recognized over a weighted-average period of 2.7 years.

No income tax benefit has been recognized relating to stock-based compensation expense and no tax benefits have been realized from exercised stock options.

Equity Awards Activity

Stock Options

A summary of the Company’s stock option activity for the periods presented is as follows (in thousands, except per share data):



	Shares		Weighted- Average Exercise Price per Share
Options outstanding — December 31, 2011	6,256		$	1.83
Granted	2,478		7.35
Exercised	(59	)	1.26
Canceled	(506	)	5.55
Options outstanding — December 31, 2012	8,169		3.28
Granted	1,506		7.17
Exercised	(822	)	1.69
Canceled	(344	)	7.74
Options outstanding — December 31, 2013	8,509		3.94
Granted	1,311		10.36
Exercised	(886	)	4.33
Canceled	(302	)	7.58
Options outstanding — December 31, 2014	8,632		4.75

The following table summarizes information about stock options outstanding at December 31, 2014:



	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number of Shares (in thousands)	Weighted- Average Remaining Life (in years)	Weighted- Average Exercise Price		Number of Shares (in thousands)	Weighted- Average Exercise Price
$0.27 —– $0.27	2,304	4.5	$	0.27	2,304	$	0.27
$0.64 —– $2.54	1,730	5.4	1.66		1,716	1.66
$3.35 —– $7.44	1,820	6.1	6.15		965	6.04
$7.50 —– $9.53	1,839	6.3	8.21		844	8.35
$9.54 —– $16.01	939	6.7	11.91		127	10.77
Total	8,632	5.6	4.75		5,956	2.96

The intrinsic value of options exercised in 2014, 2013 and 2012 was $5.5 million, $3.2 million and $0.3 million, respectively. As of December 31, 2014, there were 8.4 million options outstanding that were vested and expected to vest. Such options have a weighted-average exercise price of $4.66 and a weighted-average remaining contractual term of 5.6 years. As of December 31, 2014, the aggregate intrinsic value was $67.4 million for the 6.0 million exercisable shares. The intrinsic value is based on the Company’s common stock fair value of $14.29 per share as of December 31, 2014.

Restricted Stock Units

A summary of restricted stock unit activity for the periods presented is as follows: (in thousands, except per share data):



	Restricted Stock Units		Weighted Average Fair Value per Share at Grant Date
Outstanding at December 31, 2011	—		$	—
Granted	282		5.69
Vested	(20	)	2.00
Canceled	(14	)	6.90
Outstanding at December 31, 2012	248		5.53
Granted	285		6.92
Vested	(107	)	6.08
Canceled	(8	)	7.07
Outstanding at December 31, 2013	418		6.31
Granted	1,250		8.68
Vested	(281	)	7.38
Canceled	(42	)	7.56
Outstanding at December 31, 2014	1,345		8.25

The intrinsic value of restricted stock units vested during 2014, 2013 and 2012 was $3.2 million, $0.8 million and $39,000, respectively. As of December 31, 2014, the restricted stock units outstanding had a weighted average remaining contractual term of 1.6 years with an intrinsic value of $19.2 million.

ESPP

A summary of ESPP activity for the years presented is as follows: (in thousands, except per share data):



	Years Ended December 31,
	2014		2013		2012
Proceeds from common stock issued under ESPP	$	1,531	$	1,047	$	185
Shares of common stock issued	410		327		59
Weighted-average price per share	$	3.73	$	3.20	$	3.14

Income Taxes

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

INCOME TAXES

The domestic and foreign components of loss before provision for income taxes consisted of the following (in thousands):



	Years Ended December 31,
	2014			2013			2012
United States	$	(8,732	)	$	(26,118	)	$	(38,539	)
Foreign	1,446			1,068			972
Total	$	(7,286	)	$	(25,050	)	$	(37,567	)

The provision for income taxes for the years presented is as follows (in thousands):



	Year Ended December 31,
	2014			2013			2012
Current:
Federal	$	—		$	—		$	—
State	85			—			—
Foreign	716			865			651
Total	801			865			651
Deferred:
Federal	—			—			—
State	—			—			—
Foreign	(35		)	(2		)	—
Provision for income taxes	$	766		$	863		$	651

A reconciliation of the provision for income taxes and the amount computed by applying the statutory federal income tax rate of 34% to loss before income taxes for the years presented is as follows (in thousands):



	Year Ended December 31,
	2014			2013			2012
Income tax benefit at statutory federal rate	$	(2,477	)	$	(8,517	)	$	(12,773	)
State taxes, net of federal benefit	(4,576		)	(883		)	(1,478		)
Change in valuation allowance	16,646			8,353			12,574
Foreign tax rate and tax law differential	(43		)	237			147
Tax credits	(5,619		)	—			—
Stock-based compensation	957			1,191			1,128
Other permanent items	231			220			860
Other nondeductible/nontaxable items	(4,586		)	(2		)	20
Uncertain tax positions	233			264			173
Provision for income taxes	$	766		$	863		$	651

A summary of significant components of the Company’s deferred tax assets and liabilities as of December 31, 2014 and 2013 is as follows (in thousands):



	December 31,
	2014			2013
Deferred Tax Assets
Allowances and reserves	$	18,771		$	14,521
Net operating loss and tax credit carryforwards	28,511			16,840
Stock-based compensation	2,154			1,531
Deferred revenue	3,843			2,730
Fixed assets and intangibles	9,163			11,670
Other	2,023			476
Total gross deferred tax assets	64,465			47,768
Less valuation allowance	(64,428		)	(47,766		)
Deferred tax assets, net of valuation allowance	37			2
Deferred tax liabilities	—			—
Net deferred tax assets, net of valuation allowance	$	37		$	2

Accounting for income taxes requires that companies assess whether valuation allowances should be established against their deferred tax assets based on consideration of all available evidence, both positive and negative, using a “more likely than not” standard. This assessment considers, among other matters, the nature, frequency and amount of recent losses, the duration of statutory carryforward periods, and tax planning strategies. In making such judgments, significant weight is given to evidence that can be objectively verified. Due to the history of losses the Company has generated in the United States since inception, the Company believes that it is more-likely-than-not that all of its U.S. and state deferred tax assets will not be realized as of December 31, 2014. Therefore, the Company has recorded a full valuation allowance on its U.S. and state deferred tax assets at December 31, 2014. Should the Company determine that it would be able to realize its deferred tax assets in the foreseeable future, an adjustment to the deferred tax assets may cause a material increase to income in the period such determination is made. Significant management judgment is required in determining the period in which the reversal of a valuation allowance should occur.

The Company considers the earnings of certain non-U.S. subsidiaries to be indefinitely invested outside the United States on the basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs and the Company’s specific plans for reinvestment of those subsidiary earnings. Accordingly, the Company has not recorded a deferred tax liability related to the U.S. federal and state income taxes and foreign withholding taxes on approximately $2.6 million of undistributed earnings of foreign subsidiaries indefinitely invested outside the United States. If such earnings were repatriated, additional tax provisions may result.

The Company has net operating loss carryforwards for federal and California income tax purposes of approximately $52.9 million and $44.6 million, respectively, as of December 31, 2014. The federal and state net operating loss carryforwards, if not utilized, will expire beginning in 2026 and 2016, respectively. Utilization of the net operating loss carryforwards may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended (the “Code”), and similar state provisions. The annual limitation may result in the expiration of net operating losses before utilization. The Company has completed a study to assess whether an ownership change has occurred or whether there have been multiple ownership changes since the Company became a loss corporation under the Code. However, the Company does not anticipate these limitations will significantly impact its ability to utilize the net operating losses and tax credit carryforwards.

The Company has approximately $7.5 million of federal research credit and $7.2 million of state research credit carryforwards. The federal credits begin to expire in 2026 and the state credits can be carried forward indefinitely.

As a result of certain realization requirements under income tax accounting for stock-based compensation, the table of deferred tax assets and liabilities shown above does not include certain deferred tax assets as of December 31, 2014 and 2013 that arose directly from tax deductions related to equity compensation greater than compensation recognized for financial reporting. Equity will be increased by $1.3 million if and when such deferred tax assets are ultimately realized.

The accounting for uncertain tax positions prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is required to recognize in the financial statements the impact of a tax position, if that position is more-likely-than-not of being sustained on audit, based on the technical merits of the position. There were no significant unrecognized tax benefits recorded upon adoption and the change to the unrecognized tax benefits in 2014 was $4.0 million.

The Company does not have any tax positions for which it is reasonably possible the total amount of gross unrecognized tax benefits will increase or decrease over the next year. The unrecognized tax benefits may increase or change during the next year for items that arise in the ordinary course of business. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense.

A tabular reconciliation of the total amounts of unrecognized tax benefits for the years presented is as follows (in thousands):



	Year Ended December 31,
	2014		2013		2012
Unrecognized tax benefits—at beginning of year	$	376	$	160	$	—
Increases in balances related to tax positions taken in prior years	1,895		79		—
Increases in balances related to tax positions taken in current year	2,155		137		160
Unrecognized tax benefits—at end of year	4,426		376		160

The Company’s tax returns continue to remain subject to examination by U.S. federal authorities for the years 2011 through 2014 and by California state authorities for the years 2010 through 2014.

Concentration of Credit Risk and Major Customers	12 Months Ended
Concentration of Credit Risk and Major Customers	Dec. 31, 2014
Segment Reporting [Abstract]
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS	CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS The Company is potentially subject to financial instrument concentration of credit risk through its cash and cash equivalents and accounts receivable. The Company places its cash and cash equivalents with high quality institutions and performs periodic evaluations of their relative credit standing. Accounts receivable can be potentially exposed to a concentration of credit risk with its major customers. As of December 31, 2014, the Company had amounts due from two customers that represented 15% and 11% of the total accounts receivable balance. As of December 31, 2013, its two largest accounts receivable balances represented 16% and 10% of the total accounts receivable balance. In 2014, two customers accounted for 24% and 16% of total net revenues. In 2013, three customers accounted for 15%, 14% and 11% of total net revenues. In 2012, two customers accounted for 16% and 11% of total net revenues.

Net Loss Per Share Attributable to Common Stockholders

12 Months Ended

Dec. 31, 2014

Earnings Per Share [Abstract]

NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

In April 2012, all of the Company’s then outstanding convertible preferred stock automatically converted into common stock in connection with its IPO. For periods that ended prior to the conversion, basic and diluted net income per common share were presented in conformity with the two-class method required for participating securities.

Under the two-class method, net loss is allocated between common shares and other participating securities to the extent that the securities are required to share in the losses. The Company’s convertible preferred stock did not meet the definition of a participating security in periods of net losses as the convertible preferred stockholders did not have a contractual obligation to share in the Company’s losses. Accordingly, net losses were attributable to common stockholders. Subsequent to the Company’s IPO and the automatic conversion of the outstanding convertible preferred stock, the Company had no other participating securities and the two-class method is no longer applicable.

Basic net loss per share attributable to common stockholders is calculated by dividing net loss attributable to common stockholders by the weighted average number of shares outstanding for the period. Diluted net loss per share attributable to common stockholders is calculated by dividing net loss attributable to common stockholders by the weighted average number of common shares and potential dilutive common share equivalents outstanding during the period if the effect is dilutive. The Company’s potentially dilutive common shares include convertible notes and convertible preferred stock prior to their conversion, outstanding stock options and warrants and non-vested restricted stock units.

The following table presents the potential common shares outstanding that were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been anti-dilutive (in thousands):



	Years Ended December 31,
	2014	2013	2012
Stock options to purchase common stock	8,502	8,196	8,174
Unvested restricted stock units	1,258	381	248
Warrants to purchase common stock	195	308	331
Total	9,955	8,885	8,753

Segment and Geographic Information

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

SEGMENT AND GEOGRAPHIC INFORMATION

The Company’s chief operating decision maker is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis. The Company has one business activity, which entails the design, development, manufacture and sale of microinverter systems for the solar photovoltaic industry. There are no segment managers who are held accountable for operations, operating results or plans for levels or components below the consolidated unit level. Accordingly, management has determined that the Company has a single operating and reportable segment.

The following tables present net revenues (based on the destination of shipments) and long-lived assets by geographic region as of and for the periods presented (in thousands):

Net Revenues



	Years Ended December 31,
	2014		2013		2012
United States	$	294,549	$	192,881	$	189,711
International	49,355		39,965		26,967
Total	$	343,904	$	232,846	$	216,678

Long-Lived Assets



	As of December 31,
	2014		2013		2012
United States	$	20,037	$	16,262	$	17,136
China	9,585		7,130		6,642
Other	1,202		1,461		1,763
Total	$	30,824	$	24,853	$	25,541

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 33
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 26
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 35
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 29
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599

+ Details

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2014
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS KPCB Holdings, Inc. (“KPCB”), as nominee for certain funds of Kleiner Perkins Caufield & Byers, owned approximately 9 percent of the Company’s outstanding stock as of December 31, 2014. Revenues recognized from sales of microinverters to entities that are majority-owned by KPCB entities in 2013 and 2012 were $2.7 million and $16.8 million respectively. There were no sales to these entities in 2014.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References + Details

Summary of Significant Accounting Policies (Policies)	12 Months Ended
Summary of Significant Accounting Policies (Policies)	Dec. 31, 2014
Accounting Policies [Abstract]
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates	Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ materially from management’s estimates using different assumptions or under different conditions.
Revenue Recognition	Revenue Recognition The Company generates revenue from sales of its microinverter systems, which include microinverter units and related accessories, an Envoy communications gateway device, and an Enlighten web-based monitoring service, to distributors, large installers, OEMs and strategic partners. Enlighten service revenue represented less than 1% of the total revenues for all periods presented. Revenues from sales of microinverters and related accessories, and communication gateways are recognized when: (i) persuasive evidence of an arrangement exists; (ii) delivery of the products has occurred in accordance with the terms of the sales agreement and title and risk of loss have passed to the customer; (iii) the sale price is fixed or determinable; and (iv) collection is reasonably assured. Provisions for rebates, sales incentives, and discounts to customers are accounted for as reductions in revenue in the same period the related sales are recorded. Sales of an Envoy communications gateway device include the Enlighten web-based monitoring service. The allocation of revenue between the two deliverables is based on the Company’s best estimate of selling price determined by considering multiple factors including, internal costs, gross margin and historical pricing practices. After allocating the overall consideration from such sale to each deliverable using a best estimate of the selling price, (i) revenue from the sale of Envoy devices is recognized upon shipment, assuming all other revenue recognition criteria have been met and (ii) revenue from the web-based monitoring service is recognized ratably over the estimated economic life of the related Envoy devices of 10 years. Deferred revenues consist of payments received from customers in advance of revenue recognition for the Company’s products and services described above. As of December 31, 2014 and 2013, deferred revenues consist entirely of Enlighten service revenue.
Cost of Revenues	Cost of Revenues The Company includes the following in cost of revenues: product costs, warranty, manufacturing personnel and logistics costs, freight costs, inventory write-downs, hosting services costs related to the Company’s Enlighten service offering, and depreciation and amortization of manufacturing test equipment.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all highly liquid investments, such as certificates of deposit and money market instruments with maturities of three months or less at the time of acquisition to be cash equivalents. For all periods presented, its cash balances consist of amounts held in non-interest-bearing deposits and money market accounts.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of the Company’s cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of the short maturity of those instruments.
Foreign Currency Forward Contracts	Foreign Currency Forward Contracts The Company operates and conducts business in foreign countries where its foreign entities use the local currency as their respective functional currency. As a result, the Company is exposed to movements in foreign currency exchange rates. The Company utilizes foreign currency forward contracts to reduce the impact of foreign currency fluctuations related to anticipated cash receipts from expected future revenues denominated in Euros and British Pounds as well as from intercompany transaction gains or losses. The foreign currency forward contracts are accounted for as derivatives whereby the fair value of the contracts is reported as other current assets or current liabilities in the accompanying consolidated balance sheets, and gains and losses resulting from changes in the fair value are reported in other income (expense), net, in the accompanying consolidated statements of operations.
Allowances for Doubtful Accounts	Allowances for Doubtful Accounts The Company maintains allowances for doubtful accounts for uncollectible accounts receivable. Management estimates anticipated losses from doubtful accounts based on days past due, collection history and the financial health of customers.
Inventory	Inventory Inventory is valued at the lower of cost or market. The Company determines cost on a first-in first-out basis. Certain factors could affect the realizable value of its inventory, including customer demand and market conditions. Management assesses the valuation on a quarterly basis and writes down the value for any excess and obsolete inventory based upon expected demand, anticipated sales price, effect of new product introductions, product obsolescence, customer concentrations, product merchantability and other factors. Inventory write-downs are equal to the difference between the cost of inventories and their estimated net realizable market value.
Property and Equipment	Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Cost includes amounts paid to acquire or construct the asset as well as any expenditure that substantially adds to the value of or significantly extends the useful life of an existing asset. Repair and maintenance costs are expensed as incurred. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years. Leasehold improvements are amortized over the shorter of the lease term or expected useful life of the improvements.
Capitalized Software Costs	Capitalized Software Costs Internally used software, whether purchased or developed, is capitalized and amortized on a straight-line basis over its estimated useful life. Costs associated with internally developed software are expensed until the point at which the project has reached the development stage. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they provide additional functionality. Software maintenance and training costs are expensed in the period in which they are incurred. The capitalization of software requires judgment in determining when a project has reached the development stage and the period over which the Company expects to benefit from the use of that software.
Long-Lived Assets	Long-Lived Assets Property, plant and equipment, including capitalized software costs, are recorded at cost. Property, plant and equipment amounts are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (asset group) may not be recoverable. An impairment loss would be recognized when the carrying amount of an asset exceeds the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition. The amount of the impairment loss to be recorded is calculated by the excess of the asset's carrying value over its fair value. Fair value is generally determined using a discounted cash flow analysis.
Business Combinations	Business Combinations The Company allocates the fair value of purchase consideration (including contingent consideration) to the assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. The excess of the fair value of purchase consideration over the fair value of these assets acquired and liabilities assumed in the acquisition is recorded as goodwill. The primary items that generate goodwill include the value of the synergies between the acquiree and the Company and the value of the acquired assembled workforce, neither of which qualifies for recognition as an intangible asset. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred.
Goodwill and Intangible Assets	Goodwill Goodwill is not amortized, but is assessed for potential impairment at least annually during the fourth quarter of each fiscal year or between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired. Intangible Assets Intangible assets include patents, customer relationships and other purchased intangible assets. Intangible assets with finite lives are amortized on a straight-line basis, with estimated useful lives ranging from 3 to 5 years. Indefinite-lived intangible assets are tested for impairment annually, and are tested for impairment between annual tests if an event occurs or circumstances change that would indicate that the carrying amount may be impaired. Intangible assets with a finite lives are tested for impairment whenever events or circumstances indicate that the carrying amount of an asset (asset group) may not be recoverable. An impairment loss is recognized when the carrying amount of an asset exceeds the estimated undiscounted cash flows used in determining the fair value of the asset. The amount of the impairment loss to be recorded is calculated by the excess of the asset's carrying value over its fair value. Fair value is generally determined using a discounted cash flow analysis.
Warranty Obligations	Warranty Obligations Microinverters Sold Through December 31, 2013 The Company’s warranty accrual provides for the replacement of microinverter units that fail during the product’s warranty term (15 years for first and second generation microinverters and up to 25 years for third and fourth generation microinverters). On a quarterly basis, the Company employs a consistent, systematic and rational methodology to assess the adequacy of its warranty liability. This assessment includes updating all key estimates and assumptions for each generation of product, based on historical results, trends and the most current data available as of the filing date. The key estimates and assumptions used in the warranty liability are thoroughly reviewed by management on a quarterly basis. The key estimates used by the Company to estimate its warranty liability are: (1) the number of units expected to fail over time (i.e. failure rate); (2) the number of failed units expected to result in warranty claims over time (i.e. claim rate); and (3) the per unit cost of replacement units, including outbound shipping and limited labor costs, expected to be incurred to replace failed units over time (i.e. replacement cost). Estimated Failure Rates—The Company’s Quality and Reliability department has primary responsibility to determine the estimated failure rates for each generation of microinverter. To establish initial failure rate estimates for each generation of microinverter, the Company’s quality engineers use a combination of industry standard MTBF (Mean Time Between Failure) estimates for individual components contained in its microinverters, third party data collected on similar equipment deployed in outdoor environments similar to those in which the Company’s microinverters are installed, and rigorous long term reliability and accelerated life cycle testing which simulates the service life of the microinverter in a short period of time. As units are deployed into operating environments, the Company continues to monitor product performance via its Enlighten monitoring platform. It typically takes three to nine months between the date of sale and date of end-user installation. Consequently, the Company’s ability to monitor actual failures of units sold similarly lags by three to nine months. When a microinverter fails and is returned, the Company performs diagnostic root cause failure analysis to understand and isolate the underlying mechanism(s) causing the failure. The Company then uses the results of this analysis (combined with the actual, cumulative performance data collected on those units prior to failure via Enlighten) to draw conclusions with respect to how or if the identified failure mechanism(s) will impact the remaining units deployed in the installed base. Estimated Claim Rates—Warranty claim rate estimates are based upon assumptions with respect to expected customer behavior over the warranty period. As the vast majority of the Company’s microinverters have been sold to end users for residential applications, the Company believes that warranty claim rates will be affected by changes over time in residential home ownership because the Company expects that subsequent homeowners are less likely to file claims than the homeowners who originally purchase the microinverters. Estimated Replacement Costs—Three factors are considered in the Company’s analysis of estimated replacement cost: (1) the estimated cost of replacement microinverters; (2) the estimated cost to ship replacement microinverters to end users; and (3) the estimated labor reimbursement expected to be paid to third party installers performing replacement services for the end user. Because the Company’s warranty provides for the replacement of defective microinverters over long periods of time (either 15 or 25 years, depending on the generation of product purchased), the estimated per unit cost of current and future product generations is considered in the estimated replacement cost. Estimated costs to ship replacement units are based on observable, market-based shipping costs paid by the Company to third party freight carriers. The Company has a separate program that allows third-party installers to claim fixed-dollar reimbursements for labor costs they incur to replace failed microinverter units for a limited time from the date of original installation. Included in the Company’s estimated replacement cost is an analysis of the number of fixed-dollar labor reimbursements expected to be claimed by third party installers over the limited offering period. If actual failure rates, claim rates, or replacement costs differ from the Company’s estimates in future periods, changes to these estimates would be required, resulting in increases or decreases in the Company’s warranty obligations. Such increases or decreases could be material. Fair Value Option for Microinverters Sold Since January 1, 2014 The Company’s warranty obligations related to microinverters sold since January 1, 2014 provide the Company the right, but not the requirement, to assign its warranty obligations to a third-party. Under Accounting Standards Codification (“ASC”) 825—Financial Instruments, (“fair value option”), an entity may choose to elect the fair value option for such warranties at the time it first recognizes the eligible item. The Company made an irrevocable election to account for all eligible warranty obligations associated with microinverters sold since January 1, 2014 at fair value. This election was made to reflect the underlying economics of the time value of money for an obligation that will be settled over an extended period of up to 25 years. The Company estimates the fair value of warranty obligations by calculating the warranty obligations in the same manner as for sales prior to January 1, 2014 and applying an expected present value technique to that result. The expected present value technique, an income approach, converts future amounts into a single current discounted amount. In addition to the key estimates of failure rates, claim rates and replacement costs, the Company used certain inputs that are unobservable and significant to the overall fair value measurement. Such additional assumptions included compensation comprised of a profit element and risk premium required of a market participant to assume the obligation and a discount rate based on the Company’s credit-adjusted risk-free rate. See Note 8, (“Fair Value Measurements”) for additional information. Warranty obligations initially recorded at fair value at the time of sale will be subsequently re-measured to fair value at each reporting date. In addition, the fair value of the liability will be accreted over the corresponding term of the warranty of up to 25 years using the interest method. Any changes in fair value of the liability from period-to-period, including accretion expense, will be recognized in cost of revenues. As of December 31, 2014, warranty obligations associated with sales prior to January 1, 2014 were $30.0 million and warranty obligations associated with sales since January 1, 2014 were $3.9 million, of which $3.6 million were eligible for fair value accounting. The portion of warranty obligations arising from sales since January 1, 2014 that was not eligible for fair value accounting relates to sales of non-microinverter products. Periodic adjustments necessitated by actual experience of claims and any future changes in estimates to amounts not eligible for fair value accounting will continue to be accounted for on an undiscounted basis.
Research and Development Costs	Research and Development Costs The Company expenses research and development costs as incurred.
Share-Based Compensation	Stock-Based Compensation Share-based payments are required to be recognized in the Company’s consolidated statements of operations based on their fair values and the estimated number of shares expected to vest. The Company measures stock-based compensation expense for all share-based payment awards, including stock options made to employees and directors, based on the estimated fair values on the date of the grant. The fair value of stock options granted is estimated using the Black-Scholes option valuation model. The fair value of restricted stock units granted is determined based on the price of the Company’s common stock on the date of grant. Stock-based compensation, net of estimated forfeitures, is recognized on a straight-line basis over the requisite service period, which is typically four years.
Comprehensive Loss	Comprehensive Loss Comprehensive loss consists of two components, net loss and other comprehensive income (loss). Other comprehensive income (loss) refers to gains and losses that are recorded as an element of stockholders’ equity but are excluded from net income. The Company’s other comprehensive income (loss) consists of foreign currency translation adjustments for all periods presented.
Income Taxes	Income Taxes The Company records income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected tax consequences of temporary differences between the tax bases of assets and liabilities for financial reporting purposes and amounts recognized for income tax purposes. In estimating future tax consequences, generally all expected future events other than enactments or changes in the tax law or rates are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized. The Company operates in various tax jurisdictions and is subject to audit by various tax authorities. The Company follows accounting for uncertainty in income taxes which requires that the tax effects of a position be recognized only if it is “more likely than not” to be sustained based solely on its technical merits as of the reporting date. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes.
Contingent Consideration Liability	Contingent Consideration Liability The estimated fair value of the contingent consideration liability, initially measured and recorded on the acquisition date, is reviewed at each reporting period and revalued to its then fair value until the contingency is resolved. Increases or decreases in the fair value of the contingent consideration liability subsequent to the acquisition date can result from changes in the assumed probabilities applied to the achievement of certain revenue targets and the corresponding payout amounts. These changes in the fair value will be recognized in the consolidated statements of operations for the period in which the estimated fair value changes.

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

Schedule of Activity in Allowance for Doubtful Accounts

The following table sets forth activities in the allowance for doubtful accounts for the periods indicated:



	December 31,
	2014			2013		2012
Balance, at beginning of year	$	2,000		$	1,177	$	144
Net charges to expenses	196			678		1,068
Write-offs, net of recoveries	(1,627		)	145		(35		)
Balance, at end of year	$	569		$	2,000	$	1,177

Inventory (Tables)

12 Months Ended

Dec. 31, 2014

Inventory Disclosure [Abstract]

Summary of Inventory

Inventory as of December 31, 2014 and 2013, consists of the following (in thousands):



	December 31,
	2014		2013
Raw materials	$	3,429	$	1,428
Finished goods	18,161		15,152
Total inventory	$	21,590	$	16,580

Property and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2014

Property, Plant and Equipment [Abstract]

Summary of Property, Plant and Equipment

As of December 31, 2014 and 2013, property and equipment consists of the following (in thousands):



	Estimated Useful Life (Years)	December 31,
	Estimated Useful Life (Years)	2014			2013
Equipment and machinery	5	$	28,923		$	21,853
Furniture and fixtures	5–7	3,032			2,837
Computer equipment	3–5	2,194			1,842
Capitalized software	3–5	8,905			7,343
Leasehold improvements	4–10	6,636			5,881
Construction in progress		4,911			1,703
Total		54,601			41,459
Less accumulated depreciation and amortization		(23,777		)	(16,606		)
Property and equipment, net		$	30,824		$	24,853

Business Combination, Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2014

Business Combinations [Abstract]

Summary of Allocated Purchase Price to Acquired Tangible and Identifiable Intangible Assets Based on Estimated Fair Value



Cash consideration	$	2,535
Contingent consideration	2,300
Total purchase consideration	$	4,835

Property and equipment	$	190
Customer relationships	900
Goodwill	3,745
Net assets acquired	$	4,835

Summary of Goodwill and Purchased Intangible Assets



	December 31, 2014							December 31, 2013
	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization		Net
Goodwill	$	3,745	$	—		$	3,745	$	—	$	—	$	—

Other indefinite-lived intangibles	$	286	$	—		$	286	$	286	$	—	$	286
Intangibles assets with finite lives:
Customer relationships	900		—			900		—		—		—
Patents	750		(125		)	625		—		—		—
Total purchased intangibles	$	1,936	$	(125	)	$	1,811	$	286	$	—	$	286

Schedule of Estimated Future Amortization Expense Related to Finite-lived Intangible Assets

As of December 31, 2014, estimated future amortization expense related to finite-lived intangible assets was as follows:



Year	(In thousands)
2015	$	430
2016	430
2017	305
2018	180
2019	180
Total	$	1,525

Accrued Liabilities (Tables)

12 Months Ended

Dec. 31, 2014

Payables and Accruals [Abstract]

Schedule of Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):



	December 31,
	2014		2013
Salaries, commissions, incentive compensation and benefits	$	14,871	$	6,499
Customer rebates and sales incentives	5,083		2,818
Other	6,082		5,463
Total	26,036		14,780

Warranty Obligations (Tables)

12 Months Ended

Dec. 31, 2014

Product Warranties Disclosures [Abstract]

Summary of Changes in the Company's Product Warranty Liability

The Company’s warranty activities during 2014, 2013 and 2012 were as follows (in thousands):



	December 31,
	2014			2013			2012
Balance, at beginning of year	$	30,432		21,338			$	8,738
Accruals for warranties issued during the year	4,309			6,303			8,218
Changes in estimates	8,391			10,303			7,607
Settlements	(8,793		)	(7,512		)	(3,225		)
Increase due to accretion expense	195			—			—
Fair value adjustments	(594		)	—			—
Balance, at end of year	33,940			30,432			21,338
Less current portion	(7,607		)	(4,942		)	(6,078		)
Long-term portion	$	26,333		$	25,490		$	15,260

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2014

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Schedule of Financial Instruments Measured at Fair Value on a Recurring Basis



	Fair Value Hierarchy	December 31, 2014		December 31, 2013
Assets:
Foreign currency forward contracts	Level 2	$	76	$	325

Liabilities:
Foreign currency forward contracts	Level 2	$	—	$	605
Warranty obligations	Level 3	3,562		—
Contingent consideration	Level 3	2,300		—

Summary of Significant Unobservable Inputs used in the Fair Value Measurements of the Company's Liabilities Designated as Level 3

As of December 31, 2014, the significant unobservable inputs used in the fair value measurement of the Company’s liabilities designated as Level 3 are as follows:



Item Measured at Fair Value	Valuation Technique	Description of Significant Unobservable Input	Percent Used (Weighted-Average)
Warranty obligations for microinverters sold since January 1, 2014	Discounted cash flows	Profit element and risk premium	18%
	Discounted cash flows	Credit-adjusted risk-free rate	18%

Contingent consideration	Probability-weighted discounted cash flows	Risk-adjusted discount rate	18%

Warranty obligations

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Schedule of Reconciliation of Beginning and Ending Balances of Warranty Obligations/Contingent Consideration Measured at Fair Value

The following table provides a reconciliation of the beginning and ending balances of warranty obligations measured at fair value for the periods indicated (in thousands):



Balance—December 31, 2013	$	—
Accruals for warranties issued during period	3,989
Changes in estimates	26
Settlements	(54		)
Increase due to accretion expense	195
Fair value adjustments	(594		)
Balance—December 31, 2014	$	3,562

Contingent consideration

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Schedule of Reconciliation of Beginning and Ending Balances of Warranty Obligations/Contingent Consideration Measured at Fair Value

The following table provides a reconciliation of the beginning and ending balances of contingent consideration measured at fair value for the periods indicated (in thousands):



Balance—December 31, 2013	$	—
Fair value of contingent consideration—acquisition of NPS	2,300
Fair value adjustment to contingent consideration	—
Balance—December 31, 2014	$	2,300

Debt and Revolving Credit Facility (Tables)

12 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

Schedule of Debt Obligations

The Company’s debt obligations were comprised of the following at December 31, 2014 and 2013 (in thousands):



	December 31,
	2014		2013
Term loan	$	—	$	7,400
Equipment financing facility, net of unamortized discount of $0 and $94, respectively	—		3,661
Total debt	—		11,061
Less current portion	—		(2,384		)
Long-term portion	$	—	$	8,677

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6479336&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=34725769&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28541-108399

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21521-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 22
-Article 5

+ Details

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments Under Noncancelable Operating Leases

The Company’s minimum lease payments under noncancelable operating leases, exclusive of executory costs, as of December 31, 2014 are as follows (in thousands):



2015	$	1,980
2016	2,120
2017	1,918
2018	1,973
2019	2,032
Thereafter	5,051
Total minimum lease payments	$	15,074

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2014

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

Schedule of Weighted Average Assumptions used to Estimate Fair Value of Stock Options

A summary of the weighted-average assumptions used to estimate the fair values of the stock options granted during the periods presented is as follows:



	Years Ended December 31,
	2014			2013			2012
Expected term (in years)	4.5			4.4			5.7
Expected volatility	67.7		%	68.4		%	74.5		%
Annual risk-free rate of return	1.4		%	1.0		%	0.9		%
Dividend yield	—		%	—		%	—		%
Weighted-average fair value on grant date	$	5.64		$	3.84		$	4.69

Summary of Total Stock Based Compensation Expense Components

The following table summarizes the components of total stock-based compensation expense included in the consolidated statements of operations for the periods presented (in thousands):



	Years Ended December 31,
	2014		2013		2012
Cost of revenues	$	816	$	438	$	196
Research and development	3,127		2,110		1,728
Sales and marketing	2,487		1,812		1,254
General and administrative	3,310		2,489		1,588
Total stock-based compensation expense	$	9,740	$	6,849	$	4,766

Summary of Stock Based Compensation Expense Associated with Each Award Type

A summary of stock-based compensation expense associated with each type of award for the periods presented is as follows (in thousands):



	Years Ended December 31,
	2014		2013		2012
Stock options and restricted stock units	$	8,845	$	6,314	$	4,519
ESPP	895		535		247
Total stock-based compensation expense	$	9,740	6,849		$	4,766

Summary of Stock Option Activity

A summary of the Company’s stock option activity for the periods presented is as follows (in thousands, except per share data):



	Shares		Weighted- Average Exercise Price per Share
Options outstanding — December 31, 2011	6,256		$	1.83
Granted	2,478		7.35
Exercised	(59	)	1.26
Canceled	(506	)	5.55
Options outstanding — December 31, 2012	8,169		3.28
Granted	1,506		7.17
Exercised	(822	)	1.69
Canceled	(344	)	7.74
Options outstanding — December 31, 2013	8,509		3.94
Granted	1,311		10.36
Exercised	(886	)	4.33
Canceled	(302	)	7.58
Options outstanding — December 31, 2014	8,632		4.75

Summary of Stock Options Outstanding

The following table summarizes information about stock options outstanding at December 31, 2014:



	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number of Shares (in thousands)	Weighted- Average Remaining Life (in years)	Weighted- Average Exercise Price		Number of Shares (in thousands)	Weighted- Average Exercise Price
$0.27 —– $0.27	2,304	4.5	$	0.27	2,304	$	0.27
$0.64 —– $2.54	1,730	5.4	1.66		1,716	1.66
$3.35 —– $7.44	1,820	6.1	6.15		965	6.04
$7.50 —– $9.53	1,839	6.3	8.21		844	8.35
$9.54 —– $16.01	939	6.7	11.91		127	10.77
Total	8,632	5.6	4.75		5,956	2.96

Summary of Restricted Stock Unit Activity

A summary of restricted stock unit activity for the periods presented is as follows: (in thousands, except per share data):



	Restricted Stock Units		Weighted Average Fair Value per Share at Grant Date
Outstanding at December 31, 2011	—		$	—
Granted	282		5.69
Vested	(20	)	2.00
Canceled	(14	)	6.90
Outstanding at December 31, 2012	248		5.53
Granted	285		6.92
Vested	(107	)	6.08
Canceled	(8	)	7.07
Outstanding at December 31, 2013	418		6.31
Granted	1,250		8.68
Vested	(281	)	7.38
Canceled	(42	)	7.56
Outstanding at December 31, 2014	1,345		8.25

Summary of ESPP Activity

A summary of ESPP activity for the years presented is as follows: (in thousands, except per share data):



	Years Ended December 31,
	2014		2013		2012
Proceeds from common stock issued under ESPP	$	1,531	$	1,047	$	185
Shares of common stock issued	410		327		59
Weighted-average price per share	$	3.73	$	3.20	$	3.14

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Schedule of Domestic and Foreign Components of Loss before Provision for Income Taxes

The domestic and foreign components of loss before provision for income taxes consisted of the following (in thousands):



	Years Ended December 31,
	2014			2013			2012
United States	$	(8,732	)	$	(26,118	)	$	(38,539	)
Foreign	1,446			1,068			972
Total	$	(7,286	)	$	(25,050	)	$	(37,567	)

Schedule of Provision for Income Taxes

The provision for income taxes for the years presented is as follows (in thousands):



	Year Ended December 31,
	2014			2013			2012
Current:
Federal	$	—		$	—		$	—
State	85			—			—
Foreign	716			865			651
Total	801			865			651
Deferred:
Federal	—			—			—
State	—			—			—
Foreign	(35		)	(2		)	—
Provision for income taxes	$	766		$	863		$	651

Schedule of Effective Income Tax Rate Reconciliation



	Year Ended December 31,
	2014			2013			2012
Income tax benefit at statutory federal rate	$	(2,477	)	$	(8,517	)	$	(12,773	)
State taxes, net of federal benefit	(4,576		)	(883		)	(1,478		)
Change in valuation allowance	16,646			8,353			12,574
Foreign tax rate and tax law differential	(43		)	237			147
Tax credits	(5,619		)	—			—
Stock-based compensation	957			1,191			1,128
Other permanent items	231			220			860
Other nondeductible/nontaxable items	(4,586		)	(2		)	20
Uncertain tax positions	233			264			173
Provision for income taxes	$	766		$	863		$	651

Schedule of Deferred Tax Assets and Liabilities

A summary of significant components of the Company’s deferred tax assets and liabilities as of December 31, 2014 and 2013 is as follows (in thousands):



	December 31,
	2014			2013
Deferred Tax Assets
Allowances and reserves	$	18,771		$	14,521
Net operating loss and tax credit carryforwards	28,511			16,840
Stock-based compensation	2,154			1,531
Deferred revenue	3,843			2,730
Fixed assets and intangibles	9,163			11,670
Other	2,023			476
Total gross deferred tax assets	64,465			47,768
Less valuation allowance	(64,428		)	(47,766		)
Deferred tax assets, net of valuation allowance	37			2
Deferred tax liabilities	—			—
Net deferred tax assets, net of valuation allowance	$	37		$	2

Schedule of Reconciliation of Total Amounts of Unrecognized Tax Benefits

A tabular reconciliation of the total amounts of unrecognized tax benefits for the years presented is as follows (in thousands):



	Year Ended December 31,
	2014		2013		2012
Unrecognized tax benefits—at beginning of year	$	376	$	160	$	—
Increases in balances related to tax positions taken in prior years	1,895		79		—
Increases in balances related to tax positions taken in current year	2,155		137		160
Unrecognized tax benefits—at end of year	4,426		376		160

Net Loss Per Share Attributable to Common Stockholders (Tables)

12 Months Ended

Dec. 31, 2014

Earnings Per Share [Abstract]

Schedule of Potential Common Shares Outstanding Excluded from the Computation of Diluted Net Loss Per Share Attributable to Common Stockholders



	Years Ended December 31,
	2014	2013	2012
Stock options to purchase common stock	8,502	8,196	8,174
Unvested restricted stock units	1,258	381	248
Warrants to purchase common stock	195	308	331
Total	9,955	8,885	8,753

Segment and Geographic Information (Tables)

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Summary of Net Revenues and Long-Lived Assets by Geographic Region

Long-Lived Assets



	As of December 31,
	2014		2013		2012
United States	$	20,037	$	16,262	$	17,136
China	9,585		7,130		6,642
Other	1,202		1,461		1,763
Total	$	30,824	$	24,853	$	25,541

Net Revenues



	Years Ended December 31,
	2014		2013		2012
United States	$	294,549	$	192,881	$	189,711
International	49,355		39,965		26,967
Total	$	343,904	$	232,846	$	216,678

Summary of Significant Accounting Policies - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Accounting Policies [Line Items]
Allowance for doubtful accounts	$ 569,000	$ 2,000,000	$ 1,177,000	$ 144,000
Impairment of intangible assets	0
Warranty obligation	33,940,000	30,432,000	21,338,000	$ 8,738,000
Research and development expense	$ 45,386,000	$ 34,524,000	$ 35,601,000
Stock-based compensation requisite service period	4 years
First and Second Generation
Accounting Policies [Line Items]
Product warranty, term	15 years
Third and Fourth Generation
Accounting Policies [Line Items]
Product warranty, term	25 years
Sales prior to January 1, 2014
Accounting Policies [Line Items]
Warranty obligation	$ 30,000,000
Sales since January 1, 2014
Accounting Policies [Line Items]
Warranty obligation	$ 3,900,000
Minimum
Accounting Policies [Line Items]
Property and equipment estimated useful life	3 years
Intangible assets, estimated useful life	3 years
Product warranty, term	15 years
Product installation period	3 months
Period failure rate measurement lags product sale	3 months
Maximum
Accounting Policies [Line Items]
Property and equipment estimated useful life	10 years
Intangible assets, estimated useful life	5 years
Product warranty, term	25 years
Product installation period	9 months
Period failure rate measurement lags product sale	9 months
Maximum \| Enlighten
Accounting Policies [Line Items]
Percent of revenue represented by product line or service	1.00%
Revenue recognition period	10 years
Warranty obligations \| Sales since January 1, 2014
Accounting Policies [Line Items]
Fair value of liability	$ 3,600,000

Summary of Significant Accounting Policies - Schedule of Activity in Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Allowance for Doubtful Accounts Receivable [Roll Forward]
Balance, at beginning of year	$ 2,000	$ 1,177	$ 144
Net charges to expenses	196	678	1,068
Write-offs, net of recoveries	1,627	(145)	35
Balance, at end of year	$ 569	$ 2,000	$ 1,177

Inventory - Summary of Inventory (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Inventory Disclosure [Abstract]
Raw materials	$ 3,429	$ 1,428
Finished goods	18,161	15,152
Total inventory	$ 21,590	$ 16,580

Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 54,601	$ 41,459
Less accumulated depreciation and amortization	(23,777)	(16,606)
Property and equipment, net	$ 30,824	24,853
Equipment and machinery
Property, Plant and Equipment [Line Items]
Estimated useful life	5 years
Property and equipment, gross	$ 28,923	21,853
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	3,032	2,837
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	2,194	1,842
Capitalized software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	8,905	7,343
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	6,636	5,881
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 4,911	$ 1,703
Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Minimum \| Furniture and fixtures
Property, Plant and Equipment [Line Items]
Estimated useful life	5 years
Minimum \| Computer equipment
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Minimum \| Capitalized software
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Minimum \| Leasehold improvements
Property, Plant and Equipment [Line Items]
Estimated useful life	4 years
Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life	10 years
Maximum \| Furniture and fixtures
Property, Plant and Equipment [Line Items]
Estimated useful life	7 years
Maximum \| Computer equipment
Property, Plant and Equipment [Line Items]
Estimated useful life	5 years
Maximum \| Capitalized software
Property, Plant and Equipment [Line Items]
Estimated useful life	5 years
Maximum \| Leasehold improvements
Property, Plant and Equipment [Line Items]
Estimated useful life	10 years

Property and Equipment, Net - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Property, Plant and Equipment [Abstract]
Depreciation and amortization	$ 8.1	$ 7.0	$ 5.6
Unamortized capitalized software costs	$ 3.3	$ 3.6

Business Combination, Goodwill and Intangible Assets - Summary of Allocated (Details) - USD ($) $ in Thousands	Dec. 12, 2014	Dec. 31, 2014	Dec. 31, 2013
Net Assets Acquired
Goodwill		$ 3,745	$ 0
Next Phase Solar, Inc.
Total Purchase Price
Cash consideration	$ 2,535
Contingent consideration	2,300
Total purchase consideration	4,835
Net Assets Acquired
Property and equipment	190
Customer relationships	900
Goodwill	3,745	$ 3,745	$ 0
Net assets acquired	$ 4,835

Business Combination, Goodwill and Intangible Assets - Narrative (Details) - USD ($)		12 Months Ended
	Dec. 12, 2014	Dec. 31, 2014	Dec. 31, 2013
Business Acquisition [Line Items]
Goodwill		$ 3,745,000	$ 0
Next Phase Solar, Inc.
Business Acquisition [Line Items]
Total purchase consideration	$ 4,835,000
Purchase consideration, cash	2,535,000
Purchase consideration, cash withheld	300,000
Contingent consideration	$ 2,300,000
Indemnity hold back period	1 year
Goodwill	$ 3,745,000	3,745,000	$ 0
Contingent consideration, minimum		0
Contingent consideration, maximum		5,500,000
Acquisition related costs		$ 200,000
Patents
Business Acquisition [Line Items]
Intangible assets, estimated useful life		3 years
Customer Relationships
Business Acquisition [Line Items]
Intangible assets, estimated useful life		5 years

Business Combination, Goodwill and Intangible Assets - Summary of Goodwill and Purchased Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 12, 2014	Dec. 31, 2013
Business Acquisition [Line Items]
Goodwill	$ 3,745		$ 0
Intangibles assets with finite lives:
Total	1,525
Total purchased intangibles, net	1,811		286
Next Phase Solar, Inc.
Business Acquisition [Line Items]
Goodwill, gross	3,745		0
Goodwill	3,745	$ 3,745	0
Other indefinite-lived intangibles, gross	286		286
Intangibles assets with finite lives:
Total purchased intangibles, gross	1,936		286
Total purchased intangibles, accumulated amortization	(125)		0
Total purchased intangibles, net	1,811		286
Customer Relationships \| Next Phase Solar, Inc.
Intangibles assets with finite lives:
Finite-lived intangible assets, gross	900		0
Finite-lived intangible assets, accumulated amortization	0		0
Total	900		0
Patents \| Next Phase Solar, Inc.
Intangibles assets with finite lives:
Finite-lived intangible assets, gross	750		0
Finite-lived intangible assets, accumulated amortization	(125)		0
Total	$ 625		$ 0

Business Combination, Goodwill and Intangible Assets - Schedule of Estimated Future Amortization Expense Related to Finite-lived Intangible Assets (Details) $ in Thousands	Dec. 31, 2014 USD ($)
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
2015	$ 430
2016	430
2017	305
2018	180
2019	180
Total	$ 1,525

Accrued Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Accrued Liabilities [Abstract]
Salaries, commissions, incentive compensation and benefits	$ 14,871	$ 6,499
Customer rebates and sales incentives	5,083	2,818
Other	6,082	5,463
Total	$ 26,036	$ 14,780

Warranty Obligations - Summary of Changes in the Company's Product Warranty Liability (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Changes in the Company's product warranty liability
Balance, at beginning of year	$ 30,432	$ 21,338	$ 8,738
Accruals for warranties issued during the year	4,309	6,303	8,218
Changes in estimates	8,391	10,303	7,607
Settlements	(8,793)	(7,512)	(3,225)
Increase due to accretion expense	195	0	0
Fair value adjustments	(594)	0	0
Balance, at end of year	33,940	30,432	21,338
Less current portion	(7,607)	(4,942)	(6,078)
Long-term portion	$ 26,333	$ 25,490	$ 15,260

Warranty Obligations - Narrative (Details) unit in Millions, $ in Millions	3 Months Ended		12 Months Ended			18 Months Ended		42 Months Ended
	Sep. 30, 2013 USD ($)	Dec. 31, 2012	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Dec. 31, 2012 USD ($)	Dec. 31, 2014 unit	Dec. 31, 2013 unit	Jun. 30, 2012 unit
Minimum
Product Liability Contingency [Line Items]
Product warranty, term			15 years
Maximum
Product Liability Contingency [Line Items]
Product warranty, term			25 years
Replacement cost
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates					$ (2.1)
Claim rate
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates					(0.5)
Shipping cost
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates					(1.9)
Second generation
Product Liability Contingency [Line Items]
Number of units sold \| unit								1.0
Second generation \| Failure rate
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates			$ 8.6	$ 19.5	$ 10.2
Second generation \| Replacement cost
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates			1.3
All product generations \| Replacement cost
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates			(1.5)
Net increase (decrease) in warranty expense due to changes in warranty variables estimates			$ (0.2)
Third generation
Product Liability Contingency [Line Items]
Number of units sold \| unit							3.9
Third generation \| Failure rate
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates	$ (3.1)
Fourth generation
Product Liability Contingency [Line Items]
Number of units sold \| unit						2.3
Fourth generation \| Replacement cost
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates				$ (1.9)
Second and third generation \| Minimum
Product Liability Contingency [Line Items]
Product warranty, term				15 years
Second and third generation \| Maximum
Product Liability Contingency [Line Items]
Increase (decrease) in warranty expense due to changes in warranty variables estimates				$ (4.2)
Product warranty, term				25 years
Enlighten \| Minimum
Product Liability Contingency [Line Items]
Percent of end user customers using performance tracking system		80.00%
Enlighten \| Maximum
Product Liability Contingency [Line Items]
Percent of end user customers using performance tracking system		90.00%

Fair Value Measurements - Schedule of Financial Instruments Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Level 2
Assets:
Foreign currency forward contracts	$ 76	$ 325
Liabilities:
Foreign currency forward contracts	0	605
Warranty obligations \| Level 3
Liabilities:
Warranty obligations/Contingent Consideration	3,562	0
Contingent consideration \| Level 3
Liabilities:
Warranty obligations/Contingent Consideration	$ 2,300	$ 0

Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Derivative [Line Items]
Contingent consideration earnout period	2 years
Not designated as hedging instrument \| Foreign exchange forward
Derivative [Line Items]
Notional amount of foreign currency	$ 1,500	$ 12,500
Net gain (loss) on foreign currency	300	(400)	$ (500)
Warranty obligations \| Recurring \| Level 3
Derivative [Line Items]
Fair value of liability	3,562	0
Contingent consideration \| Recurring \| Level 3
Derivative [Line Items]
Fair value of liability	2,300	$ 0
Contingent consideration \| Discounted cash flows \| Recurring \| Level 3
Derivative [Line Items]
Fair value of liability	2,300
Decrease to fair value measurement as a result of 100 basis point increase	138
Increase to fair value measurement as a result of 100 basis point decrease	152
Contingent consideration \| Minimum \| Discounted cash flows \| Recurring \| Level 3
Derivative [Line Items]
Probability adjusted level of revenue	2,600
Contingent consideration \| Maximum \| Discounted cash flows \| Recurring \| Level 3
Derivative [Line Items]
Probability adjusted level of revenue	$ 17,000

Fair Value Measurements - Schedule of Reconciliation of Beginning and Ending Balances of Warranty Obligations Measured at Fair Value (Details) - Warranty obligations - Level 3 - Recurring $ in Thousands	12 Months Ended
	Dec. 31, 2014 USD ($)
Warranty Obligations at Fair Value [Roll Forward]
Beginning balance	$ 0
Accruals for warranties issued during period	3,989
Changes in estimates	26
Settlements	(54)
Increase due to accretion expense	195
Fair value adjustments	(594)
Ending balance	$ 3,562

Fair Value Measurements - Schedule of Reconciliation of Beginning and Ending Balances of Contingent Consideration Measured at Fair Value (Details) - Contingent consideration - Level 3 - Recurring $ in Thousands	12 Months Ended
	Dec. 31, 2014 USD ($)
Contingent Consideration at Fair Value [Roll Forward]
Beginning balance	$ 0
Fair value of contingent consideration—acquisition of NPS	2,300
Fair value adjustment to contingent consideration	0
Ending balance	$ 2,300

Fair Value Measurements - Summary of Significant Unobservable Inputs used in the Fair Value Measurements of the Company's Liabilities Designated as Level 3 (Details) - Discounted cash flows - Recurring - Level 3	12 Months Ended
	Dec. 31, 2014
Warranty obligations for microinverters sold since January 1, 2014
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Profit element and risk premium	18.00%
Credit-adjusted risk-free rate	18.00%
Contingent consideration
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Risk-adjusted discount rate	18.00%

Debt and Revolving Credit Facility - Schedule of Debt Obligations (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Schedule of long-term debt
Total debt	$ 0	$ 11,061
Less current portion	0	(2,384)
Long-term portion	0	8,677
Term loan
Schedule of long-term debt
Total debt	0	7,400
Equipment financing facility
Schedule of long-term debt
Total debt	$ 0	$ 3,661

Debt and Revolving Credit Facility - Schedule of Debt Obligations (Parenthetical) (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Equipment financing facility
Debt Instrument [Line Items]
Unamortized discount	$ 0	$ 94

Debt and Revolving Credit Facility - Narrative (Details) - USD ($)				1 Months Ended	26 Months Ended
	Dec. 08, 2014	Nov. 07, 2012	Jun. 13, 2011	Nov. 30, 2012	Dec. 31, 2014
Revolving Credit Facility \| Wells Fargo Bank
Long-Term Debt (Textual) [Abstract]
Convertible loan facility, maximum borrowing capacity				$ 50,000,000.0
Amount of liquidity required for debt compliance				15,000,000.0
Amount of undrawn credit for debt compliance				$ 5,000,000.0
Amount drawn from line of credit					$ 0
Convertible loan facility, remaining borrowing capacity					$ 37,600,000
Revolving Credit Facility \| Wells Fargo Bank \| Minimum \| LIBOR or Base Rate
Long-Term Debt (Textual) [Abstract]
Term Loan interest at an prime rate				1.50%
Revolving Credit Facility \| Wells Fargo Bank \| Maximum \| LIBOR or Base Rate
Long-Term Debt (Textual) [Abstract]
Term Loan interest at an prime rate				4.25%
Term loan \| Hercules Technology Growth Capital, Inc
Long-Term Debt (Textual) [Abstract]
Amount drawn from line of credit		$ 7,400,000
Debt instrument additional borrowing amount		$ 15,600,000
Term Loan interest at an annual rate		11.50%
Interest only period		15 months
Credit facility, end of term charge		$ 600,000
Repayment of term loans	$ 5,800,000
Term loan \| Hercules Technology Growth Capital, Inc \| Prime Rate
Long-Term Debt (Textual) [Abstract]
Term Loan interest at an prime rate		8.25%
Equipment financing facility \| Hercules Technology Growth Capital, Inc
Long-Term Debt (Textual) [Abstract]
Convertible loan facility, maximum borrowing capacity			$ 5,000,000.0
Term Loan interest at an annual rate			9.00%
Equipment financing facility term			3 years
Equipment financing facility \| Hercules Technology Growth Capital, Inc \| Prime Rate
Long-Term Debt (Textual) [Abstract]
Term Loan interest at an prime rate			5.75%

Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 2.6	$ 2.6	$ 2.4
Purchase obligation	$ 36.8

Commitments and Contingencies - Schedule of Future Minimum Lease Payments Under Noncancelable Operating Leases (Details) $ in Thousands	Dec. 31, 2014 USD ($)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2015	$ 1,980
2016	2,120
2017	1,918
2018	1,973
2019	2,032
Thereafter	5,051
Total minimum lease payments	$ 15,074

Stockholders' Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Apr. 04, 2012	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Class of Stock [Line Items]
Common stock shares issued during period, in connection with credit facility (shares)	10,315,151
Common stock issued, price per share (usd per share)	$ 6.00
Net proceeds from IPO	$ 53,800	$ 0	$ 0	$ 58,609
Underwriter's discounts and commissions	3,300
Other estimated offering costs	$ 4,800
Convertible preferred stock outstanding (shares)	22,220,856	0	0
Convertible preferred stock outstanding, value	$ 93,600
Conversion of convertible preferred stock into common stock (shares)	25,171,017
Convertible notes, outstanding balance of principal and accrued paid in kind interest	$ 21,200
Conversion of notes into common stock (shares)	3,533,988
Common stock conversion price per share (usd per share)	$ 6.00
Debt interest expense				$ 2,800
Common Stock
Class of Stock [Line Items]
Number of securities called by warrants (shares)		111,183
Common Stock \| Minimum
Class of Stock [Line Items]
Warrant to purchase common stock, price per share (usd per share)		$ 5.27

Stock-Based Compensation - Narrative (Details)		12 Months Ended
Stock-Based Compensation - Narrative (Details)	Jan. 01, 2015 shares	Dec. 31, 2014 USD ($) purchase_period $ / shares shares	Dec. 31, 2013 USD ($) shares	Dec. 31, 2012 USD ($) shares	Dec. 31, 2011 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, shares outstanding (shares)		8,632,000	8,509,000	8,169,000	6,256,000
Total unrecognized compensation cost \| $		$ 20,400,000
Weighted-average period		2 years 8 months 9 days
Income tax benefit recognized relating to stock-based compensation expense \| $		$ 0
Income tax benefit realized from exercised stock options \| $		0
Intrinsic value of options exercised \| $		$ 5,500,000	$ 3,200,000	$ 300,000
Number of options outstanding that were vested and expected to vest (shares)		8,400,000
Weighted-average fair value, vested (usd per share) \| $ / shares		$ 4.66
Weighted-average remaining contractual term, vested		5 years 7 months 6 days
Aggregate intrinsic value, exercisable shares \| $		$ 67,400,000
Number of shares exercisable (shares)		5,956,000
Common stock fair value (usd per share) \| $ / shares		$ 14.29
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of units vested \| $		$ 3,200,000	$ 800,000	$ 39,000
Weighted average remaining contractual term		1 year 7 months 6 days
Intrinsic value of restricted stock units outstanding \| $		$ 19,200,000
2006 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity awards granted period vest over		4 years
Equity awards granted contractual term		10 years
Common stock, shares outstanding (shares)		4,500,000
Number of shares available for issuance (shares)		0
2011 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity awards granted period vest over		4 years
Number of shares available for issuance (shares)		208,485
Issue of common stock (shares)		2,643,171
Increase in number of shares of common stock reserved for issuance under the stock incentive plan		4.50%
2011 Plan \| Subsequent event
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Increase in shares authorized for issuance under plan (shares)	1,968,909
2011 Plan \| Before August 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term of ESPP		10 years
2011 Plan \| After August 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity awards granted contractual term		7 years
2011 Employee Stock Purchase Plan (ESPP)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for issuance (shares)		534,674
Issue of common stock (shares)		669,603
Yearly, share increase in reserved shares (shares)		330,396
Number of interim purchase periods \| purchase_period		4
General duration (months) of employee stock purchase plan		24 months
Payroll deductions		15.00%
Fair market value		85.00%
Look-back feature in ESPP		2 years
Recognition period for additional expense triggered by the reset feature		24 months
Purchase of common stock \| $		$ 25,000
2011 Employee Stock Purchase Plan (ESPP) \| Subsequent event
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Yearly, share increase in reserved shares (shares)	330,396

Stock-Based Compensation - Schedule of Weighted Average Assumptions used to Estimate Fair Value of Stock Options (Details) - Stock options - $ / shares	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
The Fair Value of Each Option Granted During the Period [Abstract]
Expected term (in years)	4 years 6 months	4 years 4 months 24 days	5 years 8 months 12 days
Expected volatility	67.70%	68.40%	74.50%
Annual risk-free rate of return	1.40%	1.00%	0.90%
Dividend yield	0.00%	0.00%	0.00%
Weighted-average fair value on grant date (usd per share)	$ 5.64	$ 3.84	$ 4.69

Stock-Based Compensation - Summary of Total Stock Based Compensation Expense Components (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 9,740	$ 6,849	$ 4,766
Cost of revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	816	438	196
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	3,127	2,110	1,728
Sales and marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	2,487	1,812	1,254
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 3,310	$ 2,489	$ 1,588

Stock-Based Compensation - Summary of Stock Based Compensation Expense Associated with Each Award Type (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 9,740	$ 6,849	$ 4,766
Stock options and restricted stock units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	8,845	6,314	4,519
ESPP
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 895	$ 535	$ 247

Stock-Based Compensation - Summary of Stock Option Activity (Details) - $ / shares shares in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Shares
Options outstanding, beginning (shares)	8,509	8,169	6,256
Granted (shares)	1,311	1,506	2,478
Exercised (shares)	(886)	(822)	(59)
Canceled (shares)	(302)	(344)	(506)
Options outstanding, ending (shares)	8,632	8,509	8,169
Weighted- Average Exercise Price per Share
Options outstanding, beginning (usd per share)	$ 3.94	$ 3.28	$ 1.83
Granted (usd per share)	10.36	7.17	7.35
Exercised (usd per share)	4.33	1.69	1.26
Canceled (usd per share)	7.58	7.74	5.55
Options outstanding, ending (usd per share)	$ 4.75	$ 3.94	$ 3.28

Stock-Based Compensation - Summary of Stock Options Outstanding (Details) shares in Thousands	12 Months Ended
	Dec. 31, 2014 $ / shares shares
Exercise Price Range of Options Outstanding and Options Exercisable [Line Items]
Number of Shares Outstanding (shares) \| shares	8,632
Weighted- Average Remaining Life of Outstanding Options	5 years 7 months 6 days
Weighted- Average Exercise Price of Options Outstanding (usd per share)	$ 4.75
Number of Shares Exercisable (shares) \| shares	5,956
Weighted- Average Exercise Price of Options Exercisable (usd per share)	$ 2.96
$0.27 – $0.27
Exercise Price Range of Options Outstanding and Options Exercisable [Line Items]
Range of Exercise Prices - Lower Range Limit (usd per share)	0.27
Range of Exercise Prices - Upper Range Limit (usd per share)	$ 0.27
Number of Shares Outstanding (shares) \| shares	2,304
Weighted- Average Remaining Life of Outstanding Options	4 years 6 months
Weighted- Average Exercise Price of Options Outstanding (usd per share)	$ 0.27
Number of Shares Exercisable (shares) \| shares	2,304
Weighted- Average Exercise Price of Options Exercisable (usd per share)	$ 0.27
$0.64 - $2.54
Exercise Price Range of Options Outstanding and Options Exercisable [Line Items]
Range of Exercise Prices - Lower Range Limit (usd per share)	0.64
Range of Exercise Prices - Upper Range Limit (usd per share)	$ 2.54
Number of Shares Outstanding (shares) \| shares	1,730
Weighted- Average Remaining Life of Outstanding Options	5 years 4 months 24 days
Weighted- Average Exercise Price of Options Outstanding (usd per share)	$ 1.66
Number of Shares Exercisable (shares) \| shares	1,716
Weighted- Average Exercise Price of Options Exercisable (usd per share)	$ 1.66
$3.35 – $7.44
Exercise Price Range of Options Outstanding and Options Exercisable [Line Items]
Range of Exercise Prices - Lower Range Limit (usd per share)	3.35
Range of Exercise Prices - Upper Range Limit (usd per share)	$ 7.44
Number of Shares Outstanding (shares) \| shares	1,820
Weighted- Average Remaining Life of Outstanding Options	6 years 1 month 6 days
Weighted- Average Exercise Price of Options Outstanding (usd per share)	$ 6.15
Number of Shares Exercisable (shares) \| shares	965
Weighted- Average Exercise Price of Options Exercisable (usd per share)	$ 6.04
$7.50 - $9.53
Exercise Price Range of Options Outstanding and Options Exercisable [Line Items]
Range of Exercise Prices - Lower Range Limit (usd per share)	7.50
Range of Exercise Prices - Upper Range Limit (usd per share)	$ 9.53
Number of Shares Outstanding (shares) \| shares	1,839
Weighted- Average Remaining Life of Outstanding Options	6 years 3 months 18 days
Weighted- Average Exercise Price of Options Outstanding (usd per share)	$ 8.21
Number of Shares Exercisable (shares) \| shares	844
Weighted- Average Exercise Price of Options Exercisable (usd per share)	$ 8.35
$9.54 - $16.01
Exercise Price Range of Options Outstanding and Options Exercisable [Line Items]
Range of Exercise Prices - Lower Range Limit (usd per share)	9.54
Range of Exercise Prices - Upper Range Limit (usd per share)	$ 16.01
Number of Shares Outstanding (shares) \| shares	939
Weighted- Average Remaining Life of Outstanding Options	6 years 8 months 12 days
Weighted- Average Exercise Price of Options Outstanding (usd per share)	$ 11.91
Number of Shares Exercisable (shares) \| shares	127
Weighted- Average Exercise Price of Options Exercisable (usd per share)	$ 10.77

Stock-Based Compensation - Summary of Restricted Stock Unit Activity (Details) - Restricted stock units - $ / shares shares in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Restricted Stock Units
Outstanding units, beginning (shares)	418	248	0
Granted (shares)	1,250	285	282
Vested (shares)	(281)	(107)	(20)
Canceled (shares)	(42)	(8)	(14)
Outstanding units, ending (shares)	1,345	418	248
Weighted Average Fair Value per Share at Grant Date
Outstanding units, beginning (usd per share)	$ 6.31	$ 5.53	$ 0.00
Granted (usd per share)	8.68	6.92	5.69
Vested (usd per share)	7.38	6.08	2.00
Canceled (usd per share)	7.56	7.07	6.90
Outstanding units, ending (usd per share)	$ 8.25	$ 6.31	$ 5.53

Stock-Based Compensation - Summary of ESPP Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Proceeds from common stock issued under ESPP	$ 1,531	$ 1,047	$ 185
Shares of common stock issued (shares)	410	327	59
Weighted-average price per share (usd per share)	$ 3.73	$ 3.20	$ 3.14

Income Taxes - Schedule of Domestic and Foreign Components of Loss before Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income Tax Disclosure [Abstract]
United States	$ (8,732)	$ (26,118)	$ (38,539)
Foreign	1,446	1,068	972
Loss before income taxes	$ (7,286)	$ (25,050)	$ (37,567)

Income Taxes - Schedule of Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Current:
Federal	$ 0	$ 0	$ 0
State	85	0	0
Foreign	716	865	651
Total	801	865	651
Deferred:
Federal	0	0	0
State	0	0	0
Foreign	(35)	(2)	0
Provision for income taxes	$ 766	$ 863	$ 651

Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Income tax benefit at statutory federal rate	$ (2,477)	$ (8,517)	$ (12,773)
State taxes, net of federal benefit	(4,576)	(883)	(1,478)
Change in valuation allowance	16,646	8,353	12,574
Foreign tax rate and tax law differential	(43)	237	147
Tax credits	(5,619)	0	0
Stock-based compensation	957	1,191	1,128
Other permanent items	231	220	860
Other nondeductible/nontaxable items	(4,586)	(2)	20
Uncertain tax positions	233	264	173
Provision for income taxes	$ 766	$ 863	$ 651

Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013
Deferred Tax Assets
Allowances and reserves	$ 18,771	$ 14,521
Net operating loss and tax credit carryforwards	28,511	16,840
Stock-based compensation	2,154	1,531
Deferred revenue	3,843	2,730
Fixed assets and intangibles	9,163	11,670
Other	2,023	476
Total gross deferred tax assets	64,465	47,768
Less valuation allowance	(64,428)	(47,766)
Deferred tax assets, net of valuation allowance	37	2
Deferred tax liabilities	0	0
Net deferred tax assets, net of valuation allowance	$ 37	$ 2

Income Taxes - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Income Taxes [Line Items]
Foreign	$ 716	$ 865	$ 651
Federal statutory income tax rate	34.00%	34.00%	34.00%
Undistributed earnings of foreign subsidiaries	$ 2,600
Increase in equity if and when deferred tax assets are ultimately realized	1,300
Unrecognized tax benefits	4,426	$ 376	$ 160	$ 0
Increases in balances related to tax positions taken in current year	2,155	137	160
Unrecognized tax benefits, increases in tax positions for prior year	1,895	$ 79	$ 0
Change to unrecognized tax benefits	4,000
Internal Revenue Service (IRS)
Income Taxes [Line Items]
Operating loss carryforwards	52,900
California
Income Taxes [Line Items]
Operating loss carryforwards	44,600
Federal \| Research Tax Credit Carryforward
Income Taxes [Line Items]
Research tax credit carryforwards	7,500
State \| Research Tax Credit Carryforward
Income Taxes [Line Items]
Research tax credit carryforwards	$ 7,200

Income Taxes - Schedule of Reconciliation of Total Amounts of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefits—at beginning of year	$ 376	$ 160	$ 0
Increases in balances related to tax positions taken in prior years	1,895	79	0
Increases in balances related to tax positions taken in current year	2,155	137	160
Unrecognized tax benefits—at end of year	$ 4,426	$ 376	$ 160

Concentration of Credit Risk and Major Customers - Narrative (Details) - customer	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Accounts Receivable \| Credit Concentration Risk
Revenue, Major Customer [Line Items]
Number of customers considered to give rise to concentration risk	2	2
Net Revenue \| Credit Concentration Risk
Revenue, Major Customer [Line Items]
Number of customers considered to give rise to concentration risk	2
Net Revenue \| Customer Concentration Risk
Revenue, Major Customer [Line Items]
Number of customers considered to give rise to concentration risk		3	2
Customer Providing Largest Concentration of Receivable \| Accounts Receivable \| Credit Concentration Risk
Revenue, Major Customer [Line Items]
Percentage of concentration risk	15.00%	16.00%
Customer Providing Second Largest Concentration of Receivable \| Accounts Receivable \| Credit Concentration Risk
Revenue, Major Customer [Line Items]
Percentage of concentration risk	11.00%	10.00%
Customer Accounting for the Largest Concentration of Revenue \| Net Revenue \| Customer Concentration Risk
Revenue, Major Customer [Line Items]
Percentage of concentration risk	24.00%	15.00%	16.00%
Customer Accounting for Second Largest Concentration of Revenue \| Net Revenue \| Customer Concentration Risk
Revenue, Major Customer [Line Items]
Percentage of concentration risk	16.00%	14.00%	11.00%
Customer Accounting for Third Largest Concentraion \| Net Revenue \| Customer Concentration Risk
Revenue, Major Customer [Line Items]
Percentage of concentration risk		11.00%

Net Loss Per Share Attributable to Common Stockholders - Schedule of Potential Common Shares Outstanding Excluded from the Computation of Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - shares shares in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (shares)	9,955	8,885	8,753
Stock options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (shares)	8,502	8,196	8,174
Unvested restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (shares)	1,258	381	248
Warrants to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (shares)	195	308	331

Segment and Geographic Information - Summary of Net Revenues by Geographic Region (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 343,904	$ 232,846	$ 216,678
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	294,549	192,881	189,711
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 49,355	$ 39,965	$ 26,967

Segment and Geographic Information - Summary of Long-Lived Assets by Geographic Region (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	$ 30,824	$ 24,853	$ 25,541
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	20,037	16,262	17,136
China
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	9,585	7,130	6,642
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	$ 1,202	$ 1,461	$ 1,763

Related Party Transactions - Narrative (Details) - KPCB Holdings, Inc. - USD ($)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Related Party Transaction [Line Items]
Percentage of Company owned by related party	9.00%
Revenue from related parties	$ 0	$ 2,700,000	$ 16,800,000