Stock-Based Compensation

9 Months Ended

Sep. 30, 2017

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

13. Stock-Based Compensation

Employee Stock Options Valuation

The fair value of employee and director stock options was estimated at the date of grant using a Black-Scholes option valuation model with the weighted average assumptions below.

	Three Months Ended September 30						Nine Months Ended September 30
	2017			2016			2017			2016
Expected term (in years)		6.1			6.1			6.1			6.1
Expected volatility		46.9	%		60.0	%		52.1	%		60.0	%
Risk-free interest rate		1.94	%		1.28	%		2.07	%		1.45	%
Dividend yield		0.0	%		0.0	%		0.0	%		0.0	%

Stock-Based Compensation

The following table summarizes the total stock-based compensation expense included in the statements of operations and comprehensive loss for all periods presented (in thousands):

	Three Months Ended September 30				Nine Months Ended September 30
	2017		2016		2017		2016
Cost of revenue	$	36	$	3	$	112	$	8
Research and development		446		34		1,198		103
Selling, general and administrative		2,249		364		5,714		1,140
Total stock-based compensation expense	$	2,731	$	401	$	7,024	$	1,251

As September 30, 2017, there was total unamortized compensation costs of $10.1 million, net of estimated forfeitures, related to unvested stock options which the Company expects to recognize over a period of approximately 2.5 years, $12.4 million, net of estimated forfeitures, related to unrecognized restricted stock unit (“RSU”) expense, which the Company expects to recognize over a period of 2.7 years, and $0.4 million unrecognized ESPP expense, which the Company will recognize over 0.7 years.

Non-Employee Stock-Based Compensation

Stock-based compensation expense related to stock options granted to non-employees is recognized as the stock options are earned. The measurement of stock-based compensation for non-employees is subject to periodic adjustment as the underlying equity instruments vest, and the related compensation expense is based on the estimated fair value of the equity instruments using the Black-Scholes option pricing model. The Company believes that the estimated fair value of the stock options is more readily measurable than the fair value of the services received. Such expense was not material for the three and nine months ended September 30, 2017 and 2016.