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Taxation (Tables) | 12 Months Ended
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Dec. 31, 2014
Income Tax Disclosure [Abstract] |
Schedule of Current and Deferred Portions of Income Tax Expense | The current and deferred portions of income tax expense included in the consolidated statements of operations are as follows:
|  | Years ended December 31, |
(In thousands) |  | 2012 |  |  | 2013 |  |  | 2014 |
Current income tax expenses |  |  | 2,362 |  |  |  | 175 |  |  |  | 397 |
Deferred income tax benefits |  |  | (123 | ) |  |  | (822 | ) |  |  | (1,856 | )
Taxation for the year |  |  | 2,239 |  |  |  | (647 | ) |  |  | (1,459 | )
Summary of Aggregate Amount and Per Share Effect of Tax Holiday | The aggregate amount and per share effect of the tax holiday are as follows:
|  | Years ended December 31, |
|  | 2012 |  |  | 2013 |  |  | 2014 |
Aggregate dollar effect (in thousands) |  |  | 2,073 |  |  |  | 4,638 |  |  |  | 2,784 |
Per share effect—basic |  |  | 0.03 |  |  |  | 0.08 |  |  |  | 0.01 |
Per share effect—diluted |  |  | 0.03 |  |  |  | 0.06 |  |  |  | 0.01 |
Reconciliation of Total Tax (Benefit) Expense | The reconciliation of total tax (benefit) / expense computed by applying the respective statutory income tax rates to pre-tax (loss) / income is as follows:
|  | Years ended December 31, |
(In thousands) |  | 2012 |  |  | 2013 |  |  | 2014 |
Income tax (benefit) / expense at PRC statutory rate (based on statutory tax rate applicable to enterprises in Shenzhen, China) |  |  | 655 |  |  |  | 2,433 |  |  |  | 2,129 |
Effects of differences in tax rates in different jurisdictions applicable to entities of the Group outside of the PRC |  |  | 2,074 |  |  |  | 667 |  |  |  | (838 | )
Non-deductible expenses |  |  | 53 |  |  |  | 102 |  |  |  | 714 |
Effect of Super Deduction available to Shenzhen Xunlei |  |  | (2,274 | ) |  |  | (1,763 | ) |  |  | (1,365 | )
Effect of tax holiday |  |  | (2,073 | ) |  |  | (4,638 | ) |  |  | (2,784 | )
Change in valuation allowance of deferred tax assets |  |  | 6 |  |  |  | — |  |  |  | 291 |
Effect on deferred tax assets due to change in tax rates |  |  | (437 | ) |  |  | 1,764 |  |  |  | (103 | )
Outside basis difference arising from VIE and its subsidiaries in the PRC |  |  | 4,217 |  |  |  | 713 |  |  |  | 478 |
Expiration of tax loss |  |  | — |  |  |  | 31 |  |  |  | 51 |
Others |  |  | 18 |  |  |  | 44 |  |  |  | (32 | )
Income tax expense / (benefit) |  |  | 2,239 |  |  |  | (647 | ) |  |  | (1,459 | )
Summary of Changes in Deferred Tax Asset and Liability Balances | The tax effects of temporary differences that give rise to the deferred tax asset and liability balances at December 31, 2013 and 2014 are as follows:
(In thousands) |  | December 31, 2013 |  |  | December 31, 2014 |
Deferred tax assets, current portion: |  |  |  |  |  |  |  |
Net operating loss carried forward (Note a) |  |  | 50 |  |  |  | 315 |
Amortization of intangible assets arising from intragroup transactions (Note b) |  |  | 69 |  |  |  | 69 |
Amortization of content copyrights (Note c) |  |  | 1,033 |  |  |  | 1,675 |
Impairment of online game licenses |  |  | 33 |  |  |  | 32 |
Deferred tax assets, current portion, net |  |  | 1,185 |  |  |  | 2,091 |
Deferred tax assets, non-current portion: |  |  |  |  |  |  |  |
Net operating loss carried forward (Note a) |  |  | 3,676 |  |  |  | 6,103 |
Allowance for doubtful accounts |  |  | 1,311 |  |  |  | 796 |
Amortization of intangible assets arising from intragroup transactions (Note b) |  |  | 175 |  |  |  | 105 |
Impairment of online game licenses |  |  | 49 |  |  |  | 16 |
Amortization of Content Copyrights (Note c) |  |  | 4,219 |  |  |  | 4,133 |
Valuation allowance |  |  | — |  |  |  | (291 | )
Deferred tax assets, non-current portion, net |  |  | 9,430 |  |  |  | 10,862 |
Deferred tax liability, non-current portion: |  |  |  |  |  |  |  |
Outside basis difference (Note d) |  |  | (8,074 | ) |  |  | (8,552 | )
Note a: | As of December 31, 2014, the Group had tax loss carryforwards of USD 24,509 thousand, which can be carried forward to offset future taxable income. The net operating tax loss carryforwards will begin to expire as follows:
(In thousands) |  |  |
2015 |  |  | 1,259 |
2016 |  |  | 1,784 |
2017 |  |  | 1,971 |
2018 |  |  | 9,638 |
2019 and thereafter |  |  | 9,857 |
|  |  | 24,509 |
Note b: | Before 2008, Giganology Shenzhen sold several self-developed software at a market valuation of approximately RMB42 million to Shenzhen Xunlei. Shenzhen Xunlei was entitled to capitalize the amounts as intangible assets for tax purposes and the respective amortization charges could be entitled to claim tax deduction. As a result, this transaction had created a temporary difference between the accounting base (on a group basis) and the tax base (on Shenzhen Xunlei standalone basis) and led to origination of a deferred tax asset.
Note c: | As mentioned in Note 2(m), the Group adopts certain accelerated amortization methods for amortization of certain Content Copyrights for accounting purposes, while straight- line method is adopted for PRC tax reporting. Accordingly, the differences have led to origination of temporary differences.
Note d: | The deferred tax liabilities arising from the aggregate retained earnings and reserves of the VIE and its subsidiaries that are expected to be recovered by Giganology Shenzhen and other affiliates of the Group in the future periods, amounted to USD 32,296 thousand and USD 34,210 thousand as of December 31, 2013 and 2014, respectively.
Summary of Net Operating Tax Loss Carryforwards |
| The net operating tax loss carryforwards will begin to expire as follows:
(In thousands) |  |  |
2015 |  |  | 1,259 |
2016 |  |  | 1,784 |
2017 |  |  | 1,971 |
2018 |  |  | 9,638 |
2019 and thereafter |  |  | 9,857 |
|  |  | 24,509 |
Schedule of Movement of Valuation Allowance | Movement of valuation allowance is as follows:
|  | Years ended December 31, |
(In thousands) |  | 2012 |  |  | 2013 |  |  | 2014 |
Beginning balance |  |  | (37 | ) |  |  | (43 | ) |  |  | — |
Additions |  |  | (6 | ) |  |  | — |  |  |  | (291 | )
Write-off |  |  | — |  |  |  | 43 |  |  |  | — |
Ending balance |  |  | (43 | ) |  |  | — |  |  |  | (291 | )

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