Stockholders' Equity

9 Months Ended

Jul. 31, 2022

Stockholders’ Equity

Mandatory Convertible Preferred Stock

On September 30, 2019, we completed an offering of approximately 4 million shares of 8.00% Mandatory Convertible Preferred Stock, Series A, $0.001 par value per share (“Mandatory Convertible Preferred Stock”).

On September 30, 2022, unless earlier converted, each outstanding share of Mandatory Convertible Preferred Stock will automatically convert into shares of our common stock at a rate between the then minimum and maximum conversion rates. At any time prior to September 30, 2022, holders may elect to convert each share of Mandatory Convertible Preferred Stock into shares of our common stock at the then minimum conversion rate. The conversion rates are subject to anti-dilution adjustments. As of July 31, 2022, the minimum conversion rate was 3.1058 and the maximum conversion rate was 3.6301.

As of each July 31, 2022 and October 31, 2021, we recognized $27 million of accrued preferred stock dividends, which were presented as temporary equity on our condensed consolidated balance sheets.

Cash Dividends Declared and Paid


	Fiscal Quarter Ended				Three Fiscal Quarters Ended
	July 31, 2022		August 1, 2021		July 31, 2022		August 1, 2021

	(In millions, except per share data)
Dividends per share to common stockholders	$	4.10	$	3.60	$	12.30	$	10.80
Dividends to common stockholders	$	1,661	$	1,482	$	5,026	$	4,427
Dividends per share to preferred stockholders	$	20.00	$	20.00	$	60.00	$	60.00
Dividends to preferred stockholders	$	75	$	74	$	224	$	224

Stock Repurchase Program

In December 2021, our Board of Directors authorized a stock repurchase program to repurchase up to $10 billion of our common stock from time to time on or prior to December 31, 2022. During the fiscal quarter and three fiscal quarters ended July 31, 2022, we repurchased and retired approximately 3 million and 12 million shares of our common stock for $1.5 billion and $7 billion, respectively, under this stock repurchase program.

In May 2022, our Board of Directors authorized another stock repurchase program to repurchase up to an additional $10 billion of our common stock from time to time through December 31, 2023.

Repurchases under our stock repurchase programs may be effected through a variety of methods, including open market or privately negotiated purchases. The timing and amount of shares repurchased will depend on the stock price, business and market conditions, corporate and regulatory requirements, alternative investment opportunities, acquisition opportunities, and other factors. We are not obligated to repurchase any specific amount of shares of common stock, and the stock repurchase programs may be suspended or terminated at any time.

Stock-Based Compensation Expense


	Fiscal Quarter Ended				Three Fiscal Quarters Ended
	July 31, 2022		August 1, 2021		July 31, 2022		August 1, 2021

	(In millions)
Cost of products sold	$	15	$	18	$	49	$	59
Cost of subscriptions and services	22		18		60		47
Research and development	259		285		788		920
Selling, general and administrative	77		100		249		264
Total stock-based compensation expense	$	373	$	421	$	1,146	$	1,290

As of July 31, 2022, the total unrecognized compensation cost related to unvested stock-based awards was $2,993 million, which is expected to be recognized over the remaining weighted-average service period of 2.9 years.

Equity Incentive Award Plans

A summary of time- and market-based RSU activity is as follows:


	Number of RSUs Outstanding	Weighted-Average Grant Date Fair Value Per Share

	(In millions, except per share data)
Balance as of October 31, 2021	23	$	200.38

Granted	3	$	532.68
Vested	(6)	$	223.21
Forfeited	(1)	$	240.56
Balance as of July 31, 2022	19	$	236.05

The aggregate fair value of time- and market-based RSUs that vested during the three fiscal quarters ended July 31, 2022 was $3,357 million, which represented the market value of our common stock on the date that the RSUs vested. The number of RSUs vested included shares of common stock that we withheld for settlement of employees’ tax obligations due upon the vesting of RSUs.