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Share-Based Awards | 3 Months Ended
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Mar. 31, 2023
Share-Based Payment Arrangement [Abstract] |
Share-Based Awards | Share-Based Awards In addition to the option awards and restricted stock units typically granted under the Zillow Group, Inc. 2020 Incentive Plan (the “2020 Plan”) which vest quarterly over four years, during the three months ended March 31, 2023, the Compensation Committee of the Board approved option and restricted stock unit awards granted under the 2020 Plan in connection with the 2022 annual review cycle that vest quarterly over three years. The exercisability terms of these equity awards are otherwise consistent with the terms of the option awards and restricted stock units typically granted under the 2020 Plan. For additional information regarding our share-based awards, see Note 16 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Option Awards The following table summarizes all option award activity for the three months ended March 31, 2023:
| Number of Shares Subject to Existing Options (in thousands) |  | Weighted- Average Exercise Price Per Share |  | Weighted- Average Remaining Contractual Life (Years) |  | Aggregate Intrinsic Value (in millions)
Outstanding at January 1, 2023 | 28,598 |  |  | $ | 44.90 |  |  | 7.08 |  | $ | 15 |
Granted | 5,837 |  |  | 41.88 |  |  |  |  |
Exercised | (373) |  |  | 36.71 |  |  |  |  |
Forfeited or cancelled | (360) |  |  | 48.03 |  |  |  |  |
Outstanding at March 31, 2023 | 33,702 |  |  | 44.43 |  |  | 7.38 |  | 145 |
Vested and exercisable at March 31, 2023 | 17,813 |  |  | 44.90 |  |  | 5.91 |  | 87 |
The following assumptions were used to determine the fair value of all option awards granted for the periods presented:
| Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |
Expected volatility | 55% - 61% |  | 55% - 60% |  |  |  |
Risk-free interest rate | 3.80% - 4.04% |  | 1.94% - 2.54% |  |  |  |
Weighted-average expected life | 5.25 - 6.50 years |  | 4.50 - 6.00 years |  |  |  |
Weighted-average fair value of options granted | $23.60 |  | $25.08 |  |  |  |
As of March 31, 2023, there was a total of $485 million in unrecognized compensation cost related to unvested option awards. Restricted Stock Units The following table summarizes activity for all restricted stock units for the three months ended March 31, 2023:
| Restricted Stock Units (in thousands) |  | Weighted-Average Grant Date Fair Value
Unvested outstanding at January 1, 2023 | 10,930 |  |  | $ | 46.85 |
Granted | 6,649 |  |  | 42.11 |
Vested | (1,365) |  |  | 48.84 |
Forfeited | (287) |  |  | 47.78 |
Unvested outstanding at March 31, 2023 | 15,927 |  |  | 44.68 |
As of March 31, 2023, there was a total of $667 million in unrecognized compensation cost related to unvested restricted stock units. Share-Based Compensation Expense The following table presents the effects of share-based compensation expense in our condensed consolidated statements of operations during the periods presented (in millions):
| Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |
Cost of revenue | $ | 4 |  |  | $ | 3 |  |  |  |  |
Sales and marketing | 16 |  |  | 11 |  |  |  |  |
Technology and development | 39 |  |  | 28 |  |  |  |  |
General and administrative | 44 |  |  | 35 |  |  |  |  |
Share-based compensation - continuing operations | 103 |  |  | 77 |  |  |  |  |
Share-based compensation - discontinued operations | — |  |  | 14 |  |  |  |  |
Total share-based compensation | $ | 103 |  |  | $ | 91 |  |  |  |  |

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