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Employee Stock Benefit Plans | 12 Months Ended
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Jan. 03, 2025
Share-Based Payment Arrangement [Abstract] |
Employee Stock Benefit Plans | NOTE 14: EMPLOYEE STOCK BENEFIT PLANS Amended and Restated 2002 Stock Plan In September 2024, our stockholders approved an amendment to the 2002 Stock Plan to increase the number of shares of common stock available for issuance by 10.0 million shares. As such, our Amended and Restated 2002 Stock Plan provides for the grant of incentive and non-statutory stock options and Restricted Stock Units (“RSUs”) for up to 102.6 million shares. At the end of 2024, the remaining number of shares available for grant under the Amended and Restated 2002 Stock Plan was 17.9 million. Stock-Based Compensation Expense The following table summarizes the components of stock-based compensation expense recognized in our Consolidated Statements of Income for the periods indicated:
| 2024 |  | 2023 |  | 2022
(In millions) |  |  |  |  |
Restricted stock units | $ | 145.2 |  |  | $ | 132.8 |  |  | $ | 108.7 |
Stock options | 3.4 |  |  | 1.8 |  |  | 1.1 |
ESPP | 10.0 |  |  | 10.8 |  |  | 10.6 |
Total stock-based compensation expense | $ | 158.6 |  |  | $ | 145.4 |  |  | $ | 120.4 |
Stock-based compensation expense was allocated as follows:
| 2024 |  | 2023 |  | 2022
(In millions) |  |  |  |  |
Cost of sales | $ | 17.0 |  |  | $ | 14.6 |  |  | $ | 12.6 |
Research and development | 45.0 |  |  | 40.7 |  |  | 28.0 |
Sales and marketing | 29.3 |  |  | 27.1 |  |  | 24.6 |
General and administrative | 67.3 |  |  | 63.0 |  |  | 55.2 |
Total stock-based compensation expense | $ | 158.6 |  |  | $ | 145.4 |  |  | $ | 120.4 |
At the end of 2024, total unamortized stock-based compensation expense was $200.2 million, with a weighted-average recognition period of 1.7 years. Restricted Stock Units We grant RSUs containing only service conditions and RSUs containing a combination of service, performance, and market conditions (“PSUs”). RSUs containing only service conditions typically vest ratably over a three-year service period. PSUs are granted to executive officers and other senior employees and vest after a three-year service period. The fair value at the grant date is determined by (a) the closing pr ice of our common stock for awards containing only service or both service and performance conditions, or (b) the Monte Carlo valuation model for awards containing both service and market conditions. For PSUs, the number of shares received at vesting will range from 0% to 220% of the target grant amount based on either market conditions or performance conditions or, in some cases, both. Market conditions consider our relative total stockholder return (“TSR”) of our common stock as compared to the TSR of the constituents of the S&P 500 over the vesting period. Performance conditions consider the achievement of our financial results or metrics over the vesting period.
| 2024 Restricted Stock Units Unvested
| Number of Units (1) |  | Weighted Average Grant-Date Fair Value per Share
(In millions, except for per share data) |  |  |
Unvested at the beginning of year | 5.5 |  |  | $ | 58.23 |
Granted (2) | 2.5 |  |  | 65.12 |
Shares vested, net (2) | (2.0) |  |  | 60.13 |
Cancelled and forfeited | (0.6) |  |  | 61.11 |
Unvested at the end of year | 5.4 |  |  | $ | 60.37 |
(1) Includes 0.3 million PSUs granted, 0.1 million PSUs vested, 0.3 million PSUs cancelled and forfeited, and 1.1 million PSUs unvested at the end of the year. (2) Excludes approximately 0.1 million PSUs related to achievement above target levels at the vesting date and approximately 0.1 million PSUs related to shares cancelled due to achievement below target levels. The weighted-average grant date fair value of all RSUs granted during 2024, 2023, and 2022 was $65.12, $49.93, and $73.32 per share. The fair value of all RSUs vested during 2024, 2023, and 2022 was $126.5 million, $110.1 million, and $108.3 million. Employee Stock Purchase Plan We have an employee stock purchase plan (“ESPP”) under which our stockholders have approved an aggregate of 39.0 million shares of common stock for issuance to eligible employees. The fair value at the grant date is based on the Black-Scholes valuation model. The plan permits eligible employees to purchase common stock through payroll deductions at 85% of the lower of the fair market value of the common stock at the beginning or at the end of each offering period, which is six months. Rights to purchase shares are granted during the first and third quarter of each year. The ESPP terminates on March 15, 2027. In 2024, 2023, and 2022, 0.7 million, 0.8 million, and 0.6 million shares were issued, representing $34.5 million, $35.7 million, and $34.7 million in cash received for the issuance of stock under the ESPP. At the end of 2024, the number of shares reserved for future purchases was 3.9 million.

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