XML 27 R16.htm IDEA: XBRL DOCUMENT v3.4.0.3
Stock-Based Compensation
 6 Months Ended
Mar. 26, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
Stock-Based Compensation
The following presents stock-based compensation expense in the Company’s Consolidated Statements of Income:
 
Three Months Ended
 
Six Months Ended
 
March 26,
2016
 
March 28,
2015
 
March 26,
2016
 
March 28,
2015
Cost of revenues
$
2.5

 
$
2.3

 
$
4.7

 
$
4.3

Research and development
2.6

 
2.2

 
5.0

 
4.1

Selling and marketing
2.7

 
2.3

 
5.2

 
4.3

General and administrative
6.9

 
6.9

 
15.7

 
13.0

Restructuring and divestiture
—

 
—

 
—

 
0.1

 
$
14.7

 
$
13.7

 
$
30.6

 
$
25.8


The Company granted 1.0 million and 1.2 million stock options during the six months ended March 26, 2016 and March 28, 2015, respectively, with weighted-average exercise prices of $39.47 and $26.42, respectively. There were 6.7 million options outstanding at March 26, 2016 with a weighted-average exercise price of $24.80.
The Company uses a binomial model to determine the fair value of its stock options. The weighted-average assumptions utilized to value these stock options are indicated in the following table:
 
 
Three Months Ended
 
Six Months Ended
 
March 26,
2016
 
March 28,
2015
 
March 26,
2016
 
March 28,
2015
Risk-free interest rate
1.6
%
 
1.7
%
 
1.6
%
 
1.7
%
Expected volatility
37.8
%
 
38.6
%
 
37.8
%
 
38.6
%
Expected life (in years)
4.7

 
5.3

 
4.7

 
5.3

Dividend yield
—

 
—

 
—

 
—

Weighted average fair value of options granted
$
11.80

 
$
10.36

 
$
12.98

 
$
9.55


The Company granted 1.0 million and 1.4 million restricted stock units (RSUs) during the six months ended March 26, 2016 and March 28, 2015, respectively, with weighted-average grant date fair values of $39.63 and $26.35 per unit, respectively. As of March 26, 2016, there were 3.3 million unvested RSUs outstanding with a weighted-average grant date fair value of $29.58 per unit. In addition, the Company granted 0.2 million and 0.3 million performance stock units (PSUs) during the six months ended March 26, 2016 and March 28, 2015, respectively, to members of its senior management team, which have a weighted-average grant date fair value of $39.72 and $26.58 per unit, respectively. Each recipient of PSUs is eligible to receive between zero and 200% of the target number of shares of the Company’s common stock at the end of three years provided the Company’s defined Return on Invested Capital metrics are achieved. The Company is recognizing compensation expense ratably over the required service period based on its estimate of the number of shares that will vest. If there is a change in the estimate of the number of shares that are probable of vesting, the Company will cumulatively adjust compensation expense in the period that the change in estimate is made.
At March 26, 2016, there was $27.3 million and $97.7 million of unrecognized compensation expense related to stock options and stock units (comprised of RSUs and PSUs), respectively, to be recognized over a weighted-average period of 3.3 years and 2.4 years, respectively.