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Share-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Share based compensation

The effect of share-based compensation expense on our consolidated statements of income and comprehensive income by line-item follows:

			Year Ended December 31,
(in millions)			2021						2020						2019
Selling, general and administrative expense			$	85.8					$	66.3					$	49.5
Research and development expense			48.4						33.7						25.8
Total share-based compensation expense			$	134.2					$	100.0					$	75.3

Share-based compensation expense by award-type follows:

			Year Ended December 31,
(in millions)			2021						2020						2019
Stock options			$	60.5					$	47.5					$	36.5
RSUs			62.5						44.2						30.5
PRSUs			7.6						5.3						5.6
ESPP			3.6						3.0						2.7
Total share-based compensation expense			$	134.2					$	100.0					$	75.3

As of December 31, 2021, unrecognized share-based compensation expense by award-type and the weighted-average period over which such expense is expected to be recognized, as applicable, were as follows:

(dollars in millions)			Unrecognized Expense						Weighted-Average Recognition Period
Stock options			$	101.7					2.5 years
RSUs			$	150.5					2.2 years

Weighted-average assumptions for stock option grants using black-scholes option-pricing model

The fair value of each stock option granted was estimated on the date of grant using the Black-Scholes option-pricing valuation model with the following weighted-average assumptions:

			Year Ended December 31,
			2021						2020						2019
Risk-free interest rate			0.6		%				1.4		%				2.4		%
Expected volatility of common stock			45.9		%				48.5		%				54.8		%
Dividend yield			0.0		%				0.0		%				0.0		%
Expected option term			5.2 years						5.3 years						5.4 years

Summary and changes in stock options outstanding

A summary of activity related to stock options follows:

(in millions, except weighted average data)			Number of Stock Options						Weighted Average Exercise Price						Weighted-Average Remaining Contractual Term						Aggregate Intrinsic Value
Outstanding at December 31, 2020			6.8						$	62.98
Granted			1.8						$	110.74
Exercised			(0.7)						$	28.02
Canceled			(0.2)						$	103.30
Outstanding at December 31, 2021			7.7						$	76.38					6.5 years						$	136.4
Exercisable at December 31, 2021			5.2						$	63.53					5.5 years						$	134.7

Summary and changes in restricted stock units outstanding

A summary of activity related to RSUs follows:

(in millions, except weighted average data)			Number of RSUs						Weighted-Average Grant Date Fair Value						Weighted-Average Remaining Contractual Term						Aggregate Intrinsic Value
Unvested at December 31, 2020			1.5						$	89.60
Granted (1)			1.2						$	104.95
Released			(0.6)						$	82.22
Canceled			(0.1)						$	101.71
Unvested at December 31, 2021			2.0						$	99.96					1.3 years						$	174.1

_________________________

(1) In August 2021, our board of directors approved an equity grant of approximately 0.5 million RSUs, which will vest over a 2-year period, to our full-time employees other than our executive officers.

A summary of activity related to PRSUs follows:

(in millions, except weighted average data)			Number of PRSUs						Weighted-Average Grant Date Fair Value						Weighted-Average Remaining Contractual Term						Aggregate Intrinsic Value
Unvested at December 31, 2020			0.2						$	102.90
Granted			0.2						$	114.68
Unvested at December 31, 2021			0.4						$	109.31					1.2 years						$	30.9

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Tabular disclosure of allocation of amount expensed and capitalized for award under share-based payment arrangement to statement of income or comprehensive income and statement of financial position. Includes, but is not limited to, corresponding line item in financial statement.

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Tabular disclosure of the number and weighted-average grant date fair value for restricted stock units that were outstanding at the beginning and end of the year, and the number of restricted stock units that were granted, vested, or forfeited during the year.

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Tabular disclosure for stock option plans. Includes, but is not limited to, outstanding awards at beginning and end of year, grants, exercises, forfeitures, and weighted-average grant date fair value.

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