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Stock-Based Compensation | 12 Months Ended
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Oct. 01, 2022
Share-based Payment Arrangement [Abstract] |
Stock-Based Compensation | 9. Stock-Based Compensation 2018 Equity Incentive Plan In July 2018, the Board of Directors (the "Board") adopted the 2018 Equity Incentive Plan (the “2018 Plan”). The 2018 Plan became effective in connection with the Company's initial public offering ("IPO"). The number of shares reserved for issuance under the 2018 Plan increases automatically on January 1 of each year beginning in 2019 and continuing through 2028 by a number of shares of common stock equal to the lesser of (x) 5% of the total outstanding shares of the Company’s common stock and common stock equivalents as of the immediately preceding December 31 (rounded to the nearest whole share) and (y) a number of shares determined by the Company's the Board. As of October 1, 2022, there were 38,593,443 shares reserved for future issuance under the 2018 Plan. Stock Options Pursuant to the 2018 Plan, the Company issues stock options to employees and directors. The option price, number of shares and grant date are determined at the discretion of the Board. For so long as the option holder performs services for the Company, the options generally vest over 48 months, on a monthly or quarterly basis, with certain options subject to an initial annual cliff vest, and are exercisable for a period not to exceed ten years from the date of grant. The summary of the Company’s stock option activity is as follows:
|  | Number of Options |  |  | Weighted-Average Exercise Price |  |  | Weighted-Average Remaining Contractual Term |  |  | Aggregate Intrinsic Value |
|  |  |  |  |  |  |  | (In years) |  |  | (In thousands) |
Outstanding at October 2, 2021 |  |  | 14,545,239 |  |  | $ | 12.86 |  |  |  | 5.1 |  |  | $ | 282,141 |
Exercised |  |  | (3,570,150 | ) |  | $ | 11.32 |  |  |  |  |  |  |
Expired |  |  | (340 | ) |  | $ | 2.50 |  |  |  |  |  |  |
Forfeited |  |  | (171,867 | ) |  | $ | 12.69 |  |  |  |  |  |  |
Outstanding at October 1, 2022 |  |  | 10,802,882 |  |  | $ | 13.37 |  |  |  | 4.5 |  |  | $ | 10,956 |
At October 1, 2022 |  |  |  |  |  |  |  |  |  |  |  |
Options exercisable |  |  | 10,340,382 |  |  | $ | 13.29 |  |  |  | 4.4 |  |  | $ | 10,886 |
Options vested and expected to vest |  |  | 10,794,122 |  |  | $ | 13.37 |  |  |  | 4.5 |  |  | $ | 10,953 |
The Company granted no options in fiscal 2022, 2021 and 2020. Options vested in fiscal 2022, 2021 and 2020, respectively, have a fair value of $6.6 million, $10.8 million, and $27.4 million. The total intrinsic value of stock options exercised was $58.0 million, $242.7 million and $40.1 million for fiscal 2022, 2021 and 2020, respectively. As of October 1, 2022, and October 2, 2021, the Company had $0.4 million and $6.2 million, respectively, of unrecognized stock-based compensation cost, which is expected to be recognized over a weighted-average period of 0.2 years and 0.9 years, respectively. The Company’s policy for issuing stock upon stock option exercise is to issue new common stock. Restricted Stock Units Pursuant to the 2018 Plan, the Company issues RSUs to employees and directors. RSUs vest quarterly over the service period, which is generally four years with certain awards subject to an initial annual cliff vest. The summary of the Company’s RSU activity is as follows:
|  | Number of Units |  |  | Weighted-Average Grant Date Fair Value |  |  | Aggregate Intrinsic Value |
|  |  |  |  |  |  |  | (In thousands) |
Outstanding at October 2, 2021 |  |  | 9,283,525 |  |  | $ | 12.64 |  |  | $ | 299,487 |
Granted |  |  | 4,287,612 |  |  | $ | 27.97 |  |  |  |
Released |  |  | (4,255,643 | ) |  | $ | 14.00 |  |  |  |
Forfeited |  |  | (1,007,317 | ) |  | $ | 17.65 |  |  |  |
Outstanding at October 1, 2022 |  |  | 8,308,177 |  |  | $ | 19.25 |  |  | $ | 115,484 |
At October 1, 2022 |  |  |  |  |  |  |  |  |
Units expected to vest |  |  | 7,168,277 |  |  | $ | 18.93 |  |  | $ | 99,639 |
As of October 1, 2022 and October 2, 2021, the Company had $120.6 million and $90.0 million of unrecognized stock-based compensation expense related to RSUs, each of which are expected to be recognized over a weighted-average period of 2.5 years. Performance Stock Units Pursuant to the 2018 Plan, the Company has issued and may issue certain PSUs that vest on the satisfaction of service and performance conditions. PSUs vest upon satisfaction of service and performance conditions. The number of shares vested at the end of the performance period are based on the extent to which the corresponding performance goals have been achieved. The summary of the Company’s PSU activity is as follows:
|  | Number of Units |  |  | Weighted-Average Grant Date Fair Value |  |  | Aggregate Intrinsic Value |
|  |  |  |  |  |  |  | (In thousands) |
Outstanding at October 2, 2021 |  |  | 158,521 |  |  | $ | 22.81 |  |  | $ | 5,114 |
Granted |  |  | 252,296 |  |  | $ | 29.71 |  |  |  |
Forfeited |  |  | (12,740 | ) |  | $ | 29.91 |  |  |  |
Outstanding at October 1, 2022 |  |  | 398,077 |  |  | $ | 26.96 |  |  | $ | 5,533 |
As of October 1, 2022 and October 2, 2021, the Company had $0.4 million and $3.6 million of unrecognized stock-based compensation expense related to PSUs, which is expected to be recognized over a weighted-average period of 0.6 and 1.2 years, respectively. Stock-based Compensation Total stock-based compensation expense by function category was as follows:
|  | October 1, 2022 |  |  | October 2, 2021 |  |  | October 3, 2020 |
(In thousands) |  |  |  |  |  |  |  |  |
Cost of revenue |  | $ | 1,620 |  |  | $ | 988 |  |  | $ | 1,106 |
Research and development |  |  | 30,724 |  |  |  | 25,075 |  |  |  | 23,439 |
Sales and marketing |  |  | 15,335 |  |  |  | 13,570 |  |  |  | 14,359 |
General and administrative |  |  | 27,961 |  |  |  | 22,494 |  |  |  | 18,706 |
Total stock-based compensation expense |  | $ | 75,640 |  |  | $ | 62,127 |  |  | $ | 57,610 |

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