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STOCK-BASED COMPENSATION (Tables)
 12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Expense Included in Consolidated Statements of Operations
The following table presents the stock-based compensation expense included in the Company’s consolidated statements of operations:
(in thousands)
2019
 
2018
 
2017
Cost of revenues
$
18,822

 
$
16,862

 
$
14,573

Selling and marketing
32,665

 
23,237

 
15,720

Research and development
18,938

 
15,274

 
13,618

General and administrative
10,484

 
8,489

 
9,402

 
$
80,909

 
$
63,862

 
$
53,313

Income tax benefit
$
(16,392
)
 
$
(13,383
)
 
$
(12,113
)
Weighted-Average Assumptions Used in Black-Scholes Option Valuation Model
The following table summarizes the Company’s fair value assumptions for stock options:
 
2019
 
2018
 
2017
Weighted-average grant-date fair value
$
19.10

 
$
18.03

 
$
13.79

Assumptions used in the Black-Scholes option valuation model
 
 
 
 
 
Expected annual volatility (1)
32
%
 
34
%
 
35
%
Expected term in years (2)
4.5

 
4.5

 
4.5

Risk-free interest rate (3)
2.4
%
 
2.6
%
 
1.9
%
Expected annual dividend yield (4)
0.3
%
 
0.4
%
 
0.5
%
(1) The expected annual volatility for each grant is determined based on the average of historical daily price changes of the Company’s common stock over a period which approximates the expected option term.
(2) The expected option term for each grant is determined based on the historical exercise behavior of employees and post-vesting employment termination behavior.
(3) The risk-free interest rate is based on the yield of U.S. Treasury securities with a maturity that is commensurate with the expected option term at the time of grant.
(4) The expected annual dividend yield is based on the weighted-average of the dividend yield assumptions used for options granted during the applicable period.
Combined Stock Option Activity
The following table summarizes the combined stock option activity under the Company’s stock option plans for 2019:
 
Shares
(in thousands)
 
Weighted-average Exercise Price
 
Weighted-average Remaining Contractual Term (in years)
 
Aggregate Intrinsic Value
(in thousands)
Options outstanding as of January 1, 2019
6,971

 
$
34.47

 
 
 
 
Granted
2,272

 
65.91

 
 
 
 
Exercised
(1,498
)
 
27.86

 
 
 
 
Forfeited
(309
)
 
50.25

 
 
 
 
Options outstanding as of December 31, 2019
7,436

 
$
44.76

 
 
 
 
 
 
 
 
 
 
 
 
Vested and expected to vest as December 31, 2019
6,292

 
$
43.17

 
7.0
 
$
229,541

 
 
 
 
 
 
 
 
Exercisable as of December 31, 2019
3,012

 
$
28.71

 
5.6
 
$
153,399
Combined Restricted Stock Units Activity
The following table summarizes the combined RSU activity for all grants, including the CICP, under the 2004 Plan for 2019:
 
Shares
(in thousands)
 
Weighted- Average
Grant-Date
Fair Value
 
Aggregate Intrinsic Value
(in thousands)
Nonvested as of January 1, 2019
2,651

 
$
43.69

 
 
Granted
1,273

 
66.21

 
 
Vested
(1,116
)
 
40.79

 
 
Forfeited
(243
)
 
49.23

 
 
Nonvested as of December 31, 2019
2,565

 
$
55.61

 
$
204,289

Expected to vest as of December 31, 2019
1,917

 
$
56.46

 
$
151,773