Stockholders' Equity

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

Stockholders' Equity

STOCKHOLDERS’ EQUITY

Stock Repurchase Activity

In February 2016, the Board of Directors authorized a program to repurchase up to $5.0 billion of our common stock, with no fixed expiration. This stock repurchase authorization replaces the previous $2.0 billion stock repurchase authorization, approved by the Board of Directors in 2010. There were no repurchases of common stock in Q3 2016 or Q3 2015.

Stock Award Activity

Common shares outstanding plus shares underlying outstanding stock awards totaled 496 million as of September 30, 2016, and 490 million as of December 31, 2015. These totals include all vested and unvested stock awards outstanding, including those awards we estimate will be forfeited. Stock-based compensation expense is as follows (in millions):

	Three Months Ended   September 30,				Nine Months Ended   September 30,
	2016		2015		2016		2015
Cost of sales (1)	$	7	$	—	$	7	$	—
Fulfillment	165		122		467		344
Marketing	85		48		221		133
Technology and content	434		309		1,171		861
General and administrative	85		65		222		175
Total stock-based compensation expense	$	776	$	544	$	2,088	$	1,513

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(1) Beginning in Q3 2016, stock-based compensation expense was recorded to cost of sales for eligible employees providing delivery services.

The compensation expense for stock options, the total intrinsic value for stock options outstanding, the amount of cash received from the exercise of stock options, and the related tax benefits were not material for the nine months ended September 30, 2016.

The following table summarizes our restricted stock unit activity for the nine months ended September 30, 2016 (in millions):

	Number of Units		Weighted-Average Grant-Date Fair Value
Outstanding as of December 31, 2015	18.9		$	362
Units granted	7.9		640
Units vested	(4.2	)	309
Units forfeited	(1.8	)	420
Outstanding as of September 30, 2016	20.8		$	473

Scheduled vesting for outstanding restricted stock units as of September 30, 2016, is as follows (in millions):

	Three Months Ended December 31,	Year Ended December 31,
	2016	2017	2018	2019	2020	Thereafter	Total
Scheduled vesting—restricted stock units	2.0	7.0	7.0	3.1	1.2	0.5	20.8

As of September 30, 2016, there was $4.6 billion of net unrecognized compensation cost related to unvested stock-based compensation arrangements. This compensation is recognized on an accelerated basis with approximately half of the compensation expected to be expensed in the next twelve months, and has a weighted-average recognition period of 1.2 years.