Stockholders' Equity

9 Months Ended

Sep. 30, 2021

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. There were no repurchases of common stock during the nine months ended September 30, 2020 or 2021.

Stock Award Activity

Common shares outstanding plus shares underlying outstanding stock awards totaled 518 million and 523 million as of December 31, 2020 and September 30, 2021. 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,
	2020		2021		2020		2021
Cost of sales	$	75	$	126	$	193	$	361
Fulfillment	316		473		993		1,381
Technology and content	1,267		1,627		3,649		4,742
Marketing	446		657		1,233		1,804
General and administrative	184		297		578		789
Total stock-based compensation expense	$	2,288	$	3,180	$	6,646	$	9,077

The following table summarizes our restricted stock unit activity for the nine months ended September 30, 2021 (in millions):


	Number of Units	Weighted-Average Grant-Date Fair Value
Outstanding as of December 31, 2020	15.2	$	2,004
Units granted	5.7	3,334
Units vested	(3.7)	1,624
Units forfeited	(1.6)	2,232
Outstanding as of September 30, 2021	15.6	2,552

Scheduled vesting for outstanding restricted stock units as of September 30, 2021, is as follows (in millions):


	Three Months Ended December 31,	Year Ended December 31,
	2021	2022	2023	2024	2025	Thereafter	Total
Scheduled vesting — restricted stock units	1.8	5.5	5.2	2.1	0.7	0.3	15.6

As of September 30, 2021, there was $18.2 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 remaining weighted-average recognition period of 1.1 years. The estimated forfeiture rate as of December 31, 2020 and September 30, 2021 was 27%. Changes in our estimates and assumptions relating to forfeitures may cause us to realize material changes in stock-based compensation expense in the future.

Changes in Stockholders’ Equity

The following table shows changes in stockholders’ equity (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2021		2020		2021
Total beginning stockholders’ equity	$	73,728	$	114,803	$	62,060	$	93,404

Beginning and ending common stock	5		5		5		5

Beginning and ending treasury stock	(1,837)		(1,837)		(1,837)		(1,837)

Beginning additional paid-in capital	38,017		48,724		33,658		42,865
Stock-based compensation and issuance of employee benefit plan stock	2,290		3,155		6,649		9,014
Ending additional paid-in capital	40,307		51,879		40,307		51,879

Beginning accumulated other comprehensive income (loss)	(1,455)		(525)		(986)		(180)
Other comprehensive income (loss)	426		(550)		(43)		(895)
Ending accumulated other comprehensive income (loss)	(1,029)		(1,075)		(1,029)		(1,075)

Beginning retained earnings	38,998		68,436		31,220		52,551

Net income	6,331		3,156		14,109		19,041
Ending retained earnings	45,329		71,592		45,329		71,592

Total ending stockholders’ equity	$	82,775	$	120,564	$	82,775	$	120,564