Share-based Compensation Expense

3 Months Ended

Apr. 01, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-based Compensation Expense

Share-based Compensation Expense

Share-based compensation expense for all stock awards consists of the following (in thousands):

	Three Months Ended
	April 1, 2012			April 3, 2011
Cost of product revenue	$	1,812		$	1,512
Cost of service and other revenue	17			210
Research and development	7,427			7,728
Selling, general and administrative	13,773			12,589
Share-based compensation expense before taxes	23,029			22,039
Related income tax benefits	(7,823		)	(7,761		)
Share-based compensation expense, net of taxes	$	15,206		$	14,278

The assumptions used for the specified reporting periods and the resulting estimates of weighted-average fair value per share of options granted and for stock purchased under the ESPP for those periods are as follows:

	Three Months Ended
	April 1, 2012	April 3, 2011
Stock Options:
Risk-free interest rate	0.74%	2.23%
Expected volatility	43%	43%
Expected term	4.7 years	5.5 years
Expected dividends	—	—
ESPP:
Risk-free interest rate	0.09 - 0.13%	0.18 - 0.28%
Expected volatility	53 - 64%	43 - 46%
Expected term	0.5 - 1.0 years	0.5 - 1.0 years
Expected dividends	—	—

As of April 1, 2012, approximately $183.6 million of unrecognized compensation cost related to stock options, restricted stock units, performance stock units, and ESPP shares is expected to be recognized over a weighted average period of approximately 2.4 years.