As of October 3, 2021, approximately 3.4 million shares remained available for future grants under the 2015 Stock Plan.


	Restricted Stock Units (RSU)(1)	Performance Stock Units (PSU)(2)	Weighted-Average Grant Date Fair Value per Share
Units in thousands			RSU		PSU
Outstanding at January 3, 2021	1,721	—	$	313.35	—
Awarded	183	424	$	464.17	$	475.77
Vested	(92)	—	$	274.12	—
Cancelled	(206)	(34)	$	316.92	$	475.77
Outstanding at October 3, 2021	1,606	390	$	332.36	$	475.77

(1)In connection with the GRAIL acquisition, replacement awards of 59,000 RSUs were awarded to GRAIL employees.

(2)The number of units reflect the estimated number of shares to be issued at the end of the performance period. Awarded units are presented net of performance adjustments.


Units in thousands	Options	Weighted-Average Exercise Price		Performance Stock Options(1)	Weighted-Average Exercise Price
Outstanding at January 3, 2021	10	$	59.11	—	—
Granted	—	—		48	$	86.73
Exercised	(2)	$	20.06	(1)	$	83.02

Outstanding at October 3, 2021	8	$	65.58	47	$	86.89

(1)In connection with the GRAIL acquisition, we issued performance stock options. The number of units reflect awards that have been granted and for which it is assumed to be probable that the underlying performance goals will be achieved.

As of October 3, 2021, all outstanding options were exercisable and no outstanding performance stock options were exercisable.

The price at which common stock is purchased under the Employee Stock Purchase Plan (ESPP) is equal to 85% of the fair market value of the common stock on the first day of the offering period or purchase date, whichever is lower. During YTD 2021, approximately 0.2 million shares were issued under the ESPP. As of October 3, 2021, there were approximately 13.1 million shares available for issuance under the ESPP.

On February 5, 2020, our Board of Directors authorized a new share repurchase program, which supersedes all prior and available repurchase authorizations, to repurchase $750 million of outstanding common stock. The repurchases may be completed under a 10b5-1 plan or at management’s discretion. We did not repurchase any shares during YTD 2021. Authorizations to repurchase approximately $15 million of our common stock remained available as of October 3, 2021.



In millions	Q3 2021		Q3 2020		YTD 2021		YTD 2020
Cost of product revenue	$	7	$	6	$	22	$	13
Cost of service and other revenue	1		1		3		3
Research and development	193		21		243		48
Selling, general and administrative	496		33		576		52
Share-based compensation expense before taxes	697		61		844		116
Related income tax benefits	(29)		(12)		(57)		(27)
Share-based compensation expense, net of taxes	$	668	$	49	$	787	$	89

In connection with the acquisition of GRAIL, we recognized share-based compensation expense of $615 million in Q3 2021 related to the fair value of accelerated equity awards attributable to the post-combination period, of which $167 million was recorded in research and development expense and $448 million in selling, general and administrative expense. We also recognized $6 million of expense in Q3 2021 related to the replacement awards.

In February 2021, we modified the metrics and reduced the maximum potential payouts for our performance stock units granted in 2019 and 2020, which vest at the end of the three-year periods ended January 2, 2022 and January 1, 2023, respectively. The modifications affected 52 employees with units granted in 2019, which resulted in total incremental share-based compensation cost of approximately $41 million, and 72 employees with units granted in 2020, which resulted in total incremental share-based compensation cost of approximately $65 million.

The assumptions used for the specified reporting periods and the resulting estimates of weighted-average fair value per share for stock purchased under the ESPP during YTD 2021 were as follows:


	Employee Stock Purchase Rights
Risk-free interest rate	0.06% - 0.12%
Expected volatility	37% - 47%
Expected term	0.5 - 1.0 year
Expected dividends	0		%
Weighted-average grant-date fair value per share	$	134.47

As of October 3, 2021, approximately $511 million of total unrecognized compensation cost related to restricted stock, performance stock options and ESPP shares issued to date was expected to be recognized over a weighted-average period of approximately 2.0 years.