STOCKHOLDERS' (DEFICIT) EQUITY

9 Months Ended

Feb. 28, 2022

Stockholders Equity Note [Abstract]

STOCKHOLDERS' (DEFICIT) EQUITY

7. STOCKHOLDERS’ (DEFICIT) EQUITY

Common Stock Repurchases

Our Board of Directors has approved a program for us to repurchase shares of our common stock. On December 9, 2021, we announced that our Board of Directors approved an expansion of our stock repurchase program by an additional $10.0 billion. As of February 28, 2022, approximately $10.0 billion remained available for stock repurchases pursuant to our stock repurchase program. We repurchased 177.9 million shares for $15.6 billion during the nine months ended February 28, 2022 (including 0.2 million shares for $13 million that were repurchased but not settled) and 222.2 million shares for $13.0 billion during the nine months ended February 28, 2021 under the stock repurchase program.

Our stock repurchase authorization does not have an expiration date and the pace of our repurchase activity will depend on factors such as our working capital needs, our cash requirements for acquisitions and dividend payments, our debt repayment obligations or repurchases of our debt, our stock price, and economic and market conditions. Our stock repurchases may be effected from time to time through open market purchases or pursuant to a Rule 10b5-1 plan. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time.

Dividends on Common Stock

In March 2022, our Board of Directors declared a quarterly cash dividend of $0.32 per share of our outstanding common stock. The dividend is payable on April 21, 2022 to stockholders of record as of the close of business on April 8, 2022. Future declarations of dividends and the establishment of future record and payment dates are subject to the final determination of our Board of Directors.

Fiscal 2022 Stock‑Based Awards Activity and Compensation Expense

During the first nine months of fiscal 2022, we issued 58 million restricted stock-based units (RSUs), the significant majority of which were issued as a part of our annual stock-based award process and are subject to service-based vesting restrictions. These fiscal 2022 stock-based award issuances were partially offset by stock-based award forfeitures and cancellations of 7 million shares during the first nine months of fiscal 2022.

The RSUs that were granted during the nine months ended February 28, 2022 have similar vesting restrictions and contractual lives and were valued using methodologies of a similar nature as those described in Note 13 of Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended May 31, 2021.

Further, during the first nine months of fiscal 2022, the Compensation Committee of our Board of Directors approved an amendment to the terms of the performance-based stock options (PSOs) granted on July 20, 2017 to our Chief Executive Officer and Chief Technology Officer. The amendment extends the term of the performance period for each of the six tranches of the PSOs that require the attainment of both a performance metric and a market capitalization metric by three additional fiscal years from May 31, 2022 to May 31, 2025. A seventh PSO tranche that was based upon a market-based metric was achieved and accordingly the tranche vested in the first nine months of fiscal 2022 without any amendment. If any of the remaining operational and market capitalization performance goals are achieved before May 31, 2025 additional tranches may vest. Upon amendment, we estimated the revised fair values of the six unvested tranches of the PSOs using a Monte Carlo simulation approach. We are recognizing incremental stock-based compensation expense related to these amended awards for any of the remaining unvested tranches that are probable of achievement over the longer of the (a) estimated implicit service period for performance-metric achievement, or (b) derived service period for market-based metric achievement. We have preliminarily estimated service periods for those tranches that have been deemed probable of achievement as of the amendment date to be approximately three to four years.

Stock-based compensation expense is included in the following operating expense line items in our condensed consolidated statements of operations:

	Three Months Ended February 28,				Nine Months Ended February 28,
(in millions)	2022		2021		2022		2021
Cloud services and license support	$	55	$	33	$	145	$	99
Hardware		4		2		11		8
Services		17		15		49		41
Sales and marketing		113		82		328		233
Research and development		421		307		1,188		897
General and administrative		64		40		179		117
Total stock-based compensation	$	674	$	479	$	1,900	$	1,395