Stock Based Awards and Other Equity Instruments (Tables)

12 Months Ended

Dec. 31, 2020

Share Based Compensation Arrangement By Share Based Payment Award [Line Items]

Amount of Stock-Based Compensation Expense Related to Stock-Based Awards, Primarily Stock Options and RSUs

The following table presents the amount of stock-based compensation expense related to stock-based awards, primarily stock options and RSUs, on our consolidated statements of operations during the periods presented:

	Year ended December 31,
	2020			2019			2018
	(in millions)
Cost of revenue	$	1		$	1		$	1
Selling and marketing		16			23			21
Technology and content		44			55			51
General and administrative		48			45			45
Total stock-based compensation expense		109			124			118
Income tax benefit from stock-based compensation    expense		(23	)		(28	)		(27	)
Total stock-based compensation expense, net of    tax effect	$	86		$	96		$	91

Summary of Stock Option Activity

A summary of our stock option activity, consisting primarily of service-based non-qualified stock options, is presented below:

				Weighted		Weighted
				Average		Average
				Exercise		Remaining		Aggregate
	Options			Price Per		Contractual		Intrinsic
	Outstanding			Share		Life		Value
	(in thousands)					(in years)		(in millions)
Options outstanding as of December 31, 2017		6,853		$	52.78
Granted		762			43.53
Exercised (1)		(1,162	)		37.26
Cancelled or expired		(412	)		61.46
Options outstanding as of December 31, 2018		6,041			54.00
Granted		752			48.30
Exercised (1)		(195	)		42.17
Cancelled or expired		(581	)		56.97
Options outstanding as of December 31, 2019		6,017			50.27
Granted		1,106			25.23
Exercised (1)		(4	)		22.94
Cancelled or expired		(1,504	)		46.72
Options outstanding as of December 31, 2020		5,615		$	46.31		5.3	$	3
Exercisable as of December 31, 2020		3,293		$	55.87		3.4	$	—
Vested and expected to vest after December 31, 2020 (2)		5,615		$	46.31		5.3	$	3

(1) Inclusive of 2,217, 120,112, and 814,635 stock options as of December 31, 2020, 2019 and 2018, respectively, which were not converted into shares due to net share settlement in order to cover the aggregate exercise price and the required amount of employee withholding taxes. Potential shares which had been convertible under stock options that were withheld under net share settlement remain in the authorized but unissued pool under the 2018 Plan and can be reissued by the Company. Total payments for the employees’ tax obligations to the taxing authorities due to net share settlements are reflected as a financing activity within the consolidated statements of cash flows.

(2) The Company accounts for forfeitures as they occur, rather than estimate expected forfeitures as allowed under GAAP and therefore do not include a forfeiture rate in our vested and expected to vest calculation unless necessary for a performance condition award.

Weighted-Average Assumptions of Estimated Fair Value of Stock Option Grants

The fair value of stock option grants has been estimated at the date of grant using the Black–Scholes option pricing model with the following weighted average assumptions for the periods presented:

	December 31,
	2020			2019			2018
Risk free interest rate		1.15	%		1.79	%		2.70	%
Expected term (in years)		5.30			5.19			5.45
Expected volatility		43.39	%		42.09	%		41.86	%
Expected dividend yield	—  %			—  %			—  %
Weighted-average grant date fair value	$	10.08		$	21.25		$	18.11

Summary of RSU Activity

A summary of our RSU activity is presented below:

				Weighted
				Average
				Grant-		Aggregate
	RSUs			Date Fair		Intrinsic
	Outstanding			Value Per Share		Value
	(in thousands)					(in millions)
Unvested RSUs outstanding as of December 31, 2017		5,802		$	48.81
Granted		3,302			43.04
Vested and released (1)		(1,617	)		54.22
Cancelled		(847	)		46.43
Unvested RSUs outstanding as of December 31, 2018		6,640			44.93
Granted (2)		4,688			47.35
Vested and released (1)		(2,002	)		48.11
Cancelled		(857	)		47.19
Unvested RSUs outstanding as of December 31, 2019		8,469			45.42
Granted		6,397			24.41
Vested and released (1)		(3,019	)		43.48
Cancelled		(3,736	)		36.26
Unvested RSUs outstanding as of December 31, 2020 (3)		8,111		$	32.29	$	233

(1) Inclusive of 844,279, 532,164, and 424,848 RSUs as of December 31, 2020, 2019 and 2018, respectively, withheld due to net share settlement to satisfy required employee tax withholding requirements. Potential shares which had been convertible under RSUs that were withheld under net share settlement remain in the authorized but unissued pool under the 2018 Plan and can be reissued by the Company. Total payments for the employees’ tax obligations to the taxing authorities due to net share settlements are reflected as a financing activity within the consolidated statements of cash flows.

(2) Inclusive of 843,426 dividend equivalents issued to employees holding non-vested RSU grant awards in conjunction with our special cash dividend declared on November 1, 2019, which will be payable to the holder subject to, and only upon vesting of, the underlying awards.

(3) The Company accounts for forfeitures as they occur, rather than estimate expected forfeitures as allowed under GAAP and therefore do not include a forfeiture rate in our vested and expected to vest calculation unless necessary for a performance condition award.

Summary of Unrecognized Compensation Expense and Weighted Average Period Remaining

A summary of our remaining unrecognized compensation expense and the weighted average remaining amortization period at December 31, 2020 related to our non-vested equity awards is presented below (in millions, except in years information):

	Stock
	Options		RSUs/MSUs
Unrecognized compensation expense	$	18	$	160
Weighted average period remaining (in years)		1.7		1.7

MSUs

Share Based Compensation Arrangement By Share Based Payment Award [Line Items]

Summary of RSU Activity

A summary of our MSU activity is presented below:

				Weighted
				Average
				Grant-		Aggregate
	MSUs			Date Fair		Intrinsic
	Outstanding			Value Per Share		Value
	(in thousands)					(in millions)
Unvested MSUs outstanding as of December 31, 2017		213		$	30.04
Granted (1)		71			59.40
Vested and released		—			—
Cancelled		—			—
Unvested MSUs outstanding as of December 31, 2018		284			37.41
Granted (2)(3)		121			51.76
Vested and released		—			—
Cancelled		(16	)		58.63
Unvested MSUs outstanding as of December 31, 2019		389			40.99
Granted (4)		133			28.15
Vested and released		—			—
Cancelled (5)		(348	)		37.94
Unvested MSUs outstanding as of December 31, 2020		174		$	37.29	$	5

(1) MSUs provide for vesting based upon the Company’s total shareholder return, or TSR, performance over the period commencing January 1, 2018 through December 31, 2020 relative to the TSR performance of the Nasdaq Composite Total Return Index. Based upon actual attainment relative to the target performance metric, the grantee has the ability to receive up to 200% of the target number of MSUs originally granted, or to be issued none at all.

(2) Inclusive of 78,050 MSUs which provide for vesting based upon the Company’s total shareholder return, or TSR, performance over the period commencing January 1, 2019 through December 31, 2021 relative to the TSR performance of the Nasdaq Composite Total Return Index. Based upon actual attainment relative to the target performance metric, the grantee has the ability to receive up to 200% of the target number of MSUs originally granted, or to be issued none at all.

(3) Inclusive of 42,477 dividend equivalents issued to employees holding non-vested MSU grant awards in conjunction with our special cash dividend declared on November 1, 2019, which will be payable to the holder subject to, and only upon vesting of, the underlying awards.

(4) MSUs provide for vesting based upon the Company’s total shareholder return, or TSR, performance over the period commencing January 1, 2020 through December 31, 2022 relative to the TSR performance of the Nasdaq Composite Total Return Index. Based upon actual attainment relative to the target performance metric, the grantee has the ability to receive up to 200% of the target number of MSUs originally granted, or to receive none at all.

(5) MSU cancellations primarily reflect performance targets not being attained during the performance period.