Employee Stock Plans (Tables)

12 Months Ended

Oct. 02, 2015

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

Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions

The fair value of options granted and the option component of the shares purchased under the Employee Stock Purchase Plan (which is described further below) shares were estimated at the date of grant using the Black-Scholes model with the following weighted average assumptions:



	Employee Stock Plans									Employee Stock Purchase Plans
	Fiscal Years									Fiscal Years
	2015			2014			2013			2015			2014			2013
Expected term (in years)	4.15			4.13			4.76			0.50			0.50			0.50
Risk-free interest rate	1.3		%	1.2		%	0.6		%	0.1		%	0.1		%	0.1		%
Expected volatility	22.1		%	24.6		%	32.2		%	12.7		%	12.8		%	16.5		%
Expected dividend	—		%	—		%	—		%	—		%	—		%	—		%
Weighted average fair value at grant date	$	18.52		$	18.24		$	19.73		$	15.87		$	14.20		$	12.95

Fair Value of Employee Stock Option Plans with Weighted Average Assumptions



	Employee Stock Plans									Employee Stock Purchase Plans
	Fiscal Years									Fiscal Years
	2015			2014			2013			2015			2014			2013
Expected term (in years)	4.15			4.13			4.76			0.50			0.50			0.50
Risk-free interest rate	1.3		%	1.2		%	0.6		%	0.1		%	0.1		%	0.1		%
Expected volatility	22.1		%	24.6		%	32.2		%	12.7		%	12.8		%	16.5		%
Expected dividend	—		%	—		%	—		%	—		%	—		%	—		%
Weighted average fair value at grant date	$	18.52		$	18.24		$	19.73		$	15.87		$	14.20		$	12.95

Net Share-Based Compensation Expense

The table below summarizes the effect of recording share-based compensation expense:



	Fiscal Years
(In thousands)	2015			2014			2013
Cost of revenues - Product	$	4,753		$	3,323		$	4,088
Cost of revenues - Service	4,068			4,658			3,460
Research and development	6,805			6,194			5,993
Selling, general and administrative	30,677			25,461			29,096
Total share-based compensation expense	$	46,303		$	39,636		$	42,637
Income tax benefit for share-based compensation	$	(14,198	)	$	(12,062	)	$	(12,989	)

Summary the Effect of Recording Pre-Tax Share-Based Compensation Expense for Equity Incentive Awards

The table below summarizes the effect of recording pre-tax share-based compensation expense for equity incentive awards:



	Fiscal Years
(In thousands)	2015		2014		2013
Stock options	$	11,301	$	9,489	$	10,577
Restricted stock units and restricted stock awards⁽¹⁾	31,364		26,576		28,229
Employee stock purchase plan	3,638		3,571		3,831
Total share-based compensation expense	$	46,303	$	39,636	$	42,637


(1)	Restricted stock units and restricted stock awards include performance units and deferred stock units.

Summary of Share-Based Awards Available for Grant

A summary of share-based awards available for grant is as follows:



(In thousands)	Shares Available for Grant
Balance at September 28, 2012	11,868
Granted	(2,045	)
Canceled or expired	102
Balance at September 27, 2013	9,925
Granted	(1,934	)
Canceled or expired	177
Balance at September 26, 2014	8,168
Granted	(1,838	)
Canceled or expired	331
Balance at October 2, 2015	6,661

Activity Under Employee Stock Plans

Activity under the Company’s employee stock plans related to stock options is presented below:



	Options Outstanding
(In thousands, except per share amounts)	Number of Shares		Weighted Average Exercise Price
Balance at September 28, 2012	6,459		$	48.34
Granted	613		68.93
Canceled, expired or forfeited	(20	)	60.81
Exercised	(2,567	)	44.97
Balance at September 27, 2013	4,485		53.02
Granted	625		83.50
Canceled, expired or forfeited	(46	)	72.35
Exercised	(1,721	)	49.01
Balance at September 26, 2014 (2,486 options exercisable at a weighted average exercise price of $54.21)	3,343		60.53
Granted	634		92.29
Canceled, expired or forfeited	(26	)	77.53
Exercised	(1,414	)	52.83
Balance at October 2, 2015	2,537		$	72.58

Options Outstanding And Exercisable

The following table summarizes information related to stock options outstanding and exercisable under the Company’s employee stock plans at October 2, 2015:



	Options Outstanding						Options Exercisable
Range of Exercise Prices	Number of Shares	Weighted Average Remaining Contractual Term (in years)	Weighted Average Exercise Price		Aggregate Intrinsic Value ⁽¹⁾		Number of Shares	Weighted Average Remaining Contractual Term (in years)	Weighted Average Exercise Price		Aggregate Intrinsic Value ⁽¹⁾
(In thousands, except years and per-share amounts)
$37.06 – $39.85	31	0.4	$	37.17	$	1,196	31	0.4	$	37.17	$	1,196
$45.22 – $52.07	379	1.0	50.45		9,377		379	1.0	50.45		9,377
$52.61 – $72.26	908	3.1	62.30		11,697		878	3.1	62.08		11,508
$74.28 – $92.65	1,219	5.9	88.03		9		308	5.3	83.57		4
Total	2,537	4.1	$	72.58	$	22,279	1,596	3.0	$	62.97	$	22,085

(1)

The aggregate intrinsic value represents the total pre-tax intrinsic value, which is computed based on the difference between the exercise price and the closing price of VMS common stock of $75.19 as of October 2, 2015, the last trading date of fiscal year 2015, and which represents the amount that would have been received by the option holders had all option holders exercised their options and sold the shares received upon exercise as of that date.

Activity for Restricted Stock, Restricted Stock Units, Deferred Stock Units and Performance Units

The activity for restricted stock, restricted stock units, deferred stock units and performance units is summarized as follows:



(In thousands, except per share amounts)	Number of Shares		Weighted Average Grant-Date Fair Value
Balance at September 28, 2012	945		$	57.30
Granted	516		70.37
Vested	(396	)	55.67
Canceled or expired	(30	)	61.82
Balance at September 27, 2013	1,035		64.36
Granted	470		82.51
Vested	(335	)	63.70
Canceled or expired	(44	)	70.69
Balance at September 26, 2014	1,126		72.08
Granted	410		93.01
Vested	(500	)	67.93
Canceled or expired	(86	)	68.51
Balance at October 2, 2015	950		$	84.11