Stock-Based Compensation (Table)

12 Months Ended

Oct. 31, 2020

Share-based Payment Arrangement [Abstract]

Schedule of Stock-Based Compensation Expense and the Resulting Tax Benefits

Stock-based compensation expense and the resulting tax benefits for operations were as follows:

	For the fiscal years ended October 31
	2020		2019		2018
	In millions
Stock-based compensation expense	$	278	$	297	$	268
Income tax benefit	(48)		(47)		(59)
Stock-based compensation expense, net of tax	$	230	$	250	$	209

Weighted-Average Fair Value and Assumptions Used to Measure Fair Value of Restricted Stock Units

HP uses the closing stock price on the grant date to estimate the fair value of service-based restricted stock units. HP estimates the fair value of restricted stock units subject to performance-adjusted vesting conditions using a combination of the closing stock price on the grant date and the Monte Carlo simulation model. The assumptions used to measure the fair value of restricted stock units subject to performance-adjusted vesting conditions in the Monte Carlo simulation model were as follows:

	For the fiscal years ended October 31
	2020		2019		2018
Expected volatility(1)	27.6	%	26.5	%	29.5	%
Risk-free interest rate(2)	1.6	%	2.7	%	1.9	%
Expected performance period in years(3)	2.9		2.9		2.9

(1)The expected volatility was estimated using the historical volatility derived from HP’s common stock.

(2)The risk-free interest rate was estimated based on the yield on U.S. Treasury zero-coupon issues.

(3)The expected performance period was estimated based on the length of the remaining performance period from the grant date.

Summary of Restricted Stock Awards Activity

A summary of restricted stock units activity is as follows:

	As of October 31
	2020			2019			2018
	Shares	Weighted- Average Grant Date Fair Value Per Share		Shares	Weighted- Average Grant Date Fair Value Per Share		Shares	Weighted- Average Grant Date Fair Value Per Share
	In thousands			In thousands			In thousands
Outstanding at beginning of year	29,960	$	21	30,784	$	18	31,822	$	14
Granted	18,109	$	20	17,216	$	22	16,364	$	21
Vested	(14,929)	$	20	(16,934)	$	16	(15,339)	$	15
Forfeited	(3,309)	$	21	(1,106)	$	20	(2,063)	$	17
Outstanding at end of year	29,831	$	21	29,960	$	21	30,784	$	18

Weighted-Average Fair Value and Assumptions Used to Measure Fair Value of Stock Options

HP utilizes the Black-Scholes-Merton option pricing formula to estimate the fair value of stock options subject to service-based vesting conditions. HP estimates the fair value of stock options subject to performance-contingent vesting conditions using a combination of a Monte Carlo simulation model and a lattice model as these awards contain market conditions. The weighted-average fair value and the assumptions used to measure fair value were as follows:

	For the fiscal years ended October 31
	2020			2019			2018
Weighted-average fair value(1)	$	3		$	3		$	5
Expected volatility(2)	29.8		%	29.8		%	29.4		%
Risk-free interest rate(3)	1.6		%	1.7		%	2.5		%
Expected dividend yield(4)	4.0		%	3.7		%	2.6		%
Expected term in years(5)	6.0			6.0			5.0

(1)The weighted-average fair value was based on stock options granted during the period.

(2)Expected volatility was estimated based on a blended volatility (50% historical volatility and 50% implied volatility from traded options on HP's common stock).

(3)The risk-free interest rate was estimated based on the yield on U.S. Treasury zero-coupon issues.

(4)The expected dividend yield represents a constant dividend yield applied for the duration of the expected term of the award.

(5)For awards subject to service-based vesting, the expected term was estimated using a simplified method; and for performance-contingent awards, the expected term represents an output from the lattice model

Summary of Stock Options Activity

A summary of stock options activity is as follows:

	As of October 31
	2020						2019						2018
	Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value		Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value		Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value
	In thousands			In years	In millions		In thousands			In years	In millions		In thousands			In years	In millions
Outstanding at beginning of year	7,093	$	16				7,086	$	14				18,067	$	13
Granted	996	$	18				2,451	$	17				54	$	21
Exercised	(2,213)	$	14				(2,429)	$	13				(10,644)	$	13
Forfeited/cancelled/expired	(239)	$	19				(15)	$	10				(391)	$	16
Outstanding at end of year	5,637	$	17	6.4	$	10	7,093	$	16	5.7	$	15	7,086	$	14	4.2	$	73
Vested and expected to vest	5,637	$	17	6.4	$	10	7,093	$	16	5.7	$	15	7,084	$	14	4.2	$	73
Exercisable	3,196	$	15	4.4	$	9	4,707	$	14	3.6	$	15	4,707	$	14	3.7	$	49

Schedule of Shares Available for Future Grant and Shares Reserved for Future Issuance

Shares available for future grant and shares reserved for future issuance under the stock-based incentive compensation plans and the 2011 ESPP were as follows:

	As of October 31
	2020	2019	2018
	In thousands
Shares available for future grant	229,334	265,135	305,767
Shares reserved for future issuance	264,110	301,608	343,076