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Stock-Based Compensation (Tables)
6 Months Ended
Apr. 30, 2011
Stock-Based Compensation  
Performance-based Restricted Units (PRUs) Assumptions

 

 
  Six months ended
April 30
 
 
  2011   2010  

Weighted-average fair value of grants per share

  $ 27.59 (1) $ 57.13 (2)

Expected volatility(3)

    30 %   38 %

Risk-free interest rate

    0.38 %   0.73 %

Dividend yield

    0.75 %   0.64 %

Expected life in months

    19     22  

(1)
Reflects the weighted-average fair value for the third year of the three-year performance period applicable to PRUs granted in fiscal 2009, for the second year of the three-year performance period applicable to PRUs granted in fiscal 2010 and for the first year of the three-year performance period applicable to PRUs granted in the six months ended April 30, 2011. The estimated fair value of a Target Share for the third year for PRUs granted in fiscal 2010 and for the second and third years for PRUs granted in the six months ended April 30, 2011 will be determined on the measurement date applicable to those PRUs, which will be the date that the annual cash flow goals are approved for those PRUs, and the expense will be amortized over the remainder of the applicable three-year performance period.
(2)
Reflects the weighted-average fair value for the third year of the three-year performance period applicable to PRUs granted in fiscal 2008, for the second year of the three-year performance period applicable to PRUs granted in fiscal 2009 and for the first year of the three-year performance period applicable to PRUs granted in the six months ended April 30, 2010.

(3)
HP uses historic volatility for PRU awards as implied volatility cannot be used when simulating multivariate prices for companies in the S&P 500.
Performance-based Restricted Units (PRUs) Activity

 

 
  Shares
(in thousands)
 

Outstanding Target Shares at October 31, 2010

    18,508  

Granted

    5,798  

Vested

     

Change in units due to performance and market conditions achievement for PRUs vested in the period

     

Forfeited

    (786 )
       

Outstanding Target Shares at April 30, 2011

    23,520  
       

Outstanding Target Shares assigned a fair value at April 30, 2011

    17,608 (1)
       

(1)
Excludes Target Shares for the third year for PRUs granted in fiscal 2010 and for the second and third years for PRUs granted in the six months ended April 30, 2011 as the measurement date has not yet been established. The measurement date and related fair value for the excluded PRUs will be established when the annual cash flow goals are approved.
Stock Options Assumptions

 

 
  Three months ended
April 30
  Six months ended
April 30
 
 
  2011   2010   2011   2010  

Weighted-average fair value of grants per share

  $ 10.73   $ 14.12   $ 11.06   $ 14.19  

Implied volatility

    27 %   27 %   28 %   28 %

Risk-free interest rate

    2.16 %   2.45 %   1.97 %   2.42 %

Dividend yield

    0.77 %   0.61 %   0.76 %   0.61 %

Expected life in months

    60     61     60     61  

(1)
The fair value calculation was based on stock options granted during the period.
Stock Options Activity

 

 
  Shares
(in thousands)
  Weighted-
Average
Exercise
Price
Per Share
  Weighted-
Average
Remaining
Contractual
Term
(in years)
  Aggregate
Intrinsic
Value
(in millions)
 

Outstanding at October 31, 2010

    142,916   $ 28              

Granted and assumed through acquisition

    1,026   $ 22              

Exercised

    (30,828 ) $ 24              

Forfeited/cancelled/expired

    (2,398 ) $ 41              
                         

Outstanding at April 30, 2011

    110,716   $ 29     2.8   $ 1,444  
                         

Vested and expected to vest at April 30, 2011

    109,586   $ 29     2.7   $ 1,428  
                         

Exercisable at April 30, 2011

    102,792   $ 29     2.3   $ 1,327  
                         
Restricted Stock Awards Activity

 
  Shares
(in thousands)
  Weighted-
Average
Grant
Date Fair
Value
Per Share
 

Outstanding at October 31, 2010

    5,848   $ 45  

Granted

    7,717   $ 43  

Vested

    (2,412 ) $ 46  

Forfeited

    (310 ) $ 44  
             

Outstanding at April 30, 2011

    10,843   $ 43