Stock-Based Compensation

9 Months Ended

Mar. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Note 16. Stock-Based Compensation

The Company's stock-based compensation includes a combination of time-based restricted stock awards and performance-based awards. Restricted stock awards are granted without an exercise price and are converted to shares immediately upon vesting. When converted into shares upon vesting, shares equivalent in value to the minimum withholding taxes liability on the vested shares are withheld by the Company for the payment of such taxes.

The Company generally estimates the fair value of stock-based awards based on the closing market price of the Company’s common stock on the grant date. In the case of performance-based awards that include a market condition, the Company estimates the fair value of the award using a combination of the closing market price of the Company’s common stock on the grant date and the Monte Carlo simulation model. For performance-based awards, shares attained over target upon vesting are reflected as awards granted during the period.

Time-based restricted stock awards granted to eligible employees will generally vest in annual installments over a period of three to four years subject to the employees’ continuing service to the Company and do not have an expiration date. The Company's performance-based awards may include performance conditions, market conditions, time-based service conditions or a combination thereof and are generally expected to vest in annual installments over a period of three to four years. In addition, the actual number of shares awarded upon vesting of performance-based grants may vary from the target shares depending upon the achievement of the relevant performance or market-based conditions.

During the nine months ended March 30, 2024 and April 1, 2023, the Company granted 3.6 million and 3.1 million time-based restricted stock awards, respectively. The aggregate grant-date fair value of time-based restricted stock awards granted during the nine months ended March 30, 2024 and April 1, 2023 were estimated to be $35.1 million and $42.1 million, respectively.

During the nine months ended March 30, 2024 and April 1, 2023, the Company granted 1.2 million and 0.7 million performance-based awards, respectively. There were no performance-based shares attained over target during the nine months ended March 30, 2024. There were 0.1 million performance-based shares attained over target during the nine months ended April 1, 2023. The aggregate grant-date fair value of performance-based awards granted during the nine months ended March 30, 2024 and April 1, 2023 were estimated to be $13.4 million and $11.5 million, respectively.

As of March 30, 2024, $67.3 million of unrecognized stock-based compensation costs remain to be amortized.

The impact on the Company’s results of operations of recording stock-based compensation by function for the three and nine months ended March 30, 2024 and April 1, 2023, is as follows (in millions):

	Three Months Ended				Nine Months Ended
	March 30, 2024		April 1, 2023		March 30, 2024		April 1, 2023
Cost of revenues	$	1.2	$	1.2	$	3.7	$	3.6
Research and development	2.1		2.1		6.5		6.4
Selling, general and administrative	9.5		9.4		26.4		28.8
Total stock-based compensation expense	$	12.8	$	12.7	$	36.6	$	38.8

Approximately $1.2 million of stock-based compensation was capitalized to inventory as of March 30, 2024 and April 1, 2023.