Annual report pursuant to Section 13 and 15(d)

Common Stock and Stock-Based Incentive Compensation Plans (Tables)

v3.8.0.1
Common Stock and Stock-Based Incentive Compensation Plans (Tables)
 12 Months Ended
Dec. 30, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs
Stock-based compensation expense related to employee stock options, restricted stock units, including PRSUs and the ESPP, was allocated in the consolidated statements of operations as follows:
 
2017
 
2016
 
2015
 
(In millions)
Cost of sales
$
2

 
$
2

 
$
3

Research and development
57

 
49

 
36

Marketing, general, and administrative
38

 
35

 
24

Total stock-based compensation expense, net of tax of $0
$
97

 
$
86

 
$
63

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions
The weighted-average grant date fair values of the 2017 and 2016 PRSUs were $17.18 and $9.00, respectively. The weighted-average date fair values of the two grants in 2015 were $0.85 and $0.91 per share, using the following assumptions:
 
2017
 
2016
 
2015
Stock price at valuation date
$12.83
 
$5.14
 
$1.85 - $1.99

Expected volatility
64.39
%
 
57.83
%
 
48.88% - 51.69%

Risk-free interest rate
1.50
%
 
0.88
%
 
1.08% - 1.12%

Expected dividends
—
%
 
—
%
 
—
%
Expected term (in years)
3.0

 
3.07

 
2.76 - 3.0

The weighted-average estimated fair value of employee stock options granted for the years ended December 30, 2017, December 31, 2016 and December 26, 2015 was $5.46, $3.10 and $1.02 per share, respectively, using the following weighted-average assumptions:
 
2017
 
2016
 
2015
Expected volatility
57.26
%
 
62.33
%
 
60.14
%
Risk-free interest rate
1.68
%
 
1.02
%
 
1.29
%
Expected dividends
—
%
 
—
%
 
—
%
Expected life (in years)
3.92

 
3.98

 
3.91

Schedule of Share-based Compensation, Stock Options, Activity
The following table summarizes stock option activity and related information:
  
2017
 
2016
 
2015
  
Number
of Shares
 
Weighted-
Average
Exercise
Price
 
Number
of Shares
 
Weighted-
Average
Exercise
Price
 
Number
of Shares
 
Weighted-
Average
Exercise
Price
 
(In millions, except share price)
Stock options:
 
 
 
 
 
 
 
 
 
 
 
Outstanding at beginning of year
20

 
$
4.15

 
32

 
$
4.44

 
36

 
$
4.78

Granted
1

 
$
12.83

 
2

 
$
6.98

 
8

 
$
2.12

Canceled
—

*
$
7.69

 
(9
)
 
$
5.53

 
(9
)
 
$
4.91

Exercised
(4
)
 
$
5.19

 
(5
)
 
$
4.75

 
(3
)
 
$
1.61

Outstanding at end of year
17

 
$
4.32

 
20

 
$
4.15

 
32

 
$
4.44

Exercisable at end of year
13

 
$
3.82

 
13

 
$
4.32

 
21

 
$
5.34


*: Less than 1 million shares.
Schedule of Share-based Compensation, Restricted Stock Units, Activity
The summary of the changes in RSUs outstanding, including the PRSUs, during 2017, 2016 and 2015 is presented below:
  
2017
 
2016
 
2015
  
Number
of Shares
 
Weighted-
Average
Fair Value
 
Number
of Shares
 
Weighted-
Average
Fair Value
 
Number
of Shares
 
Weighted-
Average
Fair Value
 
(In millions except share price)
Unvested balance at beginning of period
52

 
$
3.73

 
51

 
$
2.61

 
43

 
$
4.05

Granted
12

 
$
11.63

 
29

 
$
4.72

 
38

 
$
2.03

Forfeited
(3
)
 
$
5.83

 
(5
)
 
$
2.95

 
(15
)
 
$
3.71

Vested
(26
)
 
$
3.81

 
(23
)
 
$
2.56

 
(15
)
 
$
4.13

Unvested balance at end of period
35

 
$
6.60

 
52

 
$
3.73

 
51

 
$
2.61

Schedule of Nonvested Performance-based Units Activity
The summary of the changes in the PRSUs during 2017, 2016 and 2015 is presented below.
  
2017
 
2016
 
2015
 
(Shares in millions)
Unvested shares at beginning of period
5

 
7

 
9

Granted
2

 
5

 
5

Forfeited
(1
)
 
(2
)
 
(7
)
Vested
(3
)
 
(5
)
 
—

Unvested shares at end of period
3

 
5

 
7

Schedule of ESPP
ESPP. The Company uses the Black-Scholes model in determining the fair value of ESPP. The weighted-average grant date fair value for the ESPP during fiscal 2017 was $3.46 per share using the following assumptions:
 
2017
Expected volatility
56.07
%
Risk-free interest rate
1.36
%
Expected dividends
—
%
Expected term (in years)
0.49

Forfeiture rate
7.8
%