Stock-Based Incentive Compensation Plans (Notes)

6 Months Ended

Jun. 28, 2014

Share-based Compensation [Abstract]

Stock-Based Incentive Compensation Plans

Stock-Based Incentive Compensation Plans

The following table summarizes stock-based compensation expense related to employee stock options, restricted stock and restricted stock units, which is allocated within the Company’s condensed consolidated statements of operations as follows:

	Three Months Ended				Six Months Ended
	June 28, 2014		June 29, 2013		June 28, 2014		June 29, 2013
	(In millions)
Cost of sales	$	1	$	1	$	2	$	3
Research and development	11		10		23		23
Marketing, general and administrative	9		9		19		18
Stock-based compensation expense, net of tax of $0	$	21	$	20	$	44	$	44

For all periods presented, the Company did not realize any excess tax benefit related to stock-based compensation and therefore did not record any related financing cash flows.

Stock Options

The weighted average assumptions applied in the lattice-binomial model that the Company uses to estimate the fair value employee stock options are as follows:

	Three Months Ended				Six Months Ended
	June 28, 2014		June 29, 2013		June 28, 2014		June 29, 2013
Expected volatility	51.68	%	57.18	%	53.36	%	59.08	%
Risk-free interest rate	1.12	%	0.58	%	1.09	%	0.60	%
Expected dividends	0.00	%	0.00	%	0.00	%	0.00	%
Expected life	3.86 years		3.83 years		3.86 years		3.83 years

For the quarter ended June 28, 2014, the Company granted 95,000 employee stock options with weighted average grant date fair value per share of $1.66. The Company did not grant any employee stock options during the quarter ended June 29, 2013. For the six months ended June 28, 2014 and June 29, 2013, the Company granted 155,000 and 1,327,000 employee stock options, respectively, with weighted average grant date fair values per share of $1.65 and $1.17, respectively.

Restricted Stock and Restricted Stock Units

For the quarters ended June 28, 2014 and June 29, 2013, the Company granted 1,690,000 and 14,149,000 restricted stock units, respectively, with weighted average grant date fair values per share of $4.00 and $3.91, respectively. For the six months ended June 28, 2014 and June 29, 2013, the Company granted 2,169,000 and 16,596,000 restricted stock units, respectively, with weighted average grant date fair values per share of $3.96 and $3.73, respectively.