Stock-Based Compensation Plans

9 Months Ended

Dec. 28, 2019

Share-based Payment Arrangement [Abstract]

The Company’s equity incentive plans are broad-based, long-term retention programs that cover employees, consultants and non-employee directors of the Company. These plans are intended to attract and retain talented employees, consultants and non-employee directors and to provide such persons with a proprietary interest in the Company.

Stock-Based Compensation

The following table summarizes stock-based compensation expense related to stock awards granted under the Company’s equity incentive plans and rights to acquire stock granted under the Company’s Employee Stock Purchase Plan (ESPP):



	Three Months Ended				Nine Months Ended
(In thousands)	December 28, 2019		December 29, 2018		December 28, 2019		December 29, 2018
Stock-based compensation included in:
Cost of revenues	$	2,961	$	2,366	$	8,386	$	6,650
Research and development	31,543		22,352		86,119		63,329
Selling, general and administrative	15,653		13,923		48,227		39,215
	$	50,157	$	38,641	$	142,732	$	109,194

Employee Stock Option Plans

The types of awards allowed under the 2007 Equity Incentive Plan (2007 Equity Plan) include incentive stock options, non-qualified stock options, restricted stock units (RSUs), restricted stock and stock appreciation rights. To date, the Company has issued a mix of non-qualified stock options and RSUs under the 2007 Equity Plan; however, there was no issuance of stock options during the first nine months of fiscal 2020 and the entire fiscal 2019. The Company's stock-based compensation expenses related to options during the third quarter and the first nine months of fiscal 2020 and the number of options outstanding as of December 28, 2019 were not material. On August 8, 2019, the stockholders approved an amendment to increase the authorized number of shares reserved for issuance under the 2007 Equity Plan by 6.0 million shares. As of December 28, 2019, 14.9 million shares remained available for grant under the 2007 Equity Plan.

RSU Awards

A summary of the Company’s RSU activity and related information is as follows:



	RSUs Outstanding
(Shares in thousands)	Number of Shares		Weighted-Average Grant-Date Fair Value Per Share
March 31, 2018	6,989		$	51.39
Granted	3,559		$	66.94
Vested	(2,681	)	$	49.05
Cancelled	(536	)	$	55.09
March 30, 2019	7,331		$	59.54
Granted	2,700		$	110.05
Vested	(2,599	)	$	54.06
Cancelled	(289	)	$	73.99
December 28, 2019	7,143		$	80.04

The estimated fair values of RSUs were calculated based on the market price of Xilinx common stock on the date of grant, reduced by the present value of dividends expected to be paid on Xilinx common stock prior to vesting. The per share weighted-average fair value of RSUs granted during the third quarter of fiscal 2020 was $89.57 ($75.72 for the third quarter of fiscal 2019), which were calculated based on estimates at the date of grant using the following weighted-average assumptions:



	Three Months Ended				Nine Months Ended
	December 28, 2019		December 29, 2018		December 28, 2019		December 29, 2018
Risk-free interest rate	1.6	%	3.0	%	1.8	%	2.7	%
Dividend yield	1.6	%	1.8	%	1.3	%	2.1	%

For the majority of RSUs granted, the number of shares of common stock issued on the date the RSU awards vest is net of the minimum statutory withholding requirements that the Company pays in cash to the appropriate taxing authorities on behalf of the Company's employees. During the first nine months of fiscal 2020 and 2019, the Company withheld $75.4 million and $42.0 million worth of RSU awards, respectively, to satisfy the employees’ tax obligations.

During the third quarter and the first nine months of fiscal 2020, the Company realized excess tax benefits of $1.3 million and $35.6 million, respectively, primarily from RSU vesting. During the third quarter and the first nine months of fiscal 2019, the excess tax benefits were $1.5 million and $10.2 million, respectively, primarily from RSU vesting. These tax benefits were recorded in the condensed consolidated statements of income as a component of the provision for income taxes.

Employee Stock Purchase Plan

Under the Company’s ESPP, shares are only issued during the second and fourth quarters of each fiscal year. Employees purchased 241 thousand shares for $19.7 million during the second quarter of fiscal 2020 and 359 thousand shares for $18.0 million during the second quarter of fiscal 2019. The per-share weighted-average fair value of stock purchase rights granted under the ESPP during the second quarter of fiscal 2020 and 2019 was $33.79 and $19.06, respectively. The fair values of stock purchase plan rights granted in the second quarter of fiscal 2020 and 2019 were estimated using the Black-Scholes option pricing model at the date of grant using the following assumptions:



	2020		2019
Expected life of options (years)	1.25		1.25
Expected stock price volatility	0.37		0.29
Risk-free interest rate	1.9	%	2.5	%
Dividend yield	1.3	%	2.0	%

The next scheduled purchase under the ESPP is in the fourth quarter of fiscal 2020. On August 8, 2019, the stockholders approved an amendment to increase the authorized number of shares reserved for issuance under the ESPP by 2.0 million shares. As of December 28, 2019, 13.1 million shares were available for future issuance under the Company's ESPP.