

	2019
Beginning outstanding balance	8,668
Awarded	3,731
Released	(3,221	)
Forfeited	(386	)
Ending outstanding balance	8,792

Beginning January 2019, restricted stock units granted as part of our annual review process or for promotions will vest over four years. Restricted stock units granted as part of our annual review process or for promotions with grant dates prior to January 2019 continue to vest over three years.



	Number of Shares (thousands)	Weighted Average Remaining Contractual Life (years)	Aggregate Intrinsic Value^(*) (millions)
2019
Restricted stock units outstanding	8,792	1.44	$	2,381.8
Restricted stock units expected to vest	7,950	1.37	$	2,153.5
2018
Restricted stock units outstanding	9,046	1.36	$	2,273.3
Restricted stock units expected to vest	8,224	1.30	$	2,066.9

In the first quarter of fiscal 2019, the Executive Compensation Committee approved the 2019 Performance Share Program, the terms of which are similar to prior year programs that are still outstanding. For information regarding our Performance Shares Program including the terms, see “Note 11. Stock-Based Compensation” of our Annual Report on Form 10-K for the fiscal year ended November 30, 2018.

In the first quarter of fiscal 2019, the Executive Compensation Committee also certified the actual performance achievement of participants in the 2016 Performance Share Program. Actual performance resulted in participants achieving 200% of target or approximately 0.8 million shares. The shares granted and achieved under the 2016 Performance Share Program fully vested on the three-year anniversary of the grant on January 25, 2019, if not forfeited.

As of May 31, 2019, the shares awarded under our 2019, 2018 and 2017 Performance Share Programs remain outstanding and are yet to be achieved.

The following table sets forth the summary of performance shares activity for the six months ended May 31, 2019 (in thousands):



	2019
	Shares Granted			Maximum Shares Eligible to Receive
Beginning outstanding balance	1,148			2,296
Awarded	722		⁽¹⁾	614
Achieved	(830	)	⁽²⁾	(830	)
Forfeited	(23	)		(46	)
Ending outstanding balance	1,017			2,034

^{_________________________________________}

There were no stock purchases under the Employee Stock Purchase Plan (“ESPP”) during the three months ended May 31, 2019 and June 1, 2018, respectively. The assumptions used to value employee stock purchase rights during the six months ended May 31, 2019 and June 1, 2018 were as follows:



	2019	2018
Expected life (in years)	0.5 - 2.0	0.5 - 2.0
Volatility	35% - 37%	26% - 27%
Risk free interest rate	2.47% - 2.63%	1.54% - 1.89%

Employees purchased 0.5 million shares at an average price of $129.23 and 0.7 million shares at an average price of $91.74 for the six months ended May 31, 2019 and June 1, 2018, respectively. The intrinsic value of shares purchased during the six months ended May 31, 2019 and June 1, 2018 was $51.2 million and $54.3 million, respectively. The intrinsic value is calculated as the difference between the market value on the date of purchase and the purchase price of the shares.

The Executive Compensation Committee of Adobe’s Board of Directors eliminated the use of stock option grants for all employees and the Board of Directors effective fiscal 2012 and fiscal 2014, respectively. However, we may assume the stock option plans of certain companies we acquire. As of May 31, 2019 we had 0.2 million stock options outstanding.

As of May 31, 2019, there was $1.45 billion of unrecognized compensation cost, adjusted for estimated forfeitures, related to non-vested stock-based awards which will be recognized over a weighted average period of 2.4 years. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures.

Total stock-based compensation costs included in our condensed consolidated statements of income for the three months ended May 31, 2019 and June 1, 2018 were as follows (in thousands):



	2019				2018
Income Statement Classifications	Option Grants and Stock Purchase Rights		Restricted Stock Units and Performance Share Awards		Option Grants and Stock Purchase Rights		Restricted Stock Units and Performance Share Awards
Cost of revenue—subscription	$	1,500	$	6,491	$	729	$	4,526
Cost of revenue—services and support	1,757		4,152		1,647		2,680
Research and development	8,771		86,123		5,301		63,608
Sales and marketing	10,087		58,525		5,443		42,747
General and administrative	2,189		24,705		1,350		17,346
Total	$	24,304	$	179,996	$	14,470	$	130,907

Total stock-based compensation costs included in our condensed consolidated statements of income for the six months ended May 31, 2019 and June 1, 2018 were as follows (in thousands):



	2019				2018
Income Statement Classifications	Option Grants and Stock Purchase Rights		Restricted Stock Units and Performance Share Awards		Option Grants and Stock Purchase Rights		Restricted Stock Units and Performance Share Awards
Cost of revenue—subscription	$	2,890	$	11,673	$	1,497	$	8,470
Cost of revenue—services and support	3,755		7,969		3,663		5,666
Research and development	17,216		161,942		10,649		117,681
Sales and marketing	20,440		110,772		10,763		81,595
General and administrative	5,470		46,860		2,830		38,088
Total	$	49,771	$	339,216	$	29,402	$	251,500