Share-Based Compensation (Notes)

9 Months Ended

Dec. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

The following table presents the details of the Company's share-based compensation expense (amounts in thousands):



	Three Months Ended				Nine Months Ended
	December 31,				December 31,
	2016		2015		2016		2015
Cost of sales ⁽¹⁾	$	3,468	$	2,270	$	15,465	$	6,325
Research and development	9,881		7,855		37,569		23,623
Selling, general and administrative	8,771		6,840		53,055		24,155
Pre-tax effect of share-based compensation	22,120		16,965		106,089		54,103
Income tax benefit ⁽²⁾	7,376		5,460		36,622		17,566
Net income effect of share-based compensation	$	14,744	$	11,505	$	69,467	$	36,537

⁽¹⁾ During the three and nine months ended December 31, 2016, $2.8 million and $8.3 million, respectively, of share-based compensation expense was capitalized to inventory. The amount of share-based compensation included in cost of sales during the three months ended December 31, 2016 included $3.5 million of previously capitalized share-based compensation expense in inventory that was sold. The amount of share-based compensation included in cost of sales during the nine months ended December 31, 2016 included $11.3 million of previously capitalized share-based compensation expense in inventory that was sold and $4.2 million of share-based compensation expense related to the Company's acquisition of Atmel that was not previously capitalized to inventory. During the three and nine months ended December 31, 2015, $2.0 million and $5.6 million, respectively, of share-based compensation expense was capitalized to inventory and $2.3 million and $6.3 million, respectively, of previously capitalized share-based compensation expense in inventory was sold.

⁽²⁾ Amounts exclude excess tax benefits related to share-based compensation of $6.1 million and $18.6 million, respectively, for the three and nine months ended December 31, 2016. The Company elected to early adopt ASU 2016-09 in the three months ended June 30, 2016. Prior to the adoption of ASU 2016-09, the Company recognized excess tax benefits related to share-based compensation in additional paid-in capital. Refer to Note 2 for additional information on the adoption of this standard.

Atmel Acquisition-related Equity Awards

In connection with its acquisition of Atmel, the Company assumed certain restricted stock units (RSUs) granted by Atmel. The assumed awards were measured at the acquisition date based on the estimated fair value, which was a total of $95.9 million. A portion of that fair value, $7.5 million, which represented the pre-acquisition vested service provided by employees to Atmel, was included in the total consideration transferred as part of the acquisition. As of the acquisition date, the remaining portion of the fair value of those awards was $88.4 million, representing post-acquisition share-based compensation expense that will be recognized as these employees provide service over the remaining vesting periods. During the three months ended December 31, 2016, the Company recognized $3.9 million of share-based compensation expense in connection with these awards. During the nine months ended December 31, 2016, the Company recognized $53.3 million of share-based compensation expense in connection with these awards, of which $38.8 million was due to the accelerated vesting of outstanding equity awards upon termination of certain Atmel employees.