Share-Based Compensation

3 Months Ended

Jun. 30, 2019

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

Share-Based Compensation Expense

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



	Three Months Ended June 30,
	2019		2018
Cost of sales ⁽¹⁾	$	4.9	$	3.6
Research and development	19.5		14.1
Selling, general and administrative	16.3		11.7
Special charges and other, net	—		15.9
Pre-tax effect of share-based compensation	40.7		45.3
Income tax benefit	9.1		10.1
Net income effect of share-based compensation	$	31.6	$	35.2

⁽¹⁾During the three months ended June 30, 2019, $4.8 million of share-based compensation expense was capitalized to inventory, and $4.9 million of previously capitalized share-based compensation expense in inventory was sold. During the three months ended June 30, 2018, $3.5 million of share-based compensation expense was capitalized to inventory and $3.6 million of previously capitalized share-based compensation expense in inventory was sold.

Microsemi Acquisition-related Equity Awards

In connection with its acquisition of Microsemi on May 29, 2018, the Company assumed certain restricted stock units (RSUs), stock appreciation rights (SARs), and stock options granted by Microsemi. The assumed awards were measured at the acquisition date based on the estimated fair value, which was a total of $175.4 million. A portion of that fair value, $53.9 million, which represented the pre-acquisition vested service provided by employees to Microsemi, 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 $121.5 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 June 30, 2018, the Company recognized $21.9 million of share-based compensation expense in connection with the acquisition of Microsemi, of which $0.4 million was capitalized into inventory and $15.9 million was due to the accelerated vesting of outstanding equity awards upon termination of certain Microsemi employees.