Stock-Based Compensation Expense (Tables)

9 Months Ended

Sep. 28, 2014

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

Summary of Stock Option Activity

The following table summarizes the Company’s stock option activity for the nine-month period ended September 28, 2014:

	Shares (in thousands)		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2013	6,138		$	15.65
Granted	1,412		39.16
Exercised	(1,133	)	13.81
Forfeited or expired	(190	)	21.42
Outstanding as of September 28, 2014	6,227		$	21.14	7.2	$	126,966
Exercisable as of September 28, 2014	2,276		$	13.21	5.4	$	64,411
Options vested or expected to vest at   September 28, 2014 (1)	5,657		$	20.34	7.0	$	119,889

 (1) In addition to the vested options, the Company expects a portion of the unvested options to vest at some point in the future. Options expected to vest are calculated by applying an estimated forfeiture rate to the unvested options.

Weighted-Average Assumptions Used in Estimating Fair Values of Stock Options Granted

The fair values of stock options granted in each period presented were estimated using the following weighted-average assumptions:

	Three-months Ended				Nine-months Ended
	September 28, 2014		September 29, 2013		September 28, 2014		September 29, 2013
Risk-free rate	2.7	%	2.0	%	2.7	%	2.0	%
Expected dividend yield	—	%	—	%	—	%	—	%
Expected volatility	41	%	42	%	41	%	42	%
Expected term (in years)	5.4		5.9		5.4		5.9

Nonvested Restricted Stock Shares Activity

The following table summarizes the Company's restricted stock award activity:

	Shares (in thousands)	Weighted-Average Exercise Price		Aggregate Intrinsic Value (in thousands)
Nonvested as of December 31, 2013	—	$	—
Granted	20	34.05
Vested	—	—
Forfeited or expired	—	—
Nonvested as of September 28, 2014	20	$	34.05	$	149

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

The following table details the stock-based compensation expense by caption for each period presented on the Consolidated Statements of Operations (in thousands):

	Three-months Ended				Nine-months Ended
	September 28, 2014		September 29, 2013		September 28, 2014		September 29, 2013
Product cost of revenue	$	242	$	160	$	795	$	564
Service cost of revenue	31		33		138		143
Research, development, and engineering	856		546		2,900		2,009
Selling, general, and administrative	2,169		1,481		7,425		5,583
	$	3,298	$	2,220	$	11,258	$	8,299