Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2012

Summary of Stock Option Activity

The following table summarizes the Company’s stock option activity for the year ended December 31, 2012:

	Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
	(in thousands)					(in years)		(in thousands)
Outstanding as of December 31, 2011		4,473		$	24.48
Granted		53			36.60
Exercised		(842	)		20.72
Forfeited or expired		(125	)		24.11
Outstanding as of December 31, 2012		3,559		$	25.56		7.1	$	40,098
Exercisable as of December 31, 2012		1,186		$	21.37		5.4	$	18,351
Options vested or expected to vest at December 31, 2012 (1)		3,203		$	25.15		6.9	$	37,424

(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:

	Year Ended December 31,
	2012			2011			2010
Risk-free rate		2.0	%		2.9	%		3.3	%
Expected dividend yield		1.2	%		1.1	%		1.3	%
Expected volatility		44	%		43	%		44	%
Expected term (in years)		5.7			5.5			5.3

Stock-Based Compensation Expense

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

	Year Ended December 31,
	2012		2011		2010
Product cost of revenue	$	581	$	456	$	206
Service cost of revenue		161		172		72
Research, development, and engineering		2,149		2,268		1,020
Selling, general, and administrative		5,629		5,172		1,729
	$	8,520	$	8,068	$	3,027