Stock-based Compensation Expense and Share Repurchase

Stock-based compensation expense

During the three and nine months ended September 30, 2018 and 2017, the Company recognized the following stock-based compensation expense:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2018		2017			2018			2017
	(in thousands)
Stock-based compensation expense by type of award:
Stock options	$	27,234	$	25,969		$	81,880		$	80,865
Restricted stock and restricted stock units (including PSUs)	55,482		46,737			157,397			131,388
ESPP share issuances	2,725		2,428			7,281			6,738
Stock-based compensation expense related to inventories	91		(678		)	(454		)	(2,001		)
Total stock-based compensation included in costs and expenses	$	85,532	$	74,456		$	246,104		$	216,990

Stock-based compensation expense by line item:
Cost of sales	$	1,259	$	686		$	3,263		$	1,656
Research and development expenses	52,918		46,186			153,018			134,855
Sales, general and administrative expenses	31,355		27,584			89,823			80,479
Total stock-based compensation included in costs and expenses	$	85,532	$	74,456		$	246,104		$	216,990

The following table sets forth the Company’s unrecognized stock-based compensation expense as of September 30, 2018, by type of award and the weighted-average period over which that expense is expected to be recognized:



	As of September 30, 2018
	Unrecognized Expense		Weighted-average Recognition Period
	(in thousands)		(in years)
Type of award:
Stock options	$	189,045	2.77
Restricted stock and restricted stock units (including PSUs)	$	388,909	2.71
ESPP share issuances	$	3,051	0.47

The following table summarizes information about stock options outstanding and exercisable as of September 30, 2018:



	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number Outstanding	Weighted-average Remaining Contractual Life	Weighted-average Exercise Price		Number Exercisable	Weighted-average Exercise Price
	(in thousands)	(in years)	(per share)		(in thousands)	(per share)
$29.07–$40.00	550	1.36	$	34.89	550	$	34.89
$40.01–$60.00	495	3.71	$	49.82	495	$	49.82
$60.01–$80.00	556	5.51	$	74.96	545	$	74.94
$80.01–$100.00	3,017	7.46	$	89.18	1,228	$	89.88
$100.01–$120.00	725	6.36	$	109.30	550	$	109.19
$120.01–$140.00	880	6.89	$	130.25	615	$	130.15
$140.01–$160.00	1,445	9.33	$	155.52	198	$	155.20
$160.01–$180.00	545	8.77	$	162.94	128	$	162.94
$180.01–$181.60	732	9.80	$	181.60	4	$	181.60
Total	8,945	7.18	$	111.22	4,313	$	89.83

Share repurchase program

The Board of Directors approved a share repurchase program, pursuant to which the Company is authorized to repurchase up to $500.0 million of its common stock between February 1, 2018 and December 31, 2019. Under the share repurchase program, the Company is authorized to purchase shares from time to time through open market or privately negotiated transactions. Such purchases may be made pursuant to Rule 10b5-1 plans or other means as determined by the Company’s management and in accordance with the requirements of the SEC.

During the nine months ended September 30, 2018, the Company repurchased 1,282,683 shares of its common stock under the share repurchase program for an aggregate of $211.0 million (of which $4.0 million was accrued as of September 30, 2018), including commissions and fees. The Company expects to fund further repurchases of its common stock through a combination of cash on hand and cash generated by operations.