Share-Based Compensation Expense (Tables)

12 Months Ended

Oct. 31, 2019

Share-based Payment Arrangement [Abstract]

Summary of stock option activity

The following table is a summary of Ciena’s stock option activity for the periods indicated (shares in thousands):

	Shares Underlying Options Outstanding		Weighted Average Exercise Price
Balance as of October 31, 2018	276		$	33.52
Granted	—		—
Exercised	(50	)	$	24.13
Canceled	(6	)	$	37.03
Balance as of October 31, 2019	220		$	35.54

Assumptions for awards granted

Assumptions for awards granted during fiscal 2019 and fiscal 2018 included the following:

	Year Ended October 31,
	2019	2018
Expected volatility of Ciena common stock, which is a weighted average of implied volatility and historical volatility	34.10%	34.93%
Historical volatility of Ciena common stock	36.80%	38.24%
Historical volatility of S&P Networking Index	17.39%	17.14%
Correlation coefficient	0.6251	0.6597
Expected life in years	2.87	2.89
Risk-free interest rate	2.62%	1.94%
Expected dividend yield	0.0%	0.0%

Summarizes information with respect to stock options outstanding

The following table summarizes information with respect to stock options outstanding at October 31, 2019, based on Ciena’s closing stock price on the last trading day of Ciena’s fiscal 2019 (shares and intrinsic value in thousands):

					Options Outstanding and Vested at
					October 31, 2019
					Number	Weighted Average Remaining	Weighted
Range of					of	Contractual	Average		Aggregate
Exercise					Underlying	Life	Exercise		Intrinsic
Price					Shares	(Years)	Price		Value
$	6.43	—	$	10.50	4	0.81	$	8.42	$	117
$	11.34	—	$	15.67	49	2.79	$	13.51	1,123
$	17.50	—	$	19.25	11	4.6	$	18.17	202
$	32.06	—	$	37.10	31	3.27	$	36.04	28
$	41.52	—	$	55.63	125	3.48	$	46.47	—
$	6.43	—	$	55.63	220	3.30	$	35.54	$	1,470

Summary of restricted stock unit activity

The following table is a summary of Ciena’s restricted stock unit activity for the period indicated, with the aggregate fair value of the balance outstanding at the end of each period, based on Ciena’s closing stock price on the last trading day of the relevant period (shares and aggregate fair value in thousands):

	Restricted Stock Units Outstanding		Weighted Average Grant Date Fair Value Per Share		Aggregate Fair Value
Balance as of October 31, 2018	4,402		$	22.26	$	140,943
Granted	2,057
Vested	(2,101	)
Canceled or forfeited	(348	)
Balance as of October 31, 2019	4,010		$	27.94	$	146,091

Share-based compensation expense

The following table summarizes share-based compensation expense for the periods indicated (in thousands):

	Year Ended October 31,
	2019		2018			2017
Product cost of goods sold	$	2,868	$	2,984		$	2,672
Service cost of goods sold	3,175		2,616			2,487
Share-based compensation expense included in cost of goods sold	6,043		5,600			5,159
Research and development	14,321		13,518			12,957
Sales and marketing	16,474		14,246			12,846
General and administrative	22,841		19,709			17,321
Share-based compensation expense included in operating expense	53,636		47,473			43,124
Share-based compensation expense capitalized in inventory, net	57		(101		)	77
Total share-based compensation	$	59,736	$	52,972		$	48,360