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Share-Based Compensation Expense (Tables)

12 Months Ended

Oct. 31, 2020

Share-based Payment Arrangement [Abstract]

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 November 2, 2019	220	$	35.54
Granted	—	—

Exercised	(105)	$	40.27
Canceled	(8)	$	28.22
Balance as of October 31, 2020	107	$	31.41

Assumptions for awards granted

Assumptions for awards granted during fiscal 2020, fiscal 2019 and fiscal 2018 included the following:


	Year Ended
	October 31, 2020	November 2, 2019	November 3, 2018
Expected volatility of Ciena common stock, which is a weighted average of implied volatility and historical volatility	31.77%	34.10%	34.93%
Historical volatility of Ciena common stock	36.29%	36.80%	38.24%
Historical volatility of S&P Networking Index	18.40%	17.39%	17.14%
Correlation coefficient	0.5891	0.6251	0.6597
Expected life in years	2.87	2.87	2.89
Risk-free interest rate	1.65%	2.62%	1.94%
Expected dividend yield	0.0%	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, 2020, based on Ciena’s closing stock price on the last trading day of Ciena’s fiscal 2020 (shares and intrinsic value in thousands):


					Options Outstanding and Vested at
					October 31, 2020
					Number	Weighted Average Remaining	Weighted
Range of					of	Contractual	Average		Aggregate
Exercise					Underlying	Life	Exercise		Intrinsic
Price					Shares	(Years)	Price		Value
$	11.34	—	$	15.00	37	2.33	$	13.60	$	943
$	17.50	—	$	18.22	9	1.97	$	18.16	203
$	32.06	—	$	37.10	19	2.26	$	35.89	67
$	41.52	—	$	55.63	42	2.63	$	47.87	—




$	11.34	—	$	55.63	107	2.41	$	31.41	$	1,213

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 November 2, 2019	4,010	$	27.94	$	146,091
Granted	2,195

Vested	(1,945)
Canceled or forfeited	(211)
Balance as of October 31, 2020	4,049	$	35.08	$	159,498

Share-based compensation expense

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


	Year Ended
	October 31, 2020		November 2, 2019		November 3, 2018
Product cost of goods sold	$	3,182	$	2,868	$	2,984
Service cost of goods sold	3,853		3,175		2,616
Share-based compensation expense included in cost of goods sold	7,035		6,043		5,600
Research and development	16,987		14,321		13,518
Sales and marketing	20,194		16,474		14,246
General and administrative	23,424		22,841		19,709

Share-based compensation expense included in operating expense	60,605		53,636		47,473
Share-based compensation expense capitalized in inventory, net	118		57		(101)
Total share-based compensation	$	67,758	$	59,736	$	52,972