Stock-Based Compensation |
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| Stock-Based Compensation | Stock-Based Compensation Common Stock
Each share of common stock is entitled to one vote per share and holders of the common stock vote as a single class of stock on any matter that is submitted to a vote of stockholders.
Employee Stock-Based Compensation Plans
At March 31, 2025, the Company had stock-based compensation awards outstanding under the following plans: the 2010 Equity Incentive Plan, as amended, or 2010 Plan, and the 2010 Employee Stock Purchase Plan, or ESPP, and the 2024 Inducement Equity Incentive Plan, or the Inducement Plan. Refer to the Company’s Annual Report for a summary of these plans.
As of March 31, 2025, the number of shares of common stock available for future issuance under the 2010 Plan was 16,105,720 shares, including stock options and restricted stock unit awards outstanding at March 31, 2025 of 11,189,718 shares.
As of March 31, 2025, the number of shares of common stock available for future issuance under the ESPP was 7,303,429 shares.
As of March 31, 2025, the number of shares of common stock available for future issuance under the Inducement Plan was 4,000,000 shares, including 342,435 shares subject to restricted stock unit awards outstanding as of March 31, 2025.
Employee Incentive Bonus
The Company’s Executive Incentive Bonus Plan permits the settlement of awards under the plan in any combination of cash or shares of its common stock. The Company settles a majority of bonus awards for its employees, including executives, in shares of common stock under the 2010 Equity Incentive Plan. When bonus awards are settled in common stock issued under the 2010 Equity Incentive Plan, the number of shares issuable to plan participants is determined based on the closing price of the Company’s common stock as determined in trading on the applicable stock exchange, on a date approved by the Board of Directors. In connection with the Company’s bonus programs, in February 2025, the Company issued 0.1 million freely-tradable (subject to certain restrictions for affiliates) shares of the Company’s common stock in settlement of bonus awards to employees, including executives, for the 2024 performance period. At March 31, 2025, the Company has an accrual of $6.8 million for bonus awards for employees for year-to-date achievement in the 2025 performance period. The Company’s compensation committee retains discretion to effect payment in cash, stock, or a combination of cash and stock.
Stock-Based Compensation
The Company recognizes stock-based compensation in the consolidated statements of operations, based on the department to which the related employee reports, as follows:
The total unrecognized compensation cost related to unvested restricted stock units as of March 31, 2025 was $115.3 million, and the weighted average period over which these equity awards are expected to vest is 2.39 years.
The total unrecognized compensation cost related to unvested performance-based restricted stock units as of March 31, 2025 was $0.9 million, and the weighted average period over which these equity awards are expected to vest is 1.27 years. Actual levels of future performance for the unvested periods may differ from current estimates.
The total unrecognized compensation cost related to unvested stock options as of March 31, 2025 was $23.2 million, and the weighted average period over which these equity awards are expected to vest is 2.89 years.
Restricted Stock Units
A summary of the Company’s restricted stock unit activity for all equity plans is as follows:
(1) Includes approximately 60 thousand shares granted under the Inducement Plan at a weighted-average grant-date fair value per share of $16.83.
(2) Includes approximately 3 thousand shares canceled under the Inducement Plan at a weighted-average grant-date fair value per share of $15.62.
Performance-Based Restricted Stock Units
Performance-based restricted stock units are eligible to vest at the end of each year-long performance period, as defined in the underlying agreement, in a three-year performance period based on whether the Company’s annual growth rate in net sales and non-GAAP diluted earnings per share (subject to certain adjustments) over baseline results relative to the growth rates for a peer group of companies for the same metrics and periods, equals or exceeds the 50th percentile.
The Company’s relative percentile rank in net sales and non-GAAP diluted earnings per share is determined by ranking the designated peer group companies (including MaxLinear) from the highest to the lowest according to their annual growth rate in each metric for the performance year, then calculating the percentile ranking of MaxLinear relative to other companies in the designated peer group. If the Company’s relative percentile rank for each metric at year-end is less than the 25th percentile, no shares will vest. If the Company’s relative percentile rank for these metrics is greater or equal to the 25th percentile, vesting may range from 50% up to a maximum 250% of target; such maximum may be achieved in year if performance at or above the 75th percentile is achieved.
For the performance-based restricted stock units granted to date, 60% of each performance-based award is subject to the net sales metric for the performance period and 40% is subject to the non-GAAP diluted earnings per share metric for the performance period. The maximum percentage for a particular metric is 250% of the target number of units subject to the award related to that metric, however, vesting of the performance stock units is capped at 30% and 100%, respectively, of the target number of units subject to the award in years one and two, respectively, of the three-year performance period. The number of shares granted is based on the maximum percentage achievable (250%) in the performance-based restricted stock unit award, in order to reserve an adequate number of shares for any potential future vesting.
As of March 31, 2025, achievement to date under the performance metrics specified in the respective award agreements are based on its expected revenue and non-GAAP diluted EPS results over the performance periods and calculated growth rates relative to its peers’ expected results based on data available, as defined in the respective award agreements. To the extent any prior achievement levels are no longer probable, any compensation expense recorded is adjusted to the revised achievement levels.
A summary of the Company’s performance-based restricted stock unit activity is as follows:
(1) Includes shares canceled due to achievement below threshold amounts from shares granted which were previously reserved at the maximum achievable (250%). No shares were eligible to vest for the 2024 performance period due to achievement below the 25th percentile.
Employee Stock Purchase Rights and Stock Options
Employee Stock Purchase Rights
During the three months ended March 31, 2025 and 2024, there were no shares of common stock purchased under the ESPP.
The fair values of employee stock purchase rights were estimated using the Black-Scholes option pricing model at their respective grant date using the following assumptions:
The risk-free interest rate assumption was based on rates for United States (U.S.) Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. The assumed dividend yield was based on the Company’s expectation of not paying dividends in the foreseeable future. The expected term is the duration of the offering period for each grant date. In addition, the estimated volatility incorporates the historical volatility over the expected term based on the Company’s daily closing stock prices.
Stock Options
A summary of the Company’s stock options activity is as follows:
The fair values of stock options were estimated using the Black-Scholes option pricing model at their respective grant date using the following assumptions:
(1) No options were granted during the three months ended March 31, 2025.
The risk-free interest rate assumption was based on the United States Treasury’s rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. The assumed dividend yield was based on the Company’s expectation of not paying dividends in the foreseeable future. The expected term of the options was calculated using the simplified method as prescribed by guidance provided by the SEC. This decision was based on the lack of historical data due to the Company’s limited number of stock option exercises under the 2010 Equity Incentive Plan. Estimated volatility incorporates historical volatility of the Company over the expected term based on the Company's daily closing stock prices.
The intrinsic value of stock options exercised was $0 and $0.5 million in the three months ended March 31, 2025 and 2024, respectively.
Cash received from exercise of stock options was negligible during the three months ended March 31, 2025 and 2024. The tax benefit from stock options exercised was $0 and $0.8 million during the three months ended March 31, 2025 and 2024, respectively.
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