Equity Awards

6 Months Ended

Jun. 30, 2026

Share-Based Payment Arrangement [Abstract]

We have three equity incentive plans: 2012 Equity Incentive Plan (the “2012 Plan”), amended and restated 2021 Equity Incentive Plan (the “2021 Plan”) and 2022 New-Hire Equity Incentive Plan (the “2022 Plan”). The 2012 Plan was terminated in connection with the initial approval of the 2021 Plan on June 7, 2021 but continues to govern the terms of outstanding equity awards that were granted prior to the termination of the 2012 Plan. As of June 7, 2021, we no longer grant equity awards pursuant to the 2012 Plan. The 2021 Plan, as amended and restated, was approved by the shareholders on June 1, 2023 and May 21, 2026 to increase shares available for future grants by approximately 50 million and 38 million shares, respectively. The 2022 Plan was terminated in June 2023 and no additional awards were granted thereafter under the 2022 Plan. Outstanding equity awards under the 2022 Plan continue to be subject to the terms and conditions of the 2022 Plan.

The 2021 Plan and the 2012 Plan provide for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, RSUs, performance-based stock awards and other forms of equity compensation (collectively, “equity awards”). The 2022 Plan permits the grant of any of the foregoing awards with the exception of incentive stock options. In addition, the 2022 Plan, the 2021 Plan and the 2012 Plan provide for the grant of performance cash awards. Incentive stock options may be granted only to employees. All other equity awards may be granted to employees, including officers, as well as directors and consultants.

Our Amended and Restated 2012 Employee Stock Purchase Plan (the “2012 ESPP”) authorizes the issuance of shares of common stock pursuant to purchase rights granted to our employees. The price at which common stock is purchased under the 2012 ESPP is equal to 85% of the fair market value of our common stock on the first or last day of the offering period, whichever is lower. Offering periods are six months long and begin on February 1 and August 1 of each year. The number of shares of common stock reserved for issuance will not be increased without shareholder approval.

Stock Options

A summary of stock option activity for the six months ended June 30, 2026 was as follows:


	Number of Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value
	(in thousands)			(in years)	(in millions)
Outstanding as of December 31, 2025	4,829	$	114.78
Granted(1)	2,675	$	13.14
Exercised	(65)	$	19.91		$	5
Forfeited	(100)	$	19.56
Outstanding as of June 30, 2026	7,339	$	79.87	6.3	$	284
Vested and expected to vest as of June 30, 2026	7,078	$	81.44	6.2	$	266
Vested and exercisable as of June 30, 2026	2,864	$	102.94	5.1	$	60

(1) Stock options related to business combinations include 2.3 million shares from the Armis acquisition.

Aggregate intrinsic value represents the difference between the estimated fair value of our common stock and the exercise price of outstanding, in-the-money options.

The total fair value of stock options vested during the six months ended June 30, 2026 was $38 million. The weighted-average grant-date fair value of stock options granted was $88.79 for the six months ended June 30, 2026.

During the year ended December 31, 2021, a one-time long-term performance-based option award was granted to the Chief Executive Officer (“2021 CEO Performance Award”) and to certain executives (collectively “2021 Performance Awards”) under the 2021 Plan at a total grant-date fair value of $232 million. The 2021 Performance Awards will vest in eight equal tranches based on service and achievement of both performance and market conditions, subject to continued employment and specifically for the 2021 CEO Performance Award, as CEO or Executive Chairman of the Company, through each vesting date. The performance and market conditions for a particular tranche may be achieved at different points in time and in any order but will become eligible to vest only when all service, performance and market conditions for the respective tranche are met but no earlier than two years from date of grant. The performance and market conditions must be achieved by September 30, 2026 (the “Performance Period”). The stock price metric will be achieved when both the 180-day volume weighted-average price (“VWAP”) and the 30-day VWAP equal or exceed the respective tranche stock price metric on any day during the Performance Period. The performance metric is achieved when the trailing four-quarter cumulative GAAP subscription revenues equal or exceed the respective tranche performance target. Shares acquired upon exercise of the options cannot be sold, transferred or disposed until after the end of the Performance Period and the 2021 Performance Awards will expire ten years from the respective date of grant. As of June 30, 2026, the first four tranches were vested based on achievement of both the performance and market conditions.

The fair value of the 2021 Performance Awards and the corresponding derived service periods were estimated using the Monte Carlo simulation. Stock-based compensation expense is recognized on a graded vesting basis over the requisite service period for each respective tranche, but not shorter than the two-year minimum service period, and includes an assessment of when it is probable the performance condition will be achieved, which involves a subjective assessment of our future financial projections.

As of June 30, 2026, total unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested stock options was approximately $210 million. The weighted-average remaining vesting period of unvested stock options at June 30, 2026 was approximately two years.

RSUs

A summary of RSU activity for the six months ended June 30, 2026 was as follows:


	Number of Shares	Weighted-Average Grant-Date Fair Value Per Share
	(in thousands)
Outstanding as of December 31, 2025	26,011	$	158.53
Granted(1)	31,339	$	104.97
Vested	(7,956)	$	135.04
Forfeited	(2,570)	$	142.78
Outstanding as of June 30, 2026	46,824	$	127.55
Expected to vest as of June 30, 2026	41,150

(1) Includes RSUs related to business combinations, of which 5.9 million shares relate to the Armis acquisition.

RSUs outstanding as of June 30, 2026 were comprised of 44.1 million RSUs with only service conditions and 2.7 million RSUs with both service and performance conditions, including certain RSUs with additional market conditions. The total intrinsic value of the RSUs vested was $0.8 billion for the six months ended June 30, 2026. As of June 30, 2026, the aggregate intrinsic value of RSUs outstanding was $4.6 billion and RSUs expected to vest was $4.1 billion.

PRSUs have service, performance and market vesting conditions. The ultimate number of shares eligible to vest range from 0% to 250%, subject to our board of directors compensation committee’s approval of performance metrics achievement and, for certain PRSUs, total shareholder return relative to that of the S&P 500 index.

The eligible shares subject to PRSUs granted during the six months ended June 30, 2026 will vest in one to three years contingent on each holder’s continuous status as an employee on the applicable vesting dates. The number of PRSUs granted included in the table above reflects the shares that could be eligible to vest at 100% of target for PRSUs and includes adjustments for over or under achievement for PRSUs granted in the prior years, as applicable.

We recognized $112 million and $90 million of stock-based compensation expense, net of actual and estimated forfeitures, associated with PRSUs on a graded vesting basis during the six months ended June 30, 2026 and 2025, respectively.

As of June 30, 2026, total unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested RSUs was $4.9 billion, and the weighted-average remaining vesting period was approximately three years.