Interpreting Disclosure on Employee Stock Options

Intel Corporation reported the following in its $201810-$K report.

Share$-$Based Compensation Share$-$based compensation recognized in $2018$ was $$1\mathrm{.}3$ billion $($ $$1\mathrm{.}2$ billion in $2017$ and $$1\mathrm{.}2$ billion in $2016).$ During $2018,$ the tax benefit that we realized for the tax deduction from share$-$based awards totaled $$399$ million $($$$520$ million in $2017$ and $$616$ million in $2016).$ We grant RSUs with a service condition, as well as RSUs with both a market condition and a service condition, which we call outperformance stock units $($OSUs$).$ We estimate the fair value of Restricted Stock Units $($RSUs$)$ with a service condition using the value of our common stock on the date of grant, reduced by the present value of dividends expected to be paid on our shares of common stock prior to vesting. We estimate the fair value of OSUs using a Monte Carlo simulation model on the date of grant. We base expected volatility for OSUs on historical volatility. We based the weighted average estimated value of RSU and OSU grants on the weighted average assumptions for each period as follows.

RSUs and OSUs Dec. $29,2018$ Dec. $30,2017$ Dec. $31,2016$

Estimated values $$41\mathrm{.}61$ $$30\mathrm{.}01$ $$25\mathrm{.}30$

Risk$-$free interest rate $2\mathrm{.}4\%1\mathrm{.}4\%0\mathrm{.}9\%$

Dividend yield $2\mathrm{.}4\%2\mathrm{.}9\%3\mathrm{.}3\%$

Volatility $22\mathrm{.}0\%23\mathrm{.}0\%23\mathrm{.}0\%$

Additional information with respect to RSU activity is as follows.

Restricted Stock Unit Awards RSU activity in $2018$ was as follows.

Weighted Average

Number of RSUs Grant$-$Date

$($in millions$)$ Fair Value

December $30,201785\mathrm{.}3$ $$27\mathrm{.}51$

Granted $30\mathrm{.}941\mathrm{.}61$

Vested $(33\mathrm{.}6)26\mathrm{.}89$

Forfeited $(6\mathrm{.}3)30\mathrm{.}80$

December $29,201876\mathrm{.}333\mathrm{.}21$

What amount did Intel record in $2018$ for share$-$based compensation expense?

$Answer

billion

What is the total fair value of RSUs granted in $2018?$

Enter answer in millions. Round to the nearest million.

$Answer

million

Imagine that during $2018,$ all employees immediately sold their shares when their RSUs vested. What profit would the employees have made $($before tax$)?$ Hint: Use the RSU average grant$-$date fair value to approximate Intel$$s average stock price in $2018.$

Enter answer in millions. Round to the nearest million.

$Answer

million