Equity Incentive Plans and Stock-Based Compensation

3 Months Ended

Mar. 31, 2025

Share-Based Payment Arrangement [Abstract]

Equity Incentive Plans and Stock-Based Compensation

10. Equity Incentive Plans and Stock-Based Compensation

As of March 31, 2025, we have two active equity incentive plans: the 2020 Equity Incentive Plan and the Employee Stock Purchase Plan (“ESPP”).

In February 2025, we granted performance stock units (“PSU”) to certain members of our management team under the 2020 Equity Incentive Plan. The vesting of PSUs is conditional upon the achievement of certain internal financial targets for the year ended December 31, 2025 and these will vest over a three-year service period. The number of units to be earned can range from 0% to 200% of the target shares depending on the achievement of the financial targets. In the event such targets are achieved, one-third of the eligible PSUs would vest and the remaining two-thirds would thereafter vest quarterly over the second and third years, subject to continued service. In the event the minimum targets are not achieved, no PSUs would vest. The compensation expense associated with PSUs is recognized using the accelerated attribution method over the requisite service period, and it is based on the estimated number of shares that is considered probable of vesting. Adjustments to the compensation expense will be made in each reporting period based on changes in our estimate of the number of PSUs that are probable of vesting.

We measure and recognize compensation for all stock-based compensation awards, including stock options, stock purchase rights, restricted stock units (“RSU”) and PSU, based upon the grant-date fair value of those awards. The grant-date fair value of our stock options and stock purchase rights is estimated using a Black-Scholes-Merton option-pricing model. The fair value of our RSUs and PSUs are calculated based on the market value of our stock at the grant date.

The following table summarizes stock-based compensation expense by line item in the condensed consolidated statements of operations (in thousands):


	Three Months Ended March 31,
	2025		2024

Cost of revenue	$	498	$	545
Sales, general and administrative		8,075		6,281
Product development		749		865
Stock-based compensation expense, net of amounts capitalized (1)	$	9,322	$	7,691
Excess income tax benefits related to stock-based compensation expense	$	163	$	447

(1)

Stock-based compensation expense capitalized were not material for each of the periods presented.

The following table summarizes by type of grant, the total unrecognized stock-based compensation expense and the remaining period over which such expense is expected to be recognized (in thousands, except number of years):


	March 31, 2025
	Unrecognized Expense		Remaining weighted average period (In years)

Stock options	$	27,338	2.6
RSUs		35,309	3.0
PSUs		6,414	2.9
ESPP		471	0.4
Total unrecognized stock-based compensation expense	$	69,532

Corsair Gaming, Inc. 10-Q