Enphase Energy, Inc.ENPH
Enphase Energy, Inc. Stock Compensation Disclosure
STOCK-BASED COMPENSATION
2011 Plan
Under the 2011 Equity Incentive Plan (the “2011 Plan”), the Company could initially issue up to 2,643,171 shares of its common stock pursuant to stock options, stock appreciation rights (“SARS”), restricted stock awards (“RSA”), RSUs, PSUs, and other forms of equity compensation, or collectively, stock awards, all of which may be granted to employees, including officers, and to non-employee directors and consultants. Options granted under the 2011 Plan before August 1, 2012 generally expire 10 years after the grant date and options granted thereafter generally expire seven years after the grant date. Equity awards granted under the 2011 Plan generally vested over a four-year period from the date of grant based on continued service to the Company. As of May 19, 2021, no further stock options or other stock awards may be granted under the 2011 Plan.
2021 Plan
On May 19, 2021, at the 2021 annual meeting of stockholders of the Company, the stockholders approved the 2021 Equity Incentive Plan (the “2021 Plan”), as the successor to the 2011 Plan. The 2021 Plan was amended and restated at the 2025 annual meeting of stockholders of the Company to increase the number of shares of common stock authorized for issuance thereunder by an additional 4,000,000 shares. The 2021 Plan provides for the grant of incentive stock options, SARS, RSAs, RSUs, PSUs and other forms of equity compensation. Eligible participants under the 2021 Plan include Company’s employees, directors and consultants. The 2021 Plan provides, among other things, that the number of shares of the Company’s common stock, $0.00001 par value per share, reserved for issuance under the 2021 Plan (subject to adjustment for certain changes in the Company’s capitalization) is equal to: (A) the sum of (i) 13,100,456 newly reserved shares of the Company’s common stock and (ii) 5,256,517 Returning Shares (as defined below) as such shares become available from time to time as set forth in the 2021 Plan. “Returning Shares” means shares subject to any outstanding award granted under the 2011 Plan (“Prior Plan Award”) that are (i) not issued because such Prior Plan Award or any portion thereof expires or otherwise terminates without all of the shares covered by such Prior Plan Award having been issued, or is settled in cash; (ii) forfeited back to or repurchased by the Company because of a failure to vest; or (iii) reacquired or withheld (or not issued) by the Company to satisfy the purchase price of, or a tax withholding obligation in connection with, a Prior Plan Award that is a Full Value Award (as defined in the 2021 Plan). As of December 31, 2025, 5,978,943 shares remained available for issuance under the 2021 Plan.
2011 Employee Stock Purchase Plan
The 2011 Employee Stock Purchase Plan (“ESPP”) became effective immediately upon the execution and delivery of the underwriting agreement for the Company’s initial public offering on March 29, 2012. The ESPP authorized the issuance of 669,603 shares of the Company’s common stock pursuant to purchase rights granted to employees. The number of shares of common stock reserved for issuance will automatically increase, on each January 1, by a lesser of (i) 700,000 shares of the Company’s common stock or (ii) 1.0% of the total number of shares of the Company’s common stock outstanding on December 31 of the preceding calendar year, as determined by the Company’s board of directors. In 2022, the Company’s board of directors waived the automatic increase of 700,000 shares that were to be added on January 1, 2023 for issuance under the ESPP and no additional shares were added to the plan on January 1, 2023. As of December 31, 2025, 2,797,029 shares remained available for future issuance under the ESPP. On January 1, 2026, the shares available for issuance under the ESPP automatically increased by 700,000 shares.
The ESPP is implemented by concurrent offering periods and each offering period may contain up to four interim purchase periods. In general, offering periods consist of the 24-month periods commencing on each May 15 and November 15 of a calendar year.
Generally, all full-time employees in the United States and certain other countries in which the Company operates, including executive officers, are eligible to participate in the ESPP. The ESPP permits eligible employees to purchase the Company’s common stock through payroll deductions, which may not exceed 15% of the employee’s total compensation subject to certain limits. Stock may be purchased under the plan at a price equal to 85% of the fair market value of the Company’s common stock on either the date of purchase or the first day of an offering period, whichever is lower. A two‑year look-back feature in the ESPP causes an offering period to reset if the fair value of the Company’s common stock on a purchase date is less than that on the initial offering date for that offering period. The reset feature, when triggered, will be accounted for as a modification to the original offering, resulting in additional expense to be recognized over the 24-month period of the new offering. During any calendar year, participants may not purchase shares of the Company’s common stock having a value greater than $25,000, based on the fair market value per share of the Company’s common stock at the beginning of an offering period.
Valuation of Equity Awards
Stock Options
No stock options were granted during the years ended December 31, 2025, 2024 and 2023.
Restricted Stock Units
The fair value of the Company’s RSU awards granted is based upon the closing price of the Company’s stock price on the date of grant.
Performance Stock Units
The fair value of the Company’s non-market PSU awards granted was based upon the closing price of the Company’s stock price on the date of grant. The fair value of awards of the Company’s PSU awards containing market conditions was determined using a Monte Carlo simulation model based upon the terms of the conditions, the expected volatility of the underlying security, and other relevant factors.
Stock-based Compensation Expense
Stock-based compensation expense for all stock-based awards, which includes shares purchased under the Company’s ESPP, RSUs and PSUs, expected to vest is measured at fair value on the date of grant and recognized ratably over the requisite service period.
The following table summarizes the components of total stock-based compensation expense included in the consolidated statements of operations for the periods presented:
| Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| Cost of revenues | $ | 17,178 | $ | 14,538 | $ | 13,357 | |||||||||||
| Research and development | 82,837 | 85,501 | 88,367 | ||||||||||||||
| Sales and marketing | 63,236 | 65,092 | 65,703 | ||||||||||||||
| General and administrative | 50,251 | 45,962 | 45,430 | ||||||||||||||
| Restructuring | 588 | 267 | — | ||||||||||||||
| Total | $ | 214,090 | $ | 211,360 | $ | 212,857 | |||||||||||
| Income tax benefit (expense) included in the provision for income tax | $ | (35,890) | $ | (17,958) | $ | 20,558 | |||||||||||
The following table summarizes the various types of stock-based compensation expense for the periods presented:
| Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In thousands) | |||||||||||||||||
| RSUs and PSUs | $ | 208,891 | $ | 205,453 | $ | 204,238 | |||||||||||
| ESPP | 5,199 | 5,907 | 7,450 | ||||||||||||||
| Post combination expense | — | — | 1,169 | ||||||||||||||
| Total | $ | 214,090 | $ | 211,360 | $ | 212,857 | |||||||||||
As of December 31, 2025, there was approximately $277.1 million of total unrecognized stock-based compensation expense related to unvested equity awards, which are expected to be recognized over a weighted-average period of 2.4 years.
Equity Awards Activity
Stock Options
No stock options were granted during the year ended December 31, 2025, 2024 and 2023. Stock option activity during the period, as well as stock options outstanding as of December 31, 2025, were immaterialRestricted Stock Units
The following table summarizes RSU activity:
| Number of Shares Outstanding | Weighted- Average Fair Value per Share at Grant Date | Weighted- Average Remaining Contractual Term | Aggregate Intrinsic Value (1) | ||||||||||||||||||||
| (In thousands) | (Years) | (In thousands) | |||||||||||||||||||||
| Outstanding at December 31, 2022 | 2,253 | $ | 181.01 | ||||||||||||||||||||
| Granted | 1,409 | $ | 154.63 | ||||||||||||||||||||
| Vested | (1,061) | $ | 152.47 | $ | 185,078 | ||||||||||||||||||
| Canceled | (269) | $ | 184.66 | ||||||||||||||||||||
| Outstanding at December 31, 2023 | 2,332 | $ | 177.64 | ||||||||||||||||||||
| Granted | 1,309 | $ | 101.53 | ||||||||||||||||||||
| Vested | (977) | $ | 171.88 | $ | 107,116 | ||||||||||||||||||
| Canceled | (381) | $ | 160.77 | ||||||||||||||||||||
| Outstanding at December 31, 2024 | 2,283 | $ | 139.27 | ||||||||||||||||||||
| Granted | 2,746 | $ | 43.63 | ||||||||||||||||||||
| Vested | (848) | $ | 153.09 | $ | 41,317 | ||||||||||||||||||
| Canceled | (381) | $ | 119.96 | ||||||||||||||||||||
| Outstanding at December 31, 2025 | 3,800 | $ | 69.01 | 1.5 | $ | 121,780 | |||||||||||||||||
| Expected to vest at December 31, 2025 | 3,745 | $ | 68.63 | 1.5 | $ | 120,025 | |||||||||||||||||
(1) The intrinsic value of RSUs vested is based upon the value of the Company’s stock when vested. The intrinsic value of RSUs outstanding and expected to vest as of December 31, 2025 is based on the closing price of the last trading day during the period ended December 31, 2025. The Company’s stock fair value used in this computation was $32.05 per share.
Performance Stock Units
The following summarizes PSU activity:
| Number of Shares Outstanding | Weighted- Average Fair Value per Share at Grant Date | Weighted- Average Remaining Contractual Term | Aggregate Intrinsic Value (1) | ||||||||||||||||||||
| (In thousands) | (Years) | (In thousands) | |||||||||||||||||||||
| Outstanding at December 31, 2022 | 376 | $ | 197.82 | ||||||||||||||||||||
| Granted | 422 | $ | 233.90 | ||||||||||||||||||||
| Vested | (380) | $ | 196.24 | $ | 80,113 | ||||||||||||||||||
| Canceled | (22) | $ | 229.11 | ||||||||||||||||||||
| Outstanding at December 31, 2023 | 396 | $ | 235.99 | ||||||||||||||||||||
| Granted | 724 | $ | 127.06 | ||||||||||||||||||||
| Vested | (100) | $ | 214.91 | $ | 12,958 | ||||||||||||||||||
| Canceled | (121) | $ | 205.51 | ||||||||||||||||||||
| Outstanding at December 31, 2024 | 899 | $ | 154.67 | ||||||||||||||||||||
| Granted | 1,143 | $ | 77.27 | ||||||||||||||||||||
| Vested | (175) | $ | 110.20 | $ | 10,017 | ||||||||||||||||||
| Canceled | (227) | $ | 119.48 | ||||||||||||||||||||
| Outstanding at December 31, 2025 | 1,640 | $ | 110.34 | 1.1 | $ | 52,541 | |||||||||||||||||
| Expected to vest at December 31, 2025 | 1,640 | $ | 110.34 | 1.1 | $ | 52,541 | |||||||||||||||||
(1) The intrinsic value of PSUs vested is based upon the value of the Company’s stock when vested. The intrinsic value of PSUs outstanding and expected to vest as of December 31, 2025 is based on the closing price of the last trading day during the period ended December 31, 2025. The Company’s stock fair value used in this computation was $32.05 per share.
Employee Stock Purchase Plan
A summary of ESPP activity for the years presented is as follows (in thousands, except per share data):
| Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Proceeds from common stock issued under ESPP | $ | 8,599 | $ | 11,773 | $ | 12,897 | |||||||||||
| Shares of common stock issued | 260 | 185 | 133 | ||||||||||||||
| Weighted-average price per share | $ | 33.14 | $ | 63.54 | $ | 97.05 | |||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 17, 2026 | Showing above |
| 2024 | Feb 10, 2025 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.