9.Stock-based compensation

Stock-based compensation expense is measured on the grant date based on the fair value of the award. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period for awards expected to vest. The estimated grant date fair value of stock options was determined using a Black-Scholes valuation model using the following weighted-average assumptions for the periods indicated:

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The expected volatility is based on the historical volatility of the Company’s common stock. The risk-free interest rate is based on the United States Treasury yield curve in effect on the date of grant for the respective expected life of the option. The expected life represents the time the options granted are expected to be outstanding. The expected life of options granted is derived from historical data on Ulta Beauty stock option exercises. Forfeitures of stock options are estimated at the grant date based on historical rates of stock option activity and reduce the stock-based compensation expense recognized. The Company does not currently pay a regular dividend.

The Company granted 56 and 42 stock options during the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. Stock-based compensation expense for stock options was $1,506 and $1,749 for the 13 weeks ended August 3, 2024 and July 29, 2023, respectively. Stock-based compensation expense for stock options was $3,185 and $3,219 for the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. The weighted-average grant date fair value of these stock options was $157.66 and $199.15 for the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. At August 3, 2024, there was approximately $15,252 of unrecognized stock-based compensation expense related to unvested stock options.

There were 51 and 45 restricted stock units issued during the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. Stock-based compensation expense for restricted stock units was $4,997 and $4,934 for the 13 weeks ended August 3, 2024 and July 29, 2023, respectively. Stock-based compensation expense for restricted stock units was $9,385 and $9,293 for the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. At August 3, 2024, there was approximately $39,738 of unrecognized stock-based compensation expense related to restricted stock units.

There were 71 and 33 performance-based restricted stock units issued during the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. Stock-based compensation expense for performance-based restricted stock units was $2,687 and $5,135 for the 13 weeks ended August 3, 2024 and July 29, 2023, respectively. Stock-based compensation expense for performance-based restricted stock units was $6,702 and $9,027 for the 26 weeks ended August 3, 2024 and July 29, 2023, respectively. At August 3, 2024, there was approximately $25,089 of unrecognized stock-based compensation expense related to performance-based restricted stock units.