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 39 weeks ended November 2, 2024 and October 28, 2023, respectively. Stock-based compensation expense for stock options was $1,531 and $1,742 for the 13 weeks ended November 2, 2024 and October 28, 2023, respectively. Stock-based compensation expense for stock options was $4,716 and $4,961 for the 39 weeks ended November 2, 2024 and October 28, 2023, respectively. The weighted-average grant date fair value of these stock options was $157.66 and $199.15 for the 39 weeks ended November 2, 2024 and October 28, 2023, respectively. At November 2, 2024, there was approximately $13,690 of unrecognized stock-based compensation expense related to unvested stock options.

There were 53 and 48 restricted stock units issued during the 39 weeks ended November 2, 2024 and October 28, 2023, respectively. Stock-based compensation expense for restricted stock units was $5,176 and $4,959 for the 13 weeks ended November 2, 2024 and October 28, 2023, respectively. Stock-based compensation expense for restricted stock units was $14,561 and $14,252 for the 39 weeks ended November 2, 2024 and October 28, 2023, respectively. At November 2, 2024, there was approximately $33,877 of unrecognized stock-based compensation expense related to restricted stock units.

There were 71 and 33 performance-based restricted stock units issued during the 39 weeks ended November 2, 2024 and October 28, 2023, respectively. Stock-based compensation expense for performance-based restricted stock units was $1,712 and $5,237 for the 13 weeks ended November 2, 2024 and October 28, 2023, respectively. Stock-based compensation expense for performance-based restricted stock units was $8,414 and $14,264 for the 39 weeks ended November 2, 2024 and October 28, 2023, respectively. At November 2, 2024, there was approximately $17,805 of unrecognized stock-based compensation expense related to performance-based restricted stock units.