STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2026

Share-Based Payment Arrangement, Noncash Expense [Abstract]

Presented below is a summary of the stock-based compensation cost and associated tax benefit included in the accompanying consolidated statements of operations:


	Three Months Ended March 31,
	2026		2025
Stock-based compensation cost	$	57	$	57
Tax benefit	$	13	$	12

During the first quarter of 2026, the Company granted 0.1 million employee stock options, which had a weighted average grant date fair value of $133.17 per share. The Company also granted 0.5 million shares of restricted stock in the first quarter of 2026, which had a weighted average grant date fair value of $443.84 per share. Both the employee stock options and restricted stock generally vest ratably over four years. Additionally, the Company granted 0.1 million shares of performance-based awards whereby the number of shares that ultimately vest is based on the achievement of certain non-market-based performance metrics of the Company over three years. The weighted average grant date fair value of these awards was $431.10 per share.

The following weighted average assumptions were used in determining the fair value using the Black-Scholes option-pricing model for options granted in 2026:


Expected dividend yield	0.93	%
Expected stock volatility	27	%
Risk-free interest rate	3.74	%
Expected holding period	5.7 years

Unrecognized stock-based compensation expense at March 31, 2026 was $16 million and $412 million for unvested stock options and restricted stock, respectively, which is expected to be recognized over a weighted average period of 2.1 years and 2.8 years, respectively. Additionally, there was $70 million of unrecognized stock-based compensation expense relating to the aforementioned non-market-based performance-based awards, which is expected to be recognized over a weighted average period of 2.2 years.

The following table summarizes information relating to stock option exercises and restricted stock vesting:


	Three Months Ended March 31,
	2026		2025
Exercise of stock options:
Proceeds from stock option exercises	$	8	$	18
Aggregate intrinsic value	$	9	$	28
Tax benefit realized upon exercise	$	2	$	6
Number of shares exercised (1)	—		0.1
Vesting of restricted stock:
Fair value of shares vested	$	197	$	229
Tax benefit realized upon vesting	$	48	$	56
Number of shares vested	0.4		0.5
Vesting of performance-based restricted stock:
Fair value of shares vested	$	72	$	8
Tax benefit realized upon vesting	$	12	$	1
Number of shares vested (2)	0.2		—

(1) The number of shares exercised in 2026 was approximately 34 thousand.

(2) The number of shares vested in 2025 was approximately 15 thousand.