Stock-based compensation expense related to awards issued under the Company's incentive compensation plans for the three and nine months ended September 30, 2025 and 2024 was as follows (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Cost of sales	$	7.4	$	6.1	$	22.2	$	20.8
Selling, general, and administrative expenses	23.4		20.4		65.8		62.4
Research and development expenses	10.3		8.7		30.7		28.3

Total stock-based compensation expense	41.1		35.2		118.7		111.5
Income tax benefit	(7.8)		(6.0)		(20.4)		(17.5)
Total stock-based compensation expense, net of tax	$	33.3	$	29.2	$	98.3	$	94.0

At September 30, 2025, the total remaining compensation cost related to nonvested stock options, restricted stock units, market-based restricted stock units, and employee stock purchase plan (“ESPP”) subscription awards amounted to $324.1 million, which will be amortized on a straight-line basis over each award's requisite service period. The weighted-average remaining requisite service period is 31 months.

On May 8, 2025, the Company’s stockholders approved the amendment and restatement of the Company’s 2001 Employee Stock Purchase Plan for United States and international employees to (1) increase the total number of shares of the Company’s common stock available for issuance to the Company’s United States employees by 4.2 million shares to a new total share limit of 43.8 million shares, and (2) increase the total number of shares of the Company’s common stock available for issuance to the Company’s international employees by 1.5 million shares to a new total share limit of 12.3 million shares.

During the nine months ended September 30, 2025, the Company granted 1.8 million stock options at a weighted-average exercise price per share of $74.78 and 1.6 million restricted stock units at a weighted-average grant-date fair value per share of $75.01. During the nine months ended September 30, 2025, the Company also

granted 0.1 million market-based restricted stock units at a weighted-average grant-date fair value per share of $89.94. The market-based restricted stock units granted during the nine months ended September 30, 2025 vest based on a combination of certain service and market conditions. The actual number of shares issued will be determined based on the Company's total shareholder return relative to a selected industry peer group over a three-year performance period and may range from 0% to 175% of the target number of shares granted.

The fair value of market-based restricted stock units was determined using a Monte Carlo simulation model, which uses multiple input variables to determine the probability of satisfying the market condition requirements. The weighted-average assumptions used to determine the fair value of the market-based restricted stock units granted during the nine months ended September 30, 2025 and 2024 included a risk-free interest rate of 3.8% and 4.5%, respectively, and an expected volatility rate of 37.9% and 32.4%, respectively.

The following table includes the weighted-average grant-date fair values of stock options granted during the periods indicated and the related weighted-average assumptions used in the Black-Scholes option pricing model:


Option Awards	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Risk-free interest rate	3.8%		4.2%		4.0%		4.5%
Expected dividend yield	None		None		None		None
Expected volatility	33.9%		31.0%		34.1%		30.9%
Expected term (years)	5.6		5.5		5.2		5.3
Fair value, per option	$	30.24	$	32.15	$	28.26	$	31.30

The following table includes the weighted-average grant-date fair values for ESPP subscriptions granted during the periods indicated and the related weighted-average assumptions used in the Black-Scholes option pricing model:


ESPP	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Risk-free interest rate	4.2%		5.3%		4.3%		5.2%
Expected dividend yield	None		None		None		None
Expected volatility	34.5%		29.5%		30.8%		33.5%
Expected term (years)	0.6		0.6		0.6		0.6
Fair value, per share	$	20.73	$	16.51	$	18.81	$	25.01