Stock Plans

12 Months Ended

Dec. 31, 2025

Share-Based Payment Arrangement [Abstract]

Stock Plans

Note 13. Stock Plans

Under our 2024 Performance Incentive Plan (the “2024 PIP”), we are authorized through May 21, 2034 to issue a maximum of 50.7 million shares of our Common Stock. As of December 31, 2025, there were 47.0 million shares available to be granted.

Stock Compensation Plans

Stock Options

We recorded compensation expense related to stock options held by our employees of $27 million in 2025, $30 million in 2024 and $25 million in 2023 in our results from continuing operations. The deferred tax benefit recorded related to this compensation expense was $3 million in 2025, $5 million in 2024 and $4 million in 2023. The unamortized compensation expense related to our employee stock options was $19 million at December 31, 2025 and is expected to be recognized over a weighted-average period of 1.6 years.

Our weighted-average Black-Scholes Model fair value assumptions were:

	Risk-Free Interest Rate	Expected Life	Expected Volatility	Expected Dividend Yield	Fair Value at Grant Date
2025	4.06%	6 years	22.52%	3.09%	$12.63
2024	4.21%	5 years	20.93%	2.33%	$15.23
2023	4.18%	5 years	20.97%	2.32%	$13.57

The risk-free interest rate represents the constant maturity U.S. government treasuries rate with a remaining term equal to the expected life of the options. The expected life is the period over which our employees are expected to hold their options. Volatility reflects historical movements in our stock price for a period commensurate with the expected life of the options. The dividend yield reflects the dividend yield in place at the time of the historical grants.

Stock option activity is reflected below:

	Shares Subject to Option	Weighted- Average Exercise or Grant Price Per Share		Average Remaining Contractual Term	Aggregate Intrinsic Value
Balance at January 1, 2023	20,490,250	$	46.31		$	417	million
Granted	2,476,320	65.39
Exercised (1)	(3,894,213)	39.59			$	123	million
Canceled	(394,237)	59.41
Balance at December 31, 2023	18,678,120	49.96			$	420	million
Granted	2,297,630	73.03
Exercised (1)	(4,096,571)	43.30			$	121	million
Canceled	(400,010)	63.40
Balance at December 31, 2024	16,479,169	54.51			$	135	million
Granted	2,025,000	65.13
Exercised (1)	(2,258,520)	42.59			$	49	million
Canceled	(523,730)	67.18
Balance at December 31, 2025	15,721,919	57.17		5 years	$	55	million
Exercisable at December 31, 2025	12,029,819	53.92		4 years	$	55	million

(1)Cash received from options exercised was $94 million in 2025, $175 million in 2024 and $152 million in 2023. The excess income tax benefit from stock option exercises was $7 million in 2025, $19 million in 2024 and $21 million in 2023.

Performance Share Units and Deferred Stock Units

We recorded compensation expense related to PSUs and DSUs of $87 million in 2025, $117 million in 2024 and $121 million in 2023 in our results from continuing operations. The deferred tax benefit recorded related to this compensation expense was $14 million in 2025, $19 million in 2024 and $18 million in 2023. The unamortized compensation expense related to our PSUs and DSUs was $129 million at December 31, 2025 and is expected to be recognized over a weighted-average period of 1.8 years.

Our PSU and DSU activity is reflected below:

	Number of Shares	Weighted-Average Fair Value Per Share (3)		Weighted-Average Aggregate Fair Value
Balance at January 1, 2023	4,451,674	$	60.12
Units granted:
Performance share units (1)	1,312,820	67.48
Deferred stock units	926,288	65.99
Total units granted (1)	2,239,108	66.86		$	150	million
Vested (1) (2)	(1,772,439)	61.92		$	110	million
Forfeited	(365,177)	62.66
Balance at December 31, 2023	4,553,166	62.53
Units granted:
Performance share units (1)	1,517,643	67.76
Deferred stock units	930,655	72.35
Total units granted (1)	2,448,298	69.50		$	170	million
Vested (1) (2)	(2,075,329)	58.51		$	121	million
Forfeited	(389,561)	66.91
Balance at December 31, 2024	4,536,574	67.76
Units granted:
Performance share units (1)	1,438,015	67.95
Deferred stock units	1,443,758	63.19
Total units granted (1)	2,881,773	65.56		$	189	million
Vested (1) (2)	(1,562,811)	63.29		$	99	million
Forfeited	(518,412)	69.30
Balance at December 31, 2025	5,337,124	67.73

(1)Includes incremental PSUs issued over target.

(2)The income tax shortfall upon vesting of PSUs and DSUs was $1 million in 2025 and the excess tax benefit upon vesting of PSUs and DSUs was $7 million in 2024 and $3 million in 2023.

(3)The grant date fair value of PSUs is determined based on the Monte Carlo simulation model for the market-based total shareholder return component and the closing market price of the Company’s stock on the grant date for performance-based components. The Monte Carlo simulation model incorporates the probability of achieving the total shareholder return market condition. Compensation expense is recognized using the grant date fair values regardless of whether the market condition is achieved, as long as the requisite service has been provided.