STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2025

Share-Based Payment Arrangement [Abstract]

During the three and nine months ended September 30, 2025 and 2024, we recognized $6 million, $19 million, $7 million and $21 million in stock-based compensation expense, respectively, which was allocated between cost of goods sold and selling, general and administrative expenses in the condensed consolidated statements of operations. We recognized tax benefits on stock-based compensation of $1 million and $2 million for each of the three and nine months ended September 30, 2025 and 2024, respectively.

2025 Activity


Restricted Stock Units	Units (in millions)	Weighted Average Fair Value
Outstanding at January 1, 2025	1.0	$	31.43
Granted	0.5	$	34.34
Vested	(0.5)	$	30.54
Forfeited	(0.1)	$	32.89
Outstanding at September 30, 2025	0.9	$	33.24

Tax benefits on the vesting of restricted stock units during the nine months ended September 30, 2025 were immaterial.

At September 30, 2025, there was $15 million of unamortized expense relating to unvested restricted stock units that is expected to be amortized over a weighted average period of 1.4 years.


Performance Share Units	Units (in millions)	Weighted Average Fair Value
Outstanding at January 1, 2025	0.9	$	35.84
Granted	0.3	$	39.70
Vested (1)	—	$	30.63
Forfeited	(0.2)	$	33.28
Outstanding at September 30, 2025	1.0	$	37.94

(1) Activity during the nine months ended September 30, 2025 rounds to zero.

Our performance share units allow for participants to vest in zero to 200% of the target number of shares granted. At September 30, 2025, there was $17 million of unamortized expense relating to unvested performance share units that is expected to be amortized over a weighted average period of 1.8 years. The forfeitures include portions of performance share unit grants that were determined to not have vested during the period as a result of not meeting established financial performance thresholds.

Stock Options

The Black-Scholes option pricing model was used to estimate the fair values for options as of their grant date. There have been no options granted since 2019. There are currently 0.2 million options outstanding, all of which are vested and exercisable, with an average exercise price of $28.06, a weighted average contractual life of 2.3 years and an immaterial aggregate intrinsic value.

Cash received by the Company upon exercise of options during the three and nine months ended September 30, 2025 was $1 million. There were immaterial tax expenses on these exercises.