XML 82 R29.htm IDEA: XBRL DOCUMENT v3.25.3
SHARE-BASED COMPENSATION
12 Months Ended
Nov. 02, 2025
SHARE-BASED COMPENSATION  
SHARE-BASED COMPENSATION

22. SHARE-BASED COMPENSATION

We grant restricted stock units (RSU) and stock options (collectively, equity incentive awards) to certain employees. RSUs are also granted to nonemployee directors for their services as directors. RSUs consist of service-based, performance/service-based, and market/service-based awards.

The Long-Term Incentive Cash granted to certain employees is accounted for as share-based compensation. This incentive includes a performance metric based, in part, on the price of our shares.

We are authorized to grant shares for equity incentive awards. The outstanding shares authorized were 13.7 million at November 2, 2025. We currently use shares that have been repurchased through our stock repurchase program to satisfy share option exercises and RSU conversions. The stock awards vesting periods and the dividend equivalents earned during the vesting period follow:

​

​

​

​

​

​

​

​

​

Vesting

​

Dividend

​

​

​

Period

​

Equivalents

​

Stock options

​

1-3 years

​

Not included

​

Service-based RSUs

​

1-3 years

​

Included

​

Performance/service-based RSUs

​

3 years

​

Not included

​

Market/service-based RSUs

​

3 years

​

Not included

​

​

Stock options expire ten years from the grant date. Performance/service-based awards are subject to a performance metric based on our compound annual revenue growth rate, compared to a benchmark group of companies. Market/service-based awards are subject to a market related metric based on total shareholder return, compared to a benchmark group of companies. The performance/service-based units and market/service-based units award common stock in a range of zero to 200% for each unit granted based on the level of the metric achieved.

The fair value of stock options and RSUs is determined using our closing price on the grant date. The fair value of the

market/service-based RSUs is determined using a Monte Carlo model. Awards are expensed over the shorter of the award vesting period or the employee’s retirement eligibility period. The performance/service-based units’ expense is adjusted quarterly for the probable number of shares to be awarded. We recognize the effect of award forfeitures as an adjustment to compensation expense in the period the forfeiture occurs.

The assumptions used in determining the fair value of the market/service-based RSUs granted in 2025 and 2024 using the Monte Carlo valuation model follow:

​

​

​

​

​

​

​

​

​

2025

​

2024

​

Expected volatility of the Company's stock

​

28.22%

​

27.93%

​

Risk-free interest rate

​

4.05%

​

4.17%

​

​

​

The total share-based compensation expense, recognized income tax benefits, and total grant-date fair values of stock options and restricted stock units vested consisted of the following:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

2025

​

2024

​

2023

​

Share-based compensation expense

​

$

151

​

$

208

​

$

130

​

Income tax benefits

​

​

34

​

​

34

​

​

21

​

Stock options and restricted stock units vested

​

​

174

​

​

110

​

​

84

​

​

At November 2, 2025, there was $89 of total unrecognized compensation cost from share-based compensation arrangements. This compensation is expected to be recognized over a weighted-average period of approximately 1.75 years.

Stock Options

The fair value of each stock option award was estimated on the date of grant using a binomial lattice option valuation model. The assumptions used for the binomial lattice model to determine the fair value of options follow:

​

​

​

​

​

​

​

​

​

​

 

2025

 

2024

 

2023

 

Risk-free interest rate*

 

4.09%

 

3.96%

 

2.68%

​

Expected dividends

​

1.4%

​

1.6%

​

1.1%

​

Volatility*

​

26.0%

​

27.0%

​

33.0%

​

Expected term (in years)*

 

5.2

 

5.1

 

5.1

​

*    Weighted-averages

​

The risk-free interest rates are based on U.S. Treasury security yields at the time of grant. Expected volatilities are based on implied volatilities from traded call options on our stock. We use historical data to estimate option exercise behavior representing the weighted-average period that options granted are expected to be outstanding.

The activity for outstanding stock options at November 2, 2025, and changes during 2025 follow:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

  ​

​

​

​

​

Remaining

​

Aggregate

 

​

​

​

​

Exercise

​

Contractual

​

Intrinsic

 

​

​

Shares

​

Price*

​

Term

​

Value

 

​

​

(thousands)

 

(per share)

 

(years)

 

(millions)

 

Outstanding at beginning of year

 

1,476

​

$

242.41

​

​

​

​

​

​

Granted

 

169

​

 

448.18

​

​

​

​

​

​

Exercised

 

(530)

​

 

145.40

​

​

​

​

​

​

Forfeited

 

(3)

​

 

428.60

​

​

​

​

​

​

Outstanding at end of year

 

1,112

​

 

319.44

 

5.75

 

$

158.1

​

Exercisable at end of year

 

789

​

 

277.80

 

4.50

​

 

145.1

​

*    Weighted-averages

​

The amounts related to stock options were as follows in millions of U.S. dollars unless otherwise noted:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

2025

​

2024

​

2023

​

Weighted-average grant date fair value (per share)

​

$

116.35

​

$

98.04

​

$

136.46

​

Intrinsic value of options exercised

​

​

165

​

​

125

​

​

153

​

Cash received from exercises

​

​

77

​

​

44

​

​

60

​

Tax benefit from exercises

​

​

35

​

​

27

​

​

34

​

​

​

Restricted Stock Units

The weighted-average grant date fair values were as follows:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

2025

​

2024

​

2023

​

Service-based

​

$

448.69

​

$

377.72

​

$

428.35

​

Performance/service-based

​

​

429.77

​

​

360.53

​

​

424.93

​

Market/service-based

​

​

591.13

​

​

370.87

​

​

​

​

​

Our nonvested RSUs at November 2, 2025, and changes during 2025 follow:

​

​

​

​

​

​

​

​

​

​

​

​

Grant-Date

 

​

​

Shares

(thousands)

​

Fair Value*

(per share)

 

Service-based:

​

​

​

​

​

​

Nonvested at beginning of year

 

471

​

$

378.39

​

Granted

 

308

​

 

448.69

​

Vested

 

(351)

​

 

389.61

​

Forfeited

​

(15)

​

​

418.74

​

Nonvested at end of year

 

413

​

 

419.87

​

Performance/service-based:

​

​

​

​

​

​

Nonvested at beginning of year

 

126

​

 

373.35

​

Granted

 

40

​

 

429.77

​

Vested

 

(26)

​

 

331.47

​

Performance change

 

(9)

​

 

331.47

​

Forfeited

 

(1)

​

 

401.55

​

Nonvested at end of year

 

130

​

 

401.48

​

Market/service-based:

​

​

​

​

​

​

Nonvested at beginning of year

 

51

​

 

370.87

​

Granted

 

40

​

 

591.13

​

Forfeited

 

(1)

​

 

501.36

​

Nonvested at end of year

 

90

​

 

467.46

​

*    Weighted-averages

​