Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2020

Stock-Based Compensation

Stock-Based Compensation Expense

Stock-Based Compensation Expense

	Three months ended
	March 31,
(Millions)	2020		2019
Cost of sales	$	22	$	22
Selling, general and administrative expenses		73		82
Research, development and related expenses		25		26
Stock-based compensation expenses	$	120	$	130
Income tax benefits		(39)		(80)
Stock-based compensation expenses (benefits), net of tax	$	81	$	50

Stock Option Activity

Stock Option Program

The following table summarizes stock option activity during the three months ended March 31, 2020:

				Weighted
				Average
		Weighted		Remaining	Aggregate
	Number of	Average		Contractual	Intrinsic Value
(Options in thousands)	Options	Exercise Price		Life (months)	(millions)
Under option —
January 1	33,675	$	151.15
Granted:
Annual	4,741		157.26
Exercised	(1,159)		87.25
Forfeited	(41)		193.77
March 31	37,216	$	153.87	70	$	359
Options exercisable
March 31	29,173	$	146.86	58	$	359

Stock Option Assumptions

Stock Option Assumptions

	Annual
	2020
Exercise price	$	157.24
Risk-free interest rate		1.5	%
Dividend yield		2.7	%
Expected volatility		19.7	%
Expected life (months)		78
Black-Scholes fair value	$	21.58

Restricted Stock and Restricted Stock Units Activity

Restricted Stock and Restricted Stock Units

The following table summarizes restricted stock and restricted stock unit activity during the three months ended March 31, 2020:

		Weighted
		Average
	Number of	Grant Date
(Shares in thousands)	Shares	Fair Value
Nonvested balance —
As of January 1	1,573	$	201.11
Granted
Annual	733		157.29
Other	10		175.81
Vested	(553)		176.16
Forfeited	(16)		193.91
As of March 31	1,747	$	190.55

Performance Shares Activity

The following table summarizes performance share activity during the three months ended March 31, 2020:

		Weighted
		Average
	Number of	Grant Date
(Shares in thousands)	Shares	Fair Value
Undistributed balance —
As of January 1	444	$	205.58
Granted	191		153.02
Distributed	(206)		190.84
Performance change	10		116.06
Forfeited	(0)		231.34
As of March 31	439	$	187.50