| Stock-Based Compensation Plans The Company grants stock option awards, restricted share units (“RSUs”), performance share units (“PSUs”), and cash awards pursuant to the 2021 Incentive Stock Plan.
Stock-based compensation expenses incurred by the Company were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended
June 30, | | Six Months Ended
June 30, | | ($ in millions) | 2026 | | 2025 | | 2026 | | 2025 | | | | Stock-based compensation expense recognized in: | | | | | | | | | | | Cost of sales | $ | 4 | | | $ | 4 | | | $ | 7 | | | $ | 8 | | | | | Selling, general and administrative | 16 | | | 14 | | | 29 | | | 30 | | | | | Research and development | 5 | | | 4 | | | 8 | | | 8 | | | | | Total | $ | 25 | | | $ | 22 | | | $ | 44 | | | $ | 46 | | | | | | | | | | | | | | | Income tax benefits | $ | 5 | | | $ | 5 | | | $ | 9 | | | $ | 10 | | | |
The fair value of options granted was determined using the following assumptions:
| | | | | | | | | | | | | | | Six Months Ended June 30, | | | | | 2025 | | | | Expected dividend yield | | | | 7.41 | % | | | | Risk-free interest rate | | | | 4.08 | | | | | Expected volatility | | | | 40.25 | | | | Expected life (years)(1) | | | | 5.89 | | |
(1)The expected term was estimated using the historical option‑exercise and settlement patterns, supplemented by a midpoint‑based assumption applied to awards meeting a one‑year post‑grant eligibility filter. A summary of the equity award transactions for the six months ended June 30, 2026 is as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Stock Options | | RSUs | | PSUs | | (shares in thousands) | Shares | | Weighted average
exercise price | | Weighted average
grant date
fair value | | Shares | | Weighted average
grant date
fair value | | Shares | | Weighted average
grant date
fair value | | Outstanding as of January 1, 2026 | 7,519 | | | $ | 27.30 | | | $ | 6.99 | | | 9,716 | | | $ | 15.35 | | | 589 | | | $ | 23.61 | | Granted/Issued | — | | | — | | | — | | | 13,585 | | | 6.02 | | | 2,128 | | | 8.27 | | | Vested/Exercised | — | | | — | | | — | | | (3,497) | | | 17.81 | | | (193) | | | 23.20 | | | Forfeited/Cancelled | (2,299) | | | 30.78 | | | 8.11 | | | (1,053) | | | 9.68 | | | (140) | | | 23.20 | | Outstanding as of June 30, 2026 | 5,220 | | | $ | 25.76 | | | $ | 6.50 | | | 18,751 | | | $ | 8.45 | | | 2,384 | | | $ | 9.98 | |
The following table summarizes information about equity awards outstanding that are vested and expected to vest and equity awards outstanding that are exercisable as of June 30, 2026:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Equity Awards Vested and Expected to Vest | | Equity Awards That are Exercisable | (awards in thousands; aggregate intrinsic value in millions) | Awards | | Weighted Average
Exercise Price | | Aggregate
Intrinsic Value | | Remaining Term (in years) | | Awards | | Weighted Average
Exercise Price | | Aggregate
Intrinsic Value | | Remaining Term (in years) | | Stock Options | 5,126 | | | $ | 25.76 | | | $ | — | | | 6.23 | | 3,949 | | | $ | 29.00 | | | $ | — | | | 5.49 | RSUs | 17,065 | | | | | 254 | | | 2.19 | | | | | | | | | PSUs | 2,328 | | | | | 36 | | | 2.22 | | | | | | | | |
The amount of unrecognized compensation costs as of June 30, 2026 was $162 million, which will be recognized in operating expense ratably over the weighted average vesting period of 2.16 years.
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