XML 126 R64.htm IDEA: XBRL DOCUMENT v3.24.0.1
Stock-Based Compensation (Tables)
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Schedule of Stock-based Compensation Expense, Tax Effect
Stock-based compensation expense was as follows:
Year Ended December 31,
202320222021
Stock-based compensation expense, pre-tax(1)
$54 $75 $54 
Income tax benefit recognized in earnings10 11 13 
____________
(1)2022 includes $21 associated with the accelerated vesting of all outstanding equity awards, according to the terms of the award agreement, in connection with the passing of Xerox Holding's former CEO.
Share-Based Payment Arrangement, Performance Shares, Performance Metrics
PSU awards are comprised of performance-based components (Earnings per share, Revenue and Free cash flow) as well as market-based components (Relative Total Shareholder Return (RTSR) and Absolute Share Price). PSUs granted in 2023 are entirely market-based. PSUs granted in 2022 and 2021 are one-half performance-based and one-half market-based. The metrics and weightings are as follows:
Award Year (Metric Weighting)
Performance Metric202320222021
Earnings per share— %50 %— %
Revenue— %— %25 %
Free cash flow— %— %25 %
Relative total shareholder return100 %— %— %
Absolute share price— %50 %50 %
100 %100 %100 %
Schedule of Stock-based Payment Award Valuation Assumptions, Performance Shares, Market-based Component Table
A summary of Xerox Holdings key valuation input assumptions used in the Monte Carlo simulation relative to awards granted were as follows:
2023 Award2022 Award2021 Award
Term3 years3 years3 years
Risk-free interest rate(1)
3.80 %1.09 %0.20 %
Volatility(2)
52.21 %42.07 %44.76 %
Weighted average fair value(3)
$23.00 $27.89 $25.80 
____________
(1)The risk-free interest rate was based on the zero-coupon U.S. Treasury yield curve on the valuation date, with a maturity matched to the performance period.
(2)Volatility is derived from historical stock prices as well as implied volatility when appropriate and available.
(3)The weighted average of fair values used to record compensation expense as determined by the Monte Carlo simulation.
Schedule of Absolute Share Price and TSR Payout, as a Percentage, Comparison to Targets
Our RTSR and Absolute Share Price metrics are compared against total return targets to determine the payout as follows:
Payout as a Percent of Target
2023 Percentile Ranking Return Targets(1)
2022 Total Return Targets(1)
2021 Total Return Targets(1)
200%
75th and above
$30.00 and above
$33.00 and above
100%50th$25.00 $30.00 
50%25th$20.00 $27.00 
0%
Below 25th
Below $20.00
Below $27.00
____________
(1)For performance between the levels described above, the degree of vesting is interpolated on a linear basis.
Schedule of Share-based Compensation Arrangements by Share-based Payment Award
Summary of Stock-based Compensation Activity
 202320222021
SharesWeighted Average Grant Date Fair ValueSharesWeighted Average Grant Date Fair ValueSharesWeighted Average Grant Date Fair Value
Restricted Stock Units
Outstanding at January 13,221 $23.16 3,161 $25.26 3,187 $26.48 
Granted(1)
3,382 16.56 2,444 21.75 1,513 23.37 
Vested(2)
(1,593)23.73 (1,975)24.56 (1,327)26.07 
Forfeited(338)19.27 (409)24.20 (212)25.06 
Outstanding at December 314,672 18.46 3,221 23.16 3,161 25.26 
Performance Shares
Outstanding at January 11,729 $28.38 2,818 $25.47 2,425 $26.67 
Granted(3)
940 22.97 977 25.72 1,195 24.67 
Vested (2)
— — (644)27.95 (672)28.08 
Forfeited/Expired (4)
(630)33.86 (1,422)20.98 (130)26.92 
Outstanding at December 312,039 24.18 1,729 28.38 2,818 25.47 
____________
(1)2023 includes approximately 445 RSUs associated with a special retention award.
(2)2022 includes approximately 469 RSUs and 644 PSUs associated with the accelerated vesting of all outstanding equity awards, according to the terms of the award agreement, in connection with the passing of Xerox Holding's former CEO. No other PSUs vested in 2022.
(3)2021 includes 60 shares associated with the over-performance of our 2018 PSU grant.
(4)2022 includes approximately 1,125 PSUs granted in 2019 that were adversely affected permanently by the impacts from the COVID-19 pandemic, and therefore no shares were earned.
Schedule of Unrecognized Compensation Cost, Nonvested Awards
Unrecognized compensation cost related to non-vested stock-based awards at December 31, 2023 was as follows:
AwardsUnrecognized CompensationRemaining Weighted-Average Vesting Period (Years)
Restricted Stock Units$46 1.7
Performance Shares17 1.8
Stock Options(1)
8 3.0
Total$71 
____________
(1)Reflects CareAR SOs granted in May 2022.
Schedule of Aggregate Intrinsic Value Restricted Stock and Performance Shares Compensation Awards
The aggregate intrinsic value of outstanding stock-based awards was as follows:
AwardsDecember 31, 2023
Restricted Stock Units$86 
Performance Shares37 
Schedule of Vested and Exercised Stock Based Awards Total Intrinsic Value and Tax Benefit Realized
The intrinsic value and actual tax benefit realized for all vested and exercised stock-based awards was as follows:
 December 31, 2023December 31, 2022December 31, 2021
AwardsTotal Intrinsic ValueTax BenefitTotal Intrinsic ValueTax BenefitTotal Intrinsic ValueTax Benefit
Restricted Stock Units$25 $5 $39 $6 $30 $5 
Performance Share Units— — 10 — 17 2