Stock-Based Compensation

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Stock-based compensation

Accounting for stock-based compensation requires that the cost resulting from all stock-based payments be recognized in the financial statements based on the grant date fair value of the award. Our stock-based compensation consists of stock options, restricted stock units (RSUs) and performance-based restricted stock units (PRSUs).

We recognized pretax stock-based compensation expense of $74 million and $118 million for the three and six months ended June 30, 2023, respectively, and $67 million and $107 million for the three and six months ended June 30, 2022, respectively.

The following table illustrates the type and fair value of the stock-based compensation awards granted during the six months ended June 30, 2023 and 2022, respectively:



	Six Months Ended June 30, 2023					Six Months Ended June 30, 2022
	Shares Granted	Weighted-Average Fair Value Per Share		Weighted-Average Grant Date Stock Price		Shares Granted	Weighted-Average Fair Value Per Share		Weighted-Average Grant Date Stock Price
Stock options	777,275	$	75.79	$	253.98	1,029,202	$	51.69	$	196.70
RSUs	379,426	$	253.98	$	253.98	484,025	$	196.70	$	196.70
PRSUs	221,869	$	253.98	$	253.98	258,900	$	196.70	$	196.70

The following table provides the assumptions used in determining the fair value of the stock-based awards for the six months ended June 30, 2023 and 2022, respectively:



	Grant Year
	2023	2022
Weighted-average dividend yield	2.60%	2.60%
Weighted-average volatility	31.0%	31.7%
Range of volatilities	28.5% - 35.5%	25.3% - 36.8%
Range of risk-free interest rates	3.92% - 5.03%	1.03% - 2.00%
Weighted-average expected lives	7 years	8 years

As of June 30, 2023, the total remaining unrecognized compensation expense related to nonvested stock-based compensation awards was $229 million, which will be amortized over the weighted-average remaining requisite service periods of approximately 1.8 years.