Stock-Based Compensation

3 Months Ended

Apr. 02, 2023

Share-Based Payment Arrangement [Abstract]

On March 7, 2022, the Parent’s Board of Directors approved the 2022 Long-Term Incentive Plan (the “2022 Plan”) providing the grant of non-qualified stock options, incentive stock options, stock appreciation rights, Restricted Stock Units (“RSUs”), performance shares, Performance Stock Units (“PSUs”), other stock-based awards, and cash awards to employees and directors including the Company’s personnel. The 2022 Plan became effective in April 2022. All options and restricted shares granted subsequent to that date were under this plan.

The components and classification of stock-based compensation expense related to stock options, RSUs, and PSUs directly attributable to those employees specifically identified as employees of the Company and allocations from the Parent for the fiscal three months ended April 2, 2023 and April 3, 2022, were as follows:


(Dollars in Millions)	April 2, 2023		April 3, 2022




Cost of sales	$	4	$	8
Selling, general, and administrative expenses	31		27
Stock-based compensation expense	$	35	$	35

Stock-based compensation expense includes $2 million and $10 million for the fiscal three months ended April 2, 2023 and April 3, 2022, respectively, of allocated charges from the Parent, based on percentage attribution related to Parent employees providing services to the Company.