Stock-Based Compensation

6 Months Ended

Jun. 30, 2024

Share-Based Payment Arrangement [Text Block]

STOCK-BASED COMPENSATION (Entergy Corporation)

Entergy grants stock and stock-based awards, which are described more fully in Note 12 to the financial statements in the Form 10-K.  Awards under Entergy’s plans generally vest over three years.

Stock Options

In January 2024 the Board approved and Entergy granted long-term incentive awards in the form of options on 352,199 shares of its common stock under the 2019 Omnibus Incentive Plan with a fair value of $18.61 per option.  As of June 30, 2024, there were options on 2,599,829 shares of common stock outstanding with a weighted-average exercise price of $101.84.  The intrinsic value, which has no effect on net income, of the outstanding stock options is calculated by the positive difference between the weighted-average exercise price of the stock options granted and Entergy Corporation’s common stock price as of June 30, 2024.  The aggregate intrinsic value of the stock options outstanding as of June 30, 2024 was $25.7 million.

The following table includes financial information for stock options for the three months ended June 30, 2024 and 2023:

	2024	2023
	(In Millions)
Compensation expense included in Entergy’s consolidated net income	$1.1	$1.1
Tax benefit recognized in Entergy’s consolidated net income	$0.3	$0.3
Compensation cost capitalized as part of fixed assets and materials and supplies	$0.5	$0.6

The following table includes financial information for stock options for the six months ended June 30, 2024 and 2023:

	2024	2023
	(In Millions)
Compensation expense included in Entergy’s consolidated net income	$2.2	$2.1
Tax benefit recognized in Entergy’s consolidated net income	$0.6	$0.6
Compensation cost capitalized as part of fixed assets and materials and supplies	$1.0	$1.1

Other Equity Awards

In January 2024 the Board approved and Entergy granted long-term incentive awards in the form of 409,947 restricted stock awards and 158,176 performance units under the 2019 Omnibus Incentive Plan.  The restricted stock awards were made effective on January 25, 2024 and were valued at $99.08 per share, which was the closing price of Entergy Corporation’s common stock on that date.  Shares of restricted stock have the same dividend and voting rights as other common stock, are considered issued and outstanding shares of Entergy upon vesting, and are expensed ratably over the three-year vesting period. One-third of the restricted stock awards and accrued dividends will vest upon each anniversary of the grant date.

The performance units represent the value of, and are settled with, one share of Entergy Corporation common stock at the end of the three-year performance period, plus dividends accrued during the performance

period on the number of performance units earned. To emphasize the importance of environmental stewardship, specifically of carbon-free generation and resilience, an environmental achievement measure was selected as one of the performance measures for the 2024-2026 performance period. Performance will be based eighty percent on relative total shareholder return and twenty percent on the environmental achievement measure.  The performance units were granted on January 25, 2024 and eighty percent were valued at $124.65 per share based on various factors, primarily market conditions; and twenty percent were valued at $99.08 per share, the closing price of Entergy Corporation’s common stock on that date.  Performance units have the same dividend and voting rights as other common stock and are considered issued and outstanding shares of Entergy upon vesting, and are expensed ratably over the three-year vesting period, and compensation cost for the portion of the award based on the selected environmental achievement measure will be adjusted based on the number of units that ultimately vest. See Note 12 to the financial statements in the Form 10-K for a description of the Long-Term Performance Unit Program.

The following table includes financial information for other outstanding equity awards for the three months ended June 30, 2024 and 2023:

	2024	2023
	(In Millions)
Compensation expense included in Entergy’s consolidated net income	$9.8	$10.1
Tax benefit recognized in Entergy’s consolidated net income	$2.5	$2.6
Compensation cost capitalized as part of fixed assets and materials and supplies	$4.6	$4.4

The following table includes financial information for other outstanding equity awards for the six months ended June 30, 2024 and 2023:

	2024	2023
	(In Millions)
Compensation expense included in Entergy’s consolidated net income	$19.7	$17.8
Tax benefit recognized in Entergy’s consolidated net income	$5.0	$4.6
Compensation cost capitalized as part of fixed assets and materials and supplies	$9.1	$7.6