Stock-Based Compensation

6 Months Ended

Jun. 30, 2025

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation:

Stock-based compensation cost for stock awards and stock options is measured at grant date, based on the fair value of the award, and is recognized over the employee requisite service period. The following table presents total stock-based compensation cost included in income from continuing operations.


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in millions)	2025		2024		2025		2024


Cost	$	67	$	53	$	132	$	109
Selling, general and administrative	244		172		461		343
Research and development	130		90		249		183
Pre-tax stock-based compensation cost	$	441	$	316	$	842	$	636
Income tax benefits	(156)		(101)		(350)		(222)
Total net stock-based compensation cost	$	285	$	214	$	492	$	414

Pre-tax stock-based compensation cost for the three months ended June 30, 2025 increased $125 million compared to the corresponding period in the prior year due to increases in restricted stock units ($102 million) and performance share units ($13 million).

Pre-tax stock-based compensation cost for the six months ended June 30, 2025 increased $206 million compared to the corresponding period in the prior year due to increases in restricted stock units ($154 million), performance share units ($34 million), and stock options ($14 million).

For the three and six months ended June 30, 2025, the pre-tax stock-based compensation cost increases reflect the company's annual cycles for executives and other employees and the issuance and assumption of stock-based compensation awards in connection with the HashiCorp acquisition.

Total unrecognized compensation cost related to non-vested awards at June 30, 2025 was $2.5 billion and is expected to be recognized over a weighted-average period of approximately 2.4 years.

INTERNATIONAL BUSINESS MACHINES CORP 10-Q