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Stock-based Compensation
12 Months Ended
Sep. 30, 2025
Share-Based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION
Unless otherwise noted, all activities and amounts reported in this footnote include both continuing operations of the Company and activities and amounts related to the R&LC HVAC business. See Note 2, "Acquisitions and Divestitures" for additional details regarding divestiture of the R&LC HVAC business.

The Johnson Controls International plc 2021 Equity and Incentive Plan authorizes stock options, stock appreciation rights, restricted (non-vested) stock/units, performance shares, performance units and other stock-based awards. The Compensation and Talent Development Committee of the Company's Board of Directors determines the types of awards to be granted to individual participants and the terms and conditions of the awards. Annual awards are typically granted in the first quarter of the fiscal year. As of September 30, 2025, there were 55 million shares of the Company's common stock reserved and 30 million shares available for issuance under the 2021 Equity and Incentive Plan.

The following table summarizes stock-based compensation related charges and benefits (in millions):

Year Ended September 30,
202520242023
Compensation expense$126 $100 $101 
Income tax benefit resulting from share-based compensation arrangements19 25 25 
Tax impact from exercise and vesting of equity settled awards14 

Substantially all compensation expense is recorded in selling, general and administrative expenses. The Company does not settle stock options granted under share-based payment arrangements in cash.

Restricted (Non-vested) Stock / Units

A summary of non-vested restricted stock awards at September 30, 2025, and changes for the year then ended, is presented below:
Weighted
Average
Price
Shares/Units
Subject to
Restriction
Non-vested, September 30, 2024$59.29 2,904,103 
Granted83.08 1,297,984 
Vested62.59 (1,231,731)
Forfeited65.78 (423,369)
Non-vested, September 30, 2025$69.68 2,546,987 

At September 30, 2025, the Company had approximately $116 million of total unrecognized compensation cost related to non-vested restricted stock arrangements granted which is expected to be recognized over a weighted-average period of 1.8 years.
Performance Share Awards (PSU's)

The following table summarizes the assumptions used in determining the fair value of performance share awards granted:
 Year Ended September 30,
 202520242023
Risk-free interest rate4.01%4.21%4.04%
Expected volatility of the Company’s stock28.50%27.20%33.50%

A summary of the status of the Company’s non-vested PSU's at September 30, 2025, and changes for the year then ended, is presented below:
Weighted
Average
Price
Shares/Units
Subject to
PSU
Non-vested, September 30, 2024$71.20 795,633 
Granted97.77 375,308 
Vested90.50 (230,999)
Forfeited80.05 (27,178)
Non-vested, September 30, 2025$76.97 912,764 
    

At September 30, 2025, the Company had approximately $46 million of total unrecognized compensation cost related to non-vested performance-based share unit awards which is expected to be recognized over a weighted-average period of 2.0 years.

Stock Options

The following table summarizes the assumptions used in determining the fair value of stock options granted:
 Year Ended September 30,
 202520242023
Expected life of option (years)5.75.75.8
Risk-free interest rate4.07%3.86%3.59%
Expected volatility of the Company’s stock30.20%29.80%29.40%
Expected dividend yield on the Company’s stock1.83%2.77%2.10%

A summary of stock option activity at September 30, 2025, and changes for the year then ended, is presented below:
Weighted
Average
Option Price
Shares
Subject to
Option
Weighted
Average
Remaining
Contractual
Life (years)
Aggregate
Intrinsic
Value
(in millions)
Outstanding, September 30, 2024$46.51 4,244,782 
Granted82.15 530,251 
Exercised39.99 (2,812,821)
Forfeited or expired67.00 (66,609)
Outstanding, September 30, 2025$65.42 1,895,603 8.07$84 
Exercisable, September 30, 2025$62.05 688,036 7.31$33 
The following table summarizes additional stock option information:
Year Ended September 30,
202520242023
Weighted-average grant-date fair value of options granted$23.97 $13.74 $18.21 
Intrinsic value of options exercised (in millions)130 22 27 

At September 30, 2025, the Company had approximately $12 million of total unrecognized compensation cost related to non-vested stock options which is expected to be recognized over a weighted-average period of 1.6 years.