Stock-Based Compensation

9 Months Ended

Sep. 30, 2021

Share-based Payment Arrangement [Abstract]


	Third Quarter				First Nine Months
	2021		2020		2021		2020
	($ in millions)

Stock-based compensation expense	$	14	$	13	$	46	$	25
Total tax benefit	3		10		28		39

During 2021, we granted stock options, restricted stock units (RSUs) and performance share units (PSUs) pursuant to the Long-Term Incentive Plan (LTIP), as follows:


	Third Quarter			First Nine Months
	Granted	Weighted-Average Grant-Date Fair Value		Granted	Weighted-Average Grant-Date Fair Value

Stock options	—	$	—	42,770	$	62.49
RSUs	2,490	258.14		179,345	239.01
PSUs	—	—		50,060	240.69

Stock Options


	Third Quarter				First Nine Months
	2021		2020		2021		2020
	($ in millions)

Options exercised	22,502		313,358		363,982		998,996
Cash received upon exercise	$	2	$	27	$	33	$	82
Related tax benefit realized	1		8		13		24

Restricted Stock Units

RSUs granted primarily have a four-year ratable restriction period and will be settled through the issuance of shares of Norfolk Southern common stock (Common Stock). Certain RSU grants include cash dividend equivalent payments during the restriction period in an amount equal to the regular quarterly dividends paid on Common Stock.


	Third Quarter				First Nine Months
	2021		2020		2021		2020
	($ in millions)

RSUs vested	1,100		1,635		260,227		203,934
Common Stock issued net of tax withholding	761		1,630		184,272		145,342
Related tax benefit realized	$	—	$	—	$	7	$	4

Performance Share Units

PSUs provide for awards based on the achievement of certain predetermined corporate performance goals at the end of a three-year cycle and are settled through the issuance of shares of Common Stock. All PSUs will earn out based on the achievement of performance conditions and some will also earn out based on a market condition. The market condition fair value was measured on the date of grant using a Monte Carlo simulation model. No PSUs were earned or paid out during the third quarters of 2021 or 2020.


	First Nine Months
	2021		2020
	($ in millions)

PSUs earned	78,727		235,935
Common Stock issued net of tax withholding	49,967		156,450
Related tax benefit realized	$	1	$	7