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Stock-Based Compensation Plans | 3 Months Ended
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Mar. 31, 2026
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation Plans | Stock-Based Compensation Plans The Company has outstanding stock-based compensation awards granted under the 2013 Stock Incentive Plan (the “2013 Plan”) and the Ingersoll Rand Inc. Amended and Restated 2017 Omnibus Incentive Plan (as amended by the First Amendment, dated April 27, 2021, the “2017 Plan”) as described in Note 18, “Stock-Based Compensation Plans” to the consolidated financial statements in its 2025 Annual Report. The Company’s stock-based compensation awards are generally granted in the first quarter of the year and consist of stock options, restricted stock units and performance stock units. In some instances, such as death, awards may vest concurrently with or following an employee’s termination. Stock-Based Compensation For the three month periods ended March 31, 2026 and 2025, the Company recognized stock-based compensation expense of $15.9 million and $14.2 million, respectively. These costs are included in “Cost of sales” and “Selling and administrative expenses” in the Condensed Consolidated Statements of Operations. As of March 31, 2026, there was $152.3 million of total unrecognized compensation expense related to outstanding stock options, restricted stock unit awards and performance stock unit awards granted to employees and non-employee directors, as well as 100,000 conditional stock options awarded during the third quarter of 2022 to our Chairman and CEO in which the service date precedes the grant date, and will be granted upon achievement of certain performance targets. These 100,000 stock options have not been included in the Stock Option Awards section below since the grant date has not occurred. Stock Option Awards Stock options are granted to employees with an exercise price equal to the fair value of the Company’s per share common stock on the date of grant. Stock option awards typically vest over four years or five years and expire ten years from the date of grant. A summary of the Company’s stock option activity for the three month period ended March 31, 2026 is presented in the following table (underlying shares in thousands).
| Shares |  | Weighted-Average Exercise Price (per share)
Stock options outstanding as of December 31, 2025 | 4,314 |  |  | $ | 49.83 |
Granted | 604 |  |  | 93.94 |
Exercised or settled | (729) |  |  | 21.88 |
Forfeited | (21) |  |  | 82.13 |
Expired | (2) |  |  | 81.78 |
Stock options outstanding as of March 31, 2026 | 4,166 |  |  | 60.94 |
Vested as of March 31, 2026 | 2,493 |  |  | 44.80 |
The following assumptions were used to estimate the fair value of options granted during the three month periods ended March 31, 2026 and 2025 using the Black-Scholes option-pricing model.
| For the Three Month Period Ended March 31,
Assumptions | 2026 |  | 2025
Expected life of options (in years) | 6.3 |  | 6.3 - 7.5
Risk-free interest rate | 3.7% |  | 4.1% - 4.2%
Assumed volatility | 34.0% |  | 34.2% - 34.3%
Expected dividend rate | 0.1 | % |  | 0.1 | %
Restricted Stock Unit Awards Restricted stock units are granted to employees and non-employee directors based on the market price of the Company’s common stock on the grant date and recognized in compensation expense over the vesting period. A summary of the Company’s restricted stock unit activity for the three month period ended March 31, 2026 is presented in the following table (underlying shares in thousands).
| Shares |  | Weighted-Average Grant-Date Fair Value
Non-vested as of December 31, 2025 | 892 |  |  | $ | 80.55 |
Granted | 299 |  |  | 93.94 |
Vested | (268) |  |  | 75.54 |
Forfeited | (23) |  |  | 84.48 |
Non-vested as of March 31, 2026 | 900 |  |  | 86.39 |
Performance Stock Unit (“PSUs”) Awards Annually, during the first quarter, the Company grants TSR PSUs to certain officers in which the number of shares issued at the end of the performance period is determined by the Company’s total shareholder return percentile rank versus the S&P 500 index for the three year performance period. The grant date fair value of these awards is determined using a Monte Carlo simulation pricing model and compensation cost is recognized straight-line over a three year period. During the first quarter of 2026, the Company granted EPS PSUs to certain officers in which the number of shares issued at the end of the performance period is determined by the level of compounded annual growth rate of the Company’s Adjusted EPS during the three year performance period. The grant date fair value of these awards is based on the market price of the Company’s common stock on the grant date. Compensation expense is adjusted based on an estimate of the number of awards expected to vest, considering the probable achievement of the performance condition, and is recognized over a three year period. During the third quarter of 2022, the Company granted Special TSR PSUs to its Chairman and CEO that were earned (but not vested) on the first date during the five year performance period on which the sum of (i) the 60-day volume-weighted average closing price of the Company’s common stock, plus (ii) the cumulative value of any dividends paid during the five year performance period equals or exceeds $81.85. The grant date fair value of these awards is determined using a Monte Carlo simulation pricing model and compensation cost is recognized straight-line over a five year period. The share price performance goal was achieved on March 6, 2024, but the PSUs will not vest until September 1, 2027, generally subject to Mr. Reynal’s continued employment through such date. The Company also granted its Chairman and CEO Special EPS PSUs that are eligible to vest based on the level of compounded annual growth rate of the Company’s Adjusted EPS during the five year performance period. The grant date fair value of these awards is based on the market price of the Company’s common stock on the grant date and recognized as a compensation expense over a 4.3 year period. A summary of the Company’s performance stock unit activity for the three month period ended March 31, 2026 is presented in the following table (underlying shares in thousands).
| Shares |  | Weighted-Average Grant-Date Fair Value
Non-vested as of December 31, 2025 | 1,347 |  |  | $ | 54.67 |
Granted | 182 |  |  | 114.87 |
Change in units based on performance | 8 |  |  | 75.52 |
Vested | (129) |  |  | 75.52 |
Non-vested as of March 31, 2026 | 1,408 |  |  | 60.67 |
The following assumptions were used to estimate the fair value of performance stock units granted during the three month periods ended March 31, 2026 and 2025 using the Monte Carlo simulation pricing model.
| For the Three Month Period Ended March 31,
Assumptions | 2026 |  | 2025
Expected term (in years) | 2.9 |  | 2.8
Risk-free interest rate | 3.4% |  | 4.0%
Assumed volatility | 28.9% |  | 28.6%
Expected dividend rate | 0.1 | % |  | 0.1 | %

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