DXC Technology CoDXC
DXC Technology Co Stock Compensation Disclosure
Stock Incentive Plans
Equity Plans
The Compensation Committee of the Board has broad authority to grant awards and otherwise administer the DXC Employee Equity Plan. The plan became effective March 30, 2017 and will continue in effect for a period of 10 years thereafter, unless terminated earlier by the Board. The Board has the authority to amend the plan in such respects as it deems desirable, subject to approval of DXC’s stockholders for material modifications.
Restricted stock units ("RSUs") represent the right to receive one share of DXC common stock upon a future settlement date, subject to vesting and other terms and conditions of the award, plus any dividend equivalents accrued during the award period. The RSU’s vest one-third ratably over a three-year period. In general, if the employee’s status as a full-time employee is terminated prior to the vesting of the RSU grant in full, then the RSU grant is automatically canceled on the termination date and any unvested shares and dividend equivalents are forfeited. Certain executives were awarded service-based "career share" RSUs for which the shares are settled over the 10 anniversaries following the executive's separation from service as a full-time employee, provided the executive complies with certain non-competition covenants during that period.
The Company also grants PSUs, which generally vest at the end of a three-year period. The number of PSUs that ultimately vest is dependent upon the Company’s achievement of certain specified financial performance criteria over a three-year period. If the specified performance criteria are met, awards are settled for shares of DXC common stock and dividend equivalents shortly subsequent to the end of the performance period, subject to continued employment through the last day of the third fiscal year.
DXC also issued PSU awards that are considered to have a market condition. Settlement of shares for these PSU awards will be made shortly subsequent to the end of third fiscal year, subject to certain market conditions and continued employment through the last day of the third fiscal year.
The terms of the DXC Director Equity Plan allow DXC to grant RSU awards to non-employee directors of DXC. Such RSU awards vest in full at the earlier of (i) the first anniversary of the grant date or (ii) the next annual meeting date, and are automatically redeemed for DXC common stock and dividend equivalents either at that time or, if an RSU deferral election form is submitted, upon the date or event elected by the director. Distributions made upon a director’s separation from the Board may occur in either a lump sum or in annual installments over periods of 5, 10, or 15 years, per the director’s election. In addition, RSUs vest in full upon a change in control of DXC.
The Board has reserved for issuance shares of DXC common stock, par value $0.01 per share, under each of the plans as detailed below:
| As of March 31, 2025 | |||||||||||
| Reserved for issuance | Available for future grants | ||||||||||
| DXC Employee Equity Plan | 51,200,000 | 20,627,115 | |||||||||
| DXC Director Equity Plan | 745,000 | 528,856 | |||||||||
| Total | 51,945,000 | 21,155,971 | |||||||||
The Company recognized share-based compensation expense for fiscal 2025, 2024 and 2023 as follows:
| Fiscal Years Ended | ||||||||||||||||||||
| (in millions) | March 31, 2025 | March 31, 2024 | March 31, 2023 | |||||||||||||||||
| Total share-based compensation cost | $ | 79 | $ | 109 | $ | 108 | ||||||||||||||
| Related income tax benefit | $ | 13 | $ | 16 | $ | 18 | ||||||||||||||
| Total intrinsic value of options exercised | $ | — | $ | — | $ | 1 | ||||||||||||||
| Tax benefits from exercised stock options and awards | $ | 8 | $ | 14 | $ | 12 | ||||||||||||||
As of March 31, 2025, total unrecognized compensation expense related to unvested DXC RSUs and PSUs, net of expected forfeitures was $104 million, respectively. The unrecognized compensation expense for unvested RSUs and PSUs is expected to be recognized over a weighted-average period of 1.75 years.
Stock Options
The Company’s stock options vest one-third annually on each of the first anniversaries of the grant date. Stock options are generally granted for a term of ten years. Information concerning stock options granted under stock incentive plans was as follows:
Number of Option Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value (in millions) | |||||||||||||||||||||||
| Outstanding as of March 31, 2022 | 1,111,387 | $ | 33.47 | 3.01 | $ | 5 | ||||||||||||||||||||
| Granted | — | $ | — | |||||||||||||||||||||||
| Exercised | (69,855) | $ | 20.03 | $ | 1 | |||||||||||||||||||||
| Canceled/Forfeited | — | $ | — | |||||||||||||||||||||||
| Expired | (48,829) | $ | 44.10 | |||||||||||||||||||||||
| Outstanding as of March 31, 2023 | 992,703 | $ | 33.89 | 2.20 | $ | — | ||||||||||||||||||||
| Granted | — | $ | — | |||||||||||||||||||||||
| Exercised | (15,278) | $ | 18.79 | |||||||||||||||||||||||
| Canceled/Forfeited | — | $ | — | |||||||||||||||||||||||
| Expired | (32,366) | $ | 30.75 | |||||||||||||||||||||||
| Outstanding and exercisable as of March 31, 2024 | 945,059 | $ | 34.25 | 1.27 | $ | — | ||||||||||||||||||||
| Granted | — | $ | — | |||||||||||||||||||||||
| Exercised | — | $ | — | |||||||||||||||||||||||
| Canceled/Forfeited | — | $ | — | |||||||||||||||||||||||
| Expired | (441,480) | $ | 31.88 | |||||||||||||||||||||||
| Outstanding and exercisable as of March 31, 2025 | 503,579 | $ | 36.32 | 0.77 | $ | — | ||||||||||||||||||||
| As of March 31, 2025 | ||||||||||||||||||||||||||||||||
| Options Outstanding | Options Exercisable | |||||||||||||||||||||||||||||||
| Range of Option Exercise Price | Number Outstanding | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term | Number Exercisable | Weighted Average Exercise Price | |||||||||||||||||||||||||||
$21.49 - $26.58 | 232,216 | $ | 26.54 | 0.15 | 232,216 | $ | 26.54 | |||||||||||||||||||||||||
$26.59 - $42.59 | 215,629 | $ | 42.56 | 1.16 | 215,629 | $ | 42.56 | |||||||||||||||||||||||||
$42.60 - $53.41 | 55,734 | $ | 52.91 | 1.78 | 55,734 | $ | 52.91 | |||||||||||||||||||||||||
| 503,579 | 503,579 | |||||||||||||||||||||||||||||||
Restricted Stock
Information concerning RSUs and PSUs granted under the stock incentive plans was as follows:
| Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
| Outstanding as of March 31, 2022 | 7,477,126 | $ | 35.89 | ||||||||
| Granted | 3,404,395 | $ | 38.08 | ||||||||
| Released/Issued | (2,252,627) | $ | 33.10 | ||||||||
| Canceled/Forfeited | (1,179,515) | $ | 36.34 | ||||||||
| Outstanding as of March 31, 2023 | 7,449,379 | $ | 37.11 | ||||||||
| Granted | 6,033,909 | $ | 24.73 | ||||||||
| Released/Issued | (4,066,367) | $ | 23.71 | ||||||||
| Canceled/Forfeited | (1,105,628) | $ | 40.20 | ||||||||
| Outstanding as of March 31, 2024 | 8,311,293 | $ | 33.97 | ||||||||
| Granted | 7,213,047 | $ | 21.66 | ||||||||
| Released/Issued | (3,310,300) | $ | 47.45 | ||||||||
| Canceled/Forfeited | (3,140,299) | $ | 25.30 | ||||||||
| Outstanding as of March 31, 2025 | 9,073,741 | $ | 22.23 | ||||||||
.
Non-employee Director Incentives
Information concerning RSUs granted to non-employee directors was as follows:
| Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
| Outstanding as of March 31, 2022 | 156,722 | $ | 36.18 | ||||||||
| Granted | 66,100 | $ | 31.29 | ||||||||
| Released/Issued | (75,335) | $ | 32.62 | ||||||||
| Canceled/Forfeited | — | $ | — | ||||||||
| Outstanding as of March 31, 2023 | 147,487 | $ | 35.80 | ||||||||
| Granted | 135,457 | $ | 19.52 | ||||||||
| Released/Issued | (69,189) | $ | 31.68 | ||||||||
| Canceled/Forfeited | — | $ | — | ||||||||
| Outstanding as of March 31, 2024 | 213,755 | $ | 26.82 | ||||||||
| Granted | 131,238 | $ | 19.42 | ||||||||
| Released/Issued | (143,976) | $ | 20.34 | ||||||||
| Canceled/Forfeited | — | $ | — | ||||||||
| Outstanding as of March 31, 2025 | 201,017 | $ | 26.63 | ||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | May 15, 2025 | Showing above |
| 2024 | May 17, 2024 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.