NASDAQ, INC.NDAQ
NASDAQ, INC. Stock Compensation Disclosure
SHARE-BASED COMPENSATION
We have a share-based compensation program for employees
and non-employee directors. Share-based awards granted
under this program include restricted stock (consisting of
restricted stock units), PSUs and stock options. For
accounting purposes, we consider PSUs to be a form of
restricted stock. Generally, annual employee awards are
granted on or about April 1st of each year.
Summary of Share-Based Compensation Expense
The following table presents the total share-based
compensation expense resulting from equity awards and the
15.0% discount for the ESPP for the years ended December
31, 2025, 2024 and 2023, which is primarily included in
compensation and benefits expense in the Consolidated
Statements of Income:
Year Ended December 31, | |||||
2025 | 2024 | 2023 | |||
(in millions) | |||||
Share-based compensation expense before income taxes | $165 | $141 | $122 | ||
Common Shares Available Under Our Equity Plan
As of December 31, 2025, we had approximately 21.6
million shares of common stock authorized for future
issuance under our Equity Plan.
Restricted Stock
We grant restricted stock to most employees. The grant date
fair value of restricted stock units awarded are based on the
closing stock price at the date of grant less the present value
of future cash dividends. Restricted stock unit awards granted
to employees below the manager level generally vest 33% on
the first anniversary of the grant date, 33% on the second
anniversary of the grant date, and the remainder on the third
anniversary of the grant date. Restricted stock unit awards
granted to employees at or above the manager level generally
vest 33% on the second anniversary of the grant date, 33% on
the third anniversary of the grant date, and the remainder on
the fourth anniversary of the grant date.
The following table summarizes our restricted stock activity
for the years ended December 31, 2025, 2024 and 2023:
Restricted Stock | |||
Number of Awards | Weighted-Average Grant Date Fair Value | ||
Unvested at December 31, 2022 | 4,380,513 | $45.48 | |
Granted | 1,850,790 | 52.66 | |
Vested | (1,703,252) | 38.21 | |
Forfeited | (318,752) | 51.15 | |
Unvested at December 31, 2023 | 4,209,299 | 51.15 | |
Granted | 1,874,976 | 60.16 | |
Vested | (1,614,071) | 47.48 | |
Forfeited | (291,337) | 55.57 | |
Unvested at December 31, 2024 | 4,178,867 | 56.30 | |
Granted | 1,616,873 | 74.50 | |
Vested | (1,629,481) | 54.86 | |
Forfeited | (245,795) | 61.68 | |
Unvested at December 31, 2025 | 3,920,464 | $64.06 | |
As of December 31, 2025, $138 million of total unrecognized
compensation cost related to restricted stock is expected to be
recognized over a weighted-average period of 2.1 years.
PSUs
We grant three-year PSUs to certain eligible employees.
PSUs are based on performance measures that impact the
amount of shares that each PSU eligible individual receives,
subject to the satisfaction of applicable market performance
conditions, with a three-year cumulative performance period
that vest at the end of the performance period and which
settle in shares of our common stock. Compensation cost is
recognized over the three-year performance period, taking
into account an estimated forfeiture rate, regardless of
whether the market condition is satisfied, provided that the
requisite service period has been completed. Performance
will be determined by comparing Nasdaq’s TSR to two peer
groups, each weighted 50.0%. The first peer group consists
of the S&P 500 GICS 4020 Index, which is a blend of
exchanges, as well as data, financial technology and banking
companies, and the second peer group consists of all
companies in the S&P 500. For awards granted prior to 2024,
our first peer group consisted of exchange companies, and
was replaced by the S&P 500 GICS 4020 Index to align more
closely with Nasdaq’s business and competitors for all future
grants. Nasdaq’s relative performance ranking against each of
these groups will determine the final number of shares
delivered to each individual under the program. The award
issuance under this program will be between 0.0% and
200.0% of the number of PSUs granted and will be
determined by Nasdaq’s overall performance against both
peer groups. However, if Nasdaq’s TSR is negative for the
three-year performance period, regardless of TSR ranking,
the award issuance will not exceed 100.0% of the number of
PSUs granted. We estimate the fair value of PSUs granted
under the three-year PSU program using the Monte Carlo
simulation model, as these awards contain a market
condition.
In 2024, we also granted PSUs with a two-year performance
period to certain eligible executives at the senior vice
president level and above. These PSUs are based on
performance measures relating to the implementation of
certain integration actions in connection with the Adenza
acquisition. Achievement of the targets impacts the amount
of shares that each PSU eligible individual receives. The
PSUs have a two-year performance period and will vest
year after the end of the performance period, and settle in
shares of our common stock. The award issuance under this
program will be between 0.0% and 200.0% of the number of
PSUs granted.
Grants of PSUs that were issued in 2022 with a three-year
performance period exceeded the applicable performance
metrics. As a result, an additional 32,802 units above the
original aggregate target amount were granted in the first
quarter of 2025 and were fully vested upon issuance.
Grants of PSUs that were issued in 2023 with a three-year
performance period exceeded the applicable performance
metrics. As a result, an additional 121,475 units above the
original target amount were granted in the first quarter of
2026 and were fully vested upon issuance. In addition, the
performance period for the two-year PSUs has ended and
exceeded the applicable performance metrics, and resulted in
the issuance of an additional 87,460 shares for
overachievement. These shares were granted in the first
quarter of 2026 and will vest in January 2027.
The following weighted-average assumptions were used to
determine the weighted-average fair values of the outstanding
PSU awards granted under the three-year PSU program
during the years ended December 31, 2025 and 2024:
2025 Grants | 2024 Grants | ||
Weighted-average risk-free interest rate | 3.82% | 4.50% | |
Expected volatility | 23.27% | 24.50% | |
Weighted-average grant date share price | $76.10 | $62.38 | |
Weighted-average fair value at grant date | $92.57 | $78.67 |
The following table summarizes our PSU activity for the
years ended December 31, 2025, 2024 and 2023:
PSUs | ||||
Three-Year Program | ||||
Number of Awards | Weighted- Average Grant Date Fair Value | |||
Unvested at December 31, 2022 | 1,966,542 | $56.44 | ||
Granted | 1,693,065 | 47.14 | ||
Vested | (1,552,311) | 37.59 | ||
Forfeited | (98,974) | 57.51 | ||
Unvested at December 31, 2023 | 2,008,322 | $62.86 | ||
Granted | 1,282,300 | 73.91 | ||
Vested | (961,331) | 73.14 | ||
Forfeited | (155,140) | 62.80 | ||
Unvested at December 31, 2024 | 2,174,151 | $64.83 | ||
Granted | 886,656 | 90.84 | ||
Vested | (620,515) | 62.89 | ||
Forfeited | (62,162) | 69.68 | ||
Unvested at December 31, 2025 | 2,378,130 | $74.91 | ||
In the table above, in addition to the annual employee grant
described above, the granted amount also includes additional
awards granted based on overachievement of performance
metrics.
As of December 31, 2025, the total unrecognized
compensation cost related to the outstanding PSU awards is
$80 million and is expected to be recognized over a
weighted-average period of 1.5 years.
Stock Options
There were no stock option awards granted and no stock
options exercised for the years ended December 31, 2025,
2024 and 2023.
A summary of our outstanding and exercisable stock options
at December 31, 2025, 2024 and 2023 is as follows:
Number of Stock Options | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in millions) | |
Outstanding at December 31, 2023 | 1,420,323 | $41.79 | ||
Outstanding at December 31, 2024 | 1,420,323 | $41.79 | ||
Outstanding at December 31, 2025 | 1,420,323 | $41.79 | 3.2 | $79 |
Exercisable at December 31, 2025 | 806,451 | $22.23 | 1.0 | $60 |
As of December 31, 2025, the aggregate pre-tax intrinsic
value represents the difference between our closing stock
price on December 31, 2025 of $97.13 and the exercise price,
times the number of shares that would have been received by
the option holder had the option holder exercised the stock
options on that date. This amount can change based on the
fair market value of our common stock. As of December 31,
2025 and 2024, 0.8 million outstanding stock options were
exercisable and the exercise price was $22.23.
ESPP
We have an ESPP under which approximately 10.1 million
shares of our common stock were available for future
issuance as of December 31, 2025. Under our ESPP,
employees may purchase shares having a value not exceeding
10.0% of their annual compensation, subject to applicable
annual Internal Revenue Service limitations. We record
compensation expense related to the 15.0% discount that is
given to our employees.
Year Ended December 31, | |||||
2025 | 2024 | 2023 | |||
Number of shares purchased by employees | 652,291 | 675,064 | 687,688 | ||
Weighted-average price of shares purchased | $69.33 | $49.16 | $42.33 | ||
Compensation expense (in millions) | $11 | $9 | $7 | ||
The impact of the activity above is included in Other
issuances of common stock, net in the Consolidated
Statements of Changes in Stockholders’ Equity.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 23, 2022 | |
| 2020 | Feb 23, 2021 | |
| 2019 | Feb 25, 2020 | |
| 2018 | Feb 22, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Mar 1, 2017 | |
| 2015 | Feb 26, 2016 | |
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.