Stroke layer style renders as full rectangle instead of following visible alpha

In recent Photoshop versions, the Stroke layer style no longer respects visible alpha transparency. Instead of outlining the visible pixels of a layer, the stroke is rendered around the full rectangular layer bounds, even when the layer contains transparent pixels.

This affects:

• Text layers with effects (drop shadow (spread=100 ,stroke, gradient, etc.)

• Smart Objects

• Flattened layers

• Rasterized layers

• Groups (as expected), but now also individual layers

Previously, Stroke correctly followed the visible silhouette of the content. This behavior appears to have regressed in recent releases.

Steps to Reproduce

1. Create a text layer

2. Add Drop Shadow (spread=100, distance=5) and outer Stroke = 6

3. Convert to Smart Object or rasterize

4. Apply Stroke layer style (outside, any color)

Expected Result

Stroke should wrap around the visible pixels (alpha silhouette).

Actual Result

Stroke renders as a full rectangle around the layer’s bounding box.

Impact

This breaks a common UI, game, and graphic design workflow used for:

• Title badges

• Buttons

• Stickers

• Icons

• UI labels

• Game HUD elements

Designers can no longer create silhouette outlines using Layer Styles.

This forces destructive selection-based workarounds and breaks nondestructive workflows.

Notes

• Flattening does not fix the issue

• Smart Objects do not fix the issue

• Trimming transparent pixels does not fix the issue

• Copy-Merged does not fix the issue

• Behavior differs from Photoshop 2022 and earlier

This appears related to the new GPU compositing / native canvas pipeline.

Requested Fix

Restore legacy behavior where Stroke respects visible alpha transparency and outlines the actual rendered pixels of the layer.