During a recent interview, Microsoft CEO Satya Nadella revealed that he earned $79.1 million (£61 million) last year, marking a 63% increase from his previous compensation. This growth occurred despite his own request to reduce one aspect of his pay due to cybersecurity issues at the tech giant, resulting in a $5 million decrease from what he would have otherwise received.
In light of significant job cuts across the tech industry, including within Microsoft’s gaming division, Nadella’s compensation appears particularly noteworthy. However, a proxy statement filed with the U.S. financial regulator highlighted that Microsoft’s revenue grew by 16% for the year ending June 30, 2024. The company’s compensation committee noted, “Mr. Nadella agreed that the Company’s performance was extremely strong.” Alongside this, he requested that the committee consider altering the usual performance metrics to reduce his cash incentive, citing his personal accountability for a series of cyber attacks.
One notable incident involved hackers accessing the email accounts of approximately 25 organizations, including government agencies, which Microsoft reported in July 2023. Although the company attributed the breach to Chinese actors, the Chinese embassy in London dismissed these claims as “disinformation.” Notably, the fiscal period in question ended just weeks before a significant internet outage that affected Windows PCs globally. While this incident was not a cyber attack, Microsoft later apologized for another outage caused by one.
The compensation committee ultimately decided to cut Nadella’s cash pay to $5.2 million, a reduction of over 50%, which constitutes less than 7% of his total compensation. The majority of his earnings, totaling $71.2 million, were derived from stock options.
Luke Hildyard, director of the High Pay Centre, acknowledged that, on the surface, Nadella’s earnings could be justified given Microsoft’s robust financial performance. However, he posed a critical question: “Is an additional $79 million on top of $49 million from last year for someone who is already worth hundreds of millions—someone with the means to enjoy multiple lifetimes of absolute luxury—truly necessary as a reward or incentive?” He emphasized that Microsoft’s success is built on the contributions of its employees, customers, and society at large, suggesting that the benefits of that success could be distributed more equitably.
In comparison, Apple CEO Tim Cook earned $63.2 million in 2023, while Jensen Huang, CEO of Nvidia, received $34.2 million for the 2024 fiscal year. However, none of these leaders come close to Tesla’s Elon Musk, whose compensation could potentially reach an astounding $56 billion.
