Microsoft CEO Satya Nadella’s payouts top $1 billion on a stock surge of 1,000%.
Microsoft Corp.’s AI-fueled rally has sent its stock soaring to new highs and pushed CEO Satya nadella’s total compensation from the company past the $1 billion mark. Nadella’s fortune includes all payments he has received from Microsoft, according to regulatory filings, including stock grants, salary, bonus and dividends. His fortune is supported by Microsoft’s stock, which has returned more than a thousand percent since Nadella took office.What Nadella did with the proceeds is unclear, and Bloomberg does not include expenses or private investments in its calculation. According to regulatory filings, Nadella donated $20 million worth of shares over the years without disclosing the recipients.
Microsoft spokesman Frank Shaw said Nadella does not have a net worth of $1 billion or more. He declined to elaborate.When Nadella took over in 2014, many thought Microsoft’s days were numbered. The company is now the second-largest in the world, and is seen as a leader in the race to embrace artificial intelligence. Nadella’s most notable move may be his $1 billion investment in OpenAI, a chatbot that a senior executive described as a “Windows 95 moment,” a reference to a hugely successful software release from nearly 30 years ago. Microsoft’s investment in OpenAI has set it apart from rivals such as Alphabet Inc., and is credited with driving Microsoft’s stock up 50% this year. “He’s a very popular person and has assembled a great team around him,” said Sam Garg, associate professor at the ESSEC Business school in Singapore. “He’s also one of the few tech CEOs that is not hated by politicians and regulators.”
Nadella joins a small club of corporate tycoons who have earned tens of millions from their companies. He follows a similar trajectory as Apple Inc. (AAPL) CEO Tim Cook, who took over the world’s most valuable company nine years after Nadella did. Both men inherited successful companies at a critical juncture, and both faced the long shadow of celebrated founders.Nadella has earned much of his fortune through a series of stock grants, many of which are tied to continued service and performance targets. Nadella has sold shares on a regular basis.It also takes into account cash bonuses and dividends that he has received, assuming they are taxed at the federal top rate.Like Cook, Nadella’s increases in awards are largely due to Microsoft’s stock price performance, including reinvested dividend payments, beginning in 2014.
It also symbolizes a decade of transformation at Microsoft, based in Redmond, Washington. At the time of Nadella’s appointment, many viewed Microsoft as a fading juggernaut: a company that had become synonymous with Windows and Office, but was now struggling to find its footing in the world of handheld devices. The task of charting the company’s future lay with Nadella — a Hyderabad native with a bachelor’s degree in electrical engineering from the University of Hyderabad and master’s degrees in computer science from the University of Michigan at Ann Arbor.Nadella joined Microsoft in 1992 as a software and services engineer, earning an MBA by commuting from Seattle to Chicago for weekend classes. He rose through the company’s leadership ranks, rising to president of its server business before being named CEO after a long and drawn-out search process. Nadella was 46 years old at the time.Nadella recalled a conversation he had with then-Microsoft CEO Steve Ballmer during Ballmer’s annual review in 2014. Nadella asked Ballmer, “How are you doing?” and Ballmer responded, “It’s implicit at your level.”