Microsoft CEO Satya Nadella’s pay package for fiscal 2024 has increased significantly, reaching $79.1 million. This represents a 63 per cent rise from the previous year, largely due to stock awards. It is his largest compensation since 2014, when he received $84 million upon becoming CEO. Microsoft’s advancements in artificial intelligence and its investment in OpenAI have bolstered its market position, enhancing Nadella’s stock-based earnings.
Nearly 90 per cent of Nadella’s 2024 pay comes from stock awards, which climbed to approximately $71 million, up from $39 million the previous year. This increase reflects Microsoft’s strong market performance, with its valuation exceeding $3 trillion and shares rising 31.2 per cent during the fiscal year ending June 30, 2024. The company’s AI initiatives, especially in generative AI, have driven its growth, reinforcing Microsoft’s leadership in the field.
Despite the substantial pay package, Nadella requested a reduction in his cash incentive due to cybersecurity issues. Initially set at $10.66 million, it was cut to $5.2 million following breaches, including incidents involving Chinese and Russian actors. Nadella sought the adjustment himself, highlighting personal accountability in response to the breaches, which drew criticism from the U.S. government.
Microsoft has committed to enhancing its security practices following these incidents. A report from the U.S. Department of Homeland Security in April emphasized the need for a focus on security culture. Nadella assured employees in May that security would be a priority in future strategies and has included cybersecurity efforts in employee compensation.
The breaches have prompted Microsoft to overhaul its cybersecurity measures, aligning with U.S. agency recommendations. Despite generating over $20 billion in revenue from its security division in 2022, Nadella’s decision to reduce his pay reflects a commitment to addressing the cybersecurity challenges. In comparison, Apple CEO Tim Cook earned $63.2 million in 2023, while Nvidia CEO Jensen Huang received $34.2 million
