CEO Satya Nadella’s compensation package has surged by 63%, totaling a staggering $79.1 million. This substantial increase comes despite a backdrop of mass layoffs and significant cybersecurity breaches that have plagued the tech giant.
Compensation Breakdown Amidst Controversy
According to Microsoft’s latest regulatory filings, approximately 90% of Nadella’s pay consists of company shares, reflecting his ongoing connection to the company’s stock performance. Notably, this figure could have been even higher—by $5 million—had Nadella not requested a pay cut, citing “personal accountability” following the fallout from Microsoft’s cybersecurity failures.
In March, the U.S. Cyber Safety Review Board criticized Microsoft’s security measures, highlighting deficiencies in its response to a significant breach involving a Chinese hacking group that compromised the email accounts of 25 organizations, including several government agencies. Microsoft President Brad Smith publicly acknowledged the company’s shortcomings before Congress, expressing the need for improvement.
Cybersecurity Failures and Layoffs
Adding to the tumult, Microsoft disclosed that it was also targeted by a Russian state-sponsored group known as Midnight Blizzard, which led to the compromise of a small number of corporate email accounts. These incidents prompted Microsoft to announce a comprehensive review of its cybersecurity protocols, which includes the establishment of six key “security pillars” aimed at enhancing its defenses against future threats.
This year has also seen Microsoft undertake major layoffs, cutting 1,900 jobs at Activision Blizzard and Xbox in January, followed by an additional 650 positions last month. Since acquiring Activision Blizzard for $69 billion in October 2023, the company has eliminated over 2,500 jobs and shuttered four game studios, marking a turbulent period for its workforce.
Executive Pay Increases Amidst Employee Struggles
Despite these setbacks, Nadella is not alone in his lucrative pay increase; Chief Financial Officer Amy Hood’s compensation rose by 30% to $25.8 million, while President Brad Smith received a 29% increase, bringing his package to $23.4 million.
As Microsoft navigates these complex challenges, Nadella’s significant pay raise has raised eyebrows, reflecting a disconnect between executive compensation and the experiences of employees facing layoffs and organizational upheaval. For more details on this story, visit PC Gamer.
