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Su, Papermaster Poised to Rake in Huge AMD Bonuses

(Image credit: AMD)

AMD is willing to pay out big rewards to some of the company's top executives to both stay on board and hit performance goals. A Form 8-K filed to the United States Securities and Exchange Commission (SEC) filed earlier this month show the company's board of directors approving a salary increase for CEO Dr. Lisa Su, as well as target bonuses for both Su and CTO Mark Papermaster. Usain Pirzada highlighted the SEC form on Twitter.

The company's board is now offering three awards. For Su, there's a "CEO Annual LTI Award" to Su with a target value of $11,651,000 and a "CEO Value Creation Equity Award" with a target value of $25 million (slightly less than 25 times her salary). For Papermaster, a "CTO Value Creation Equity Award" has a target value of $7 million.

As of July 1, Su's annual salary increased to $1,055,000 (a $55,00 increase). Additionally, her target bonus will increase to 170% of her 2019 base salary, up from 150%.

All three awards will be made in performance-based restricted stock units (PRSUs), stock options, and "time-based restricted stock units." For the CEO Annual LTI Award, Su will be rewarded based on "the Company’s stock price relative to the return on the S&P 500 Index, in each case over the performance period that begins on August 9, 2019 and ends on August 9, 2022," as well as non-GAAP earnings per share growth from fiscal years 2019 to 2021.

The two Value Creation Equity Awards will both be in PRSUs, and the number earned will be tied to "five-year compounded annual growth rate milestones" tied to AMD's 60-trading day average closing stock price from the date of the grant through August 9, 2024. These vest on the third and fifth anniversaries of the rewards, encouraging both Su and Papermaster to stay in their positions for at least that long.

Other conditions of the rewards can be found in the 8-K filing

Recently, Su quashed rumors that she would be leaving AMD for a role at IBM. And if these potential monetary rewards are in her sights, we may know one reason why she plans to stay.

  • TheSecondPower
    I get that consistency and great executives are good for the company, but it's not good for moral to give the CEO a raise the size of an entry-level engineer's salary and a bonus big enough to pay the salaries of over 150 senior engineers. I know other companies are worse at this but it's still disheartening for everybody else in the company.
    Reply
  • Mandark
    ah, but such is Capitalism. Would you rather it be communistic and only the upper echelon keep all of it instead? (hint, it's almost the SAME THING)

    capitalism leads to the same thing communism does, the pyramid, only the few at the top make anything. difference is capitalism works better and making the rich richer (longer) and takes a much longer time to destroy the underclass
    Reply
  • TheSecondPower
    I'm not a fan of communism, I just think that the stockholders and executives should, by there own free will, recognize the harmfulness of what they're doing. The free market will probably sort this out via less profitable ARM competitors becoming more capable.
    Reply
  • apone
    Mandark said:
    ah, but such is Capitalism. Would you rather it be communistic and only the upper echelon keep all of it instead? (hint, it's almost the SAME THING)

    capitalism leads to the same thing communism does, the pyramid, only the few at the top make anything. difference is capitalism works better and making the rich richer (longer) and takes a much longer time to destroy the underclass

    Why the assumption that everyone who works under a CEO is making peanuts? You're also assuming low and mid-level employees are incapable of career advancement (at AMD or elsewhere) and are perpetually stuck in their respective (consented) salaries.

    Sure, CEO's like Jeff Bezos are multi-billionaires but they've also created thousands of jobs, helped people make extra cash via side gigs, and improved the consumer lifestyle (e.g. Amazon Prime).
    Reply
  • apone
    TheSecondPower said:
    I get that consistency and great executives are good for the company, but it's not good for moral to give the CEO a raise the size of an entry-level engineer's salary and a bonus big enough to pay the salaries of over 150 senior engineers. I know other companies are worse at this but it's still disheartening for everybody else in the company.

    Why is Dr. Su at fault for bringing the company back from years of CPU mediocrity to spanking Intel? (A first for AMD considering their traditional MO) Every employee at AMD consented to their salary and are free to leave to start their own business or switch to a better-paying job at any time (aka career mobility). Also just because Dr. Su is getting a 25x bonus doesn't mean other employees are being robbed of their legally-obligated compensation.
    Reply
  • Mandark
    lol
    Reply
  • JQB45
    I see nothing wrong with awarding people for great leadership and rather remarkable and outstanding performance and giving them goals to hit to continue to improve not only the companies products, market share, technology and stock price. Keep in mind just because the CEO and COO bonuses make the news that does not mean the other top performers down to your 2nd year engineers are not also getting what in there eyes is also excellent bonuses for their contributions as well.

    As a former junior, senior software engineer and lead developer I know others made larger bonuses but I got substantial bonuses as well when I showed my commitment to time and performance as well. It pays to be a top contributor and show some semblance of commitment to most companies large and small, especially those that get purchased by a bigger company.
    Reply
  • Co BIY
    Work one year for a bad leader and $25 million (over 4 committed years , if the fickle market continues to reward the good work of the company, things keep going great, trade wars don't sink you, your competition doesn't do an "Empire Strikes Back" to you and there is no industry devastating disruptive innovation no one knows about yet) sounds like a good deal for great leadership.

    She obviously has great confidence in herself and the market to take such a low base salary (less than the minimum salary allowed for a US NBA basketball player) with large market based incentives. Right now it looks like it paid off.
    Reply
  • TheSecondPower
    I think I might be wrong. Given the (relatively) low base salary with a big bonus system and the likely fact that many other people in the company have also been richly rewarded, the bonus is probably somewhat reasonable.
    Reply
  • bit_user
    TheSecondPower said:
    I get that consistency and great executives are good for the company, but it's not good for moral to give the CEO a raise the size of an entry-level engineer's salary
    Morale? They just have to check the stock price, if they need a morale boost. I'm pretty sure all their engineers have stock options, nearly all of which should be above water.

    I'm just as concerned about executive compensation as anyone, but I think she's unquestionably earned a bonus and companies typically have executive compensation committees to make sure their compensation packages and awards are in line with current practices.

    I'd suggest reserving your outrage for the execs that resign in disgrace, yet still get big payouts, thanks to their golden parachutes (I seem to recall this happened after the Equifax data breach, or something like that). Or CEOs that get bonuses for cutting costs by initiating massive layoffs and off-shoring efforts.

    TheSecondPower said:
    bonus big enough to pay the salaries of over 150 senior engineers.
    Except it doesn't work like that. The shares & options vest over a 5-year period. I think the value is projected based on the current share price, but it might be lower.

    If they were to actually hire those engineers, they would incur those costs annually. Also, your estimate doesn't seem to cover various overheads.

    TheSecondPower said:
    I know other companies are worse at this but it's still disheartening for everybody else in the company.
    What would be far more disheartening would be to lose competent executives, especially in light of the previous clowns who helped dig such a hole for AMD that they've been struggling to get out of.
    Reply