Satya Nadella's Earnings From Microsoft Hit $1 Billion After Stock Surges 900% Since He Became CEO

At a time when many tech giants, including Google, Apple, Nvidia, etc., are riding the AI boom, Satya Nadella-led Microsoft is no exception.

Microsoft CEO's Earnings Cross $1 Billion

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Microsoft¡¯s AI-driven rally in recent weeks has pushed its stock to new highs and reportedly pushed its CEO Satya Nadella¡¯s total windfall from the company past the $1 billion mark.

The boom in Nadella¡¯s wealth includes all payouts he has collected from Microsoft that can be parsed from regulatory filings: equity grants, salary, bonuses, and dividends. It¡¯s underpinned by Microsoft shares surging nearly 900% since his first day in the top job.

As per multiple reports, Satya Nadella will earn a total compensation package of nearly $55 million in 2022.

"Not A Billionaire Yet Despite 876% Surge In Stock"

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Satya Nadella took the reins at Microsoft in February 2014, at a time when many thought the technology giant¡¯s best days were behind it. When he joined Microsoft, the share price was $36.35 (as per Nasdaq data), and today, it is 876% up at $355.08.

However, Microsoft spokesperson Frank Shaw said that Nadella "does not have a net worth of a billion dollars or more", as per the Bloomberg report. It¡¯s not clear what Nadella has done with these proceeds, and Bloomberg¡¯s calculation does not account for expenditures or private investments. Regulatory filings show that he¡¯s gifted shares worth $20 million over the years, though there¡¯s no disclosure of the beneficiaries.

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Fast forward to today, and Microsoft is among the largest companies in the world and is considered the frontrunner in the race to capitalise on the AI boom.

Satya Nadella¡¯s most transformative move may prove to be the company¡¯s multibillion-dollar investment in OpenAI and its ChatGPT bot, which a senior executive called a "Windows 95 moment," referring to the hugely successful software release nearly three decades ago. That catapulted Microsoft ahead of competitors like Alphabet in AI capabilities and is the main driver of the stock¡¯s nearly 50% surge this year to date.

Satya Nadella's Similar Arc To Tim Cook

Microsoft CEO Nadella is a part of an exclusive club of corporate titans who¡¯ve amassed 10-figure earnings from their employers. He¡¯s traced a similar arc to Apple¡¯s Tim Cook, the leader of the only company in the world that¡¯s more valuable than Microsoft. Both took over successful firms at inflection points, and both had to contend with the long shadows of lauded founders. Nine years after ascending to the CEO role, Cook reached billionaire status, as per the report.

Most of Nadella¡¯s wealth stems from a series of equity grants he has received over the years, with payouts tied both to his continued service and to performance targets. He¡¯s periodically sold some of the shares, too. It also accounts for cash bonuses and dividends he¡¯s received, assuming they¡¯re taxed at the top federal rates.

Like Tim Cook, the ballooning value of Nadella¡¯s awards largely stems from Microsoft¡¯s stock returns, including reinvested dividends, since early 2014, when he took over as CEO.

He Had Joined Microsoft In 1992

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Nadella began his journey at Microsoft in 1992 and worked on business software and services through much of his career. He earned an MBA by taking weekend classes at the University of Chicago, commuting from Seattle.

He moved through various leadership roles and eventually became president of Microsoft¡¯s server business. From there, he was plucked as CEO after a lengthy process that included several internal and external candidates. He was 46 at the time, as the report mentioned. A few years before that, Nadella had sat down with then-Microsoft CEO Steve Ballmer for his annual review.

In a 2014 interview with the New York Times, Nadella recalled asking Ballmer how he was performing, to which he replied, "You don¡¯t have to ask me, ¡®How am I doing? At your level, it¡¯s going to be fairly implicit."

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