According to the Wall Street Journal (WSJ), Intel Corporation set forth a hefty compensation of $178.6 million to its Chief Executive Officer, Pat Gelsinger, last year.
Intel Corporation released its annual proxy filing last week, disclosing Gelsinger’s compensation.
Intel CEO Gelsinger’s high earnings made him the second highest-earning CEO in the S&P 500. He was $68 million short of matching the highest-paid CEO, Discovery Inc.’s David Zaslav. Apple Inc.’s Tim Cook ranks third with nearly $100 million last year.
According to CRN, Intel employs roughly 121,000 employees, with the median salary being $104,400. Gelsinger’s earnings are 1,711-times greater than most of Intel’s employees’ income.
Intel noted in their SEC filing that Gelsinger’s compensation consists of a $1.1 million base salary, a $1.75 million hiring bonus, and a combined total of $169.5 million worth in stock and stock option awards. He also received $5.1 million in a non-equity incentive plan.
Intel stated that Gelsinger’s generous compensation package was appropriate based on his previous experience and unique abilities. They also noted that leaving his last company cost him significantly. The WSJ reported that monetary loss to be upward of $50 million.
Gelsinger had previously worked for Intel for 30 years. The decision to hire him as CEO reflected his ability to market effectively and grow the company’s revenue. Since his return to Intel in February 2021, Intel has seen a 1% increase in value, causing the company’s worth to hit $79 billion.
According to The Oregonian, the downside of Intel CEO Gelsinger’s compensation package is that the majority of it is tied to the company’s ability to increase stock value. This could be a lofty goal as investors are nervous about Gelsinger’s spending plans.
Intel shares rose after Gelsinger was hired, reflecting enthusiasm for his return to the company. However, Intel’s stock has dropped back down in the months since.
Gelsinger announced his plans to build Intel manufacturing plants in Arizona, Ohio, and Germany — an expenditure worth $90 billion.
Intel’s stock dropped from $61.81 a share in February 2021 to $52 a share last week. Gelsinger needs a significant turnaround to obtain the heftiest portion of his compensation.
Intel’s future is up in the air. Bloomberg reported in January that Intel is slowly losing the chip manufacturing race and that Samsung could overtake them soon. Samsung beat out Intel in three quarters last year.
To decrease reliance on Asian-based companies’ production of chips and processors, Gelsinger has pushed for the U.S. Congress to financially support his plans to create more domestic plants. Gelsinger urged congress to pledge $50 billion towards his endeavor, but progress has stagnated.
According to Tech News World, with the world experiencing a global chip shortage, many hope that Gelsinger will save Intel and put the American-based company back on top of the international market.