- Microsoft CEO Satya Nadella received a record compensation package worth approximately $96.5 million for fiscal year 2025, marking a nearly 22% increase from the previous year's $79.1 million.
- The compensation included over $84 million in stock awards, a base salary of $2.5 million, and about $9.5 million in cash bonuses.
- Microsoft's board specifically highlighted Nadella's leadership in artificial intelligence, describing the company's progress in AI as exceptional during what it called a generational technology shift.
- The company reported approximately 15% year-over-year revenue growth, while operating income increased by 17%. The company's cloud business continued to be a major growth driver, with Microsoft Cloud revenue climbing 23% to nearly $169 billion.
- The CEO-to-median employee pay ratio reached nearly 480:1 during fiscal 2025.
- According to Microsoft's compensation framework, over 95% of Nadella's target annual pay is performance-based, with at least 70% tied to equity awards, meaning the value of a significant portion of his earnings depends on Microsoft's long-term success.
- Nadella's stock awards are tied to metrics such as total shareholder returns compared with the S&P 500, overall company revenue, Azure revenue, Microsoft Cloud revenue, and broader financial performance.
- His equity arrangements use overlapping performance periods, modifiers based on shareholder returns and vesting schedules that extend over several years.
Microsoft CEO Satya Nadella's total compensation for fiscal 2025 reached approximately $96.5 million, a 22% increase from the previous year. This growth reflects the company's strong performance, with cloud revenue rising 23% to nearly $169 billion and Azure revenue increasing 34% to over $75 billion.14
The board attributed Nadella's pay increase to his leadership during a significant technological shift, particularly in artificial intelligence. They noted exceptional progress in AI under his guidance, which has been pivotal for Microsoft's strategy.3
Nadella's compensation package includes over $84 million in stock awards, a base salary of $2.5 million, and approximately $9.5 million in cash bonuses. Notably, over 95% of his pay is performance-based, with at least 70% tied to equity awards, linking his earnings to Microsoft's long-term success.2
The CEO-to-median employee pay ratio reached nearly 480:1, highlighting the disparity in compensation within the company. Microsoft's overall revenue grew by 15% year-over-year, with operating income up 17%, showcasing the company's robust financial health amidst its focus on cloud and AI technologies.5
“Over 95% of Nadella's target pay is performance-based, with at least 70% tied to equity, linking his earnings to Microsoft's long-term success. The CEO-to-median employee pay ratio reached nearly 480:1, while Microsoft Cloud revenue grew 23% to nearly $169 billion.”
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