Broadcom CEO pay award jumps 164% to $160.8M | Hacker News Reader

Broadcom CEO pay award jumps 164% to $160.8M

theregister.com

50 pointsneverrroot21 comments

Every time I read an article like this, they fail to mention an important factor: The equity payout occurs only if they hit certain milestones (typically stock price hitting some value), and they expire if they don't hit that milestone.

Take this:

"Intel reported that its new CEO Pat Gelsinger earned $178.59 million in total compensation over an 11-month span from when he started in February 2021, until the end of the year."

No he didn't. He didn't hit any of the stock goals since signing on as CEO, and the grants will likely expire before Intel's price hits those goals (I think the lowest target is in the 80 dollars).

His actual compensation? About $10M - quite a bit of it being a sign on bonus.

https://www.crn.com/news/components-peripherals/intel-ceo-pa...

Where does one learn about the milestones and the actual compensation?

Proxy statements. You can find them either on the investor relations website for the company, or the SEC website

https://investors.broadcom.com/node/61851/html

Annual proxy statement. Will have details on the compensation of leadership, and (usually) a scorecard for the past year.

Ya and vested over 5 years. See the actual SEC filing copy:

   To retain and motivate Hock Tan, President and CEO, and 
   Charlie Kawwas, President, Semiconductor Solutions Group, 
   the independent members of the Board granted Mr. Tan and    
   the Compensation Committee granted Dr. Kawwas performance 
   stock unit (PSU) awards in fiscal 2023 that require (i) 
   achievement of formidable stock price performance hurdles 
   and (ii) continued service over a five-year vesting 
   period.
   
   Mr. Tan’s fiscal 2023 PSU award was front-loaded to cover 
   the market-based value of both his annual cash and long- 
   term incentive opportunities over a period of five years. 
   Dr. Kawwas’ fiscal 2023 PSU award was also front-loaded 
   to cover the market-based value of his annual long-term 
   incentive opportunities over a period of five years. The 
   annualized GAAP value of these PSU awards was in line 
   with our compensation peer group benchmarks. During the 
   five-year vesting period, we do not intend to grant 
   annual equity awards to Mr. Tan and Dr. Kawwas and Mr. 
   Tan will not be eligible to receive annual cash incentive 
   payouts because these PSU awards were front-loaded.

   These PSU awards are 100% at risk and deliver value to Mr. 
   Tan and Dr. Kawwas only if our stockholders receive 
   significant and sustained value appreciation. Additional 
   disclosure on the methodology and design of these PSU 
   awards is provided below in “Compensation Discussion and 
   Analysis.”

>The equity payout occurs only if they hit certain milestones (typically stock price hitting some value), and they expire if they don't hit that milestone.

Meanwhile, other people receive billions, their board gets sued for breach of fiduciary duty and people still think the CEO is deserving on HN.

> Every time I read an article like this, they fail to mention an important factor:

The writers or publishers are knowingly putting out clickbait / ragebait, and people eat it up, even on a forum such as this one filled with somewhat educated individuals.

Even educated people (perhaps, especially educated people) trust other professionals to do their jobs.

> Even educated people (perhaps, especially educated people) trust other professionals to do their jobs.

That's a pretty sweeping generalization. As Ronald Reagan used to say (to the point of annoying Mikhail Gorbachev), the old Russian proverb is, trust, but verify.

Or as they say in the nuclear Navy (and I hammer into my 3L students), you get what you INspect, not what you EXpect.

Can confirm a current Broadcom VMware customer went from $8M renewal to $100M

https://news.ycombinator.com/item?id=39509506

I’m not a big fan of this style of rhetoric, but the facts of the article are interesting. I wasn’t aware of Broadcom’s pivot to infrastructure nor their acquisition of VMware.

Pretty surprising to not hear about VMware acquisition. People have been talking about the 10000% (or w/e) price increase for weeks.

I hear about it constantly reading HN and Reddit.

Do you know if there any publicly traded competitors that customers may turn to?

IBM, Nutanix, Microsoft, cloud providers.

"Krause told investors that the company actively pursues 600 customers ... ... because they are often in highly regulated industries, therefore risk-averse, and unlikely to change suppliers."

In short: no. Broadcom knows their top 600 or so accounts that are nearly 50% of their revenue have no place to run, and the remaining 6000 or so will be forced to bite the bullet.

Everyone else (eg, "distribution channels") are a 10% revenue blip in the radar that Broadcom doesn't care about having wind down or disappear.

https://www.theregister.com/2022/05/30/broadcom_strategy_vmw...

Nutanix has a "free" KVM based hypervisor that you can use if you buy their HCI platform (you can also run VMware on top if you prefer).

From what I've heard it seems that most enterprises are moving to Hyper-V because it's already included in their Microsoft agreements (server Datacenter licenses).

Right after layoffs.

I'm sure Hock Tan would see it differently, but I interpret that as a vote of no-confidence in VMware followed by extracting as much cash as possible before the ship sinks. Were I in the market for VMware today, no, I would not be.

Which is a huge shame because historically it's been an incredibly stable and easy to use platform with tons of third party support and integrations.

And starting with vSphere 7 it's been really easy to manage and snappy with a full web interface (it used to be a weird half thick client/half web interface management).

People don't realize how revolutionary VMware was in the IT community, it was probably the biggest disruption between 2005-2015.

And for now, I'm sure it's still great. However, I personally believe it's in keep-the-lights-on maintenance mode. If you like it today, great. I wouldn't have faith in any public roadmap though.

I used to really look up to and want to work for Vmware. And a lot of other FAANG that lost their magic over the last decade.

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