Microsoft Corp.’s stock has experienced a remarkable surge, catapulting Chief Executive Officer Satya Nadella’s total windfall past the $1 billion mark. This can be attributed to the more than 1,000% increase in Microsoft shares since Nadella assumed his position.
Nadella’s substantial earnings include all the payouts he has received from Microsoft, such as equity grants, salary, bonuses, and dividends. While it remains unclear what he has done with these proceeds, Bloomberg’s calculations do not take into account personal investments or expenditures. Regulatory filings reveal that he has been gifted shares worth $20 million, although the beneficiaries are undisclosed.
Taking the reins at Microsoft in 2014, Nadella faced a company that many believed had seen its best days. However, under his leadership, Microsoft has become the second-largest company globally and the frontrunner in leveraging artificial intelligence (AI).
One of Nadella’s most significant moves was Microsoft’s multibillion-dollar investment in OpenAI and its ChatGPT bot. This investment has been referred to as a Windows 95 moment, akin to the highly successful software release three decades ago. This strategic move has propelled Microsoft ahead of competitors like Alphabet Inc., and has been a key driver of the company’s 50% stock surge this year.
According to Sam Garg, an associate professor at ESSEC Business School in Singapore, Nadella has built an incredible team around him and is well-liked, unlike many other tech CEOs who face criticism from politicians and regulators.
Nadella now belongs to an exclusive club of corporate titans who have amassed billion-dollar fortunes from their respective companies. His trajectory echoes that of Apple Inc.’s Tim Cook, as both took over successful firms at inflection points and had to grapple with the shadows of revered founders. Nine years into his role, Cook achieved billionaire status.
The majority of Nadella’s windfall is derived from equity grants received over time, with payouts tied to both his continued service and performance targets. He has occasionally sold some of these shares. Additionally, the ballooning value of his awards is primarily due to Microsoft’s stock returns, including reinvested dividends, since early 2014.
Nadella’s journey also reflects a decade of transformation within Microsoft. When he assumed the CEO position, the company was seen as losing relevance, a tech giant synonymous with Windows and Office struggling to find its footing in a world dominated by handheld devices. Nadella, originally from Hyderabad, India, with degrees in electrical engineering and computer science, laid out the path forward for Microsoft.
Having joined Microsoft in 1992, Nadella worked on enterprise software and services throughout his career. He pursued an MBA by attending weekend courses at the University of Chicago while commuting from Seattle. Climbing through various leadership roles, he ultimately became the president of Microsoft’s server business. Following a lengthy process involving both internal and external candidates, he was chosen as CEO at the age of 46.
A few years before assuming the CEO role, Nadella had an annual review with then-CEO Steve Ballmer. In a 2014 interview with the New York Times, Nadella recalled asking Ballmer how he was performing. Ballmer responded by saying that at Nadella’s level, it should be implicit, and he didn’t have to ask.
While Nadella’s achievements and his contribution to Microsoft’s success are undeniable, it is essential to consider different perspectives and opinions on his leadership and the company’s growth. The journey to becoming a billion-dollar CEO is an outcome of various factors, both internal and external, that played a role in shaping Microsoft’s trajectory.
