LogInMicrosoft CEO Satya Nadella's annual compensation now only relies on overall numbers for the Xbox gaming division, with Xbox Game Pass growth no longer being a factor in the calculation.
Image credit: Microsoft
Microsoft CEO Satya Nadella's pay targets underwent a significant change as, for the first time in three years, they did not include a specific growth milestone for Xbox Game Pass. According to a Microsoft SEC filing discovered by Axios, Nadella's only games-related performance-based incentive for the fiscal year ending June 30, 2023, was to achieve a 4.4% growth in Xbox Content and Services revenue.
The filing revealed that over 95% of Nadella's annual target compensation opportunity is performance-based. Surprisingly, the Xbox target comprised only 10% of his performance-based pay targets, with the largest category focusing on growing Microsoft's cloud revenue, weighted at 30%.
Unfortunately, Xbox's revenues fell short of the 4.4% growth target, experiencing a mere 0.7% increase. Axios' analysis highlighted that Nadella had previously been assigned targets based on the subscriber growth of Xbox Game Pass. In the prior year, Microsoft had set a goal of achieving 73% growth in Xbox Game Pass subscribers, but the actual result reached only 28%.
The filing also disclosed that Nadella's total cash and stock compensation for the twelve months ending June 30, 2023, amounted to $48.5 million, indicating a decrease from the previous year's $54.9 million, as reported by Axios.
Some more news on Microsoft, after having acquired Activision Blizzard, the company decided to address its labor policies. Vice Chair and President Brad Smith also added that Microsoft planned to commit to its labor principles and "innovative approach to union partnerships".
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