Meta executives are set to receive significantly higher bonuses this year. According to a corporate filing on Thursday, the company has approved “an increase in the target bonus percentage” for its annual executive bonus plan. Under the new structure, Meta’s named executive officers could earn bonuses up to 200% of their base salary, a substantial jump from the previous 75%.
The filing clarified that this updated bonus plan does not apply to Meta CEO Mark Zuckerberg.
Board’s Rationale for the Change
The decision to boost bonuses was made by a committee from Meta’s board of directors on February 13. The committee determined that the “target total cash compensation” for executives “was at or below the 15th percentile of the target total cash compensation of executives holding similar positions” at peer companies.
“Following this increase, the target total cash compensation for the named executive officers (other than the CEO) falls at approximately the 50th percentile of the Peer Group Target Cash Compensation,” the filing noted.
Layoffs and Stock Option Reductions
The news of increased executive bonuses comes just a week after Meta announced layoffs affecting 5% of its global workforce, primarily targeting its lowest-performing employees.
In addition to the layoffs, Meta has reduced its annual distribution of stock options by around 10% for thousands of employees, according to a report by the Financial Times. The report highlighted that the reduction in stock options might vary depending on employees’ locations and roles within the company.
Strong Market Performance and Revenue Growth
Despite these internal cost-cutting measures, Meta’s stock has seen a notable rise, climbing over 47% in the past year. Shares closed at $694.84 on Thursday, reflecting investor confidence in the company’s expanding digital advertising sales and its ambitious investments in artificial intelligence.
Meta reported in January that its fourth-quarter revenue grew by 21% year over year, reaching $48.39 billion, further bolstering its market performance and investor optimism.
