CEO salary watch IBM emperor Arvind Krishna’s total financial package went up by double digits in 2024 to more than $25 million.
Chairman, CEO, and president Krishna received $1.5 million in salary, $14.8 million in stock awards, $4.49 million in option awards, $3.5 million in non-equity incentive plan compensation, $34,000 in pension contributions, and $425,000 for all other compensation.
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This was 23.1 percent more than what Big Blue’s top dog was deemed worthy of in 2023, and is certainly a cut above the median employee annual total compensation of IBM’s workforce, which was $48,582 versus $43,069 in the prior year.
The relatively low financial package for the overall workforce is likely due to IBM employing a huge swathe of its employees in lower-wage locations such as India.
In terms of the financial metrics IBM applies to Krishna’s compensation, he scored above expectations (102 percent) for the revenue generation target, below (90 percent) on operating earnings per share, and nearly hit the goal on free cash flow.
For calendar 2024, IBM reported revenue of $62.8 billion, up 1 percent year-on-year. This included a more than 75 percent contribution from software and consulting services.
The target for operating EPS was $33.10, but IBM attained $29.94. Free cash flow reached $33.8 billion, compared to a forecast of $34.6 billion.
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Highlights included $1 billion in GenAI “book of business” revenue in the Software division and $4 billion in Consulting.
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IBM also flagged the $3.5 billion annual run rate in productivity savings made since 2022. This helped gross margin grow year-on-year by 1.2 percent to 57 percent. The relatively fat margins from software and consulting are a thing of beauty (well, they were for Krishna).
Shareholders saw a payout too, as $6.1 billion was returned to stock owners.
Krishna’s colleagues in the C-suite won’t be scrambling around for loose change either. CFO James Kavanaugh received a remuneration package of $13 million, up from $11.7 million, and head of software Robert Thomas got $11.85 million, up from $10.33 million.
It’s tough at the top but someone’s got to do it. ®
