Advanced Micro Devices (AMD) has announced its executive compensation decisions for fiscal 2025, including annual cash bonuses for key executives and a significant new long-term equity award for CEO Lisa Su. These moves reflect AMD’s efforts to reward performance, retain top leadership, and align executive incentives with shareholder value creation over the long term.
The company approved cash bonuses for several senior executives based on their 2025 performance and granted CEO Lisa Su a special $75 million performance-based equity award designed to motivate sustained stock price growth and long-term commitment.
Key details on fiscal 2025 executive bonuses
- AMD awarded annual cash performance bonuses to five top executives, payable in March 2026:
- Lisa Su, Chair, President and CEO: $3,125,430
- Mark Papermaster, EVP and Chief Technology Officer: $1,293,187
- Jean Hu, EVP, Chief Financial Officer and Treasurer: $1,179,750
- Forrest Norrod, EVP and General Manager, Data Center Solutions: $1,157,062
- Ava Hahn, Senior Vice President, General Counsel and Corporate Secretary: $738,100
Details of CEO Lisa Su’s $75 million Value Creation Equity Award
- The award is a special long-term equity incentive granted under AMD’s 2023 Equity Incentive Plan, with a target value of $75 million.
- It will be granted on March 15, 2026, and converted into performance-based restricted stock units (PRSUs) based on the average stock price over the 30 trading days before the grant.
- The number of PRSUs earned can range from 0% to 200% of the target amount, depending on stock price performance over a five-year performance period ending March 15, 2031.
- The award is 100% performance-based and tied to four escalating stock price hurdles, each requiring the company’s 90-day average stock price to meet or exceed specific targets during the performance period:
- Tranche 1 (50% of target PRSUs): 10% compound annual growth rate (CAGR) in stock price
- Tranche 2 (100%): 15% CAGR
- Tranche 3 (150%): 17.5% CAGR
- Tranche 4 (200%): $600 stock price target (approximately 20%+ CAGR)
- The baseline price for calculating these hurdles is the average closing price over the 60 trading days before the grant date.
- The hurdles are set well above the median five-year CAGR of the S&P 500 and its Information Technology sector, reflecting ambitious growth expectations.
- Vesting of earned PRSUs is staggered:
- Any PRSUs earned within the first three years vest 50% on the third anniversary and 50% on the fifth anniversary of the grant date.
- PRSUs earned after the third year but before the fifth year vest fully on the fifth anniversary.
- Vesting requires Dr. Su to remain CEO or Executive Chair through the applicable vesting dates.
- If Dr. Su is terminated for cause, all unvested and unearned PRSUs are forfeited.
- The award is designed to incentivize long-term leadership continuity and align CEO compensation with shareholder returns over a multi-year horizon.
Implications for investors
- The substantial size and performance-based nature of the CEO equity award underscore AMD’s focus on sustained stock price growth and long-term value creation.
- The multi-year vesting schedule and high performance hurdles align Lisa Su’s incentives with shareholders’ interests and encourage her continued leadership through 2031.
- The cash bonuses reflect strong individual and company performance in 2025, rewarding key executives across finance, technology, data center, and legal functions.
- Overall, AMD’s executive compensation structure reinforces its strategic priorities of innovation, market leadership, and shareholder alignment.