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Intel Shareholders Vote To Reject Executive Pay Plan

A regulatory filing shows shareholders of the Santa Clara-based semiconductor giant signals disapproval of ballooning executive salaries, including Pat Gelsinger’s $178.6 million 2021 compensation. ‘We take our stockholders’ feedback very seriously, and we are committed to engaging with them and addressing their concerns,’ an Intel spokesperson told CRN.

A majority of shareholders at Intel Corp. revolted against the company’s proposed executive compensation package, including part of CEO Pat Gelsinger’s $178.6 million pay package, according to a regulatory filing.

More than 1.78 billion votes were tallied against the executive compensation while 932 million votes were cast in favor of the payout plan, according to a U.S. Securities and Exchange filing. The nay votes made up about 54.2 percent of the company’s shareholders.

Investors were jolted when Gelsinger in February announced his $43.5 billion, four-year-plan to return Intel to its early silicon glory days. After Gelsinger laid out his ambitious roadmap that offered only modest revenue growth in the short term, stocks tumbled 4 percent temporarily. The stock suffered another blow today, decreasing 4.4 percent to $42.43 by 2 p.m. ET. The stock is down by 22.6 percent (falling $12.39 per share) in the past year.

[RELATED STORY: Intel’s 6 Most Highly Compensated Execs; Pat Gelsinger Leads]

The investor vote is advisory, so it will not impact salaries in the short term, but it does provide a glimpse into shareholders’ mindset as Intel embarks on its plan that includes billions of dollars in spending on U.S. and European manufacturing sites.

“We take our stockholders’ feedback very seriously, and we are committed to engaging with them and addressing their concerns,” an Intel spokesperson said in a statement sent to CRN. “We have already taken specific steps to address investor questions regarding compensation, including making our overall compensation approach easier to understand, clarifying our annual performance bonus goals, clearly linking pay to performance, and increasing our disclosures and transparency. However, there is clearly more work to do. The board, Pat, the management team and the entire company are committed to delivering on our commitments, fulfilling our strategy and delivering value to our stockholders.”

In a proxy filing this month, the company stated, “The Compensation Committee believed that having 73 (percent) of the CEO’s new-hire equity awards contingent on achieving ambitious stock price growth was in the best interest of Intel and its stockholders.”

Gelsinger took the company’s reins in February 2021. His 2021 compensation package included more than $1 million in salary, a $1.75 million bonus, more than $140 million in stock and nearly $30 million in stock option awards.

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