Meta Platforms, Inc. Announces Major Increase in Executive Bonuses Following Workforce Layoffs
Meta Platforms, Inc. has recently approved a significant hike in executive bonuses to 200%, just days after the company laid off five percent of its workforce due to underperformance. This decision was outlined in a report submitted to the United States Securities and Exchange Commission, detailing the approval by the company’s board of directors.
The approved change, which escalates the target bonus percentage under its annual executive bonus plan, was sanctioned by the Compensation, Nominating, and Governance Committee (CNGC) of the Board. Katherine R. Kelly, Vice President and Corporate Secretary at Meta, signed the disclosure, emphasizing that the company’s Bonus Plan aims to provide annual variable cash incentives. These incentives are designed to encourage executive officers to concentrate on the company’s key goals and to reward them based on corporate performance and successes.
The report clarified that bonuses are determined by multiplying each executive officer’s base salary by their designated target bonus percentage and the company performance percentage established by the CNGC for the corresponding annual performance period.
In a market data assessment dated February 13, 2025, the CNGC approved an increase in the target bonus percentage for all of the company’s named executive officers (excluding the CEO) from 75% to 200% of their individual base salaries. This adjustment will take effect for the 2025 annual performance period under the Bonus Plan.
The CNGC based its decision on thorough market analysis of executive compensation, which is conducted annually with the assistance of an independent compensation consultant. The committee noted that prior to this increase, the target total cash compensation for named executive officers (excluding the CEO) was situated at or below the 15th percentile compared to similar roles within the company’s peer group. With the newly approved increase, this target total cash compensation is expected to land around the 50th percentile among its competitors.
Highlights of the Situation:
- The bonus announcement follows Meta’s decision to reduce its workforce by five percent, citing performance issues.
- Additionally, the company cut its annual stock option distribution by approximately ten percent for thousands of employees.
- In a financial report released earlier this year, Meta revealed a substantial year-on-year revenue increase of 21% for the fourth quarter, amounting to $48.39 billion.
Meta, formerly known as Facebook, operates popular platforms including Facebook, Instagram, Threads, and WhatsApp.
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