NEW YORK – Mr Nikesh Arora has repeatedly succeeded in winning big pay cheques.
At Google, he became the firm’s highest-paid executive after getting a compensation package worth about US$51 million in 2012, and collected stock awards worth at least US$200 million by the time he left.
Poached in 2014 by SoftBank Group’s Mr Masayoshi Son – and touted as the legendary investor’s likely successor – he amassed a US$135 million first-year compensation package that broke Japanese records and made him the world’s best-paid executive.
But it is Mr Arora’s latest stint, as chief executive officer of cyber-security firm Palo Alto Networks, that has catapulted the 55-year-old into the billionaire class.
Palo Alto Networks handed Mr Arora a US$125 million stock and options compensation package when he was hired in 2018. Thanks to a boom in cyber-security software after a series of high-profile hacking incidents that disrupted casinos, ports and even Treasury markets, the company’s share price has more than quadrupled since then – and Mr Arora’s stake is now worth US$830 million (S$1.1 billion).
Combined with the enormous pay awards that he secured earlier in his career, Mr Arora’s net worth stands at US$1.5 billion, according to the Bloomberg Billionaires Index. That makes him a rare non-founder billionaire tech chief executive.
The bulk of Mr Arora’s stake in Palo Alto Networks relates to the more than 3.4 million options he was awarded upon joining the firm. Those were subject to meeting share price targets, all of which have now been achieved, including the highest goal: a 300 per cent gain.
Mr Arora sold nearly US$300 million worth of shares in 2023 after exercising some of the options.
He is primed to continue building his fortune at Palo Alto Networks. Mr Arora’s 2023 compensation includes a maximum of 750,000 stock awards that vest upon the achievement of certain performance conditions, which would currently be worth more than US$220 million.
In its proxy statement, the company wrote that the award was justified because Mr Arora’s strong performance over his first five years meant he had already been able to vest “US$102 million of value each year”.
“Because of this significant vested ownership and the amount that Mr Arora was projected to vest in over the next several years, the board determined that a meaningful equity award would be necessary to ensure that such award retains and engages Mr Arora.” BLOOMBERG