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While it may sound severe, having your stock options cut by fifty percent is nothing compared to the hit his company has taken over the last year.
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Netflix CEO's Stock Options Cut In Half
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Outamyhead
Supreme [H]ardness
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Oh no he will have to get by like all the other millionaires scraping by on 1.5m in stock, and $500,000 in annual earnings, what will the neighbours say?
I don't know how he still has a job. Down here at the bottom of the ladder I've watched guys get marched out for losing decent amounts of money (biggest was 100K), but that's a drop in the bucket to the amount of money this guy has seen go away. "Congratulations! Your bad decisions have led to a loss of 70% of our total net worth. Just so you know how upset we are, you'll only get $2MM instead of your $3.5MM originally agreed to."
I want that kind of job where I can monumentally screw up and still have it afterwards.
I want that kind of job where I can monumentally screw up and still have it afterwards.
Keep in mind that these are stock options (potentially with vesting issues) and this is not cash. Or in other words, it's only as good as the company's stock - which is down almost 60% year to date. That can be good for them if the stock appreciates in value.
Also interesting to note - the Chief Product Officer's salary remains unchanged at $1,000,000 and his stock option allowance actually increased from $900k to $1.5 million. The Chief Content Officer went from $900k salary to $1 million and his stock options went from $1.4 million to $1.8 million. I would've guessed that these guys would be punished too, but they got raises instead. Go figure.
Also interesting to note - the Chief Product Officer's salary remains unchanged at $1,000,000 and his stock option allowance actually increased from $900k to $1.5 million. The Chief Content Officer went from $900k salary to $1 million and his stock options went from $1.4 million to $1.8 million. I would've guessed that these guys would be punished too, but they got raises instead. Go figure.
Zangmonkey
Supreme [H]ardness
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There's a mantra among traders that says "all parabolic curves end badly"
NFLX should have been a surprise to nobody... though the flixter thing was just a bad call....
NFLX should have been a surprise to nobody... though the flixter thing was just a bad call....
It looks like he will make more than $3M out of his $1.5M stock options, since the share price is at its lowest and can only go back to at least twice its current value give it a year or two. Unless Hastings messes things up again by opening his mouth...
A positive $1.5M penalty is not really a penalty, it's still 36 years of average U.S. salary.
A positive $1.5M penalty is not really a penalty, it's still 36 years of average U.S. salary.
Jebus, really guys? You make it sound like this guy had sole decision making privileges at every turn and was intentionally trying to screw the consumer while simultaneously tanking his own company. I guess had nothing to do with a company with a fresh approach to something we wanted which delivered until the previous d-bags who controlled the same content counted out the little guy. Did he make all the best decisions, no. What would you have done if you resold a product your supplier suddenly tripled the price on? Oh, and that product can't be bought anywhere else.
Agreed it's not it's not his fault alone, I'm sure there's enough blame to go around.
sfsuphysics
[H]F Junkie
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Yet when people defend CEOs for all the money they make they sure as fuck make it sound like they're solely in charge of all the good shit that comes out of a company
sfsuphysics
[H]F Junkie
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While in theory yeah... one would think that your company's stock drops 75% and loses some $12 billion in value, combined with the fact that the mass exodus of customers will stagnate the company's profit margin (or lack thereof) for many years, that perhaps losing half of the stock options, really isn't that much of a punishment. In fact one could say that he's actually get a raise if you consider the number of shares he's given compared to prior years, basically everyone else who had stock, lost 75% of the value, he on the other hand only loses 50%.
And I heard an interesting nugget of truth. If Dave Chappelle is starring in a new movie or show, it's his reputation on the line. If the Executive Producer messes something up, or an actor, and Dave doesn't fix it... people will blame the star.
So it's been a wicked roller-coaster, but 34% overall stock price jump and much more since say 2007.
So it's been a wicked roller-coaster, but 34% overall stock price jump and much more since say 2007.
What? Netflix has TWO services.. with what 4-5 tier options each? If I was CEO I would raise holy hell if those 2 services price were raised with out my authority.
Its not like he is CEO of GE getting smacked around for raising the price of a microwave (out of their 100's if not 1000s of products).
He is the leader of the company, if the stock tanks ultimately it is HIS fault, especially in this situation where he botch pretty much everything in a 6 month period...
OK lets look at it...
1. Raised prices, in some cases 60%
2. Streaming content reduced shortly after by loosing contracts (Starz)
3. Trying to split the brand name AND services (especially since streaming was loosing content).
Man that guy must of been on some serious drugs to have the conjones to pull all that stuff of in such a short time. It would have been one thing ifthey was adding streaming content. Or if they raised prices a couple bucks but kept the plans merged.
All of it put together was just a disaster and the stock prices prove it.
Funny thing... ok stock prices go down 60%, his options go down 50%... If he can get the stock back up to just the previous level he will make MORE money then if his options stayed the same and the stock price was stable.
/whoosh
The prices went up because Netflix had to renegotiate contracts on all the content they provide. If their costs go up, they eventually have to pass it on. Blame the entertainment companies.
Fox News commentator: That's class warfare! How dare you try to imply success hasn't been earned here. Quit picking on the job creators! Sure, on that $1.5 million his taxes will be LOWER than than that guy who's only making $30,000 a year, but that's completely fair and to say otherwise is class warfare.
Oh, and pretend I threw in a tirade against 'entitlements' and outrage that a public sector employee gets $50,000 somewhere.
Meh, not as sound-bite ready, pithy, brief... jk
Basically, it's like Netflix taking the bullet for their supply chain/vendors.
madmat
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Personally, I think that given as badly as he screwed the pooch (losing 12 billion dollars... say it with me, twelve BILLION) he's lucky to still have a job. I've seen people lose jobs over a whole lot less.
It's tough to expand a newer aspect of your business. It's even tougher when you try to do it by shitting all over your bread-and-butter and pissing off your customers.
Hasting's flaw isn't in trying to expand streaming; it's trying to kill his DVD rentals. They obviously need more streaming content, and it is going to cost more money than in the past. The fact is, their streaming selection plain sucks compared to what they can send out on disc. Why try and kill DVD when it is still 10x more diverse than streaming?
This past summer, streaming was something I'd browse through and pick something to watch. Every time I wanted a specific title, it was DVD only. The money I've saved by canceling Netflix will buy me the specific titles I want on DVD.
Hastings went full retard.
Hasting's flaw isn't in trying to expand streaming; it's trying to kill his DVD rentals. They obviously need more streaming content, and it is going to cost more money than in the past. The fact is, their streaming selection plain sucks compared to what they can send out on disc. Why try and kill DVD when it is still 10x more diverse than streaming?
This past summer, streaming was something I'd browse through and pick something to watch. Every time I wanted a specific title, it was DVD only. The money I've saved by canceling Netflix will buy me the specific titles I want on DVD.
Hastings went full retard.