Microsoft CEO Satya Nadella’s leadership has netted big gains for both himself and the company since he took office in February 2014. Company filings showed that his salary last year was just under $55 million, and Bloomberg has calculated that this brings his total compensation since he became CEO to more than $1 billion.
Nadella’s tenure at the company has been defined by his push to cement the company as a network and cloud computing giant, unsurprising since he was promoted into the top role from his perch as Microsoft’s executive vice president of the cloud and enterprise division. Nadella's leadership has helped diversify Microsoft’s business away from its legacy, but still highly lucrative Office 365 software package, but recent decisions show that he's combining these two mandates in ways that keep boosting Microsoft's value.
And how his efforts have paid off—On Nadella’s first day on the job, February 4, 2014, Microsoft’s stock price closed at $36.35. On Tuesday, roughly nine-and-a- half years later, it hit an all-time high of $364.02, a 900% increase. Microsoft’s performance far outpaced the market, with the S&P 500 only growing about 148% since February 2014. He's also, of course, led Microsoft past the historic $2 trillion number—its market capitalization actually currently stands at $2.59 trillion, behind only Apple's whopping $3 trillion. Apart from those two, the only other company ever to exceed the $2 trillion valuation is Saudi Aramco, the national champion oil producer.
Tuesday’s surge came off the back of Nadella’s announcement that Microsoft would offer a $30-per-month A.I. subscription to supplement its existing Office 365 products. The move could net Microsoft an additional $14 billion in revenue, Macquarie Equity Research estimated in a research report the day of the announcement. Microsoft also announced earlier this week that it would be the cloud computing vendor for Meta’s free-to-the-public Llama 2 large language model.
In fiscal 2022 (which runs from July to June), the company recorded revenue of $198.2 billion, an 18% increase, and profits of $72.7 billion, up 19%. These unmistakably strong numbers actually missed Wall Street expectations, such is the street's expectation of the Microsoft titan. This, of course, is also testament to Nadella’s leadership.
Nadella's acquisition record is likely another boost to the stock: he acquired LinkedIn for $26 billion in 2016 and GitHub for $7.5 billion in 2018, before announcing the biggest deal in tech history early last year: the $68.7 billion purchase of video game developer ActivisionBlizzard. That transformative acquisition, called a vertical merger in antitrust parlance, is still pending as it has drawn fierce opposition from regulators in the UK and U.S., but the Federal Trade Commission is fresh off a bruising defeat from a judge who gave his nod to the deal going ahead earlier this month.
On Thursday, Microsoft was served with another antitrust lawsuit in Germany. Local video conferencing competitor alfaview alleges that Microsoft’s decision to bundle its Teams video call product with its existing Office 365 offering is an unfair competitive advantage.
Another transformative deal from Nadella occurred earlier this year, with Microsoft announcing an investment of at least $10 billion in Sam Altman’s OpenAI, the maker of ChatGPT and DALL-E, which will power Office 365’s new A.I. capabilities. Morgan Stanley estimates the move could lead Microsoft to a $3 trillion valuation.
In a stark contrast to other tech executives, Nadella has a “nice guy” reputation. He has also been credited with overhauling Microsoft’s culture from a “know it all” to a “learn it all” mentality. Part of his efforts included getting rid of the forced curve performance evaluations that he felt had incentivized internal competition rather than collaboration.
He was named Fortune’s Businessperson of the Year in 2019. In an interview tied to the recognition he told Fortune “I’m wired to be fairly confident in myself and to let others shine.” A telling insight into the leadership style that has endeared him to his peers who voted him the “most underrated CEO” seven consecutive years from 2017 to 2022 in Fortune’s World’s Most Admired survey.
Microsoft referred Fortune to the comments it previously made to Bloomberg on the matter, saying that Nadella "does not have a net worth of $1 billion or more."
[This article has been updated with a comment from Microsoft.]
