In one of the most surprising revelations from Cisco Systems, Inc. (NASDAQ:CSCO), the top management including the CEO of the company had a decline in compensation in the latest fiscal, as mentioned in its latest SEC filing.
John Chambers made a total of $16.5 million in the recent fiscal with a 22% decline from last year. The primary reason for lower compensation was the decline in his performance-based remuneration. The leading network device manufacturers couldn’t reach its sales target of $49.5 billion for the fiscal 2014 with net sales of $47.1 billion and operating margin of $13.4 billion, $600 million short from the $14 billion target.
Chamber is likely to leave the post by 2016 after a successful career of 20 years and Cisco Systems, Inc. (NASDAQ:CSCO) is likely to cut up to 6,000 jobs in the upcoming months, as the company witnessed 3% decline in its fiscal revenue when compared with the prior year. According to a spokesperson for the company, John Earnhardt,
“Cisco’s executive officers are compensated in a manner consistent with Cisco’s strategy, competitive practice, sound corporate governance principles, and shareholder interests and concerns. We believe our compensation program is strongly aligned with the long-term interests of our shareholders.”
With same base salary, Chambers had net stock awards of $12.9 million against $15.2 million for the prior year and non-equity incentive compensation of $2.5 million against $4.7 million. Chambers was not the only executive with lower compensation, as his potential successors, Gary Moore and Robert Lloyd, received 35% and 33% lower compensation respectively.
Earlier, Cisco Systems, Inc. (NASDAQ:CSCO) announced investments of up to $1 billion in the global cloud computing network, Intercloud, with potential partnerships with Equinix Inc (NASDAQ:EQIX) and BT Group plc (ADR) (NYSE:BT).
This article has been written by Prakash Pandey.