It Looks Like STMicroelectronics N.V.'s (EPA:STMPA) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• STMicroelectronics to hold its Annual General Meeting on 28th of May
• CEO Jean-Marc Chery's total compensation includes salary of US$1.17m
• The overall pay is 54% above the industry average
• Over the past three years, STMicroelectronics' EPS fell by 19% and over the past three years, the total loss to shareholders 34%

Our free stock report includes 1 warning sign investors should be aware of before investing in STMicroelectronics. Read for free now.

The results at STMicroelectronics N.V. (EPA:STMPA) have been quite disappointing recently and CEO Jean-Marc Chery bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 28th of May. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for STMicroelectronics

How Does Total Compensation For Jean-Marc Chery Compare With Other Companies In The Industry?

According to our data, STMicroelectronics N.V. has a market capitalization of €20b, and paid its CEO total annual compensation worth US$9.5m over the year to December 2024. That's a notable increase of 30% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.

For comparison, other companies in the French Semiconductor industry with market capitalizations above €7.1b, reported a median total CEO compensation of US$6.1m. Hence, we can conclude that Jean-Marc Chery is remunerated higher than the industry median. What's more, Jean-Marc Chery holds €1.2m worth of shares in the company in their own name.

Component	2024	2023	Proportion (2024)
Salary	US$1.2m	US$1.2m	12%
Other	US$8.3m	US$6.1m	88%
Total Compensation	US$9.5m	US$7.3m	100%

On an industry level, roughly 49% of total compensation represents salary and 51% is other remuneration. It's interesting to note that STMicroelectronics allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at STMicroelectronics N.V.'s Growth Numbers

STMicroelectronics N.V. has reduced its earnings per share by 19% a year over the last three years. Its revenue is down 25% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has STMicroelectronics N.V. Been A Good Investment?

The return of -34% over three years would not have pleased STMicroelectronics N.V. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for STMicroelectronics that investors should think about before committing capital to this stock.

Switching gears from STMicroelectronics, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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