We Think Some Shareholders May Hesitate To Increase A10 Networks, Inc.'s (NYSE:ATEN) CEO Compensation

Key Insights

• A10 Networks to hold its Annual General Meeting on 9th of May
• Total pay for CEO Dhrupad Trivedi includes US$672.9k salary
• The total compensation is 31% higher than the average for the industry
• Over the past three years, A10 Networks' EPS grew by 32% and over the past three years, the total shareholder return was 76%

Performance at A10 Networks, Inc. (NYSE:ATEN) has been reasonably good and CEO Dhrupad Trivedi has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 9th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for A10 Networks

Comparing A10 Networks, Inc.'s CEO Compensation With The Industry

At the time of writing, our data shows that A10 Networks, Inc. has a market capitalization of US$1.1b, and reported total annual CEO compensation of US$4.6m for the year to December 2023. This means that the compensation hasn't changed much from last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$673k.

On examining similar-sized companies in the American Software industry with market capitalizations between US$400m and US$1.6b, we discovered that the median CEO total compensation of that group was US$3.5m. Hence, we can conclude that Dhrupad Trivedi is remunerated higher than the industry median. What's more, Dhrupad Trivedi holds US$3.0m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$673k	US$646k	15%
Other	US$3.9m	US$3.8m	85%
Total Compensation	US$4.6m	US$4.5m	100%

On an industry level, roughly 17% of total compensation represents salary and 83% is other remuneration. A10 Networks pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at A10 Networks, Inc.'s Growth Numbers

A10 Networks, Inc. has seen its earnings per share (EPS) increase by 32% a year over the past three years. Its revenue is down 7.5% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has A10 Networks, Inc. Been A Good Investment?

Most shareholders would probably be pleased with A10 Networks, Inc. for providing a total return of 76% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for A10 Networks that you should be aware of before investing.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.