It Looks Like AudioCodes Ltd.'s (NASDAQ:AUDC) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• AudioCodes' Annual General Meeting to take place on 17th of September
• Total pay for CEO Shabtai Adlersberg includes US$358.4k salary
• Total compensation is 51% above industry average
• AudioCodes' three-year loss to shareholders was 68% while its EPS was down 23% over the past three years

The results at AudioCodes Ltd. (NASDAQ:AUDC) have been quite disappointing recently and CEO Shabtai Adlersberg bears some responsibility for this. At the upcoming AGM on 17th of September, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for AudioCodes

How Does Total Compensation For Shabtai Adlersberg Compare With Other Companies In The Industry?

Our data indicates that AudioCodes Ltd. has a market capitalization of US$282m, and total annual CEO compensation was reported as US$3.2m for the year to December 2023. We note that's a decrease of 16% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$358k.

On comparing similar companies from the American Communications industry with market caps ranging from US$100m to US$400m, we found that the median CEO total compensation was US$2.1m. Hence, we can conclude that Shabtai Adlersberg is remunerated higher than the industry median. Moreover, Shabtai Adlersberg also holds US$43m worth of AudioCodes stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$358k	US$393k	11%
Other	US$2.9m	US$3.4m	89%
Total Compensation	US$3.2m	US$3.8m	100%

On an industry level, around 21% of total compensation represents salary and 79% is other remuneration. AudioCodes sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

AudioCodes Ltd.'s Growth

Over the last three years, AudioCodes Ltd. has shrunk its earnings per share by 23% per year. It saw its revenue drop 5.4% over the last year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has AudioCodes Ltd. Been A Good Investment?

Few AudioCodes Ltd. shareholders would feel satisfied with the return of -68% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for AudioCodes that investors should think about before committing capital to this stock.

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.