Microsoft CEO Nadella's pay hits record $96.5 million amid AI growth

Microsoft Corporation Chief Executive Officer Satya Nadella’s compensation surged to $96.5 million for the financial year 2024-2025 -- his highest since assuming the role more than a decade ago. The board attributed the increase to the company’s strides in artificial intelligence (AI), Bloomberg reported.

The results “demonstrate that Satya Nadella and his leadership team have positioned Microsoft as a clear artificial intelligence leader for this generational technology shift", the board’s compensation committee wrote in a note to shareholders included in a regulatory filing released on Tuesday.

According to the filing, around 90 per cent of Nadella’s pay -- which includes a $2.5 million base salary -- is in Microsoft shares. He earned $79.1 million in the previous financial year. Nadella became Microsoft’s third CEO in 2014.

Top executives’ pay also climbs

Pay for Nadella’s top deputies also rose in the year ending June. Chief Financial Officer Amy Hood’s total compensation stood at $29.5 million, while Judson Althoff, recently elevated to lead Microsoft’s commercial business, received a package worth $28.2 million.

Shares of the world’s largest software company have gained 23 per cent this year through Tuesday’s close. Microsoft’s Azure cloud computing division has consistently recorded growth ahead of competitors such as Amazon.com Inc.

Strategic acquisitions under Nadella

Nadella’s most significant achievement has been steering Microsoft’s successful shift to cloud computing. Recognising the promise of cloud services early on, he championed the growth of Azure, which now competes closely with Amazon Web Services for market leadership.

Strategic acquisitions such as GitHub and LinkedIn further expanded Microsoft’s footprint in software development and professional networking. Nadella also strengthened the company’s gaming portfolio through major investments, including the acquisition of Activision Blizzard, consolidating Microsoft’s presence in the rapidly growing gaming sector.

Betting big on OpenAI

Under Nadella’s leadership, Microsoft made a $1 billion investment in the then little-known AI start-up OpenAI. Thanks to ChatGPT, OpenAI has since become the most recognisable name in AI. Microsoft deepened the partnership with an additional $10 billion investment and has since embedded AI features across nearly all its products and services.

Satya Nadella's career trajectory

Born and raised in Hyderabad, Nadella earned a degree in electrical engineering from Mangalore University in 1988. After moving to the United States, he completed a master’s degree in computer science at the University of Wisconsin–Milwaukee in 1990 and joined Sun Microsystems as part of its technology team.

He was recruited by Microsoft in 1992, where he initially contributed to the development of Windows NT, an operating system aimed at business users. Nadella later became president of Microsoft’s server and tools division and subsequently executive vice president overseeing the firm’s cloud computing operations.

On February 4, 2014, Nadella was appointed CEO of Microsoft, becoming the third person to lead the company after co-founder Bill Gates and Steve Ballmer.