President and CEO of video game maker Activision Blizzard, Robert Kotick, has become one of the highest paid executives in the U.S. last year after getting a financial compensation of $65 million, eight times higher than in 2011.
Just billionaire Larry Ellison, founder and CEO of Oracle, was better paid last year, with a financial package of $96.2 million.
Most of Kotick’s financial compensation comes from shares with a total value of $55.9 million. Add this to a base salary of two million dollars, a cash bonus of $2.5 million and “other gains” in the amount of $4.52 million. This results in a total of $64.9 million, according to documents submitted by Activision Blizzard to regulators of capital markets.
For the previous year, Kotick received a total financial compensation of $8.33 million. Robert Kotick could get another $16 million if Activision Blizzard will achieve the most demanding performance targets set by the board.
“We don’t like any element of this pay package. In the past we have expressed concern about this company and its compensation practices,” said Nell Minow, a corporate-governance consultant at GMI Ratings.
The analyst believes that the base salary and bonuses received by Kotick are too high for the video games industry. He also notes that it is unclear how this figure was reached and the stock bonus doesn’t seem to be determined by an objective criteria of performance.
Contacted by Bloomberg, Activision representatives were not immediately available for comment.
According to documents submitted by Activision Blizzard to U.S. regulatory authorities of the capital market, the company has exceeded under Kotick’s several targets for operating profit, the net income per share and free cash flow. Margin growth targets were not achieved.
Activision Blizzard (NASDAQ:ATVI) has a market value of $16.5 billion and the company recorded in the last fiscal year a net profit of $1.15 billion, on sales of $4.86 billion. The video game manufacturer is owned by the French group Vivendi, which also controls other companies such as Universal Music and Canal Plus.
Oracle, the only company that pays better its CEO than Activision Blizzard, recorded in the last fiscal year a net profit of $10 billion, on revenues of $37.1 billion and has a market capitalization of $152 billion.
Before presenting Kotick’s financial compensation for 2012, the highest paid CEO in the U.S. media was Leslie Moonves, CBS Corp. chief, with $62.2 million, followed by David Zaslav of Discovery Communications with $49.9 million and Walt Disney CEO, Robert Igen, with $40.2 million.
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