Summary
Adobe Inc. (ADBE) has filed an 8-K report detailing its executive compensation programs for 2023. The company has approved a 2023 Performance Share Program and a 2023 Executive Annual Incentive Plan, both designed to align executive interests with stockholder value and drive company performance. The Performance Share Program involves awards based on a relative total stockholder return goal over three years and a Net New Sales goal measured annually. The Executive Annual Incentive Plan ties cash bonuses to the achievement of GAAP revenue and non-GAAP EPS targets, with potential for up to 200% of base salary for most executives.
Key Highlights
- 1Adobe has implemented a 2023 Performance Share Program with awards tied to a 3-year Total Stockholder Return (TSR) goal compared to the NASDAQ 100, and a 3-year Net New Sales goal (measured annually).
- 2Performance Share awards can range from 0% to 200% of the target award, with independent achievement metrics for TSR and Net New Sales.
- 3The TSR Goal has specific hurdles: no payout if Adobe's TSR ranks below the 25th percentile of NASDAQ 100 companies, and the award is capped at 100% of target if Adobe's absolute TSR is negative.
- 4Net New Sales goals focus on annualized recurring revenue (ARR) in Digital Media and subscription revenue growth in Digital Experience, with adjustments for mergers, acquisitions, and currency fluctuations.
- 5Awards under the Performance Share Program vest in a single installment on January 24, 2026, or later, contingent on continued employment.
- 6The 2023 Executive Annual Incentive Plan offers cash bonuses based on achieving at least 90% of the fiscal year 2023 GAAP revenue and non-GAAP EPS targets.
- 7Executive bonuses under the Annual Incentive Plan can reach up to 200% of a participant's target award (based on base salary and target bonus percentage), with potential for a Corporate Performance Result up to 155% and an Individual Performance Result up to 150%.