Intel tapped Bob Swan to be its new CFO, replacing Stacy Smith who will now oversee the company’s sales, manufacturing, and operations.
Swan’s hiring was a bit of a surprise, given his lack of experience in the chip business. He was most recently a partner at private equity firm General Atlantic, and before that, has spent 9 years as eBay’s CFO.
But perhaps what’s more surprising is his lofty pay package that exceeds $23 million in total, according to a regulatory filing.
Swan will get an $850,000 base salary, but is eligible for an annual bonus of $1.2 million and a hiring bonus of $5.5 million. On top of that, his new hire stock grant and annual equity award could each be worth $9.5 million and $6.5 million, respectively.
Swan’s compensation package is particularly interesting because it shows Intel’s willingness to pay big bucks to bring in outside executives, even as the company’s going through a massive cost cutting plan that involves its biggest layoff in history. Just last year, Intel gave a $25 million pay package to former Qualcomm exec Venkata “Murthy” Renduchintala to hire him as the company’s number two executive.
“We do note a continuation of high pay for new talent however, with Mr. Swan’s package coming in at a bit over $23 million,” Bernstein’s analyst Stacy Rasgon wrote in a note.
It will be interesting to see how Intel’s current employees take these high compensation packages given that the rest of the company is going through a painful reorganization process. We did previously hear rumblings from a number of current and former employees who questioned the logic behind these big pay packages.
Still, Rasgon says Swan’s hiring is a “reasonably positive” move given his experience in restructuring at a private equity firm. At eBay, he also oversaw more than 30 acquisitions and helped with the spinoff of PayPal.
“Mr. Swan’s most recent role in private equity (Operating Partner at General Atlantic), may enable him to bring a skillset to bear on Intel’s ongoing restructuring and refocusing, as well as investing for growth…Overall our initial (outside-in) impressions of this hire are reasonably positive,” Rasgon wrote.