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Business Game Dev Activision CEO Bobby Kotick Takes a 50% Pay Cut, But It's Not as Big a Cut as It Sounds

IbizaPocholo

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After years of criticism for being one of the "most overpaid" CEOs in the United States, Activision-Blizzard CEO Bobby Kotick is taking a pay cut — though it's not as generous a cut as it may initially seem.

In an SEC filing yesterday spotted by GamesIndustry.biz, the company has opted to renew Kotick's contract for a few more years. His current contract, set in 2016, was initially set to expire on December 31 of this year, but his role as CEO has now been extended at least March 31, 2023. It can be extended further beyond that date if the board so chooses.

The renewal document lavished praise upon the CEO, citing significantly increased shareholder returns and improved market value during Kotick's tenure. It does not mention the numerous rounds of layoffs the company has undergone under his leadership, including around 190 employees earlier this year and around 800 back in 2019.

Despite the board's recognition of Kotick's performance, the renewal also includes a contract adjustment, saying the board reached out to investors and pay committee members to reevaluate the CEO's compensation package. As a result, Kotick's salary is being reduced by 50% beginning retroactively January 1, 2021, bringing it from $1.75 million a year to a mere $875,000.

Furthermore, his annual target bonus has also technically been reduced. He's still eligible for up to 200% of his base salary in bonus per year, but with his salary reduced that brings Kotick down from potentially earning $3.5 million in bonuses each year to only $1.75 million in bonuses each year, on top of his existing salary. In total, that means that Kotick still stands to make $2.6 million a year if he keeps meeting all the objectives set by the board. Notably, his objectives have also shifted a bit, effectively focusing more on meeting certain financial metrics and less on meeting other non-money-related milestones.

The pay cut is, on paper, very likely in response to ongoing criticism over how much Kotick is paid. He recently appeared (not for the first time) on a list of the most overpaid CEOs in the US at rank 16, with the report calculating that including stock options, Kotick received a total of over $30 million in compensation in 2019 — most of which stemmed from equity grants rather than his actual set salary.

And Kotick is still eligible for more long-term equity incentive awards in the future, basically meaning that Kotick gets awarded a whole lot more money thanks to stock options if the company continues to do well. The renewal filing stipulates that his max payout be in line with other companies deemed similar to Activision Blizzard at the time that it happens, rather than — as has been pointed out in the past — well above them.

That doesn't even include the additional bonus of up to $200 million that Kotick could still be awarded in June with the approval of a board committee. When asked for comment on whether or not this bonus was impacted by the contract amendment, an Activision Blizzard spokesperson said, "The value and timing of the [bonus] are at the discretion of the Compensation Committee."

So even with his salary slashed in half, Kotick is still set to keep making millions as Activision-Blizzard CEO each year alongside both a potentially massive upcoming bonus payout, and the likely possibility of large payouts in the future.
 
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Aldynes

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michael torpey crying GIF by paidoff
 

Kuranghi

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I don't gaf about Bobby Kotick, but I care about morons not understanding basic economics and then spouting nonsense, read this:


Or another basic economics book thats as well written as that if you dislike the author. At least have a basic understanding of the world before you spout garbage trash like "eat the rich".

Its the same kind of stupidity as not understanding the situation with huge companies using 3rd world labour:

"These people are being paid 1/100 what we are being paid!"

Cool story, but what the context of that pay? What are the local wages like? What alternatives do they have? Whats the workers output? Is their output similar to, for example, an American worker in the same field who gets paid 100x as much?

I'm a million miles away from being an expert on economics but at least I've educated myself to the level of basic understanding, as opposed to just spouting meaningless platitudes.

Fucking read a book ffs.

Ugh capitalism!! This is so sad!

So should I do a only fans? 😆

Yes, but only if you really put an effort into it, none of this just sleeping with a webcam on business lol.
 
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harmny

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kotick bought activision 30 years ago when it was almost going bankrupt and had like 60 million in debt. it took like 7 years for the company to be profitable. nobody gave a fuck about him. nobody lends you a hand when you are starting your own business. but now that he is making millions everyone cares right?

everyone that hates this is free to start their own company. you can make all the games you want. no mtx. no crunch. no multiplayer. and pay your employees an amazing salary of millions of dollars instead of getting bonuses for yourself.
 

GeorgPrime

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As a result, Kotick's salary is being reduced by 50% beginning retroactively January 1, 2021, bringing it from $1.75 million a year to a mere $875,000.


If if he is unhappy about it, i can do his job. I will just take 1.000.000 a year
 
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BattleScar

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I don't think anyone who says "eat the rich" has the creativity + work ethic + willpower + courage to ever start a business, let alone grow it.
You're asking the right question to the wrong person.
Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.
 

Kuranghi

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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.

What does it matter what he does with the money though, do you think he'd do as good a job if he was being paid £50,000 a year?

A lot of politicians have terrible salaries and they completely suck and are very self serving, just doing what they need to do to keep in power or keep people thinking they have their interests at heart.

Do the people doing the donkey work make decisions that would justify them being paid 500k a year instead of 50k a year though? Its about output not what you perceive as whats "fair" imo.
 

Zeroing

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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.
This!!!

everyone on this thread should read “capital in the 21st century” or if you don’t know how to read ( joking ).. watch the documentary

I am pretty sure after it, some opinions here will change.
 

harmny

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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.

he just did. 50% pay cut
 

Kataploom

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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.

That's totally irrelevant, if the man bought the company out of being totally bankrupted, grew it t what's it today and is constantly meeting company's goals... Why is a problem how much he earns?

He's smart enough to play that way and has the balls to take the risk, if someone else isn't and therefore won't earn a 1/10th of what he does what does it have to do with him? Should he cap his own work, talent or capabilities just so "others don't feel bad for not having same abilities?" lol

Some people srsly seem not to care about people being poor but about people being rich, like they could be ok with people being poor as long as others aren't that much rich. Too much envy under a mask hat says "it's for the people" around here.

Let the talented people get as rich as they can as long as they're not damaging anyone else so hey can give other people jobs, if workers feel they aren't being paid enough there are a lot of places they can work on, and I say this as a software developer myself.
 
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Trogdor1123

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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.
Absolutely I want more. It is short sighted ideas like this that pull families down. If you are a patriarch or matriarch of a family and are able to set your family up for generations of comfort you have an obligation to do so. It's not just about you.
 

ToTTenTranz

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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.
I don't care how much money he makes. He's not in the same business as I am and he couldn't be further from being a professional competitor, so his salary doesn't concern me.
Salaries in private companies are discussed between employees and private companies. I'm not going to police how much money other people make in that situation, as long as they pay their legal share of taxes.
 

A.Romero

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He is a very capable guy and Activision wouldn't be the same without him. Maybe it would belong to EA or don't exist at all.

He is set for life and deserves it. This 50% cut is nothing but corporate politics.

I also think that article is slanted. Reducing employees is not a sign that he did a bad job as a CEO. Quite the opposite. If he cut 1000 jobs and the company still did well, means he did a great job as a CEO.
 
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VALCON 82

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Absolutely I want more. It is short sighted ideas like this that pull families down. If you are a patriarch or matriarch of a family and are able to set your family up for generations of comfort you have an obligation to do so. It's not just about you.
I personally think he gets to earn whatever the market dictates.. but i do think that the word obligation can lead to bad decisions for his family in coming generations.
I only earn pocket lent compared to him but i earn enough to take care of my wife and children. it is my obligation/job to prepare them (my kids) to be self sustaining adults who know how to take care of themselves whenever they strike out on their own . its not my job to give them the world on a silver platter to the point that they don't understand how the world operates because they have had so much given to them they don't understand the value of other people and/or efforts of those person's time.
 

oagboghi2

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The renewal document lavished praise upon the CEO, citing significantly increased shareholder returns and improved market value during Kotick's tenure. It does not mention the numerous rounds of layoffs the company has undergone under his leadership, including around 190 employees earlier this year and around 800 back in 2019.

What a stupid thing to add. Are the shareholders supposed to be upset he increased profits while cutting down on labor?
 
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Zeroing

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That's totally irrelevant, if the man bought the company out of being totally bankrupted, grew it t what's it today and is constantly meeting company's goals... Why is a problem how much he earns?

He's smart enough to play that way and has the balls to take the risk, if someone else isn't and therefore won't earn a 1/10th of what he does what does it have to do with him? Should he cap his own work, talent or capabilities just so "others don't feel bad for not having same abilities?" lol

Some people srsly seem not to care about people being poor but about people being rich, like they could be ok with people being poor as long as others aren't that much rich. Too much envy under a mask hat says "it's for the people" around here.

Let the talented people get as rich as they can as long as they're not damaging anyone else so hey can give other people jobs, if workers feel they aren't being paid enough there are a lot of places they can work on, and I say this as a software developer myself.
You are rich!!!
Or else you would be here being jealous , like the rest of us :(

joking
 

jakinov

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Nov 19, 2008
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Probably true, but even if everyone did have the creativity, work ethic and willpower, not everyone can become a millionaire CEO.

I tend to prefer asking the following question.
At what point do you have enough money?
Once you've got your million dollar salary - do you really need more money? What would you do with your 10 bed 10 bath mansion with nobody in it?
Why not cut your pay/bonuses for yourself and other c-suite executives and VPs to increase the pay down the corporate structure to benefit the thousands of people that do all the donkey work in putting your grand plans into action.
Not everyone can but that's also why people are willing to pay so much for the few that have all the qualities plus more. This is other rich people's money we're talking about. A lot of these "over-paid" executives don't' decide their own salary, they choose to be CEO for these companies because of the pay.

Enough depends on your ambition and the life style you want. Money can be a measurement of career/life success. People life goal could be billionaire or to be one of the most desired CEO. Then there's always value in life besides having extra bed rooms and bathrooms. There's so much extra convivences and levels of quality of things in life that having more money can always make your life better. Some people see making more money as not worth the trade off for work-life balance. But some people see it as a way to greatly enhance the "life" aspect that every minute is worth more and you get more minutes of it doing higher quality things.

As I said above, CEOs often agree to work for the pay. They don't just get the job and choose to pay that themselves. People generally don't want to be paid less than what they are worth in the market and if they want to run a business they generally don't want to over pay people above market either (Especially if your job is to run a tight ship). A lot of times taking away even all of the CEO money isn't going to make a bigger difference among everyone else pay. For an individual or a subset of the employees sure. That's not a whole lot of money to go around for everybody to get a meaningful of a raise one might think even if you include unrealized gains from all the stock awarded. For Activision, you might raise the average salary by a few grand before taxes, for others it can be as low <$100 per employee. I mean the numbers get better if you take away ALL of the other exec pay too but then nobody is going to want to work for your company if they don't get paid at all.

Bobby's $200M performance or whatever bonus though is a whole other thing that in my book is not anything about market value and is just really excessive. But at the end of the day it's the shareholders money and their fault that they made that deal years ago. It's an anomaly that is arguably only reached because of COVID, at least that's the argument shareholders are making.
 

MrA

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This!!!

everyone on this thread should read “capital in the 21st century” or if you don’t know how to read ( joking ).. watch the documentary

I am pretty sure after it, some opinions here will change.
And if you read that book you need to remember it was written by a pinhead french communist that continuously slobber all over the ccp and basically makes stuff up
 
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zeorhymer

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So instead of getting paid 1 mil, he's getting paid 500k. Of course it doesn't affect his stock options or bonuses or a golden parachute if he has one.
 

Kenpachii

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And if you read that book you need to remember it was written by a pinhead french communist that continuously slobber all over the ccp and basically makes stuff up

He also forgot to read the part where it says, that in a pandamic its best to fire a bunch of workers and enrich yourself even further with harvesting all there salary's and combined into your own paycheck.Which totally doesn't make devs question there future in your company and leave as result, and consumers that mostly pay for goodwill will think twice about spending again on your games.

Fuck yea.
 
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Dream-Knife

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Since Activision purposely hurt MW2019 to boost black ops. I will never buy any of their products again.

Even got BO CW for free and wouldn't play it.
 
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MrA

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He also forgot to read the part where it says, that in a pandamic its best to fire a bunch of workers and enrich yourself even further with harvesting all there salary's and combined into your own paycheck.Which totally doesn't make devs question there future in your company and leave as result, and consumers that mostly pay for goodwill will think twice about spending again on your games.

Fuck yea.
Im sure activision has a plenty of developers banging on their door to work there, go indie and take the risks if you don't like activision policies
This shoreholder concerns only, if activision policy can't attract talent the they'll face the consequences but frankly that doesn't seem to be a problem
 
Oct 2, 2019
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kotick bought activision 30 years ago when it was almost going bankrupt and had like 60 million in debt. it took like 7 years for the company to be profitable. nobody gave a fuck about him. nobody lends you a hand when you are starting your own business. but now that he is making millions everyone cares right?

everyone that hates this is free to start their own company. you can make all the games you want. no mtx. no crunch. no multiplayer. and pay your employees an amazing salary of millions of dollars instead of getting bonuses for yourself.
Hey fuck you Bobby! Stop posting on NeoGAF and let studios make games instead of assimilating them into your twisted CoD machine!
 

oagboghi2

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He also forgot to read the part where it says, that in a pandamic its best to fire a bunch of workers and enrich yourself even further with harvesting all there salary's and combined into your own paycheck.Which totally doesn't make devs question there future in your company and leave as result, and consumers that mostly pay for goodwill will think twice about spending again on your games.

Fuck yea.
The majority of the recent layoffs were in 2019, and last I checked a ton of buisness shrink their workrate during a recession
 
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The majority of the recent layoffs were in 2019, and last I checked a ton of buisness shrink their workrate during a recession
He got a 200.000.000 $ BONUS after that!
Google says, the average yearly income at Activision is $78,972

So from his BONUS(!!!) they could have employed about 2.532.543 of these "average" income employees for one year or maybe even better those 800 fired employees for 3.165 years (!!! again) each.

#Mathgenius@work :D
 

fighterman101

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He got a 200.000.000 $ BONUS after that!
Google says, the average yearly income at Activision is $78,972

So from his BONUS(!!!) they could have employed about 2.532.543 of these "average" income employees for one year or maybe even better those 800 fired employees for 3.165 years (!!! again) each.

#Mathgenius@work :D
2 and over half a person isn't a lot.
 

nerdface

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How fucking stupid does the damage control division over at Activision think we are? CEOs make their money as bonuses.