Netflix has had a great 2017. It has become an entertainment giant, with 109 million subscribers worldwide. Its stock, which closed Thursday at $192.71, is up 51% since the beginning of the year.
A lot of the credit for the outstanding results goes to Reed Hastings, Chairman and CEO of Netflix.
As a result, he is set to receive $28.7 Million in company stock options for 2018 in addition to an annual salary of $700,000. That’s a massive hike from the $21 million in stock options the Netflix chief received in 2017, while his base salary will decline from $850,000 this year, according to company filings with the SEC.
Stock options allow the employees to buy or sell company shares at a pre-determined price at some point in the future. When it comes to using stock options as corporate compensation, the recipient usually gets a buy option for whatever the market price is at that time.
Hastings currently has a net worth estimated at $2.2 billion, mostly tied to Netflix stock, and he was mentioned for the first time in the Forbes 400 list of richest Americans this year.
Netflix also disclosed salary and stock-option awards for other top execs in an 8-K filing on Thursday. Chief Content Officer Ted Sarandos will have a $12 million annual salary and will receive $14.25 million in stock options in 2018. CFO David Wells will have a base salary of $2.8 million and $2.45 million in stock options; Greg Peters, Chief Product Officer, will have a $6 million salary and $6.6 million in stock options; and General Counsel David Hyman’s 2018 pay package will include $2.5 million in salary and $3.275 million in stock awards.
The executive pay details for 2018 that Netflix released aren’t reflective of total pay, because they don’t include potential bonuses and other non-monetary benefits that form part of their compensation.