Meta, Facebook's parent company, will offer stock options to top executives for the first time since its 2012 initial public offering (IPO).
According to the Wall Street Journal (WSJ) on the 25th, Meta is introducing a stock option program that would grant each executive up to hundreds of millions of dollars in compensation on the condition that its market capitalization grows roughly sixfold from the current $1.5 trillion to $9 trillion (about 1,349.2 trillion won) by 2031.
Given that Nvidia, the world's largest corporation, currently has a market cap of about $4.2 trillion, Meta's $9 trillion target is an ambitious goal.
Recipients of the stock option program include top Meta executives such as Chief Technology Officer (CTO) Andrew Bosworth, Chief Product Officer (CPO) Chris Cox, Chief Operating Officer (COO) Javier Olivan, and Vice President Dana Powell McCormick.
Founder and Chief Executive Officer (CEO) Mark Zuckerberg is excluded from the program.
It is seen as a decision to offer massive financial rewards to secure the loyalty of key talent amid intensifying competition in artificial intelligence (AI) technology. Major foreign media said it also reflects CEO Zuckerberg's strong will to accelerate Meta's growth rate.
A Meta Spokesperson said in a statement, "This decision is a big gamble," adding, "All stock options only have value if the share price meaningfully exceeds the exercise price, and in this case in particular, it is a challenge to meet the targets within a very aggressive five-year period."
Under the stock option package, options are paid out in tranches each time the share price reaches a step target. To receive the first-stage payout, Meta's share price must exceed $1,116.08 per share, an 88.2% surge from the closing price on the 24th ($592.92). The target price for the second-stage payout is $1,393.87, and to receive the top-tier payout, the price must reach $3,727.12.
The WSJ assessed that Meta's stock option decision is essentially similar to the astronomical stock compensation package Tesla set for CEO Elon Musk last year. To secure a $1 trillion (about 1,498 trillion won) stock grant, Musk must grow Tesla's market cap to $8.5 trillion.