The Tool Desk
Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →PayPal reported Dan Schulman’s total compensation at $21,957,922 for fiscal 2022, down about 31.5% from $32,070,353 in 2021—a decrease conventionally rounded to 32%. The company said the company-performance portion of its 2022 annual incentive plan paid out at 0% of target because of revenue and non-GAAP operating margin results. But a separate three-year performance-based stock award paid out at 145% of target, so not every incentive missed its mark.
How much did Dan Schulman’s reported pay fall?
PayPal Holdings’ 2023 definitive proxy statement lists total compensation of $21,957,922 for Schulman in fiscal 2022, compared with $32,070,353 for fiscal 2021. The difference is $10,112,431, or approximately 31.5% of the 2021 figure. Calling it a 32% decrease is a rounded description of the compensation-table totals, not a claim that every component of his pay fell by that amount. PayPal’s 2023 proxy statement was filed with the SEC on April 13, 2023.
| # | Preview | Product | Price | |
|---|---|---|---|---|
| 1 |
|
Sell Digital Products Online with Google Drive and PayPal: Sell digital products directly to... | $9.60 | Buy on Amazon |
| Fiscal year | Reported total compensation |
|---|---|
| 2021 | $32,070,353 |
| 2022 | $21,957,922 |
What made up the 2022 total?
The proxy’s compensation table breaks Schulman’s 2022 total into salary, stock awards, non-equity incentive compensation and other compensation.
| 2022 compensation component | Reported amount |
|---|---|
| Salary | $1,250,000 |
| Stock awards | $20,182,730 |
| Non-equity incentive compensation | $312,500 |
| Other compensation | $212,692 |
| Total | $21,957,922 |
The $20,182,730 in stock awards is the grant-date fair value reported under proxy compensation-table rules. It should not be read as cash Schulman received in 2022, or as the value he ultimately realized from those awards.
Recommended Free Tools
Why did the annual company-performance incentive pay zero?
PayPal’s 2022 Annual Incentive Plan (AIP) included company and individual performance components. The company stated that, based on 2022 revenue and non-GAAP operating margin results, the company-performance portion paid out at 0% of target. This is the direct link between the annual financial results and the reported pay decrease.
The proxy does not establish the precise target levels or quantify how far the results fell short. PayPal also said it did not disclose the specific goals for its 2022–2024 performance-based restricted stock units for competitive reasons, so a precise shortfall against those goals cannot be calculated from the filing.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Did all of Schulman’s incentive pay miss its target?
No. The annual company-performance result and the long-term award covered different periods and measures. PayPal reported that performance-based restricted stock units (PBRSUs) for 2020–2022 paid out at 145% of target, based on compound annual growth rates in FX-neutral revenue and free cash flow over the three-year period from January 1, 2020, through December 31, 2022.
| Incentive | Measurement period | Reported result |
|---|---|---|
| 2022 AIP company-performance portion | Fiscal 2022 | 0% of target, based on revenue and non-GAAP operating margin |
| 2020–2022 PBRSUs | January 1, 2020–December 31, 2022 | 145% of target, based on FX-neutral revenue and free cash flow compound annual growth rates |
The zero payout applies to the company-performance portion of the annual plan; it does not mean every component of Schulman’s AIP or all of his incentives paid nothing. His 2022 total includes $312,500 in non-equity incentive compensation, and the separate long-term award exceeded target.
Which financial measures did PayPal identify?
For linking compensation actually paid to named executive officers in 2022, PayPal identified revenue, non-GAAP operating margin, free cash flow and stock price as its most important financial performance measures. These measures span the annual incentive and longer-term compensation context; the proxy does not provide enough disclosed target detail to calculate an exact miss for each one.
How does the CEO-to-employee pay ratio fit in?
PayPal estimated Schulman’s 2022 pay ratio at 284 to 1, using median employee annual total compensation of $77,244. That comparison offers context about compensation within the company, but it does not explain why Schulman’s reported total fell year over year. PayPal also cautioned that companies may use different employee populations and methodologies, making pay ratios potentially incomparable across issuers.
Quick Recap
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
