UPDATE—June 25, 2024: This article has been updated to reflect more recent share price values.
Key Takeaways
- Nvidia will hold its annual shareholder meeting on Wednesday.
- Stockholders will vote on company executives’ compensation plans, including that of CEO Jensen Huang, who reportedly earned more than $34 million in total compensation for fiscal 2024.
- Investors will vote on 12 board directors up for re-election and whether to ratify PwC as the company’s accounting firm.
- While analysts don’t expect any major new announcements during the meeting, Nvidia could use the time with investors to showcase its strengths in the artificial intelligence (AI) era.
Nvidia (NVDA) shares jumped over 5% in intraday trading Tuesday, recovering somewhat from a three-day pullback ahead of the company’s annual shareholder meeting on Wednesday, with investors set to vote on executive compensation, board re-election, and ratifying an accounting firm. The meeting could also serve as an opportunity for the chipmaker to reinforce its strengths in the artificial intelligence (AI) era.
Voting on CEO Jensen Huang’s Compensation Plan
Investors will vote on the compensation packages for Nvidia executives, including CEO Jensen Huang and CFO Colette Kress, among others, as part of an annual “say-on-pay” vote. The non-binding vote could signal the perceived value of Nvidia’s leaders as the company’s valuation soars in the AI era.
Nvidia’s executive compensation structure is largely tied to performance, and since around 78% of CEO Jensen Huang’s compensation is through stock awards, the stock’s meteoric rise has boosted his compensation.
Nvidia reported that Huang earned $34.2 million in total compensation for fiscal year 2024, up nearly 60% from his pay in fiscal 2023. Huang recently sold 120,000 shares valued at around $15.25 million at the time of the Securities and Exchange Commission (SEC) filing last Friday.
Huang is the highest earner of Nvidia’s executives, followed by Executive Vice President, Worldwide Field Operations Ajay Puri and CFO Kress, who each receive more than $13 million in total compensation.
The Nvidia vote comes weeks after Tesla (TSLA) shareholders approved CEO Elon Musk’s nearly $56 billion compensation package.
Re-electing 12 Board Members, Ratifying Accountant
Shareholders will also vote to re-elect 12 existing directors to the company’s board, including Huang.
Two current directors, Mark Perry and Michael McCaffery, who have been with the company since 2005 and 2015, respectively, are not seeking re-election, which will reduce the board to 12 members.
The investors will also vote to ratify PwC as the company’s independent registered public accounting firm for fiscal 2025. The firm has audited Nvidia’s financial statements annually since 2004.
Opportunity To Flex Prime Position in AI Era
While Nvidia may not make any groundbreaking announcements, the annual meeting could serve as an opportunity for Huang and other company leaders to highlight the chipmaker’s gains amid the AI boom and showcase long-term growth prospects.
CFRA “expect[s] no major announcements or impact to the stock price” from the shareholder meeting, analyst Angelo Zino told Investopedia. He added that Nvidia “will likely make some high-level comments about AI/existing offerings but nothing new should be expected.”
Firstrade President Don Montanaro told Investopedia that the online brokerage serving self-directed retail investors sees increased buying activity heading into the meeting. “Our clients are generally very bullish on Nvidia, and are mostly holding steady or adding to their positions,” Montanaro said, adding that “Firstrade clients are largely enthusiastic supporters of Nvidia, and the AI thesis more broadly.”
Nvidia shares were up 5.3% at $124.34 as of 1:20 p.m. ET Tuesday, rebounding from a three-day pullback that sent the stock into correction territory after a rally that briefly made Nvidia the world’s most valuable company by market capitalization.