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Not agreeing with GP, but your point about paying the CEO less for more profits for the shareholders isn't always true, especially for growth companies like big
by malfist 2y ago
Not agreeing with GP, but your point about paying the CEO less for more profits for the shareholders isn't always true, especially for growth companies like big tech.
Their valuation is based on the future growth of the company, so while profit today matters, what matters more is increases in revenue and hitting or exceeding your guidance. Look at amazon's recent 20% tumble, it was all driven by not increasing revenue. Amazon increased it's profits just fine through cost cutting, was more profitable than ever, but missed the expected growth in revenue by half a billion dollars and it cratered.