Key Insights

• Digital Turbine to hold its Annual General Meeting on 27th of August
• Salary of US$650.0k is part of CEO Bill Stone's total remuneration
• The overall pay is 269% above the industry average
• Digital Turbine's EPS declined by 127% over the past three years while total shareholder loss over the past three years was 92%

Digital Turbine, Inc. (NASDAQ:APPS) has not performed well recently and CEO Bill Stone will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 27th of August. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.

How Does Total Compensation For Bill Stone Compare With Other Companies In The Industry?

Our data indicates that Digital Turbine, Inc. has a market capitalization of US$430m, and total annual CEO compensation was reported as US$6.8m for the year to March 2024. We note that's a decrease of 17% compared to last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$650k.

On examining similar-sized companies in the American Software industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$1.8m. This suggests that Bill Stone is paid more than the median for the industry. What's more, Bill Stone holds US$6.4m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. Digital Turbine pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Digital Turbine, Inc.'s Growth

Over the last three years, Digital Turbine, Inc. has shrunk its earnings per share by 127% per year. It saw its revenue drop 17% over the last year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Digital Turbine, Inc. Been A Good Investment?

The return of -92% over three years would not have pleased Digital Turbine, Inc. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 3 warning signs for Digital Turbine you should be aware of, and 1 of them is a bit unpleasant.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.