Joshua Yeh
Senior Vice President and Asia General Manager at AAOI
Executive
About Joshua Yeh
Shu-Hua (Joshua) Yeh, age 59, is Senior Vice President and Asia General Manager at Applied Optoelectronics (AAOI). He has served as Asia GM since February 2015 and as Senior Vice President since November 2012; prior to AAOI’s acquisition of Global Technology Inc. (GTI) in March 2006, he was GTI’s President/CEO (2002–2006). He holds a B.S. in Mechanical Engineering and an M.S. in Automatic Control Science from National Chung Shing University (Taiwan) . Company performance context during 2024: revenue grew 14.6% to $249.4M vs. $217.6M in 2023, while non‑GAAP EBITDA missed the annual target (actual losses >$8M) but the “New Customer Orders” metric exceeded maximum, and AAOI’s five‑year TSR (2019–2024) reached 310.27 (indexed to $100) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Applied Optoelectronics (AAOI) | Senior Vice President, Network Equipment Module BU | Nov 2012 – present | Executive leadership over network equipment module business; elevated to Asia GM in 2015 . |
| Applied Optoelectronics (AAOI) | Asia General Manager | Feb 2015 – present | Regional leadership across China/Taiwan operations and customers . |
| Global Technology Inc. (AAOI China subsidiary) | President & CEO | Apr 2002 – Mar 2006 (acquired Mar 2006) | Led GTI prior to AAOI acquisition; subsequently served as GM of Video Equipment Division post-acquisition . |
| Twoway CATV Technology Inc. | Vice President, Sales & Marketing | May 1995 – Apr 2002 | Cable/video equipment commercial leadership . |
Fixed Compensation
| Year | Base Salary (USD) | Target Bonus (% salary) | Target Bonus ($) | Actual Bonus Paid ($) |
|---|---|---|---|---|
| 2024 | $350,403 | 50% | $175,846 | $109,905 (62.5% achievement) |
| 2023 | $334,706 | 45.83% | — | $174,445 |
| 2022 | $364,698 | — | — | $193,977 |
Notes: 2024 salary reflects increases approved for 2024; Mr. Yeh’s compensation is paid in NTD/RMB and disclosed in USD at year-end FX; fluctuations reflect FX effects .
Performance Compensation
Annual cash incentive plan – 2024
| Metric | Weight | Threshold | Target | Maximum | 2024 Actual | Weighted Payout |
|---|---|---|---|---|---|---|
| Non‑GAAP EBITDA | 50% | Losses ≤ $8.0M | Losses ≤ $2.0M | ≥ breakeven | Losses > $8.0M | 0% |
| New Customer Orders | 50% | — | Minimum order from 2 new customers | Minimum order from 3 new customers | Achieved ≥3 new customers | 62.5% |
| Aggregate | — | — | — | — | — | 62.5% of target |
Resulting 2024 bonus for Mr. Yeh: $109,905 (62.5% of $175,846 target) .
Long-term equity (granted in 2024)
- Structure: 50% time-based RSUs vesting quarterly over four years (commencing Jan 21, 2024); 50% PSUs with a 3-year performance period ending Apr 29, 2027, split equally between relative TSR vs 2024 peer group and a stock price hurdle .
- PSU goals and payout curve:
- Relative TSR vs peer group: 25th/50th/75th percentile = 25%/100%/200% payout (linear interpolation) .
- Stock price CAGR hurdles: $13.87 (5% CAGR) = 25%; $15.95 (10% CAGR) = 100%; $20.70 (20% CAGR) = 200% (above max capped at 200%) .
| 2024 Grant | Time‑vesting RSUs (target $) | PSUs (target $) | Vesting / Measurement |
|---|---|---|---|
| Mr. Yeh | $290,000 | $290,000 | RSUs vest quarterly over 4 years (from 1/21/2024); PSUs measure 3-year TSR and stock price through 4/29/2027 . |
Historical PSU outcome: 2021–2024 PSUs certified at 200% of target; due to share pool constraints, excess settled in cash per plan, indicating strong outperformance but near-term cash usage .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Outstanding unvested at FY2024 | 18,612 unvested RSUs (market value $686,038 at $36.86); 22,906 PSUs at target (market value $844,315) . |
| 2024 vested/realized | 116,051 shares vested; value realized on vesting $1,487,394; options exercised 1,000 shares with $6,941 value realized . |
| Ownership guidelines | Senior Vice President guideline: 2× annual base salary; company states all executive officers and directors are in compliance as of filing . |
| Hedging/pledging | Prohibited: no short sales/options, no hedging/monetization, and no pledging/margin accounts under insider trading policy . |
| Grant form | Company currently uses RSUs/PSUs; does not grant stock options to employees, including NEOs . |
Note: Beneficial ownership totals and % outstanding were not detailed in the cited sections; outstanding award balances and vesting provide visibility on potential supply from scheduled releases .
Employment Terms
| Provision | Terms for Joshua Yeh |
|---|---|
| Employment status | At-will under written employment agreement . |
| Severance (outside CoC period) | 0.5× base salary + 0.5× target bonus + $15,000 (COBRA/other); lump sum . |
| Severance (within CoC period; double-trigger) | 1× base salary + 1× target bonus + $15,000; accelerated vesting of equity awards; lump sum . |
| Non-compete / release | 12-month non-compete; severance conditioned on release, 6-month cooperation, mutual non‑disparagement . |
| Change of Control timing window | Six months prior to or one year after a Change of Control for non-CEO NEOs . |
| Equity acceleration details | Time-based RSUs: full acceleration on death/disability and if not assumed at CoC; Double‑trigger acceleration during CoC period. PSUs: relative TSR portion vests at target on death/disability and at greater of target or actual after period on CoC; stock-price portion vests to extent earned per event; unearned forfeited on other terminations . |
| Estimated benefits at 12/31/2024 | Outside CoC: $258,078 salary+bonus; $15,000 other cash; no equity acceleration. Within CoC: $514,958 salary+bonus; $15,000 other cash; $15,767,239 equity acceleration (assumes PSU max for 2022–2024 tranches). Death/Disability: $14,450,800 equity; Retirement: $10,436,818 equity; CoC not assumed: $14,359,311 equity . |
| Tax gross-ups | Only CEO has potential 280G excise tax gross‑up; not applicable to Mr. Yeh . |
| Clawback | Incentive Compensation Recovery Policy adopted in 2023, compliant with SEC/Nasdaq Rule 10D‑1; applicable to executive officers . |
Compensation Structure Analysis
- Mix and at-risk pay: 2024 target bonus restored to pre-2023 percentages (Mr. Yeh at 50% of base) to align with 50th percentile market; long-term incentives split 50% PSUs (relative TSR and stock price) and 50% RSUs, reinforcing pay-for-performance with retention balance .
- Performance rigor: 2024 annual plan set a stringent non‑GAAP EBITDA loss cap (≤$2M at target) and a new-customer order objective; EBITDA was below minimum (0 payout) while new-customer orders exceeded maximum, netting a 62.5% payout—evidence of balanced metrics and no discretionary override .
- Governance and market positioning: Independent compensation consultant (Aon) engaged; independence affirmed; committee composed of independent directors; base salaries adjusted 7–12% in 2024 toward 50th percentile given performance and market data; say‑on‑pay approved by 90.17% in 2024 .
- Peer group: 2024 peer set spans communications equipment/tech hardware including A10 Networks, ACM Research, Semtech, SkyWater, Vishay Precision Group, etc., used for benchmarking and relative TSR PSU goals .
Performance & Track Record
| Indicator | Evidence |
|---|---|
| Revenue growth | 2024 revenue $249.4M vs. $217.6M (+14.6% YoY), driven by data center and CATV demand . |
| Strategic wins | 2024 “New Customer Orders” metric above maximum (≥3 new customers achieved) . |
| Profitability proxy | 2024 non‑GAAP EBITDA missed minimum (losses >$8M), yielding 0% on that metric . |
| TSR context | Five‑year TSR (2019–2024) indexed value: 310.27 vs. peer composite 123.89; strong stock outperformance over this horizon . |
Company-level control environment note (governance risk): AAOI disclosed a material weakness in internal control over financial reporting as of 2024 related to review of technical accounting analysis; remediation underway .
Equity Ownership & Alignment (Policies)
- Stock ownership guidelines: Senior Vice Presidents at 2× base salary; all executives in compliance as of filing; amended in Feb 2025 to exclude unexercised options and unvested PSUs from counting toward compliance .
- Hedging/pledging: Prohibited (short sales, derivatives, collars/monetization, pledging or margin accounts) .
- Grant practices: No options currently granted; annual grants on predetermined schedule; no timing around MNPI .
Investment Implications
- Pay-for-performance alignment: Mr. Yeh’s incentives are tightly linked to objective operating (non‑GAAP EBITDA) and commercial (new customer orders) goals annually and to multi‑year shareholder outcomes (relative TSR, absolute stock price) via PSUs—supporting alignment with value creation but creating payout variability if profitability targets are missed .
- Retention and supply overhang: Significant unvested equity (RSUs/PSUs) and substantial 2024 vesting (116,051 shares) indicate ongoing equity-based retention; scheduled vesting creates periodic share supply but hedging/pledging prohibitions and ownership guidelines mitigate misalignment risks .
- Change-of-control economics: Double-trigger protection (1× salary+bonus + equity acceleration) is moderate versus market norms and lacks tax gross‑ups for Mr. Yeh, limiting excessive parachute risk while preserving retention through transactions .
- Execution risk: 2024 missed EBITDA threshold despite strong top-line/new-customer execution; multi-year PSUs historically paid at maximum for 2021–2024, signaling robust shareholder return delivery but also requiring cash settlement in 2024 due to share pool limits (incremental expense/cash outflow) .
- Governance: Strong say‑on‑pay support (90.17%) and independent advisor oversight are positives; the disclosed 2024 material weakness in internal controls is a monitoring item for investors .