Martin Cotter
ANALOG DEVICESAbout Martin Cotter
Martin Cotter (age 59) is Senior Vice President, Vertical Business Units (since December 1, 2024) and President of Analog Devices EMEA. He joined ADI in 1986 as a design engineer and has held leadership roles across engineering, product lines, and global sales/digital marketing. He holds a BEng, MEng, and MBA from the University of Limerick . As ADI navigated a severe industry downturn, FY2024 results included $9.4B revenue, 57.1% gross margin, 21.6% operating margin, $3.9B operating cash flow, $3.1B free cash flow (10-year TSR >450%), anchoring management pay-for-performance and incentive outcomes .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Analog Devices | SVP, Vertical Business Units | Dec 1, 2024–present | Oversees Industrial & Multi‑Markets, Automotive, Aerospace/Defense & Communications, Healthcare, Consumer; aligns growth with technology and market needs |
| Analog Devices | President, ADI EMEA | As of Jan 2025–present | Leads regional engagement with customers, governments, industry bodies, universities; drives strategic growth/investment in precision and power products |
| Analog Devices | Leader, Global Sales & Digital Marketing | Not disclosed (prior to current role) | Built stronger, collaborative customer partnerships to deliver differentiated products globally |
| Analog Devices | Engineering & Product Line Management roles | 1986 onward | Led some of ADI’s highest‑growth business segments; various engineering and P&L leadership roles |
External Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| None disclosed in 2025 DEF 14A | — | — | No external directorships/roles disclosed for Cotter |
Fixed Compensation
- Individual amounts (base salary, target bonus, actual bonus) for Cotter are not disclosed; ADI’s NEOs (not including Cotter) had a temporary 10% base‑salary reduction Mar 24–Sep 28, 2024 as part of cost control; annual reviews resumed in September .
- ADI’s executive pay framework uses base salary plus an executive short‑term variable cash incentive and long‑term equity (RSUs/PRSUs), with high at‑risk orientation for alignment with shareholders .
Performance Compensation
Short‑Term Cash Incentive (FY2024 design and FY2025 changes)
| Element | Details |
|---|---|
| Metrics/weighting (FY2024) | 50% year‑over‑year revenue growth (measured quarterly); 50% quarterly OPBT margin; minimum OPBT margin required for payout |
| FY2024 corporate payout | Executive performance incentive plan payout factor ≈27% of target for FY2024 (vs. ≈182% FY2023; ≈293% FY2022) |
| Payout maximum (legacy vs. new) | Legacy max 3.0x; reduced to 2.5x beginning FY2025 in response to shareholder feedback |
| Assessment cadence | FY2024 measured quarterly and paid semi‑annually; moved to annual assessment and payout beginning FY2025 |
OPBT = Operating Profit Before Taxes
Long‑Term Equity Incentives (structure applicable to executive officers)
| Instrument | Purpose | Performance metric(s) | Payout/vesting |
|---|---|---|---|
| Relative TSR PRSUs | Align to shareholder returns vs. peers | 3‑year TSR vs S&P 500; target at 55th percentile; 0–200% payout; capped at 100% if absolute TSR negative | |
| Financial Metric PRSUs | Drive long‑term profitability | 3‑year cumulative non‑GAAP operating profit (2024 grants moved to three‑year cumulative target) | |
| Time‑based RSUs | Retention/ownership accumulation | None | Four‑year graded vesting; FY2024 grants to NEOs vest on 1st–4th anniversaries (anchored to Aug 15, 2024) |
Notes: CEO equity mix is 75% PRSUs/25% RSUs; other NEOs 65% PRSUs/35% RSUs (indicative of high at‑risk long‑term pay design) . Cotter’s specific grant sizes are not disclosed.
Equity Ownership & Alignment
| Policy/Practice | Details |
|---|---|
| Executive stock ownership guidelines | 3x base salary for executive officers/SVPs; 5x for CEO. New Leadership Team members have 5 years (4 for CEO) to reach targets. RSUs (vested/unvested) and certified PRSUs count; options and uncertified PRSUs do not. ADI disclosed all Leadership Team members as of Nov 2, 2024 were in compliance . |
| Hedging/pledging | Hedging and short sales prohibited; directors/executives prohibited from holding ADI stock in margin accounts and from any future pledging since Jan 2013 . |
| Beneficial ownership disclosure | Cotter is not individually listed in the “Security Ownership of Directors and Executive Officers” table; ADI itemizes directors and NEOs and reports the group total . |
| Pledging red‑flag context | Legacy pledges by a founder are disclosed; policy bars future pledging by directors/executives . |
Employment Terms
| Topic | Terms (as disclosed by ADI) |
|---|---|
| Change‑in‑control (CIC) retention agreements | ADI states it has entered into ADI Retention Agreements with its executive officers; agreements provide severance if terminated without cause or for good reason within 24 months after a Board‑approved CIC; also cover CICs not approved by the Board (12‑month window) . |
| Severance multiples | Lump sum equal to 200% of base salary + 200% of total variable cash incentive paid over prior four fiscal quarters (some named roles at 299%); 24 months of medical and other benefits; reimbursement of legal fees. New agreements since 2009 exclude excise‑tax gross‑ups . |
| Equity acceleration on CIC | 50% of unvested equity vests at closing; remaining 50% continues on schedule and vests if terminated without cause/for good reason within 1 year post‑CIC (double‑trigger structure) . |
| Death/disability acceleration | Outstanding options/RSUs/PRSUs accelerate (PRSUs at target unless measurement is completed, then actuals) . |
| Clawback (restatement) | Company will recover excess incentive‑based compensation from CEO and officers for the three completed fiscal years preceding a required restatement . |
| Deferred compensation | Executives eligible to defer cash comp under ADI’s DCP; company contributions up to 8% on eligible deferrals (plan features described; individual elections for Cotter not disclosed) . |
Performance & Track Record (context for Cotter’s remit)
| Area | Evidence |
|---|---|
| Company performance backdrop | FY2024: revenue $9.4B; gross margin 57.1%; operating margin 21.6%; diluted EPS $3.28; operating cash flow $3.9B; free cash flow $3.1B; 10‑year TSR >450% . |
| Strategy/execution context | Management maintained “model margins” and continued high R&D and hybrid manufacturing investment through one of the industry’s worst downturns; positioned for AI‑enabled intelligent edge opportunities . |
Compensation Structure Analysis (signals)
- Pay mix remains heavily performance‑based with PRSUs tied to 3‑year cumulative operating profit and relative TSR, aligning long‑term incentives with shareholder value creation .
- Short‑term plan changes reduce upside risk (max from 3.0x to 2.5x) and shift to annual assessment, addressing shareholder feedback after 72.5% say‑on‑pay support in 2024 and emphasizing longer‑term focus .
- FY2024 cash incentive payout factor of ~27% demonstrates downward sensitivity when targets are not met, reinforcing pay‑for‑performance discipline .
Risk Indicators & Red Flags
- Hedging/pledging prohibited for executives; no pledging by Cotter disclosed (and future pledging barred) .
- Related‑party transactions: ADI disclosed none requiring Item 404 reporting since the start of FY2024 through the proxy date .
- Section 16(a) compliance: ADI noted one late Form 4 for the CAO; no issues disclosed regarding Cotter .
Say‑on‑Pay & Shareholder Feedback
- 2024 say‑on‑pay approval ≈72.5%; in response, ADI reduced short‑term max to 2.5x and moved to annual assessment/payout; also shifted PRSU financial target to a single 3‑year cumulative goal for 2024 grants .
- Extensive engagement with holders representing >36% of shares; Board and Compensation & Talent Committee incorporated feedback into program design .
Expertise & Qualifications
- 39‑year ADI veteran with deep domain leadership across high‑growth segments, engineering, product management, and global commercial roles; BEng, MEng, MBA (University of Limerick) .
Equity Ownership & Vesting Calendars (selling pressure watch‑outs)
- Typical executive equity structure: four‑year graded RSUs and 3‑year cliff PRSUs create predictable vesting events that can coincide with tax‑related sales; specific grant dates/amounts for Cotter not disclosed .
- Ownership guidelines (3x salary) and no‑pledging policy mitigate misalignment/forced‑sale risks .
Employment Terms Summary for Retention Risk
| Dimension | Cotter‑relevant read‑through |
|---|---|
| CIC protection | Executive officers have ADI Retention Agreements with double‑trigger severance and equity acceleration (individual multiple for Cotter not disclosed) . |
| Retirement vesting | Post‑Retirement Equity Vesting Policy can permit continued vesting (subject to approvals), supporting retention/transition planning . |
Investment Implications
- Incentive alignment: High weighting to 3‑year PRSUs (relative TSR and cumulative operating profit) plus reduced short‑term upside (2.5x cap) should keep senior leaders, including Cotter, focused on durable profitability and TSR outperformance through the cycle .
- Retention risk moderate: Long‑dated PRSUs and PREV, combined with CIC double‑trigger protection, reduce near‑term flight risk; lack of disclosed individual ownership reduces visibility into Cotter’s personal “skin in the game” and potential sale overhangs around vest dates .
- Execution risk: With Cotter now overseeing pivotal verticals amid recovery and AI‑edge demand, performance against ADI’s cumulative OPBT and relative TSR hurdles will be a key barometer; FY2024’s 27% cash bonus payout underscores the downside sensitivity if targets aren’t met .
Notes on disclosure gaps and method: Cotter is not an NEO in the 2025 proxy; individual base salary, bonus, equity grant amounts, and beneficial share count were not disclosed. We reviewed the management team section, compensation discussion/tables, and security ownership sections for individual data and found none for Cotter .