Richard Puccio, Jr.
ANALOG DEVICESAbout Richard Puccio, Jr.
Richard C. Puccio, Jr. is Executive Vice President and Chief Financial Officer (CFO) of Analog Devices (ADI), serving since February 5, 2024. He is 57, holds an A.B. in Economics from Harvard University and an MBA from Boston University, and previously served as CFO of Amazon Web Services after a 21-year Partner tenure at PwC with earlier corporate finance roles at Hanover Insurance and Digital Equipment . Under the company’s recent performance backdrop, ADI delivered FY2024 revenue of $9.4B with 57.1% gross margin and 21.6% operating margin (adjusted gross margin 67.9% and adjusted operating margin 40.9%); 10‑year TSR exceeded 450% and 3‑year TSR was 37% . ADI’s executive pay programs emphasize OPBT margin, revenue growth, non‑GAAP operating profit, and relative TSR as key pay-for-performance metrics .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Amazon Web Services (AWS) | Chief Financial Officer | 2021–2024 | Led financial strategy for ~$88B revenue business, partnering on growth and profitability across 200+ services (compute, ML/AI, IoT, etc.) . |
| PricewaterhouseCoopers (PwC) | Partner (Technology/Semiconductor focus; later led team supporting Dell) | 2000–2021 | Advised global tech/semicap clients; leadership on large accounts and complex finance/operations . |
| PwC; Hanover Insurance; Digital Equipment | Associate at PwC; two-year corporate finance roles at Hanover Insurance and Digital Equipment | 1990–2000 (w/ two-year period outside PwC; dates not disclosed) | Corporate finance experience in industry; foundational audit/consulting training at PwC . |
External Roles
- No external public company directorships or other external roles for Mr. Puccio are disclosed in ADI’s proxy .
Fixed Compensation
| Element | FY2024 Value | Notes |
|---|---|---|
| Base Salary (earned) | $476,731 | Partial-year (start Feb 5, 2024) . |
| Base Salary (annual target) | $670,000 | Set at hire . |
| Target Bonus (% of salary) | 125% | Individual target under executive plan . |
| Actual Short-Term Incentive (paid) | $119,505 | Based on FY2024 plan outcomes . |
| New-Hire Cash Bonus | $500,000 | To offset forfeited equity; subject to repayment if voluntary departure within 2 years . |
| All Other Compensation | $575,072 | Includes relocation $280,669; tax reimbursement on relocation $262,408; cybersecurity $4,500; retirement/DCP matching $27,495 . |
Performance Compensation
Short-Term (Annual/Quarterly) Cash Incentive
- FY2024 metrics and weightings: 50% OPBT margin (non‑GAAP) and 50% YoY revenue growth, with a 0–3.0x payout curve; OPBT margin floor at 40% (below which payout is 0%) .
- FY2025 program changes: max reduced to 2.5x and moved to annual assessment/payout (from quarterly/sem-annual), reflecting shareholder feedback .
FY2024 quarterly performance and payout factor:
| Metric | Q1 FY24 | Q2 FY24 | Q3 FY24 | Q4 FY24 |
|---|---|---|---|---|
| OPBT Margin (by quarter) | 42.0% | 39.0% | 41.2% | 41.1% |
| OPBT Component Payout | 100% | 0% | 58% | 56% |
| Revenue Growth YoY | (22.7)% | (33.8)% | (24.8)% | (10.1)% |
| Revenue Component Payout | 0% | 0% | 0% | 0% |
| Quarterly Payout Factor (avg) | 49% | 0% | 29% | 28% |
- Full‑year FY2024 payout was ~27% of target (vs. ~182% FY2023; ~293% FY2022) .
Long-Term Equity Incentives (RSUs/PRSUs)
- Structure and metrics:
- PRSUs: Three‑year cumulative performance; metrics include non‑GAAP operating profit and relative TSR vs comparator group; PRSUs cliff‑vest after 3 years; payouts capped at target if absolute TSR is negative .
- RSUs: Four‑year graded vesting (25% per year); time‑based retention vehicle .
- CFO-specific grants:
- New‑hire equity: $10M in time‑based RSUs (3‑year ratable vesting) to induce hire and offset forfeited equity .
- FY2024 annual equity: $5.5M target mix (65% PRSUs; 35% RSUs) .
- No stock options granted to NEOs in FY2024 .
Outstanding unvested awards at FY2024 year‑end (Nov 2, 2024):
| Grant Date | Award Type | Units Unvested | Market Value at 11/1/2024 |
|---|---|---|---|
| 03/15/2024 | RSUs (new‑hire) | 53,121 | $11,977,723 |
| 09/10/2024 | RSUs (annual) | 9,166 | $2,066,750 |
| 09/10/2024 | PRSUs (annual) | 15,551 | $3,506,439 |
Vesting schedules:
- New‑hire RSUs: 3‑year ratable (equal annual tranches beginning on/after 03/15/2025) .
- Annual RSUs: Four‑year graded (equal annual tranches beginning on/after 09/10/2025) .
- Annual PRSUs: Three‑year cumulative performance; cliff-vest following committee certification after the performance period .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (as of Jan 8, 2025) | 19 shares; no options/RSUs vesting within 60 days; <1% of outstanding shares . |
| Unvested Awards (as of FY2024 YE) | 53,121 RSUs (3/15/24); 9,166 RSUs (9/10/24); 15,551 PRSUs (9/10/24) . |
| Ownership Guidelines | Leadership Team must hold ≥3x base salary; five years to comply for new executives; RSUs count; uncertified PRSUs and options do not; all Leadership Team members were in compliance as of Nov 2, 2024 . |
| Hedging/Pledging | Hedging and new pledging prohibited; no margin accounts; only legacy pledge disclosure pertains to a director (Ray Stata); no pledges disclosed for Mr. Puccio . |
Implications for selling pressure:
- Near‑term vesting events on 3/15 and 9/10 in 2025–2027 (RSUs) and cliff PRSU vest in 2027 may create periodic liquidity windows; policies prohibit hedging/pledging, and ownership guidelines drive ongoing retention .
Employment Terms
| Term | Key Economics/Terms |
|---|---|
| Start Date | February 5, 2024 (EVP & CFO) . |
| Short-Term Incentive Plan | FY2024: quarterly measured OPBT margin and YoY revenue growth (0–3.0x); FY2025: annual measurement, 2.5x cap . |
| Long-Term Incentives | PRSUs (3‑yr cumulative performance; cliff) and RSUs (4‑yr graded); new‑hire RSUs vest ratably over 3 years . |
| Change‑in‑Control (CIC) Retention Agreement | Double trigger: if terminated without cause/for good reason within 24 months after a Board‑approved CIC, cash severance equals 299% of base salary plus 299% of variable cash incentive paid/awarded in the prior 4 fiscal quarters, plus 24 months of benefits; new agreements since 2009 do not include excise tax gross‑ups . |
| Equity on CIC | Upon CIC: 50% of unvested equity vests at closing; remaining 50% continues and fully vests if terminated without cause/for good reason within 1 year post‑CIC . |
| Clawbacks | SOX clawback for CEO/CFO; broader policy to recover excess incentive-based compensation after restatements (past 3 completed fiscal years) . |
Estimated payments upon termination (as of 11/2/2024):
| Scenario | Cash Severance | Variable Cash Incentive Component | Accelerated Equity Value | Benefits | Total |
|---|---|---|---|---|---|
| Involuntary not-for-cause or good reason, following Board‑approved CIC | $2,003,300 | $195,513 | $17,550,912 | $2,864 | $19,752,589 |
Performance & Track Record
- FY2024 performance baseline: Revenue $9.4B; gross margin 57.1%; operating margin 21.6%; adjusted gross margin 67.9% and adjusted operating margin 40.9%; operating cash flow $3.9B; FCF ~$3.1B (33% of revenue) .
- Strategic commentary (CFO): targeting 70% gross margin via mix and utilization improvements; industrial mix approaching ~50% revenue as a margin lever; utilization improving after Ireland fab supply issues; CapEx normalizing, supporting ~35% TTM FCF margin .
- Market dynamics (CFO): automotive order pull‑ins unwinding into Q4 FY2025; conservatism in near‑term auto outlook given EV credits/tariff risks; industrial bookings trends constructive; China auto pull‑ins noted in Q3 FY2025 .
- Pricing/geo risk: stated stable pricing in 2024–2025; awareness of China anti‑dumping probe context; ADI positioned at higher‑ASP bands in China .
Citations:
Compensation Structure Analysis
- Year 1 package is equity‑heavy with a $10M time‑based RSU new‑hire award (3‑year ratable) to replace forfeited equity—supports retention but increases guaranteed component vs strictly performance‑conditioned equity .
- Ongoing annual equity emphasizes performance: 65% PRSUs (non‑GAAP operating profit and relative TSR; 3‑year cumulative) and 35% RSUs; no stock options granted to NEOs in FY2024 .
- Short‑term plan rigor maintained in downturn: FY2024 payout ~27% despite margin performance due to negative YoY revenue growth; FY2025 caps reduced (3.0x→2.5x) and moved to annual cycle (shareholder alignment) .
Say‑on‑Pay & Shareholder Feedback
- The company modified executive incentives for FY2025 (lowered bonus cap to 2.5x; annual assessment) and shifted PRSUs to a cumulative 3‑year target beginning with FY2024 grants, reflecting investor outreach and prior say‑on‑pay feedback .
- Historical reference: 2023 say‑on‑pay support was 80.7% (context for responsiveness trend) .
Related Party Transactions and Red Flags
- No related‑person transactions requiring disclosure reported in the most recent proxy period; hedging/pledging prohibited; no tax gross‑ups in new CIC agreements since 2009 .
Equity Ownership & Alignment (Detail Table)
| Measure | Value |
|---|---|
| Shares Beneficially Owned (1/8/2025) | 19 shares; <1% . |
| Shares Pledged | None disclosed for Mr. Puccio (company prohibits new pledging) . |
| Ownership Guideline | 3x base salary; 5 years to comply; all Leadership Team members in compliance as of 11/2/2024 . |
Employment Terms (Key Policies)
| Policy | Summary |
|---|---|
| CIC Severance | 299% salary + 299% variable cash; 24 months benefits; double trigger . |
| Equity on CIC | 50% accelerates at close; remaining 50% vests if terminated within 1 year post‑CIC . |
| Clawback | SOX CEO/CFO + company recovery policy for restatements (3 years) . |
| Insider Trading | Blackout windows, pre-clearance for executives, hedging/pledging prohibited . |
Investment Implications
- Alignment/Retention: A sizable 3‑year new‑hire RSU plus annual PRSU/RSU mix creates strong multi‑year retention and performance alignment; ownership guidelines and clawbacks reinforce shareholder alignment .
- Near‑term Supply Risk in Stock: Scheduled RSU vesting (March/September windows) may add periodic selling pressure; however, hedging/pledging prohibitions and guidelines mitigate misalignment risk .
- Change‑in‑Control Economics: 299% multiples and accelerated vesting deliver significant CIC value ($19.75M estimated as of FY2024 YE), which could influence incentives during strategic scenarios (double‑trigger structure aligns with market practice; no new excise tax gross‑ups) .
- Execution Focus: CFO commentary emphasizes mix/utilization to achieve ~70% gross margin over the cycle, industrial mix recovery, and disciplined capital return—key levers for margin/FCF accretion; watch auto order normalization and China tariff/anti‑dumping developments for near‑term volatility .