Edward McGowan
AKAMAI TECHNOLOGIESAbout Edward McGowan
Edward McGowan, age 54, is Akamai’s Executive Vice President and Chief Financial Officer (CFO) since March 2019, with added oversight of the global IT organization since December 2021; he joined Akamai in 2000, is a certified public accountant, and previously served at Arthur Andersen and PwC as well as Controller at iCast Corporation . Under his finance leadership, Akamai delivered 2024 revenue of $3.99B (+5% YoY), with Security surpassing $2B (+16% YoY) and Compute at $630M (+25% YoY), and operating cash flow of $1.52B (38% of revenue) while repurchasing $557M of stock; relative TSR for the 2022 RSU cohort ranked at the 26th percentile, earning 28% of target . Akamai’s 2024 annual bonus paid out at 72.57% of target in stock, and 2024 PRSU tranche earned at 80.5% on revenue and non‑GAAP EPS metrics; executive clawbacks, anti‑hedging/pledging, stock ownership guidelines and double‑trigger CIC treatment underpin governance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Akamai | EVP, CFO & Treasurer | Mar 2019–present | Led finance through transformation to Security/Compute; added global IT oversight Dec 2021 . |
| Akamai | Added oversight of global IT | Dec 2021–present | Integrated IT with finance priorities; supports platform scale. |
| Akamai | SVP, Finance | Sep 2018–Feb 2019 | Prepared transition into CFO role. |
| Akamai | SVP, Global Sales – Media & Carrier Division | Jan 2017–Aug 2018 | Drove go‑to‑market in media/carrier segment. |
| Akamai | VP, Global Carrier Strategy & Sales | Apr 2013–Dec 2016 | Built carrier partnerships supporting CDN/network strategy. |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| WinVest Acquisition Corp. | Director | Not disclosed | Capital markets perspective; SPAC/transaction insight. |
| iCast Corporation (CMGI) | Controller | Prior to 2000 | Early-stage operating finance experience. |
| Arthur Andersen (High Technology Practice) | CPA | Prior to 2000 | Audit/technical accounting for tech clients. |
| PwC (Transaction Services Group) | CPA | Prior to 2000 | Deal diligence and transaction advisory. |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $515,000 | $515,000 | $519,538 (paid); Year‑end salary level $535,000 |
| Target Bonus % of Salary | 85% (policy unchanged into 2024) | 85% | 85% |
| Target Bonus ($) | Not disclosed | Not disclosed | $441,608 (prorated by Oct 2024 increase) |
| Actual Bonus ($) | Not disclosed | Not disclosed | $320,462 (paid in stock) |
| All Other Compensation ($) | $6,000 | $6,000 | $6,000 |
| Stock Awards ($) | $4,208,604 | $4,852,329 | $5,006,694 |
| Total Compensation ($) | $4,729,604 | $5,373,329 | $5,532,232 |
Performance Compensation
2024 Annual Bonus Plan (paid in stock)
| Metric | Weighting | Threshold | Target | Maximum | Actual | Payout % vs Target |
|---|---|---|---|---|---|---|
| Revenue (adjusted for FX) ($MM) | 50% | $3,706.6 | $4,118.4 | $4,530.2 | $4,032.7 | 79.2% |
| Non‑GAAP Operating Income ($MM) | 50% | $1,094.7 | $1,216.3 | $1,337.9 | $1,187.5 | 76.3% |
| Overall payout excl. ESG | — | — | — | — | — | 77.75% |
| ESG modifier | — | — | — | — | — | −6.66 pts → Final 72.57% |
2024 PRSUs – Annual Earned Tranche
| Metric | Weighting | Threshold | Target | Maximum | Actual | Achievement vs Target | % of PRSUs Earned |
|---|---|---|---|---|---|---|---|
| Revenue (adjusted for FX) | 50% | $3,706.6MM | $4,118.4MM | $4,530.2MM | $4,032.7MM | 97.9% | 79.2% |
| Non‑GAAP EPS | 50% | $6.04 | $6.71 | $7.38 | $6.59 | 98.2% | 81.8% |
| Overall | — | — | — | — | — | — | 80.5% |
| Vesting | — | — | — | — | — | — | 3‑year cliff; one‑third earned each year; vests after 2026 certification |
Relative TSR‑Based RSUs (2022 grant outcome over 2022–2024)
| Metric | Target | 2022–2024 TSR | Percentile vs Index Group | % of Target Earned |
|---|---|---|---|---|
| Relative 3‑yr TSR | 50th percentile | −10.7% | 26th percentile | 28% |
2024 Long‑Term Incentive Award Mix (grant‑date target values)
| Award Type | Vesting | Weight | McGowan 2024 Target ($) |
|---|---|---|---|
| Time‑vesting RSUs | 1/3 annually over 3 years | 50% | $2,205,000 |
| PRSUs | 3‑year cliff; earned annually | 20% | $882,000 |
| Relative TSR‑Based RSUs | 3‑year cliff | 30% | $1,323,000 |
| Total LTI Target | — | — | $4,410,000 |
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Total beneficial ownership (2/25/2025) | 42,611 shares, incl. 51 in 401(k) and 20,106 RSUs vesting within 60 days |
| Shares outstanding (2/25/2025) | 150,387,475 |
| Ownership as % of outstanding | ~0.028% (42,611 ÷ 150,387,475) |
| Stock ownership guidelines | NEOs must hold ≥3× base salary; 5‑year compliance window; sales restricted if below guideline (tax sales permitted) |
| Compliance status | As of 12/31/2024, all NEOs met minimum ownership requirement |
| Hedging/Pledging | Hedging, short sales, margin/pledging prohibited for executives/directors |
| Clawbacks | 2014 policy (misconduct/detrimental conduct; 12‑month sale profits and 36‑month incentive recovery upon restatement); 2023 Dodd‑Frank/Nasdaq‑compliant mandatory recoupment for restatements (3 years; regardless of misconduct) |
Employment Terms
| Provision | Detail |
|---|---|
| Executive Severance Pay Plan (non‑CIC) | If terminated without cause and sign release: lump sum equal to 1× current base salary, 1× target annual bonus for year of termination, and up to 12 months COBRA premium reimbursement |
| 2022 Change‑in‑Control Agreement | If terminated without cause or for good reason within 1 year post‑CIC: pro‑rated lump sum of target bonus for year‑to‑date, plus lump sums equal to 1× base salary and 1× target bonus, and up to 12 months COBRA reimbursement |
| Equity treatment on CIC | No single‑trigger if awards assumed; performance awards convert to time‑based (incomplete periods assumed target; completed periods use actual); if not assumed, accelerate at target immediately prior to CIC; double‑trigger acceleration if assumed and terminated within 12 months |
| Tax gross‑ups | No excise tax gross‑ups; policy prohibits |
| Non‑compete/Non‑solicit | Not specifically disclosed in proxy; executive severance requires separation/release; standard confidentiality/insider trading policies apply . |
| Deferred compensation | McGowan’s salary includes amounts deferred under the Deferred Compensation Plan . |
Compensation Structure Analysis
| Indicator | Evidence |
|---|---|
| Pay mix increasingly equity‑weighted | Stock awards rose from $3.75M (approved 2022) to $4.05M (2023) and $4.41M (2024) for McGowan; time‑vested RSUs 50%, PRSUs 20%, TSR RSUs 30% . |
| Annual bonus rigor | 2024 paid at 72.57% of target on revenue and non‑GAAP OI; ESG modifier reduced payout by 6.66 points; paid in stock . |
| Performance metric evolution | PRSUs based on annual revenue (adj FX) and non‑GAAP EPS with 3‑year vesting; TSR RSUs measured vs S&P 500 Index; enhanced focus on TSR since 2023 . |
| Governance best practices | Double‑trigger CIC; anti‑hedging/pledging; clawbacks; ownership guidelines; “few, if any” perquisites; no repricing; no tax gross‑ups . |
| Shareholder support | Say‑on‑pay approval ~92% at 2024 meeting . |
Related Party Transactions and Red Flags
- 2024: No related‑party transactions requiring Item 404 disclosure; Code of Ethics restricts conflicts; oversight by Audit Committee .
- No hedging/pledging; no option repricing; clawbacks in place; no excise tax gross‑ups .
Compensation Peer Group and Design References
- Benchmarking peer group set September 2023 (~15–20 companies; median revenue ~$3.4B, market cap ~$18.5B) to inform 2024 decisions; 2025 updates added Cloudflare, Open Text, Twilio, Zscaler; removed Splunk, VMware, Arista, Equinix, Sabre to better match Akamai’s size/operations .
- Design peer group of larger tech names used for plan design trends (e.g., Adobe, Alphabet, Amazon, Apple, Cisco, Cloudflare, Meta, Microsoft, Oracle, Salesforce, Zscaler) .
Equity Ownership & Vesting Schedule Details
- RSUs: 1/3 annually over 3 years; near‑term for McGowan includes 20,106 RSUs vesting within 60 days post 2/25/2025 .
- PRSUs: one‑third earned each of 2024–2026 on revenue/non‑GAAP EPS; vest following 2026 certification by TL&C .
- Relative TSR RSUs: earned 0–200% based on percentile vs S&P 500; vest after 3‑year period (2024–2026) certification .
Investment Implications
- Alignment: McGowan’s pay has high equity and performance linkage (PRSUs/TSR RSUs), with strict ownership, clawbacks and anti‑hedging/pledging—favorable for investor alignment .
- Retention and CIC risk: Severance provides 1× salary/bonus, and double‑trigger CIC economics; equity converts/accelerates per plan—adequate retention without excessive guarantees; no tax gross‑ups mitigates shareholder risk .
- Selling pressure: Near‑term RSU releases (20,106 within 60 days of 2/25/2025) could create technical supply; however, ownership guidelines restrict discretionary sales if below thresholds .
- Performance signals: 2024 bonus below target and PRSU earn at ~80% reflect disciplined targets; TSR underperformed peers for 2022 cohort (28% earn), increasing pressure to improve multi‑year shareholder returns .
- Governance strength: High say‑on‑pay (92%) and robust TL&C/peer process suggest continued investor support for the compensation framework .