Rick McConnell - Chief Executive Officer | Dynatrace (DT) Executive Profile & Compensation

About Rick McConnell

Rick McConnell, age 59, has served as Dynatrace’s Chief Executive Officer and a director since December 2021; he is not independent and holds a B.A. in Quantitative Economics and an M.B.A., both from Stanford University . Fiscal 2025 performance under his tenure included ARR of $1,734 million (+17% y/y constant currency), revenue of $1,699 million (+20% y/y constant currency), non-GAAP operating income of $494 million, and free cash flow of $431 million, indicating balanced growth and profitability . Pay-versus-performance disclosure shows company TSR value of a fixed $100 investment at $198 in 2025 versus peer group at $284, providing context for relative returns; revenue was $1,699 million and net income $484 million for 2025 per the table . Dynatrace added rTSR PSUs to executive LTI in fiscal 2025 following shareholder feedback, with one-year rTSR payout at 137.4% of target, signaling above-median stock performance over that period .

Past Roles

Organization	Role	Years	Strategic Impact
Dynatrace (DT)	Chief Executive Officer & Director	Dec 2021–present	Leads scaling across observability with AI; board deems CEO qualified due to company knowledge .
Akamai Technologies	President & GM (Security Technology Group); President & GM (Web Division); President, Products & Development	2011–2021	Scaled multi-billion businesses; product portfolio breadth; go-to-market execution .
Cisco Systems	Senior executive roles	2004–2011	Senior operating roles post-Latitude acquisition .
Latitude Communications	President & CEO	Pre-2004 (through Cisco acquisition)	Led voice/Internet conferencing provider into Cisco acquisition .

External Roles

Organization	Role	Years	Notes
Dynatrace Board	Class I Director (Not Independent)	Since 2021, term expires 2026	No committee roles; independence affirmed for other directors but not for CEO .
Board Leadership	Chair of the Board (Jill Ward)	Chair since 2021	CEO and Chair separated; independent Chair presides over executive sessions .

Fixed Compensation

Metric	FY 2023	FY 2024	FY 2025
Base Salary ($)	$630,000	$655,000	$675,000
Target Annual Bonus (% of Salary)	100%	100%	100%
Actual STI Paid ($)	$670,572	$696,265	$671,828 (99.5% of target)
All Other Compensation ($)	$28,509	$31,556	$32,787 (incl. President’s Club travel $8,263 and tax gross-up $7,342)
Total Compensation ($)	$14,563,163	$17,279,634	$19,380,348

Performance Compensation

Annual STI Plan – FY 2025 Design and Outcomes

Metric	Weighting	Threshold (50% payout)	Target (100% payout)	Max (150% payout)	Actual	Payout
ARR (constant currency)	65%	95% / $1,677.7m	100% / $1,766.0m	105% / $1,854.3m	99.1% / $1,749.3m	90.5% on metric; weighted total 99.5%
Non-GAAP Operating Income	35%	90% / $430.2m	100% / $478.0m	110% / $525.8m	103.3% / $493.5m	116.3% on metric; weighted total 99.5%

STI Result	Value
CEO STI Paid	$671,828 (99.5% of $675,000 target)

Long-Term Incentives – FY 2025 Grants and Mechanics

Component	Grant Date	Target Value	Shares at Target	Vesting	Performance Metrics
Financial PSUs	Jun 5, 2024	$16,500,000	106,132	1-year performance; then 33% on year 1 anniversary, remainder quarterly over 2 years	Revenue (75%) and NGOI (25%); payout 130.0% of target for FY25
rTSR PSUs	Jun 5, 2024	Included above	70,755	1, 2, and 3-year performance tranches; 1-year vested Jun 5, 2025	Russell 3000 rTSR; 1-year payout 137.4% at 59th percentile
Time-based RSUs	Jun 5, 2024	Included above	176,887	33% on first anniversary; remainder quarterly over following two years

FY 2025 PSU Targets	Threshold	Target	Maximum	Actual	Payout
Revenue	95% / $1,600.75m	100% / $1,685.0m	105% / $1,769.25m	101.5% / $1,709.5m	129.1% on revenue sub-metric
NGOI	90% / $430.2m	100% / $478.0m	110% / $525.8m	103.3% / $493.5m	132.5% on NGOI sub-metric
Weighted Financial PSU Payout	—	—	—	—	130.0% of target

Additional context: Approximately 96% of CEO’s target FY25 compensation was variable “at risk” via STI/LTI, reinforcing pay-for-performance orientation .

Equity Ownership & Alignment

Item	Detail
Beneficial Ownership	173,682 shares; less than 1% of outstanding
Shares acquired on vesting (FY 2025)	339,270 shares; value realized $17,346,338
Unvested RSUs/PSUs (as of Mar 31, 2025)	Sign-on RSUs: 15,825 ($746,149) ; 2022 awards: 27,916 ($1,316,239) ; 2023 awards: 148,766 ($7,014,317) ; 2024 awards: 314,858 ($14,845,555) ; 2024 rTSR 1-yr tranche: 32,405 ($1,527,896) unvested at FY-end, vested 6/5/25
rTSR PSUs outstanding (max reflected)	2-year tranche: 47,170 ($2,224,066); 3-year tranche: 47,170 ($2,224,066), subject to performance
Options (exercisable/unexercisable)	None for CEO; no option grants in FY 2025
Stock Ownership Guidelines	CEO: 5x base salary; compliance assessed annually beginning March 31, 2027
Hedging/Pledging	Prohibited; insider trading/10b5-1 plan policy in place

Employment Terms

Provision	Key Terms
Employment Agreement	Amended & restated March 2023; at-will; base initially $630,000; target bonus 100% of salary
Severance (non‑CIC)	12 months base salary; prior-year earned bonus; 100% of current-year target bonus; up to 12 months employer health contribution (COBRA)
Change-in-Control (double trigger)	Lump sum 24 months base salary + prior-year bonus; full acceleration of all unvested equity; up to 18 months employer health contribution (COBRA)
Clawback	NYSE-compliant compensation recovery policy for erroneously awarded incentive-based compensation (3 fiscal years)
Tax Gross-ups (parachute)	None for CIC payments under 280G/4999
Perquisites	Limited; FY25 included President’s Club travel and tax gross-up ($8,263 travel; $7,342 gross-up)

Board Governance

Role/Independence: CEO serves as a Class I director (not independent); Chair is independent (Jill Ward), and CEO/Chair roles are separated; seven of eight directors are independent .
Committees: Audit, Compensation, Cybersecurity, Nominating & Corporate Governance—CEO is not a committee member; independent directors meet in executive session presided by the Chair .
Attendance: Each director attended at least 75% of Board/committee meetings in FY25; Board met nine times .
Director Compensation: Employee directors receive no additional compensation for board service .
Director Ownership Guidelines: 5x annual base board cash retainer; compliance assessed annually beginning March 31, 2027 (excludes unvested RSUs/PSUs) .
Say-on-Pay: 94% approval in August 2024, indicating strong shareholder support for executive pay program .

Compensation Peer Group (Benchmarking)

Peer Group (FY 2025 set)	Positioning
Cloudflare, Confluent, Datadog, Elastic, Fair Isaac, Five9, HubSpot, Informatica, MongoDB, Nutanix, Okta, Paylocity, PTC, Samsara, Splunk, UiPath, Zscaler	Base salaries targeted around the 50th percentile; overall design emphasizes variable, at-risk pay

Risk Indicators & Red Flags

Hedging/Pledging: Explicitly prohibited—alignment positive .
Option Repricing: No option grants in FY25; no repricing disclosed .
Golden Parachute Gross-ups: None—shareholder-friendly .
Related Parties: No Rick-specific related-party transactions disclosed; broader related-party transactions reviewed by Audit Committee policy .
Perq Gross-up: Small tax gross-up for President’s Club travel—note as minor governance watch item .

Performance Compensation Analysis

Element	Shift/Signal
Introduction of rTSR PSUs (FY25)	Added after investor engagement; aligns pay to market-relative returns; 1-year tranche paid 137.4% at 59th percentile .
Financial PSU weighting	Increased emphasis on revenue (75%) vs NGOI (25%)—growth-focused tilt .
STI metrics	ARR (65%) and NGOI (35%), both with rigorous thresholds; FY25 payout near target (99.5%) reflecting balanced execution .
Pay mix	~96% of CEO target compensation “at risk”—high alignment with outcomes .

Equity Vesting & Potential Selling Pressure

RSU cadence: Annual grants vest 33% at year 1 then quarterly, creating regular settlements; CEO had 339,270 shares vest in FY25 (value realized $17.35m), which can contribute to periodic market supply subject to trading windows/10b5-1 plans .
rTSR PSUs: 1-year tranche vested June 5, 2025; remaining 2- and 3-year tranches outstanding and performance-contingent through FY26 and FY27 .

Equity Ownership & Alignment Table (as of Mar 31, 2025)

Category	Amount	Notes
Shares Beneficially Owned	173,682; <1% of outstanding	Includes 500 shares in spouse’s trust; Rick disclaims beneficial ownership beyond pecuniary interest .
Unvested RSUs (sign-on)	15,825 ($746,149)	Remaining portion of Dec 2021 sign-on award .
Unvested RSUs/PSUs (FY22)	27,916 ($1,316,239)	FY22 awards now vesting schedule completed by 6/5/25 .
Unvested RSUs/PSUs (FY23)	148,766 ($7,014,317)	Vests through 6/5/26 .
Unvested RSUs/PSUs (FY24)	314,858 ($14,845,555)	Vests through 6/5/27 .
rTSR PSUs (1-yr tranche)	32,405 ($1,527,896)	Unvested at FY-end; vested 6/5/25 .
rTSR PSUs (2-yr tranche)	47,170 ($2,224,066)	Max reflected; performance-based through 3/31/26 .
rTSR PSUs (3-yr tranche)	47,170 ($2,224,066)	Max reflected; performance-based through 3/31/27 .
Options	—	No FY25 option grants; none shown for CEO .
Ownership Guidelines	5x salary	Compliance assessed annually from 3/31/27 .

Employment & Contracts

Item	Detail
Start Date	CEO since Dec 2021; agreement amended Mar 2023
Non-compete/Non-solicit	Company uses confidentiality/IP/restrictive covenants in executive agreements; clawback adopted under NYSE rules
Severance	12 months base + prior-year earned bonus + 100% current-year target bonus; 12 months COBRA contribution
CIC (Double Trigger)	24 months base + prior-year bonus; full equity acceleration; 18 months COBRA contribution

Say-on-Pay & Shareholder Feedback

Year	Outcome	Company Response
2024 (FY25 annual meeting in Aug 2024)	~94% approval	Introduced rTSR PSUs; adopted majority voting for uncontested director elections .

Investment Implications

Strong pay-for-performance alignment: CEO’s compensation is predominantly at-risk, with STI/LTI tied to ARR, NGOI, revenue, and rTSR; FY25 Financial PSU payout at 130% and rTSR 1-year at 137.4% indicate above-target performance on key growth and market-relative measures .
Retention risk mitigants: Robust CIC protections with full equity acceleration and 24-month salary in double-trigger scenarios; stock ownership guidelines (5x salary) and clawback policy reinforce alignment and governance .
Potential supply/settlement pressure: Significant ongoing RSU releases (339k shares vested FY25) and quarterly vesting cadence may lead to regular settlements under 10b5-1 plans—monitor Form 4 activity around vest dates and trading windows .
Governance quality: Independent Chair; majority independent board; no CIC tax gross-ups; prohibition on hedging/pledging—all supportive of shareholder-friendly practices. Note minor perquisite gross-up tied to a sales event as a small watch item .
Performance track record: ARR and revenue growth with expanding NGOI and strong free cash flow support value creation; company TSR growth lagged peer group on cumulative basis per pay-versus-performance, but rTSR PSU outcome shows above-median relative performance over the latest year—monitor multi-year rTSR tranches through FY26–FY27 for sustained market-relative execution .