Stephen McMahon

About Stephen McMahon

Stephen “Steve” McMahon is Executive Vice President, Chief Customer Officer at Dynatrace, appointed effective May 12, 2025; he is 52 years old, holds a B.A. in Economics from Yale University, and previously served in the U.S. Navy . His background includes senior customer-success and CIO roles at Zscaler (Chief Customer Success Officer, 2024–2025), CrowdStrike (Customer Success/Operations and CIO, 2021–2024), Splunk (various leadership roles including CIO, 2015–2021), and nearly 15 years at Cisco in customer-focused leadership . Company performance levers embedded in executive compensation recently emphasized revenue and Non‑GAAP Operating Income (NGOI) outperformance (FY2025 Financial PSUs paid 130% of target on revenue $1,709.5M vs $1,685.0M target and NGOI $493.5M vs $478.0M target) and a new rTSR PSU program that paid ~137.4% for the one‑year tranche, signaling alignment to growth and relative TSR outcomes .

Past Roles

External Roles

• No public company board roles or committee positions for McMahon are disclosed in company filings reviewed .

Fixed Compensation

• Compensatory arrangements (base salary, target bonus %) for McMahon were not disclosed in the April 22, 2025 8‑K announcing his appointment or the FY2025 proxy; the 8‑K focused on the outgoing CCO’s transition terms and furnished a press release about McMahon’s appointment .
• Dynatrace communicates executive pay philosophy (base, STI, LTI) and program design in the proxy, but McMahon did not appear in the FY2025 named executive officer (NEO) tables given his start date post fiscal year end (March 31, 2025) .

Performance Compensation

Annual STI Plan (FY2025 design and outcome for executives)

Notes: The company discloses plan design and aggregate outcome; specific STI targets/actuals by metric were not enumerated in the summary (payout 99.5% overall) .

Long‑Term Incentive (LTI) – FY2025 PSU framework and results

Vesting mechanics:

• RSUs (FY2025 annual awards granted June 5, 2024): 33% on first anniversary, then equal quarterly installments over the next two years .
• Financial PSUs: One‑year performance certification; 33% of earned PSUs vest at first anniversary/certification, remainder vests in equal quarterly installments over the following two years .
• rTSR PSUs: Three independent measurement periods (1, 2, and 3 fiscal years starting Apr 1, 2024); 1‑year tranche vested June 5, 2025; remaining tranches depend on 2‑ and 3‑year performance .

Equity Ownership & Alignment

• Beneficial ownership: McMahon is identified as an executive officer, but he was not listed with an individual share count in the “Security Ownership of Certain Beneficial Owners and Management” table as of June 27, 2025 (the table includes NEOs/directors and shows less‑than‑1% positions for listed insiders) .
• Stock ownership guidelines: CEO 5x base salary; other executive officers 2x base salary; five‑year compliance window from becoming subject to the guidelines. Compliance assessed annually beginning March 31, 2027; unvested RSUs/PSUs and unexercised options do not count toward compliance .
• Hedging/pledging: Prohibited (no hedging or pledging of company stock) .
• Clawback: NYSE‑compliant policy adopted Oct 2023; 3‑year lookback for recovery of erroneously awarded incentive‑based compensation following a required restatement; legacy policy applies pre‑Oct 2, 2023 awards .
• Perquisites/benefits: Company states no material executive perquisites; market‑standard benefits and 401(k); no defined benefit pension or non‑qualified deferred compensation plans .

Employment Terms

Note: These are company‑standard terms disclosed for specific NEOs (CEO/CFO) and may indicate the general framework; McMahon‑specific terms have not been disclosed in filings reviewed .

Investment Implications

• Pay‑for‑performance alignment: Program design ties significant value to revenue and NGOI (Financial PSUs paid 130% for FY2025) and relative TSR (one‑year rTSR ~137.4%), reinforcing growth and shareholder alignment as compensation levers McMahon is expected to operate under as CCO .
• Selling pressure/vesting cadence: DT’s standard annual RSU/PSU vesting (33% at first anniversary, then quarterly) can create periodic liquidity windows once grants are awarded and certified; monitor Form 4 filings to detect any emerging selling pressure from new awards to McMahon (none disclosed in filings reviewed) .
• Ownership/pledging risk: Strong governance posture—no hedging/pledging, 2x salary ownership guideline for execs with five‑year window, and an NYSE‑compliant clawback—limits alignment and reputational risk; track McMahon’s progress toward ownership guidelines as holdings are reported in future proxies .
• Retention/CIC economics: Company‑standard double‑trigger CIC acceleration and severance for NEOs reduce transaction‑related retention risk and discourage entrenchment; McMahon’s specific terms are not yet public, but precedent suggests competitive protections .
• Governance signal: Say‑on‑pay support remains high (94% in 2024; 95% in 2023; 93% in 2022), indicating shareholder endorsement of the compensation framework that will govern McMahon’s incentives .

Key watch items: (1) McMahon’s initial equity grant terms (grant date, size, vesting) once disclosed; (2) Form 4 activity for any sell‑to‑cover or discretionary sales; (3) ARR/NGOI trajectory and rTSR percentile vs Russell 3000, as these drive payout curves and potential future vesting scale .

Citations:

• Executive officer biography/age and appointment details:
• STI/LTI design and outcomes (FY2025):
• Ownership guidelines, clawback, hedging/pledging:
• Beneficial ownership table (absence of McMahon listing):
• Employment agreement practices and illustrative NEO severance/CIC terms:
• Say‑on‑pay results: