Kevin Kraus
Chief Financial Officer at EGHT
Executive
About Kevin Kraus
Kevin Kraus, 55, is Chief Financial Officer of 8x8 (EGHT), serving as permanent CFO since June 5, 2023 after acting as interim CFO from November 30, 2022; he joined 8x8 in 2019 as SVP Finance. He is a CPA with a B.S. in Accounting from Rutgers and an MBA from Penn State, and previously held finance leadership roles at Imperva and Gigamon . During FY2025 under the current leadership team, 8x8 delivered GAAP operating profit of $15.2M (2% margin), $64M operating cash flow, and reduced term-loan principal by $73M, while total revenue declined 2% to $715M and core (ex-Fuze) service revenue grew 3%; stockholder returns were negative over the multi‑year period, with the company’s “$100 investment” TSR measure at 15.54 for FY2025 .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| 8x8, Inc. | Chief Financial Officer | Jun 2023–Present | Oversight of global finance; FY2025 GAAP operating profit ($15.2M), $64M operating cash flow, debt reduction ($73M) . |
| 8x8, Inc. | Interim Chief Financial Officer | Nov 2022–Jun 2023 | Stabilized finance function during CEO transition . |
| 8x8, Inc. | SVP, Finance (FP&A, procurement) | Oct 2019–Nov 2022 | Led FP&A and procurement; prepared for interim/permanent CFO role . |
| Imperva | Vice President, Finance | Feb 2018–May 2019 | Cybersecurity software finance leadership . |
| Gigamon | Senior Director, Finance | 2015–2017 | Finance leadership in network visibility technology . |
External Roles
- No public company directorships or outside board roles disclosed for Mr. Kraus .
Fixed Compensation
| Year | Base Salary ($) | Target Bonus % | Actual Bonus Paid ($) |
|---|---|---|---|
| 2023 | 334,906 | 65% (CFO target per promotion letter) | 151,667 (one‑time leadership/debt financing payments; see proxy footnote) |
| 2024 | 420,000 | 65% | 53,333 (one‑time leadership payment per proxy footnote) |
| 2025 | 420,000 | Plan suspended for FY2025 (no annual cash incentive) | 0 |
Note: FY2025 annual cash incentive plan was suspended company‑wide; FY2023–FY2024 bonus column includes special one-time payments tied to leadership changes/financing, not formulaic annual incentives .
Performance Compensation
FY2025 Equity Grants (awarded 9/15/2024)
| Award type | Shares (target) | Grant-date fair value ($) | Vesting/terms |
|---|---|---|---|
| RSUs | 200,000 | 376,000 | 3-year schedule: 1/3 on first anniversary; remainder in eight equal quarterly installments . |
| PSUs (2025 EPP) | 200,000 | 376,000 | Earned based on cumulative cash flow from operations (CFFO) over 4/1/2024–3/31/2027; time-vesting gates and annual certification apply . |
Performance Plan Mechanics and Outcomes
| Plan/Grant | Metric | Weighting | Target/Threshold | Actual (as reported) | Payout | Vesting cadence |
|---|---|---|---|---|---|---|
| 2025 EPP PSUs (granted 9/15/2024) | CFFO (cumulative) | 100% | $150M = 100%; $50M = 33% (linear interpolation; up to 66% vest eligible after year 1) | FY2025 CFFO $63M | 42% of target vested for FY2025 (84,000 of 200,000) | Earned portion vests within ~75 days post-FY; remaining subject to FY2026–FY2027 performance/time gates . |
| 2024 EPP PSUs (granted 6/15/2023) | Absolute stock price | 100% | +130% to $8.88 = 100%; +70% to $6.56 = 33% | Below threshold (highest $3.27) | 0% to date | 3-year time vesting gates; performance measured over 6/15/2023–6/15/2027 . |
| 2023 EPP PSUs (granted 6/15/2022) | Relative TSR vs S&P Software & Services | 50% tranches | 25th pct = 50%; 50th pct = 100%; 75th pct = 200% | First tranche ended 6/15/2024 at 0.76 percentile (below threshold) | 0% (first tranche) | Second tranche measured through 6/15/2025; to be determined (as of filing) . |
| CFO Promotion PSUs (6/15/2023) | Stock price hurdles | — | Tranche 1: +70%; Tranche 2: +100%; Tranche 3: +130% (20-day avg), with 1/2/3-yr time gates | Not disclosed achieved | N/A | Three tranches; must meet both price and time gates; if Tranche 1 not met by end of performance period, entire award forfeits . |
FY2025 compensation design emphasized long-term equity and cash flow alignment: annual cash incentive suspended; 50% of long-term awards in PSUs tied to CFFO; company reduced stock-based compensation and share issuance to manage dilution .
Equity Ownership & Alignment
Beneficial Ownership and Near-term Vesting
| Item | Detail |
|---|---|
| Beneficial ownership | 187,565 shares; <1% of outstanding . |
| Shares outstanding reference | 135,092,912 shares outstanding as of May 29, 2025 . |
| RSUs vesting within 60 days (as of 5/29/2025) | 21,847 shares . |
| Ownership guidelines | Executives must hold shares = 1× initial base salary within 5 years (CEO 6×); all active NEOs still within 5-year accumulation period . |
| Hedging/pledging | Prohibited for employees/executives/directors (no short sales, hedging, pledging, or derivatives) . |
Outstanding Equity Awards at FY2025 Year-End (Market price $2.00)
| Grant/Type | Unvested/earned shares (#) | Value ($) | Notes |
|---|---|---|---|
| 6/15/2022 RSU | 3,422 | 6,844 | Time-based vesting . |
| 6/15/2022 PSU (target) | 6,842 | 13,684 | Relative TSR plan; first period 0% vested; second period TBD . |
| 6/15/2023 RSU | 92,125 | 184,250 | Time-based vesting . |
| 6/15/2023 PSU (target) | 221,100 | 442,200 | Absolute price hurdles; below threshold to date . |
| 9/15/2024 RSU | 200,000 | 400,000 | Time-based vesting . |
| 9/15/2024 PSU – earned tranche | 84,000 | 168,000 | 42% earned for FY2025 CFFO; time-vested after certification . |
| 9/15/2024 PSU – remaining at target | 116,000 | 232,000 | Subject to FY2026–FY2027 CFFO and time gates . |
Insider selling pressure: time‑based RSUs vest quarterly and PSUs vest upon annual certification when earned, creating periodic settlement windows; hedging/pledging is prohibited, and the company adopted net‑share tax withholding (“net cash settlement”) to reduce gross issuance, which lowered new share issuance by ~175k shares in FY2025 .
Employment Terms
- Current compensation (promotion letter, June 5, 2023): base salary $420,000; target cash bonus 65% of base; promotion RSU valued at ~$1,105,500 (number of RSUs based on the greater of $5.00 or 20‑day average) with 3‑year 1/3 then quarterly vesting; promotion PSU equal in count to RSUs with three share‑price tranches (+70%/+100%/+130%) and annual time gates; eligible under 2017 Executive Change‑in‑Control and Severance Policy (amended May 13, 2021) .
- Clawback: equity plans and a standalone clawback policy (adopted FY2024) meeting Nasdaq rules apply to incentive compensation .
Change‑in‑Control and Severance Economics (as of 3/31/2025)
| Scenario | Cash Severance ($) | Target/Bonus ($) | Equity Acceleration Value ($) | Benefits ($) | Total ($) |
|---|---|---|---|---|---|
| Constructive termination in connection with CIC (double trigger) | 420,000 | — (FY2025 plan suspended) | 591,094 | 38,436 | 1,049,530 |
| Constructive termination not in connection with CIC | 210,000 | — (FY2025 plan suspended) | — | 19,218 | 229,218 |
Policy highlights:
- No single‑trigger CIC benefits; performance awards assessed at CIC and time‑vesting continues unless terminated; 100% acceleration for time-based awards upon qualifying CIC severance .
- No tax gross‑ups; no option repricing without shareholder approval .
Compensation Structure Analysis
- Shift to at‑risk, cash‑flow‑linked equity: FY2025 suspended annual cash bonuses; 50% of long‑term awards in PSUs tied to cumulative CFFO; 42% of 2025 PSU target earned on $63M CFFO, while prior TSR/price‑based PSUs tracked below thresholds (forfeitures) .
- Dilution management: moved most non‑executive comp to cash; net‑share tax withholding for executives; RSU grant-date value and SBC materially reduced vs prior years (SBC ~$39.9M FY2025 vs $61.9M FY2024; RSU grant value down from ~$76M in FY2023 to < $17M in FY2025) .
- Governance and alignment: robust stock ownership guidelines (1× salary for executives), hedging/pledging prohibited, clawback policy adopted, no single‑trigger CIC, and no pension/deferred comp plans for executives .
Say‑on‑Pay, Peer Group, and Shareholder Feedback
- 2024 Say‑on‑Pay approval: ~98% support .
- Peer group: size/industry‑aligned SaaS cohort (e.g., Five9, RingCentral, Zuora, Blackbaud, etc.); program generally targeted around market median .
- Investor feedback: emphasize revenue growth and cash flow; company increased weighting of service revenue metrics in cash plans (FY2024) and tied FY2025 PSUs to CFFO; FY2026 cash incentive reinstated with service revenue, net new subscription revenue, and operating income metrics .
Investment Implications
- Alignment: Kraus’s pay is heavily equity‑based and directly levered to multi‑year CFFO, with legacy price/TSR PSUs underwater—sharply aligning realized pay with execution on cash generation and deleveraging .
- Supply/overhang: Quarterly RSU vesting and earned PSU settlements create periodic supply; however, hedging/pledging prohibitions, net cash settlement for tax, and reduced SBC mitigate dilution relative to prior years .
- Retention risk: Moderate—policy provides standard double‑trigger CIC protection and limited non‑CIC severance; promotion RSU acceleration on termination without cause/good reason increases retention but preserves performance linkage via PSUs .
- Execution bar: With FY2025 PSUs at 42% earned and prior TSR/price awards below thresholds, forward realizable compensation hinges on sustaining/increasing CFFO and improving stock performance; negative TSR trend underscores the need for durable revenue reacceleration and margin improvement to crystallize PSU value .
No related‑party transactions or hedging/pledging red flags disclosed; insider policies and clawback frameworks are shareholder‑friendly .