Lawrence J. Ellison
About Lawrence J. Ellison
Lawrence J. Ellison is Oracle’s Executive Chair of the Board, Chief Technology Officer (CTO), and Founder. He has served as Executive Chair and CTO since September 2014; previously CEO from 1977 (founding) to September 2014 and Chairman May 1995–January 2004. Age 81; Director since 1977. He leads product engineering and technology development and is Oracle’s largest stockholder, which the Board views as aligning his interests with stockholders . Oracle’s stock rose ~130% from end of FY22 to end of FY25; GAAP revenues reached $57.4B, GAAP operating income $17.7B, GAAP net income $12.4B, EPS $4.34 in FY25 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Oracle Corporation | Chief Executive Officer | 1977–2014 | Led Oracle’s growth and transformation, setting long-term strategy; positioned for cloud transition later overseen as Executive Chair/CTO . |
| Oracle Corporation | Chairman of the Board | 1995–2004 | Board leadership during scale-up years; governance continuity . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Tesla, Inc. | Director | Previously within last five years | External perspective from large-scale technology and manufacturing; network benefits to Oracle . |
Fixed Compensation
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Base Salary ($) | $1 | $1 | $1 |
| All Other Compensation ($) | $3,136,719 | $3,013,678 | $5,643,947 |
| Total Compensation ($) | $7,301,933 | $8,305,939 | $5,643,948 |
Notes: Oracle disclosed Mr. Ellison voluntarily in compensation tables although not an SEC-defined NEO for FY25 .
Performance Compensation
Annual Performance-Based Cash Bonus (Executive Bonus Plan)
| Year | Metric | Target ($) | Maximum ($) | Payout ($) | Committee Action |
|---|---|---|---|---|---|
| FY 2025 | Non-GAAP operating income YoY growth | $5,000,000 | $10,000,000 | $0 | Reduced to $0 notwithstanding actual achievement levels to preserve capital for strategic priorities . |
Plan mechanics: capped payouts; metric aligns executives with company-wide bonus funding; used broadly by management, mitigates excessive risk .
Long-Term Incentive: Performance-Based Stock Options (PSOs, granted 7/20/2017)
| Tranche | Criteria | Shares | Achievement Date | Vesting Date | Status |
|---|---|---|---|---|---|
| 1 | 30-day average stock price ≥ $80 | 2,500,000 | June 2021 | June 30, 2021 | Earned/Vested . |
| 2 | Matching market cap goal + operational goal(s) | 2,500,000 | FY 2023 | June 30, 2023 | Earned/Vested . |
| 3 | Matching market cap goal + operational goal(s) | 2,500,000 | FY 2024 | June 27, 2024 | Earned/Vested . |
| 4 | Operational goal: $20B non-GAAP total cloud revenues in a fiscal year | 2,500,000 | FY 2025 | June 24, 2025 | Earned/Vested . |
| 5 | Operational goal: $10B non-GAAP total PaaS & IaaS revenues in a fiscal year | 2,500,000 | FY 2025 | June 24, 2025 | Earned/Vested . |
Program overview: 7 equal tranches; requires rigorous stock price, market capitalization, and operational goals over eight fiscal years (2018–2025). Compensation Committee extended performance period in FY22 to FY25 without granting new equity during that period .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 1,158,232,353 shares; 40.6% of class . |
| Pledged Shares | 346,000,000 shares pledged as collateral to secure personal indebtedness; Governance Committee reviews quarterly and believes arrangements do not pose material risk (no margin accounts; loans for outside ventures) . |
| Stock Ownership Guidelines | Executive Chair/CTO required to hold 250,000 shares; Ellison’s holdings exceed requirement by >4,600x . |
| Hedging & Pledging Policies | Anti-hedging applies to all; anti-pledging applies to all except Ellison (subject to strict oversight and pre-clearance) . |
Outstanding Equity Awards (as of 5/31/2025)
| Award Type | Grant Date | Exercisable (#) | Unexercisable (#) | Unearned PSOs (#) | Strike ($) | Expiration |
|---|---|---|---|---|---|---|
| PSOs/Options | 7/20/2017 | 7,500,000 | 5,000,000 | 5,000,000 | 51.13 | 7/20/2025 |
Option Exercises and Value Realized (FY 2025)
| Shares Exercised | Exercise Price | Expiration | Value Realized ($) |
|---|---|---|---|
| 2,250,000 | $40.47 | July 24, 2024 | $230,992,425 . |
Intrinsic Value of Unvested Equity (indicative)
| Scenario | Intrinsic Value ($) |
|---|---|
| Acceleration on death (unvested RSUs and PSO tranches methodology) | $572,000,000 . |
| Double-trigger change in control (unvested RSUs, in-the-money options; PSO tranches deemed earned to extent MC goals met pre-CIC) | $1,144,000,000 . |
Employment Terms
| Term | Detail |
|---|---|
| Employment Type | At-will; no individual severance agreements for U.S. NEOs (including Ellison) . |
| Change-in-Control | No single-trigger benefits; double-trigger acceleration of RSUs/time-based options if awards not assumed or termination without cause within 12 months post-acquisition; PSO rules addressed during performance period (now ended FY25) . |
| Clawback | SEC-compliant policy; recovery in case of restatement or significant misconduct (also permits recovery where aware/willfully blind) . |
| Hedging/Pledging | Anti-hedging for all; anti-pledging for all except Ellison with Governance Committee oversight and pre-clearance . |
| Deferred Compensation | Cash and RSU deferral programs available; RSU settlement deferral permitted . |
| Pension/SERP | No executive pensions or SERPs for U.S. NEOs; standard benefits only (Ireland exception for an Irish-based executive) . |
Board Governance
- Role and tenure: Executive Chair and CTO since September 2014; Director since 1977; non-independent director .
- Committee memberships: Ellison does not serve on standing Board committees; all standing committees (Finance & Audit, Compensation, Governance, Independence) are 100% independent .
- Lead Independent Director: Rotates annually among committee chairs; currently Bruce R. Chizen (also Governance Chair) .
- Board leadership structure: Separate Chair and CEO roles; majority of independent directors; annual elections; executive sessions held after each regular Board meeting (four in FY25) .
- Pledging oversight: Governance Committee oversees Ellison’s pledging quarterly, reports to F&A Committee and Board .
- Director compensation: Executive directors (including Ellison) do not receive separate director pay; non-employee directors receive cash retainers and annual RSUs (e.g., $52,500 base retainer; additional committee retainers; annual RSUs reduced to 2,114 units in FY25) .
Compensation Structure Analysis
- No new equity awards in FY25 for Ellison; five of seven PSO tranches vested over the eight-year period ending FY25, emphasizing long-term, stockholder-aligned outcomes .
- Annual cash bonus reduced to $0 despite achievement levels to preserve capital—shows discretionary control and capital allocation priority over short-term cash payouts .
- Bonus metric tethered to non-GAAP operating income growth, consistent with broader employee bonus funding—alignment across the enterprise .
- No severance packages, single-trigger CIC, or tax gross-ups; robust clawback—shareholder-friendly posture .
Compensation Peer Group (Benchmarking)
| Peer Companies (FY25) |
|---|
| Accenture plc; Adobe Inc.; Alphabet Inc.; Amazon.com, Inc.; Apple Inc.; Cisco Systems, Inc.; Hewlett Packard Enterprise; Intel Corporation; IBM; Meta Platforms, Inc.; Microsoft Corporation; QUALCOMM Incorporated; Salesforce, Inc.; SAP SE . |
- Use of peer data: Informational; committee did not tie compensation to specific percentile targets .
Say-on-Pay & Shareholder Feedback
| Year | Say-on-Pay Approval (%) |
|---|---|
| 2024 | 78% . |
- Ongoing outreach: Compensation Committee meets with large institutional investors; responsiveness documented and incorporated into FY26 equity program design for other executives .
Company Performance (context for alignment)
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Revenues ($) | $49,954,000,000 | $52,961,000,000 | $57,399,000,000 |
| EBITDA ($) | $19,778,000,000* | $21,227,000,000* | $23,486,000,000* |
*Values retrieved from S&P Global.
Additional FY25 highlights: GAAP cloud services and license support revenues $44B (+12% YoY); $5.3B capital returned (repurchases/dividends) .
Risk Indicators & Red Flags
- Pledging: 346M shares pledged (exception to anti-pledging policy); while governance oversight is strong and Board deems risk immaterial, concentrated leverage can create forced-sale risk under stress—monitor LTV and market conditions .
- Option activity: Large exercises to avoid expiration (e.g., 2.25M shares exercised at $40.47 in FY25), potentially contributing to insider selling pressure around expirations .
- Governance mitigants: Independent committees, robust clawback, anti-hedging, no single-trigger CIC, no severance/gross-ups, majority independent Board .
- Related party review: Independence Committee oversees related person transactions and director independence determinations .
Investment Implications
- Alignment: Extraordinary ownership (40.6%) and PSO structure tightly link Ellison’s incentives to sustained stock appreciation and cloud growth; minimal fixed pay and no severance reduce moral hazard .
- Capital allocation signal: FY25 bonus reduction to $0 despite achievement signals management’s preference to fund growth (AI/OCI capacity, product innovation) over cash comp—supportive for long-term value creation .
- Risk monitor: Pledging is the key governance risk; Board oversight is detailed, but investors should track any changes in pledged amounts, loan terms, and market stress that could trigger sales .
- Trading cues: Watch option expiration calendars and potential exercises/settlements for supply effects; Ellison’s prior expirations prompted sizable exercises . Cloud KPIs embedded in PSOs (now completed) historically acted as catalysts; current performance focus remains on revenue growth and OCI momentum .