George Kao
Super Micro ComputerAbout George Kao
George Kao (64) is Senior Vice President of Operations at Super Micro Computer (SMCI); he joined the company in October 2016 after senior operations roles at Pericom Semiconductor and Orient Semiconductor Electronics Philippines. He holds a B.S. in Electrical Engineering from California State Polytechnic University, San Luis Obispo . During FY2024, SMCI’s revenue grew 110.4% to $14,989.3 million and net income rose 80.1%, while the stock price appreciated 229% between June 30, 2023 and June 28, 2024—a key KPI in Kao’s performance plan .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Super Micro Computer, Inc. | SVP Operations; previously VP Operations | Oct 2016–present | Leads global operations amid rapid AI-driven growth; brought performance-based incentives into Ops in FY2024 . |
| Pericom Semiconductor Corp. | Vice President of Operations | Oct 2006–Sep 2016 | Scaled semiconductor operations and supply chain . |
| Orient Semiconductor Electronics Philippines, Inc. (subsidiary of Orient Semiconductor Electronics Ltd.) | Chief Operating Officer | Jul 2003–Mar 2006 | Ran Philippines operations; manufacturing execution . |
| Foveon; National Semiconductor | Various technology roles (U.S.) | ~1983–2003 (20-year U.S. tech career) | Engineering and operations foundation; pipeline to COO role . |
External Roles
No external public company board roles or committee positions for Kao are disclosed in company filings .
Fixed Compensation
| Component | FY2024 Detail |
|---|---|
| Base Salary (rate at end of FY) | $411,649 . |
| Fixed Bonus % of Base Salary | 16% (set by CEO within Compensation Committee-approved range) . |
| Fixed Bonus Paid (cash) | $49,398 (semi-monthly) . |
Performance Compensation
| Metric | Weighting | Target Definition | Actual FY2024 | Payout Component | Vesting |
|---|---|---|---|---|---|
| Stock Price Increase KPI | 1x | 100% stock price increase counts as 1.00 | 229% (2.29) | Included in total multiple | PRSUs granted Feb 27, 2025; generally vest in equal annual installments over ~4 years from July 1, 2024 . |
| Worldwide Revenue KPI | 1x | 100% YoY revenue increase counts as 1.00 | 110% (1.10) | Included in total multiple | PRSUs vesting as above . |
| Compensation Adjustment Factor | 1x | CEO discretion (scale 1.0–3.0) | 2.00 | Included in total multiple | — |
| Aggregate Multiple | — | Sum of weighted scores | 5.39 | Determines incentive value | — |
| Base Incentive Unit | — | % of Base Salary | 8% of Base ($32,931.89) | ||
| Total Earned Performance Incentive Award | — | Multiple × Base Incentive Unit | $177,503 | 50% cash ($88,751) + 50% PRSUs ($88,751) | PRSUs: 2,412 units, granted Feb 27, 2025; vest annually over ~4 years from July 1, 2024 . |
Other FY2024/FY2023 Equity Awards to Kao
| Grant Type | Quantity | Grant/Key Dates | Vesting |
|---|---|---|---|
| Special Recognition RSUs | 10,000 | Granted Aug 11, 2023 | 50% vested Aug 15, 2023; 50% vested Feb 15, 2024 . |
| FY2024 Performance PRSUs (earned) | 2,412 | Granted Feb 27, 2025 | Equal annual installments over ~4 years from July 1, 2024 . |
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Total Beneficial Ownership (as of Mar 31, 2025) | 237,999 shares . |
| Ownership % of Shares Outstanding | Less than 1% . |
| Options Exercisable within 60 days | 216,720 . |
| RSUs Issuable within 60 days | 1,830 . |
| Notes on Pledging/Hedging | Insider policy prohibits hedging and derivative transactions; no pledging noted in ownership table footnotes . |
Employment Terms
- Employment Arrangement: At-will, via signed offer letter; no formal employment agreement .
- Severance/Change-of-Control: No severance or change-of-control benefits for NEOs (CEO award has specific treatment; not applicable to Kao) .
- Clawback: Company-wide clawback policy effective Oct 25, 2023 for excess incentive-based compensation upon restatements; prior recoupment policy also applies to earlier awards .
- Perquisites: None provided to NEOs .
- Retirement/Pension: Eligible for employee-funded 401(k); no SERP or defined benefit plans .
- Insider Trading: Trading window governance; grants typically scheduled post-earnings; hedging/derivatives prohibited .
Compensation Structure Analysis
- Shift to performance-based pay: FY2024 marked Kao’s first year under a KPI-based program (stock price appreciation, revenue growth), with payouts split between cash and multi-year vesting PRSUs, increasing at-risk, performance-linked compensation .
- Fixed vs variable mix: Fixed bonus set at 16% of salary to support retention while overall cash comp remained below peer median rationale; the majority of incremental value came via performance awards with four-year vesting .
- Governance controls: Robust clawback and insider trading policies reduce misalignment and risk of opportunistic trading around grants .
Say-on-Pay & Shareholder Feedback
- The January 22, 2024 say-on-pay vote received ~97% approval, supporting the company’s pay-for-performance approach and expanded KPI programs for non-CEO NEOs (including Kao) .
Vesting Schedules and Potential Selling Pressure
- Recognition RSUs: 10,000 units vested 50% on Aug 15, 2023 and 50% on Feb 15, 2024, creating discrete vest events .
- FY2024 PRSUs: 2,412 units granted Feb 27, 2025 vest in equal annual installments over ~4 years from July 1, 2024, implying ongoing annual supply; insider policy prohibits hedging and requires trading-window compliance .
Investment Implications
- Alignment: Kao’s compensation is materially tied to stock price appreciation and revenue growth with multi-year PRSU vesting, aligning operating decisions with shareholder value creation .
- Retention: Modest salary increases and fixed bonus support retention, but at-will status and absence of severance reduce exit costs; ongoing PRSU vesting enhances stickiness through 4-year horizons .
- Supply overhang: Annual PRSU vesting and pre-existing exercisable options (216,720) may create periodic selling pressure, though hedging is prohibited and trading must occur within windows .
- Governance/risk: Formal clawback and disciplined grant timing mitigate governance risk; no perquisites or tax gross-ups reported, and no pledging noted in ownership footnotes for Kao .