Spencer Stiles
STRYKERAbout Spencer Stiles
Spencer S. Stiles is Group President, Orthopaedics at Stryker; he became Group President Orthopaedics & Spine in August 2019 after joining Stryker in 1999, and was named a Named Executive Officer in October 2021 . He oversees Joint Replacement, Trauma & Extremities and Digital/Robotics/Enabling Technologies with direct responsibility for EMEA, LATAM, Canada, and enterprise M&A; he holds a BA from Miami University and an MBA from the University of Nebraska . Company performance during his tenure as NEO shows strong growth: net sales +11.1% in 2023 and +10.2% in 2024; adjusted EPS +13.5% (2023) and +15.0% (2024), with dividends per share rising to $3.20 in 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Stryker Communications | General Manager | ~3 years | Led Communications business unit |
| Stryker Spine | President | ~4 years | Grew Spine; global leadership roles |
| Stryker Instruments | President | >3 years | Led Instruments; operating model/globalization |
| Stryker Neurotechnology, Instruments & Spine | Group President | 2018–2019 | Design of Transatlantic Operating Model; key acquisitions integration |
External Roles
| Organization | Role | Notes |
|---|---|---|
| Chart Industries (NYSE: GTLS) | Director | Public company board |
| Medical Device Manufacturers Association (MDMA) | Director | Industry association board |
Fixed Compensation
Multi-year compensation actually paid (SEC Summary Compensation Table):
| Metric ($USD) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | 695,833 | 720,833 | 750,000 |
| Non-Equity Incentive (cash bonus paid) | 452,277 | 1,174,500 | 917,325 |
| All Other Compensation | 136,684 | 129,042 | 211,695 |
| Total Compensation | 5,711,874 | 6,487,347 | 6,759,339 |
2023–2025 salary/target bonus decisions:
| Item | 2023 | 2024 | 2025 |
|---|---|---|---|
| Annualized Base Salary ($) | 725,000 | 755,000 | 800,000 |
| Target Bonus ($) | 652,500 | 679,500 | 760,000 |
| Target Bonus (% of salary, derived) | 90% | 90% | 95% |
Performance Compensation
2024 individual bonus plan metrics for Stiles (weights shown are plan target weights):
| Metric | Weight | Threshold | Target | Actual | Payout Contribution |
|---|---|---|---|---|---|
| Adjusted operating income – Orthopaedics Group | Core 10% | $2.156B; (4.6)% vs 2023 | $2.396B; +5.9% | $2.446B | 10.0% |
| Adjusted operating income – Consolidated | Core 10% | $5.045B; +1.8% | $5.606B; +13.1% | $5.826B | 10.0% |
| Adjusted operating income margin – Consolidated | Core 20% | 25.00%; +3.4% | 25.25%; +4.5% | 25.70% | 20.0% |
| Constant currency sales – Orthopaedics Group | Core 20% | $8.488B; +1.8% | $8.935B; +7.2% | $9.094B | 20.0% |
| Constant currency sales – Consolidated | Core 20% | $21.092B; +2.9% | $22.202B; +8.3% | $22.670B | 20.0% |
| Free cash flow excluding recall payments – Consolidated | Core 20% | $2.656B; (15.4)% | $3.320B; +5.7% | $3.552B | 20.0% |
| Adjusted operating income – Orthopaedics Group | Overachievement 17.5% | $2.396B; +5.9% | $2.516B; +11.2% | $2.446B | 2.7% |
| Adjusted operating income – Consolidated | Overachievement 17.5% | $5.606B; +13.1% | $5.830B; +17.7% | $5.826B | 6.3% |
| Constant currency sales – Orthopaedics Group | Overachievement 17.5% | $8.935B; +7.2% | $9.203B; +10.4% | $9.094B | 10.4% |
| Constant currency sales – Consolidated | Overachievement 17.5% | $22.202B; +8.3% | $22.868B; +11.6% | $22.670B | 12.3% |
| Adjusted net EPS – Consolidated | Overachievement 30% | $11.87; +12.0% | $12.46; +17.5% | $12.19 | 3.3% |
| CR commitments modifier | +/-10% | — | — | No adjustment | 0.0% |
| Total payout vs target | — | — | — | — | 135.0% |
Additional design levers:
- Bonus payments require minimum adjusted consolidated operating income of $4.48B, and overachievement payouts are gated by adjusted operating income margin targets .
- 2023 payout was 180% of target (after downward adjustment vs calculated >180%) reflecting above-target performance across measures .
Long-term incentives and vesting:
- 2024 grant: PSUs target 7,416; stock options 19,780 at $339.77 exercise price; PSUs settle in early 2027 after the 2024–2026 performance period; options vest 20% annually over five years .
- 2025 grant decision: PSUs target 6,728; options 13,458 at $392.39; PSUs settle in early 2028; PSU measures are three-year average adjusted EPS growth and relative reported net sales growth (0–200% payout) .
- Historical PSU outcomes: 2021 PSUs vested at 148% of target (relative net sales growth at 94th percentile; EPS growth 8.8%) ; 2022 PSU payout was ~174% of target for the 2022–2024 cycle .
Equity Ownership & Alignment
| Item (as of Feb 28, 2025) | Amount | Notes |
|---|---|---|
| Shares owned (direct/indirect) | 57,010 | Excludes shares acquirable within 60 days |
| Right to acquire within 60 days (options/RSUs/PSUs) | 158,581 | Includes options and awards vesting within 60 days |
| Total beneficial ownership | 215,591 | Less than 1% of outstanding |
| Option exercises (2024) | 0 | No exercises; reduces selling pressure |
| Shares vested (2024) | 9,966; $3,530,092 value | RSUs/PSUs incl. dividend equivalents |
Ownership policies and alignment levers:
- Stock ownership guideline: 3× salary for NEOs; compliance or projected to comply within 5 years; 25% of net shares from option exercises cannot be sold until guideline met .
- Hedging/pledging: Prohibited to hedge or pledge Stryker securities (with limited grandfathered exceptions); margin accounts disallowed .
- Clawbacks: Broad recoupment policy (2015) for misconduct/quasi-compliance failures and mandatory clawback policy (Oct 2023) for restatements under SEC/NYSE rules .
Employment Terms
- Employment/severance agreements: Stryker generally does not provide employment or severance agreements; no contractual change-in-control cash payments for NEOs .
- Non-compete: Executives sign confidentiality/non-compete agreements; Mr. Stiles signed a version that does not contemplate payment to enforce restrictions (only Mr. Pierce’s agreement includes potential paid non-compete) .
- Change-in-control equity: Committee may accelerate vesting, deem performance satisfied, or cash out options (FMV less strike) within 60 days post-CIC; minimum one-year vesting for awards granted after May 8, 2025 with limited exceptions .
- Unvested equity value sensitivities (12/31/2024): Death/Disability $21,108,662; Change in Control $22,897,391 (closing price $360.05 basis) .
Compensation Structure Analysis
- Mix shift and risk: For 2024, salary 11%, cash bonus 14%, PSUs 39%, options 36% of primary elements—high pay-at-risk alignment with shareholders . PSUs emphasize multi-year adjusted EPS growth and relative sales growth; options maintain direct exposure to stock price without repricing .
- Benchmarking: Compensation decisions are reviewed annually against a medical technology peer set (Abbott, Boston Scientific, Medtronic, Danaher, Thermo Fisher, Zimmer Biomet, etc.), with target cash and LTI values “generally consistent” with philosophy per 2023–2024 studies .
- Governance strengths: No tax gross-ups (other than relocation/expatriate), no option repricing or buyouts, significant ownership requirements, and robust clawback regime; say-on-pay approvals ~87% (2023) and ~91% (2024) .
Investment Implications
- Alignment and incentives: High variable pay and multi-year PSU design tie payouts to EPS growth and relative top-line performance; strong ownership and anti-hedging/pledging policies reinforce alignment .
- Retention risk: No guaranteed severance/change-in-control cash; vesting continuity for retirees does not apply to Stiles (not retirement eligible per plan definition), which can strengthen retention value of awards . 2025 target bonus increased to 95% of salary with fresh PSUs/options, indicating ongoing retention/engagement .
- Selling pressure: No option exercises in 2024 and ownership guideline constraints reduce near-term selling risk; 2024 vesting of ~9,966 shares occurred via RSU/PSU programs .
- Change-in-control exposure: Equity acceleration cash value under CIC could be material ($22.9M) but remains purely equity-based—no contractual cash parachutes (shareholder-friendly) .
Appendix – Equity Grant Details
| Grant | Instrument | Quantity | Strike/Terms | Vesting/Settlement |
|---|---|---|---|---|
| Feb 7, 2024 | PSUs (target) | 7,416 | 0–200% payout based on EPS/relative sales | Settle early 2027 (2024–2026 period) |
| Feb 7, 2024 | Options | 19,780 | $339.77 strike; 10-year term | 20% per year × 5 years |
| Feb 4, 2025 | PSUs (target) | 6,728 | 0–200%; EPS/relative sales | Settle early 2028 (2025–2027 period) |
| Feb 4, 2025 | Options | 13,458 | $392.39 strike; 10-year term | 20% per year × 5 years |
Biography sources: Stryker management page and DeviceTalks profile .
Company performance context: Net sales, adjusted EPS and dividends from Stryker’s proxy statements .