Boston, MA 12/19/2013 (wallstreetpr) – Hewlett-Packard Company (NYSE:HPQ) has announced increase of the salary for its Chief Executive officer Meg Whitman. The CEO will now earn $1.5 million annually up from $1 million that she has been taking for the past two years. This comes as Whitman enters her third year with the struggling company.
When she joined the company, Whitman made the sacrifice which most good CEOs do when their aim is to turnaround a company. She accepted a salary lower than what her CEO-peers earn.
What is the justification for this salary increase for the Hewlett-Packard Company (NYSE:HPQ) chief? The first one has already been mentioned that she settled for a smaller salary than what her peers earn. The second reason has to do with her performance. The company has been able to eliminate a lot of financial burdens in its operations since Whitman came in.
These eliminations have been achieved through job-cuts and consolidation of resources to ensure that financial wastages are plugged. In so doing, the stock is up more than 20 percent since she joined HPQ and the stock has more than doubled this year. However, there is still more work to be done considering that the company is yet to realize meaningful revenue growth.
Whitman is a successful executive who made most of her wealth which is valued at approximately $1.9 billion while working with Internet bazaar eBay Inc (NASDAQ:EBAY). She left eBay to run for the California governor’s position, a bid that was unsuccessful.
Now out of politics, at least for now, Whitman now has the challenge of proving to investors that she deserves the salary increase and even future increases. Her immediate focus will be dealing with the declining PC business and the increasing competition for the printer business. This would mean developing more revenue sources.
A share of Hewlett-Packard Company (NYSE:HPQ) is currently trading around $27.51 and the company is valued at $53 billion in terms of market cap. Its outstanding shares are about 1.93 billion.
