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Alphabet Inc. approved a new compensation package for CEO Sundar Pichai, with a $2 million base salary and $692 million in stock awards vesting over three years.
Google CEO Sundar Pichai speaking at the India AI Impact Summit 2026. (PTI)
Alphabet Inc. has approved a new long-term compensation package for its CEO Sundar Pichai as part of its triennial (three-year) pay structure.
The company’s board cleared the package on March 4, 2026. The compensation is largely equity-based and performance-linked, meaning Pichai will earn the full value only if the company meets certain targets.
His base salary remains unchanged at $2 million annually, and he is not eligible for a yearly bonus, similar to the structure followed in previous years.
The newly approved stock awards together are estimated to be worth about $692 million (around Rs 6,360 crore).
Performance Stock Units (PSUs): Linked To Shareholder Returns
A major part of the compensation comes through performance stock units (PSUs).
Alphabet granted two PSU tranches worth $63 million each. These payouts depend on the company’s total shareholder return compared with companies in the S&P 100 index.
The performance periods are:
- 2026–2027 for the first tranche
- 2026–2028 for the second tranche
If Alphabet’s performance is strong relative to peers, Pichai could receive up to 200% of the target shares. However, if performance is weak, the payout could also fall to zero.
Restricted Stock Units (GSUs): Time-Based Vesting
Another portion of the package includes $84 million worth of restricted stock units (GSUs).
These shares will vest gradually over three years, starting March 2026 and continuing monthly until January 2029, provided Pichai remains CEO during the vesting period.
Each vested unit converts into Alphabet Class C shares.
Big Bet On Waymo And Wing
The package also includes incentives tied to Alphabet’s “Other Bets” businesses.
Pichai received:
- $130 million worth of Waymo BPUs
- $45 million worth of Wing BPUs
BPUs are units that convert into ownership stakes in specific Alphabet projects, but only if those businesses increase in value.
These performance units will vest only if the value of Waymo and Wing rises over a three-year period. If there is no increase in valuation, he earns nothing from this component.
This move aims to push leadership focus on scaling futuristic businesses like autonomous driving and drone delivery.
Why Alphabet Structured The Pay This Way
Alphabet’s board said the compensation structure is meant to:
- Align CEO pay with long-term shareholder value
- Incentivize growth in new technology ventures
- Reward leadership in scaling high-potential projects like Waymo and Wing
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March 08, 2026, 12:05 IST
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