Applied Materials is the global leader in materials engineering solutions, enabling the production of virtually every advanced semiconductor chip and display in the world. As the company continues to lead the semiconductor and display equipment industry, its CEO, Gary Dickerson, plays a pivotal role in shaping its growth and innovation.
In this blog, we’ll provide an in-depth look at Gary Dickerson’s salary, net worth, and the factors influencing his compensation.
About Applied Materials
Applied Materials is a global leader in materials engineering solutions, with its technology used to produce nearly every advanced chip and display in the world. The company plays a crucial role in the semiconductor industry by providing innovative solutions that help manufacturers improve the power, performance, and efficiency of their products.
Over the years, Applied Materials has been at the forefront of technological advancements, driving innovation in industries like artificial intelligence (AI), 5G, and advanced displays. The company’s financial performance and market dominance are a testament to its innovative capabilities and strong leadership.
Who is Gary Dickerson?
Background and Career Journey
Gary Dickerson has been a prominent figure in the semiconductor industry for over 35 years. He joined Applied Materials in 2012 as president and was appointed CEO in September 2013. Since then, Dickerson has been instrumental in driving the company’s growth and innovation.
Prior to joining Applied Materials, Dickerson served as the CEO of Varian Semiconductor Equipment Associates, Inc. for seven years. He also spent 18 years at KLA-Tencor Corporation, where he held various roles in operations and product development before becoming president and chief operating officer. Dickerson began his career in semiconductor manufacturing and engineering management at General Motors’ Delco Electronics Division and AT&T Technologies.
Education
- Bachelor of Science in Engineering Management from the University of Missouri, Rolla.
- MBA from the University of Missouri, Kansas City.
Achievements as CEO of Applied Materials
Since becoming CEO in 2013, Gary Dickerson has achieved remarkable milestones:
- Revenue Growth: Under his leadership, Applied Materials’ revenue has grown more than 3.5 times, setting records for profitability.
- Innovation: He has overseen the addition of over 8,500 new patents to the company’s portfolio.
- Sustainability Leadership: Dickerson has driven the company’s Net Zero 2040 initiative, promoting sustainability across the semiconductor supply chain.
- Recognition: He has received numerous accolades, including the SEMI Sustainability Excellence Award and the Public Service Star Award from Singapore for his contributions to the semiconductor industry.
Applied Materials CEO Salary Breakdown
Gary Dickerson’s compensation reflects his exceptional leadership and the company’s strong financial performance. For the 2024 fiscal year, his total compensation was approximately $27.8 million, which marked a slight increase from his 2023 compensation of $27 million.
Key Components of Gary Dickerson’s 2024 Compensation
- Base Salary:
- Dickerson’s base salary for 2024 was approximately $1.03 million.
- This fixed salary represents less than 4% of his total compensation, highlighting the company’s focus on performance-based pay.
- Stock Awards:
- The largest portion of Dickerson’s compensation—$24.86 million—came from stock awards.
- These awards are tied to the company’s performance, ensuring that the CEO’s earnings align with shareholder returns.
- Non-Equity Incentive Plan:
- Dickerson earned $1.75 million through the company’s non-equity incentive plan.
- This component rewards the CEO for achieving specific financial and operational goals.
- Other Compensation:
- Additional benefits, such as retirement contributions, health insurance, and other perks, were also included in his compensation package.
Year-Over-Year Comparison
- 2022 Total Compensation: $20.4 million.
- 2023 Total Compensation: $27 million (up by 32%).
- 2024 Total Compensation: $27.8 million (a modest increase from 2023).
This steady growth in compensation reflects Applied Materials’ strong financial performance and Dickerson’s role in driving the company’s success.
Gary Dickerson’s Net Worth
Estimated Net Worth
Gary Dickerson’s net worth is estimated to be over $200 million, thanks to his long and successful career in the semiconductor industry. His wealth is primarily derived from his substantial earnings at Applied Materials, as well as his previous leadership roles at Varian Semiconductor and KLA-Tencor.
- Stock Holdings:
- A significant portion of Dickerson’s net worth comes from his stock holdings in Applied Materials.
- With stock awards accounting for over 90% of his 2024 compensation, his wealth is closely tied to the company’s stock performance.
- Career Earnings:
- Dickerson has consistently earned multi-million-dollar compensation packages since becoming CEO in 2013.
- His total earnings during his tenure at Applied Materials have contributed significantly to his net worth.
- Other Investments:
- In addition to his earnings from Applied Materials, Dickerson may have other investments in real estate, financial assets, or private ventures.
Comparison to Industry Peers
- Pat Gelsinger (Intel CEO): Estimated net worth of $150–$200 million, with a total compensation of $89 million in 2022.
- Peter Wennink (ASML CEO): Estimated net worth of $120–$150 million, with a total compensation of $20 million in 2023.
- Tim Archer (Lam Research CEO): Estimated net worth of $100–$150 million, with a total compensation of $21 million in 2023.
Gary Dickerson’s compensation and net worth place him among the top earners in the semiconductor industry, reflecting Applied Materials’ leadership position and his role in its success.
CEO Pay Ratio and Industry Comparison
CEO-to-Median Employee Pay Ratio
In 2022, Applied Materials reported a CEO-to-median employee pay ratio of 201:1. This means Gary Dickerson earned 201 times more than the median employee at Applied Materials.
While this ratio may seem high, it is relatively common in the tech and semiconductor industries, where executive compensation is heavily influenced by stock awards and performance-based incentives.
Comparison to Industry Peers
- Intel CEO: Pat Gelsinger’s CEO-to-median employee pay ratio in 2022 was approximately 1,711:1.
- ASML CEO: Peter Wennink’s pay ratio was 282:1 in 2023.
- Lam Research CEO: Tim Archer’s pay ratio was 360:1 in 2023.
Compared to its industry peers, Applied Materials’ CEO pay ratio is relatively moderate, reflecting the company’s efforts to balance executive compensation with employee wages.
Factors Influencing Applied Materials CEO Compensation
1. Company Performance
- Applied Materials has experienced significant revenue growth under Gary Dickerson’s leadership, with revenue increasing by more than 3.5 times since he became CEO in 2013.
- The company’s strong financial performance, including record profitability and shareholder returns, plays a significant role in determining Dickerson’s compensation.
2. Innovation and Market Leadership
- Dickerson has driven Applied Materials to the forefront of the semiconductor and display equipment industry.
- The company’s focus on innovation has resulted in over 8,500 new patents during his tenure, solidifying its position as a global leader in materials engineering.
3. Sustainability Initiatives
- Applied Materials is leading the industry with its Net Zero 2040 playbook, which focuses on clean energy and sustainable practices.
- Dickerson’s leadership in promoting sustainability has garnered recognition, including the SEMI Sustainability Excellence Award.
4. Industry Trends
- The global semiconductor industry has faced significant challenges, including supply chain disruptions and fluctuating demand.
- Applied Materials’ ability to navigate these challenges and maintain its market leadership has been a key factor in determining Dickerson’s performance-based pay.
Public Perception and Controversy
Public Opinion on CEO Pay
- Supporters’ Perspective:
- Many believe Gary Dickerson’s compensation is justified, given Applied Materials’ exceptional growth and innovation under his leadership.
- The emphasis on performance-based pay ensures that his earnings are tied to the company’s success.
- Critics’ Perspective:
- Some critics argue that high CEO pay contributes to income inequality, particularly in industries with large pay gaps between executives and employees.
- The CEO-to-median employee pay ratio of 201:1 has raised questions about fairness in compensation practices.
Transparency in Compensation
Applied Materials is transparent about its executive compensation practices, providing detailed information in its annual proxy statements. This transparency helps build trust among stakeholders and ensures accountability in executive pay decisions.
Applied Materials’ Financial Performance and CEO Pay
Applied Materials has consistently delivered strong financial results under Gary Dickerson’s leadership. Key highlights include:
- Revenue Growth: The company’s revenue has increased more than 3.5 times since Dickerson became CEO in 2013.
- Profitability: Applied Materials has achieved record levels of profitability, driven by its leadership in semiconductor and display equipment.
- Global Expansion: The company has expanded its presence in key markets, including Singapore, where Dickerson was recently recognized for his contributions to the semiconductor industry.
These achievements have directly influenced Dickerson’s performance-based pay, which accounts for over 90% of his total compensation.
Future Outlook for Applied Materials CEO Compensation
Gary Dickerson’s compensation is expected to remain competitive in the coming years, driven by Applied Materials’ continued growth and innovation. Key factors influencing his future earnings include:
- Technological Advancements:
- Applied Materials is at the forefront of innovation in AI, 5G, and advanced display technologies.
- The company’s ability to capitalize on these trends will impact its financial performance and, in turn, Dickerson’s compensation.
- Sustainability Goals:
- The company’s commitment to achieving Net Zero emissions by 2040 will require significant investments in clean energy and sustainable practices.
- Successful implementation of these initiatives could enhance Applied Materials’ reputation and financial performance.
- Industry Growth:
- The global semiconductor market is expected to grow significantly in the coming years, creating opportunities for Applied Materials to expand its market share.
- Dickerson’s leadership in navigating this growth will likely influence his future pay.
Key Takeaways
- 2024 Compensation: Gary Dickerson earned $27.8 million, with over 90% of his pay coming from performance-based stock awards and incentives.
- Net Worth: Dickerson’s estimated net worth exceeds $200 million, driven by his long career in the semiconductor industry and substantial stock holdings in Applied Materials.
- CEO Pay Ratio: In 2022, the CEO-to-median employee pay ratio was 201:1, reflecting a significant but industry-standard pay gap.
- Leadership Impact: Under Dickerson’s leadership, Applied Materials has achieved record revenue growth, profitability, and innovation, justifying his compensation.
- Future Outlook: As Applied Materials continues to lead the semiconductor industry, Dickerson’s pay is likely to remain tied to the company’s financial and strategic success.
Conclusion
Gary Dickerson’s leadership at Applied Materials has been transformative, driving the company to new heights in revenue, profitability, and innovation. His compensation package of $27.8 million in 2024 reflects his pivotal role in the company’s success and is heavily tied to performance-based incentives.