Thought this was supposed to be announced quarterly…
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PSP has been a mystery the last few years. If I’m being honest I’ve never really understood the formula. Sometimes we have great years and PSP is lower than I would have expected based on earnings. Sometimes we have just OK years and PSP is higher than I would have expected. I’ve never seen anyone explain the formula so that a dummy like me can understand it.
Whatever the case I never base any spending decisions on anticipated PSP. To me it’s so variable that I don’t want to assume I’m getting XXXX only to be disappointed if it’s lower. Or much lower.
Same goes for profit sharing. I’ve never understood that formula either. A previous poster was correct. Profits have been good that last couple years but we were told “No profit sharing bonus”. Meanwhile with executive compensation being largely based on stock price our executives have made out like bandits the last few years while the rest of us get our 3% raises. I’d like to see Nike go the Netflix route where ALL employees get to decide what percentage of their salary is paid out in cash and what percentage, up to 100%, gets paid in stock. That adds both risk and the possibility for significant earnings upside and each employee can decide for herself how much risk she wants and can afford to take. I’d rather allocate maybe 20% of my salary to stock and get that upside most years as opposed to being tied to below-inflation small raises.
how about that profit sharing everyone got screwed out of the last few years.. as record profits were made.
Yes, you'll learn about PSP after the year closes, but the targets should be known well in advance. Before COVID, PSP was based on EBIT vs. annual Budget. During COVID, 1H and 2H targets were clearly communicated based on nonconventional metrics such as Digital Rev growth, Inventory management in addition to EBIT. Perhaps this fiscal year is based on 1H and 2H EBIT budgets, but there is no communication on this from what I've seen. If that is the case, the supply chain situation has erased any Bonus potential for FY22...
Any word on if they decided to move forward with determining PSP on an individual team basis?
@2msa, not exactly like EVERY previous year. Last year was different because how PSP was restructured. Now, starting this year, it is back how it used to be prior to last year.
You’ll learn about PSP after Q4 earnings, in June. Exactly like in every previous year.