Compensation Advisory Partners (CAP) assessed burn rate and market trends taken by 53 companies in the Technology industry throughout the past three years. These companies were split into three groups by revenue size: $500 million to $2 billion, $2 billion to $5 billion, and over $5 billion in revenue over the last 12 months. Key findings include:

• Burn rate has trended upward over the past three years across all 3 groups
• Stock-based compensation expense has increased each year, though the median rate of increase has slowed in recent years
• Market volatility heavily impacts this industry, leading to fluctuations in company market capitalization, burn rate and equity use. As a result, companies may adjust their compensation spend and equity grant practices from year to year
• Among all the companies in our sample, 2022 saw the biggest decline in TSR, with a rebound in 2023 TSR; TSR in the $5B+ revenue group was impacted the least. To date, 2024 returns have been relatively flat
• As stock price falls (or rises), companies need to use more (or less) shares to deliver the same dollar value of equity. Tech companies needed to award larger equity awards to attract and retain key talent as the labor market tightened; this combined with recent stock price fluctuations has driven up both burn rate and stock-based compensation expense in recent years

The PDF of the report provides additional data for the Technology industry.
The market trends that CAP is tracking include burn rate; changes to stock-based compensation expense; total shareholder return (TSR); and market volatility.