Form 4: Cirrus Logic EVP Alberty's Equity Transactions

Cirrus Logic EVP Carl Jackson Alberty reported the vesting of performance-based and restricted stock units, along with new equity grants and tax-related share withholdings.

Summary

• Carl Jackson Alberty, EVP, MSP at Cirrus Logic, Inc. (CRUS), reported several equity transactions.
• 2,450 shares of common stock vested from Market Stock Units (MSUs) based on a 113% payout percentage, determined by Total Shareholder Return (TSR) relative to the Philadelphia Semiconductor Index over a three-year period ending February 6, 2026.
• 3,012 shares of common stock vested from Restricted Stock Units (RSUs) on February 6, 2026.
• The company withheld 597 shares and 781 shares of common stock, valued at $142.78 per share, to satisfy tax withholding requirements related to the vested MSUs and RSUs, respectively.
• Mr. Alberty was granted 5,140 new Restricted Stock Units (RSUs) on February 5, 2026, which will vest 100% on February 5, 2029.
• Mr. Alberty was also granted 4,141 new Performance Shares (MSUs) on February 5, 2026, with vesting contingent on achieving pre-established performance metrics (TSR relative to the Russell 3000 index) over a three-year period ending February 5, 2029.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this filing as generally positive, reflecting the successful vesting of performance-based awards and the ongoing alignment of executive incentives with future company performance, which are routine but healthy signs for corporate governance and executive retention.

Positives

• The executive received a significant number of shares (2,450 from MSUs and 3,012 from RSUs) from vested equity awards, indicating the achievement of past performance metrics and vesting schedules.
• The 113% payout for MSUs suggests Cirrus Logic's Total Shareholder Return (TSR) outperformed the component companies of the Philadelphia Semiconductor Index over the 2023-2026 performance period.
• New grants of 5,140 RSUs and 4,141 MSUs align executive incentives with the company's future performance and long-term shareholder value creation.

Negatives

• A total of 1,378 shares (597 and 781) were withheld by the company to cover tax obligations, which is a standard practice but reduces the net shares received by the executive.

Risks

• The vesting of the newly granted Performance Shares (MSUs) is contingent upon the achievement of pre-established performance metrics (Total Shareholder Return relative to the Russell 3000 index) over a three-year period, introducing performance risk for the executive's future compensation.

Future Outlook

The grant of new performance-based equity awards (MSUs) tied to Total Shareholder Return (TSR) relative to the Russell 3000 index for a period ending February 5, 2029, indicates a long-term incentive structure for executive compensation, aligning management's interests with future shareholder value creation.

Industry Context

StockSavvy.ai notes that tying executive compensation to relative Total Shareholder Return (TSR) against industry indices like the Philadelphia Semiconductor Index (for past awards) and broader market indices such as the Russell 3000 (for new awards) is a common and well-regarded practice in the technology and semiconductor sectors. This approach effectively aligns executive incentives with shareholder value creation and market performance, encouraging management to focus on competitive returns.

Comparison to Industry Standards

• The use of relative Total Shareholder Return (TSR) against a peer group, such as the Philadelphia Semiconductor Index, for performance-based awards is a standard practice in the semiconductor industry, observed in companies like NVIDIA, Intel, and Qualcomm.
• A 113% payout for the vested MSUs suggests above-target performance relative to the Philadelphia Semiconductor Index, indicating strong relative TSR for Cirrus Logic during the 2023-2026 period, which compares favorably to peers that might have achieved lower payout percentages.
• The grant of new MSUs tied to the Russell 3000 index for future performance is a broader market comparison, often used by larger companies or to diversify the peer group beyond a narrow industry focus, similar to practices seen in diversified tech companies like Texas Instruments or Analog Devices.

Related Party Transactions

• The reported transactions involve an executive (Carl Jackson Alberty) and the company (Cirrus Logic, Inc.), which are standard related-party dealings for executive compensation and are disclosed as required by SEC regulations.

Stakeholder Impact

• Shareholders: The executive's incentives are aligned with shareholder value creation through performance-based equity awards. The achievement of past performance metrics leading to MSU vesting suggests value creation relative to peers.
• Employees: Standard executive compensation practices, including performance-based awards, can reflect overall company performance and contribute to a culture of accountability.

Next Steps

• The newly granted Restricted Stock Units (RSUs) are scheduled to vest on February 5, 2029.
• The newly granted Performance Shares (MSUs) will be evaluated based on performance metrics over a three-year period ending February 5, 2029, to determine the final number of shares to be acquired.

Key Dates

Recommendation

This Form 4 filing details routine executive compensation events, including the vesting of previously granted equity awards and the grant of new ones. While the vesting indicates past performance achievement and the new grants align executive incentives, these are standard operational disclosures and do not present new information that would fundamentally alter the investment thesis for Cirrus Logic. Therefore, a 'hold' recommendation is appropriate as the filing does not provide a strong catalyst for either buying or selling.

Keywords

Cirrus Logic, CRUS, Form 4, executive compensation, restricted stock units, performance shares, Market Stock Units, TSR, semiconductor industry, insider transactions