An employee at NVIDIA, who earns $250,000 per year, said that the company's earnings are not as rosy as some may think. He anonymously told Business Insider that while some NVIDIA employees may be lucky enough to become millionaires, it is not always the case. The publication verified the identity and wealth of the interviewee.
A software engineer who joined the company a few years ago receives almost half of his base salary in RSUs (restricted stock units).
"If you look from afar and say that NVIDIA employees are millionaires, then that is absolutely true, but this million doesn't go too far. Because the stocks have soared to the sky, there is an expectation that everyone has earned a lot of money. In reality, the RSUs you receive are a major part of your exponential wealth growth, and not everyone will earn a lot," he said.
Even if some employees receive a lot of RSUs, not all of them always retain this wealth.
"In the end, you will cash out your stocks to meet your annual personal tax obligations, property levies, and any other expenses," he said.
NVIDIA, which employs around 26,000 people, has benefited significantly from the boom in generative artificial intelligence. Its stock has soared in the last 12 months, making it the most expensive company after Microsoft and Apple. However, on Friday, NVIDIA's shares fell by 10% and are now nearly $200 below the March peak.
NVIDIA engineers have ranks ranging from level 1 to level 8. The interviewee has the fourth level. He said he is often asked on social media how much he earns. He claims it is a misconception that all NVIDIA employees have a lot of money, as most of their wealth is stored in stocks, and taxes take a lot.
The employee claims that in California, where NVIDIA has four offices, a million "is not a large figure", because housing prices and the cost of living are usually high. He adds that "life happens", meaning there are always unexpected bills or expenses.
The biggest purchase he made after selling some of his NVIDIA shares was a $250,000 down payment for his three-bedroom house costing almost $1.4 million.
There is also a limit on the number of stock units employees can receive. Even the most exemplary employees have restrictions on receiving 50% of their base salary in a year. This means that an NVIDIA employee earning $1 million per year cannot be considered wealthy in a place like San Francisco. According to a 2023 study, to be "wealthy", you need to have $4.7 million.
Furthermore, there is a significant disparity in the pay of NVIDIA employees in the U.S. and other countries. A software engineer in India, at the third level, receives a base salary of around $19,000.
"I am still happy where I am, and I am glad I made it, but it is not as rosy as it looks from the outside. I am very pleased with the price at which NVIDIA shares are trading."
The rise in stocks helped make CEO Jensen Huang one of the wealthiest people in the world. He ranks 21st on the Bloomberg Billionaires Index with a fortune of around $67 billion.
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