Former AOL exec receives millions in golden parachute from Verizon

The former head of Verizon’s ailing digital media division is set to walk away with a multimillion dollar golden parachute.

Tim Armstrong left in December, around the time Verizon reported that Oath, its media arm, had an almost worthless brand value. Armstrong took home more than $30 million in stock awards, cash and other compensation in 2018, according to public filings posted Monday.

He’ll also get a $6.5 million severance package and an estimated $23.6 million in additional stock awards, depending on how the company performs, according to the filings and a spokesperson for the company.

Oath from Verizon

Armstrong, a former Google executive, headed AOL when it was snapped up by Verizon for $4.4 billion in 2015. Verizon also spent billions to purchase Yahoo in 2017 and dubbed its combined media arm Oath, which it hoped to build up to compete with giants Facebook and Google in the online ads sector.

But Oath hasn’t made much of a dent in the duopoly. Armstrong exited Oath’s CEO seat at the end of September and left the company entirely in December, just as Verizon announced it was forced to take a $4.6 billion writedown on Oath’s brand value.

The segment was rebranded as Verizon Media in December, and in January it announced layoffs affecting 7% of its staff.

Still, the digital content division is a drop in the bucket for Verizon’s overall business: The company has a market value of more than $230 billion.

Last June, Verizon signaled that it wanted to focus primarily on its wireless technology when it named Hans Vestberg, the former chief technology officer, as its new CEO. He was behind Verizon’s 4G LTE rollout and its plans to build a 5G wireless broadband network.

Verizon says its media brand is essentially worthless

But Armstrong’s total payout for 2018 eclipsed Vestberg’s $22 million compensation package in large part because of a “founders award,” which is a stock-based incentive award pledged to Armstrong in 2015 after the AOL merger.

Armstrong received the first slice of that award, $31.1 million, in June 2018, the filings show. And he’s due to receive a second piece in June of this year — though right now it’s estimated to be $16.6 million, reflecting the massive writedown Oath took in December. That could change depending on what Oath is worth later this year.

Armstrong is also due to receive about $7 million in equity awards this year, depending on how Verizon’s stock performs.