Stock-based compensation to revenue
What it measures¶
Stock-based compensation (SBC) is pay given to employees in the company's own shares or share options instead of cash. It is a real cost to the owners — each new share dilutes their slice — but because no cash leaves the company, it is added back in the cash-flow statement. The ratio divides it by revenue.
Why it is on the page¶
A company can look highly cash-generative while paying a large part of its staff in shares. The ratio shows how large that hidden cost is against sales.
Thresholds, their source and the population they were fitted on¶
| Reference | Line | Source |
|---|---|---|
| Fundamentals page | above about 10% flags stock pay as a material hidden cost | the product's research archive |
- Fitted on: no statistical sample — a practitioners' line, most relevant to technology companies.
- Evidence grade: practitioner convention.
A worked example¶
Apple, as the condition summary described fiscal 2025 on 25 October 2026: stock-based compensation of 12.9 billion US dollars was added back to reach operating cash flow. Against revenue of about 416 billion, that is roughly 3% — under the 10% line.
Celestica, as the Fundamentals page showed it on 9 August 2026: the figure was not sourced — the data provider carried no line for it, so the row read — rather than 0.
What “No verdict” means here¶
The row carries no verdict of its own. It reads a dash when stock-based compensation is not stored: an absent cost is not a zero cost.
What the verdict is and is not¶
The figure describes one year's stock pay against sales. It is not a judgement of the company's pay policy, not a forecast, and not an instruction to trade the shares.