JetBlue Airways slashed its chief executive’s cash bonus last year after a majority of shareholders voted against its executive pay packages, according to documents filed Wednesday with the U.S. Securities and Exchange Commission.
JetBlue CEO Joanna Geraghty saw her bonus shrink in 2024 to $385,000, compared to more than $1.7 million for the previous year, when she served as the Queens-based airline’s president and COO, the SEC filing states. Geraghty’s overall compensation dropped by more than 24% in 2024 to $6.7 million, compared to $8.9 million the previous year, largely due to her bonus taking a hit.
The blow to Geraghty’s pay follows a vote last May where the majority of the airline’s shareholders rejected compensation packages for JetBlue’s executives. The airline’s compensation committee said, in response to shareholder feedback, that in June it voted to cap executive’s annual bonuses to no more than 100% of base salary (down from up to 175% for Geraghty’s annual salary of $700,000). The airline’s compensation committee said in the SEC filing that it took the action following a failed merger with Spirit Airlines in early 2024, “recognizing that post-merger goal resets were no longer feasible following the [Department of Justice’s] decision to block the merger.”
“The decision reflected JetBlue’s operating and financial environment and served as a proactive response to stockholder feedback given our low Say-on-Pay vote,” JetBlue’s SEC filing states.
Teri McClure, the chair of JetBlue’s compensation committee, wrote in the filing that the changes to its executive pay “reflect our commitment to aligning executive compensation with both performance and stockholder expectations.”
As a result of the May stockholder vote, JetBlue said it committed the remainder of 2024 to listening to stockholders’ concerns and gathering their feedback. Shareholders consistently told the airline that they wanted enhanced disclosure for “Ms. Geraghty’s special equity award” and “Spirit-related transaction incentive awards,” among other metrics, the SEC filing shows. JetBlue said the airline’s shareholders also called for “a closer tie to individual performance and financial and operational performance” for bonuses.
Last year all three major ratings agencies downgraded JetBlue’s credit after it announced plans to issue $3 billion in debt, following its failed Spirit merger. The carrier, in the months since, has bolstered its footprint in the Northeast, adding new routes like daily flights from John F. Kennedy International Airport to Washington D.C., Detroit and Pittsburgh, plans to open new lounges in New York and Boston this year, and says it will launch new premium seating. Aviation analysts have said they are encouraged by the changes, but worry it could take years to pay off.
JetBlue’s shares have plummeted to under $5 per share, down nearly 42% in the year to date.
