SBC Expense
SBC is eating EPS
For companies with large equity programs, stock-based comp can represent 15-30% of revenue. Every quarter it depresses earnings and makes S&P 500 inclusion harder to achieve.
Solutions · Finance
85% Less SBC. Same Grants.
Reduce stock-based comp expense by up to 85% without changing what your employees receive. Unlock higher net income, better operating metrics, GAAP profitability, index eligibility and more by partnering with Carver Edison.
Request a demoThe challenge
The equity tradeoff finance teams inherit
Dilution
Buybacks exist to offset equity plans
70% of share repurchases by public companies exist solely to offset equity plan dilution, not to return capital. That's the buyback treadmill, and it costs the company twice.
EPS
Growth is masked by equity overhead
Real operational improvement gets obscured by SBC drag on reported earnings. Investors see diluted EPS declining even when the underlying business is improving.
Employees receive the same shares. Same tax treatment. No payroll deduction changes.
Grant size and vesting schedule unchanged
No employee enrollment or opt-in required
Tax treatment identical to standard equity grants
HR and legal workload: minimal
Outcomes
What finance teams accomplish with Carver Edison
Materially lower SBC expense
Reduce stock-based comp expense by 60–85% on participating grants - on the same plan design with the same employee grants.
Improved EPS and index eligibility
Lower SBC flows directly to better reported EPS. GAAP profitability unlocks S&P 500 inclusion and broader index eligibility.
Reduced share dilution
Replace new share issuance with open market purchases. Cut your annual burn rate from 5%+ to under 1%, preserving shareholder value.
Buybacks that return capital, not offset dilution
Stop using repurchases to offset equity plan dilution. Free up capital for actual capital returns - dividends, buybacks with genuine rationale.
Auditor-validated
The structure is fully documented and has been reviewed by Big Four audit firms. Compliant under current US GAAP.
Income statement impact
What the P&L looks like after Carver Edison
Every dollar of SBC eliminated by Carver Edison flows directly to net income. No operational changes, no headcount cuts, no changes to what employees receive.
| Metric | Before | After Carver Edison |
|---|---|---|
| SBC Expense | $760M | $114M |
| Net Income | ($595M) | $51M |
| Annual dilution | 5.2% | 0.78% |
| Index eligible? | No | Yes |
* Illustrative example. Results vary by company.
Done-for-you implementation
We handle everything. Live in 30 days.
Carver Edison manages the full implementation for you. Your team approves, we execute.
1
Week 1: We review your plan
Our team pulls your equity plans. We map the structures, identify the savings opportunities and forecast value creation.
2
Week 2-3: We coordinate across stakeholders
We use custom built playbooks and technology to coordinate across stakeholders with speed, precision and your organizational requirements at the center.
3
Week 4: You go live
Savings and dilution reduction begins. No change to value received for employees.
30
days to live
Works with all major equity platforms, HRIS, Payroll and transfer agent systems.
See what your SBC expense looks like with Carver Edison.
We'll model the impact on your income statement using your actual equity plans - SBC, EPS, dilution and market cap in one view.
Request a Demo