Comment by mindvirus

Even in FAANG it's a promotion. If not immediately, the cap for ICs is much lower.

Principal engineer at FAANG (L8): likely one of the best engineers in the world.

Engineering director at FAANG (L8): manager who's been there for a while and is good at acquiring more reports.

As a ratio, there are far more eng directors to managers than principal engineers to engineers.

All that said, know what you want in your career. If you love building, build. If you want money, do management.