NVIDIA 2013 Annual Report Download - page 50

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Executive Compensation
Compensation Discussion and Analysis
Introduction
This section explains our executive compensation program as it relates to the “named executive officers” listed below
(we refer to them in this section as either our named executive officers or as our executive officers). The fiscal year 2014
compensation information for our named executisve officers is presented in the tables following this discussion in accordance
with SEC rules. We compensate our named executive officers based on our fiscal year (which ends on the last Sunday of
January of each calendar year). Our fiscal year 2014 ran from January 28, 2013 to January 26, 2014.
Named Executive Officers
Jen-Hsun Huang. . . . . . . . . . . . . . President and Chief Executive Officer
Colette M. Kress (1) . . . . . . . . . . . Executive Vice President and Chief Financial Officer
Karen T. Burns (2) . . . . . . . . . . . . . Former Interim Chief Financial Officer and Current Vice President, Finance
Ajay K. Puri . . . . . . . . . . . . . . . . . Executive Vice President, Worldwide Sales
David M. Shannon . . . . . . . . . . . . Executive Vice President, Chief Administrative Officer and Secretary
Debora Shoquist. . . . . . . . . . . . . . Executive Vice President, Operations
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(1) Ms. Kress became our CFO on September 30, 2013.
(2) In connection with the appointment of Ms. Kress as our CFO, Ms. Burns resumed her previous position as our Vice President, Finance.
Executive Summary
NVIDIA is committed to pay for performance. We demonstrate this commitment by designing our executive
compensation programs so that the amounts ultimately received by our executive officers vary to reflect NVIDIA’s financial
performance, our executives’ individual performance and our stock price performance. While we pay our executive officers
an annual base salary that is fixed, a meaningful portion of total cash compensation is in the form of variable cash
compensation which is tied to NVIDIA’s financial performance and the executive officer’s individual performance. Our
equity-based compensation is also linked to performance and is intended to align the long-term interests of our executive
officers with those of our stockholders. We continue to believe that we should tie our executive compensation programs
to key financial metrics that we believe drive value and contribute to the long-term success of NVIDIA.
In setting fiscal year 2014 executive officer compensation, our Compensation Committee reflected on the votes cast
on our say-on-pay proposal for fiscal year 2013. At our 2013 Annual Meeting of Stockholders, over 96% of the votes cast
on our say-on-pay proposal were in support of the compensation paid to our executive officers for fiscal year 2013. While
this vote was only advisory and not binding, our Compensation Committee carefully considered the results of the vote in
the context of our overall compensation philosophy, as well as our compensation policies and decisions, and as a result,
determined to continue the key components of our executive compensation program. These components include our variable
compensation program, or the Variable Plan, under which up to 50% of an executive officer’s target award opportunity is
earned based on our success at achieving a corporate financial performance target and up to 50% of the target opportunity
is earned based on how well an executive officer performs against his or her individual objectives. Another main component
of our executive compensation program is our equity awards. In fiscal year 2014, our Compensation Committee decided
to shift from granting 100% of Mr. Huang’s annual equity grant in the form of stock options to a mix of approximately 50%
of the target equity grant value in performance stock units, or PSUs, and the remainder in stock options. Our Compensation
Committee believes that this mix of awards and performance metrics reflects the changing market trend for equity incentives
granted to CEOs at our peer companies. Our other executive officers received a mix of RSUs and stock options. In addition,
we paid a signing bonus to our recently hired CFO and offered her an anniversary bonus, as explained below.