SanDisk 2011 Annual Report Download - page 40

COMPENSATION DISCUSSION AND ANALYSIS
This section contains a discussion of the material elements of compensation awarded to, earned by or paid to
the following executive officers of the Company: the principal executive officer and the principal financial
officer; two other most highly compensated individuals who were serving as executive officers as of the last day
of fiscal 2011; and one former executive officer who would have been one of the three other most highly
compensated executive officers but for the fact that the individual was not serving as an executive officer of the
Company at the end of fiscal 2011. These individuals are referred to as the “Named Executive Officers” in this
Proxy Statement and include:
• Sanjay Mehrotra—President and Chief Executive Officer (principal executive officer);
• Judy Bruner—Executive Vice President, Administration and Chief Financial Officer (principal financial
officer);
• James Brelsford—Chief Legal Officer and Senior Vice President of IP Licensing;
• Sumit Sadana—Senior Vice President and Chief Strategy Officer; and
• Yoram Cedar—Executive Vice President and Chief Technology Officer (who resigned from his position
effective December 31, 2011).
The Company’s current executive compensation programs are determined and approved by the
Compensation Committee. None of the Named Executive Officers is a member of the Compensation Committee.
As contemplated by the Compensation Committee charter, the Company’s Chief Executive Officer recommends
to the Compensation Committee for its approval the base salary, annual bonus and long-term equity
compensation levels for the other Named Executive Officers. The Company’s Executive Vice President,
Administration and Chief Financial Officer provides financial information to the Compensation Committee, as
requested from time to time, and recommends to the Company’s Chief Executive Officer the form and amount of
compensation provided to the Company’s Chief Legal Officer and Senior Vice President of IP Licensing. Except
for the Company’s Chief Executive Officer and Executive Vice President, Administration and Chief Financial
Officer, the Company’s executive officers do not have any role in determining or recommending the form or
amount of compensation provided to the Named Executive Officers other than providing financial or other
information as the Compensation Committee may request from time to time.
Executive Summary
Significant Fiscal 2011 Business Results and Actions. The Company achieved the following financial results
for fiscal 2011, demonstrating that the Company successfully executed its strategy:
• Total revenue of $5.66 billion in fiscal 2011, up 17% compared to fiscal 2010 revenue;
• Diluted earnings per share on a non-GAAP basis was $4.65 per share, an increase over the non-GAAP
diluted earnings per share in fiscal 2010 of $4.60; and
• Cash flow from operations was $1.05 billion in fiscal 2011, and the Company ended fiscal 2011 with
cash and cash equivalents and short and long-term marketable securities above $5.62 billion, up from
$5.34 billion at the end of fiscal 2010.
The Company uses non-GAAP measures to establish operational goals and to measure performance for
executive officer compensation because the Company believes that non-GAAP measures allow management to
better evaluate the core operating performance of the Company especially when comparing to the results of
previous periods and to the Company’s business model objectives. For reconciliation of non-GAAP to GAAP
financial measures, see Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and
Results of Operations—Non-GAAP Financial Measures,” of the Company’s Form 10-K for the fiscal year ended
January 1, 2012.
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