Credit Suisse 18 th Annual Technology Conference Alper Ilkbahar, Vice President, Marketing SanDisk Enterprise Storage Solutions December 3, 2014 1
Forward-Looking Statements During our meeting today we will make forward-looking statements. Any statement that refers to expectations, projections or other characterizations of future events or circumstances is a forward-looking statement, including those relating to market growth, market position, revenue, industry trends, product performance and product capabilities. This presentation also contains forward-looking statements attributed to third parties, which reflect their projections as of the date of issuance. Actual results may differ materially from those expressed in these forward-looking statements due to a number of risks and uncertainties, including the factors detailed under the caption Risk Factors and elsewhere in the documents we file from time to time with the SEC, including our annual and quarterly reports. We undertake no obligation to update these forward-looking statements, which speak only as of the date hereof or as of the date of issuance by a third party, as the case may be. 2
A Global Leader in Flash Storage Solutions Financial Strength Trailing 4 Quarter Financials* $6.6B Revenue $2.6B Net Cash $0.8B R&D Investment Patent Portfolio 5000+ Patents Vertically Integrated Fab Memory Cell Design Memory System Design Full Product Manufacturing Software Solutions Retail Leadership Worldwide Products sold through 300K+ storefronts Strong brand recognition Qualified at the 5 largest server and 4 largest storage OEMs Enterprise SSDs & Storage Software All Leading Smartphone & Tablet Manufacturers use SanDisk SanDisk Client & Retail SSDs Approved supplier to all leading PC manufacturers * Financials as of Q3 14. Net Cash = (Cash + cash equivalents + short-term and long-term marketable securities) less (debt at maturity value) as of end of Q3 14; patents are as of Q3 14. 3
SanDisk Grows into the Enterprise Series of Acquisitions Deliver Industry s Broadest Portfolio 2011 2012 2012 2013 2014 SAS attached flash Application acceleration caching software Flash-optimized database and data store solutions SATA attached flash SAS attached flash DDR attached flash PCIe attached flash Application accelerator software and appliances SanDisk enterprise SSD revenue expected to exceed $1 Billion in 2015 REVENUE 4
Evolution of Flash in the Datacenter Flash in periphery Flash on PCIe & Memory Bus Flash and Software Integration SSDs as super-fast HDD replacements Application Accelerators Caching Software Middleware With Flash API Flash- Aware / Optimized Applications 5
Diverse Enterprise Workloads Accelerated by Flash Databases Big Data and Analytics Virtualized Servers and Cloud Virtual Desktop Infrastructure 6
Vertically Integrated with the Best Solutions! Solution Management Software IO Sphere Management SW Application File System Oracle SAP SQL VMware USER KERNEL Operating Systems NVMFS Application Acceleration ION Media Interface Block Layer VSL Enhanced Drivers Device Driver / DDR Driver Solid State Hardware ION Accelerator Flash Ownership/Expertise SanDisk NAND 7
Flash Transforms Applications Across Tiers of Storage TIER 0 TIER 1 +DRAM Indexing Caching In-Memory Compute VDI/Virtual Server OLTP TIER 2 Image Retrieval Exchange Server Web Search Analytics VOD/Media Streaming TIER 3 Data Warehouse Web Server Logs Content Repository 8
From Total Cost of Ownership (TCO) to Total Cost of Acquisition (TCA) Cost Total Cost of Ownership HDD SSD Flash-based systems are cheaper to operate than HDD-based systems SSD HDD Total Cost of Acquisition Flash-based systems are now cheaper to purchase than HDD-based systems 2012 2014 Time 9
SanDisk Performance Proof Point Example: 50TB minimum of 150K IOPS needed HDDs(Short Stroked) SanDisk SSDs (12) 24 drive enclosures Read Reference Database 596 HDDs @ 300GB Short Stroked to 150GB Read Reference Database 24 SSDs @ 4TB (4) 24 drive enclosure 170K IOPS More power and more space needed ½ the Total Cost of Acquisition ½ the Total Cost of Ownership 1.8M IOPS 11x Performance same cost per GB HDD-based systems are now more expensive than flash-based systems Source: Based on Dell PowerEdge pricing www.dell.com/us/business/p/poweredge-r720/fs along with HDD studies Failure Trends in a Large Disk Drive Population and Disk failures in the real world : proceedings of 5th USENIX Conference on File and Storage Technologies and incorporated into TCO model developed by SanDisk architect Fritz Kruger December 2013 10
Varied Scale & Requirements for Enterprise Customers TRADITIONAL ENTERPRISE CLOUD / HOSTING HYPERSCALERS 10K Servers 100K Servers 1M Servers Many SKUs Large number of applications used in small scale General purpose systems from Tier-1 enterprise OEMs 24x7 IT support Very limited SKUs Small number of applications used in large scale Custom-designed systems for specific applications Machine learning, fully automated support 11
Enterprise Storage Purchase Models HYPERSCALERS TRADITIONAL ENTERPRISE CLOUD/ HOSTING CLOUD / HOSTING HYPERSCALERS Buy proven, reliable, general purpose systems from leading OEM companies Purchase from multiple OEMs; newer & cheaper solutions influenced by hyperscalers Design cheaper special purpose systems directly with ODM partners OEM-SOURCED ODM-DIRECT 12
Best Positioned for the Flash-Transformed Data Center Captive NAND SATA SAS PCIe Application Accelerators Flash on DDR Software SanDisk Innovation Vertical Integration Comprehensive Portfolio Customer Flexible Scale, Supply & Cost Broadest Solutions Coverage 13
Follow us on the SanDisk IT Blog at ITblog.sandisk.com 2014 SanDisk Corporation. All rights reserved. SanDisk is a trademark of SanDisk Corporation, registered in the United States and other countries. FlashSoft, Lightning and Optimus are trademarks of SanDisk Enterprise IP LLC., registered in the United States and other countries. CloudSpeed, CloudSpeed Eco, CloudSpeed Ascend, CloudSpeed Ultra, Optimus Eco, Optimus Ascend, Optimus Ultra, Optimus Extreme, Optimus Max, Lightning Eco, Lighting Ascend, Lighting Ultra, Fusion iomemory, Fusion iodrive2, Fusion iodrive2 Duo, Fusion iosphere, SanDisk ION Accelerator, iovdi, ioturbine, ZetaScale and ULLtraDIMM are trademarks of SanDisk Enterprise IP LLC. All other product and company names are used for identification purposes and may be trademarks of the companies with which they are associated. 14