EARNINGS PER COMMON SHARE
Potentially issuable shares of common stock include shares issuable upon the exercise of outstanding employee stock option awards, common stock issuable under the Company’s ESPP, unvested RSUs and contingent issuances of common stock related to the Company's convertible debt.
The following table sets forth the computation of basic and diluted earnings per common share (common shares in thousands):
Years Ended December 31,
202520242023
Numerator:
Net income, basic
$348,901 $426,859 $167,645 
Add: Interest expense, net of tax, on the Company's convertible debt
7,334 7,327 — 
Net income, diluted
$356,235 $434,186 $167,645 
Denominator:
Weighted-average common shares outstanding, basic191,787 190,027 187,834 
Effect of dilutive securities:
Common stock issuable under the Company's equity incentive plans1,242 2,316 3,761 
Common stock issuable under the Company’s convertible debt (1)
4,365 4,365 — 
Weighted-average common shares outstanding, diluted197,394 196,708 191,595 
Earnings per common share, basic
$1.82 $2.25 $0.89 
Earnings per common share, diluted
$1.80 $2.21 $0.87 
In addition to the equity instruments included in the table above, the table below presents potential shares of common stock that were excluded from the computation of diluted earnings per common share as they were anti-dilutive (in thousands):
Years Ended December 31,
202520242023
Common stock issuable under the Company's equity incentive plans
11,307 9,438 8,072 
Common stock issuable under the Company’s convertible debt (1)
— — 8,335 
Total number of potentially issuable shares11,307 9,438 16,407 
(1)    If converted, the Company would issue 4.4 million shares under the 2027 Notes and, for the year ended December 31, 2023, would have issued 4.0 million shares under the Company’s 2024 Notes, which matured and were settled in August 2024.

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 24, 2025
2023Feb 26, 2024
2022Feb 27, 2023
2021Feb 25, 2022
2020Feb 26, 2021
2019Feb 27, 2020
2018Feb 28, 2019

About Earnings Per Share Disclosures

The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.

Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.