Net Income Per Share
Basic net income per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income for the period by the weighted average number of shares of common stock and potentially dilutive common stock outstanding during the period. The dilutive effect of outstanding options and equity incentive awards is reflected in diluted net income per share by application of the treasury stock method. The calculation of diluted net income per share excludes all anti-dilutive common shares.

The following table presents the computation of basic and diluted net income per share (in millions, except per share amounts):
 Year Ended December 31,
 202520242023
Numerator:
Income from continuing operations
$1,996 $1,981 $2,775 
Income (loss) from discontinued operations, net of income taxes35 (6)(8)
Net income
$2,031 $1,975 $2,767 
Denominator:
Weighted average shares of common stock - basic459 496 530 
Dilutive effect of equity incentive awards
Weighted average shares of common stock - diluted468 501 533 
Income (loss) per share - basic:
Continuing operations$4.35 $4.00 $5.24 
Discontinued operations0.08 (0.01)(0.02)
Net income per share - basic
$4.43 $3.99 $5.22 
Income (loss) per share - diluted:
Continuing operations$4.26 $3.95 $5.21 
Discontinued operations0.08 (0.01)(0.02)
Net income per share - diluted
$4.34 $3.94 $5.19 
Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive
20 

Historical Timeline

Fiscal YearFiled
2025Feb 19, 2026Showing above
2024Feb 27, 2025
2017Feb 5, 2018

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.