NET INCOME PER SHARE
Basic net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period, plus the dilutive effects of restricted stock units RSUs, stock options and PSUs. Dilutive shares of common stock are determined by applying the treasury stock method.
A reconciliation of the numerator and denominator used in the calculation of basic and diluted net income per share is (in millions, except per share amounts):
 Year Ended December 31,
 202520242023
Numerator:
Net income
$1,853.4 $1,745.2 $1,147.8 
Denominator:
Basic shares:
Weighted-average common stock outstanding-basic758.0 764.4 778.6 
Diluted shares:
Weighted-average common stock outstanding-basic758.0 764.4 778.6 
Effect of potentially dilutive securities:
RSUs 2.3 2.4 3.3 
Stock options3.8 4.7 6.2 
PSUs
0.5 0.4 0.1 
Weighted-average shares used to compute diluted net income per share
764.6 771.9 788.2 
Net income per share:
Basic$2.45 $2.28 $1.47 
Diluted$2.42 $2.26 $1.46 

The following weighted-average shares of common stock were excluded from the computation of diluted net income per share for the periods presented, as their effect would have been antidilutive (in millions):
 Year Ended December 31,
 202520242023
RSUs 1.9 0.2 0.7 
Stock options0.7 2.5 2.8 
PSUs
— 0.1 0.1 
Total2.6 2.8 3.6 
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Historical Timeline

Fiscal YearFiled
2025Feb 25, 2026Showing above
2024Feb 21, 2025
2023Feb 26, 2024
2022Feb 24, 2023
2021Feb 25, 2022

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.