Net Income (loss) per Common Share
The separation was executed through WDC’s pro rata distribution of 80.1% of the outstanding shares of common stock of the Company to holders of WDC’s common stock as of February 21, 2025. On the separation date, the Company issued 145 million shares of common stock, par value $0.01 per share. This share amount is utilized for the calculation of basic and diluted earnings per share for all periods presented prior to the separation, and these shares are treated as issued and outstanding for purposes of calculating historical earnings per share. For periods prior to the separation, it is assumed that there are no dilutive equity instruments as there were no equity awards of Sandisk outstanding prior to the separation.
The following table presents the computation of basic and diluted income (loss) per common share:
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| 2025 | | 2024 | | 2023 |
| (in millions, except per share amounts) |
| | | | | |
| | | | | |
| Net income (loss) | $ | (1,641) | | | $ | (672) | | | $ | (2,143) | |
| | | | | |
| Weighted average shares outstanding: | | | | | |
| Basic and diluted | 145 | | | 145 | | | 145 | |
| | | | | |
| | | | | |
| | | | | |
| Net loss per common share: | | | | | |
| Basic and diluted | $ | (11.32) | | | $ | (4.63) | | | $ | (14.78) | |
| | | | | |
| | | | | |
| | | | | |
Dilutive weighted-average shares (1) | 2 | | — | | — |
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(1) Dilutive stock-based awards were excluded from the calculation of diluted shares because their effect would have been anti-dilutive.
Basic net income (loss) per share is computed using (i) net income (loss) divided by (ii) weighted average basic shares outstanding. Diluted net income (loss) per share is computed as (i) net income divided by (ii) weighted average diluted shares outstanding. The treasury stock method is used to determine the dilutive impact of unvested equity awards.
Potentially dilutive shares include dilutive outstanding employee RSUs, PSUs, and rights to purchase shares of common stock under the ESPP. For the year ended June 27, 2025, the Company recorded net losses, and as such, all potentially dilutive securities have been excluded from those periods as including them would be anti-dilutive.
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.