Xylem Inc.XYL

Xylem Inc. Earnings Per Share Disclosure

10-KFiled Feb 25, 20262 min read
Earnings Per Share
The following is a reconciliation of the shares used in calculating basic and diluted EPS:
Year Ended December 31,
202520242023
Net income attributable to Xylem (in millions)$957 $890 $609 
Shares (in thousands):
Weighted average common shares outstanding243,345 242,557 216,982 
Add: Participating securities (a)21 26 30 
Weighted average common shares outstanding — Basic243,366 242,583 217,012 
Plus incremental shares from assumed conversions: (b)
Dilutive effect of stock options345 526 768 
Dilutive effect of restricted stock units and performance share units283 412 400 
Weighted average common shares outstanding — Diluted243,994 243,521 218,180 
Basic earnings per share$3.93 $3.67 $2.81 
Diluted earnings per share$3.92 $3.65 $2.79 
(a)Restricted stock units containing rights to non-forfeitable dividends that participate in undistributed earnings with common shareholders are considered participating securities for purposes of computing EPS.
(b)Incremental shares from stock options, restricted stock units and performance share units are computed by the treasury stock method. The weighted average shares listed below were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive for the periods presented or were otherwise excluded under the treasury stock method. The treasury stock method calculates dilution assuming the exercise of all in-the-money options and vesting of restricted stock units and performance share units, reduced by the repurchase of shares with the proceeds from the assumed exercises and unrecognized compensation expense for outstanding awards. Performance share units are included in the treasury stock calculation of diluted earnings per share based upon achievement of underlying performance and market conditions at the end of the reporting period, as applicable. See Note 17, "Share-Based Compensation Plans," for further detail on the performance share units.
Year Ended December 31,
(in thousands)202520242023
Stock options908 951 1,703 
Restricted stock units350 404 566 
Performance share units160 262 289 
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Historical Timeline

Fiscal YearFiled
2025Feb 25, 2026Showing above
2024Mar 3, 2025
2023Feb 28, 2024
2022Feb 24, 2023
2021Feb 25, 2022
2020Feb 26, 2021
2019Feb 28, 2020
2018Feb 22, 2019
2017Feb 23, 2018
2016Feb 23, 2017
2015Feb 26, 2016

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.

Other Available Disclosures

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