Basic and Diluted Net Income (Loss) Per Share

3 Months Ended

Mar. 31, 2023

Basic and Diluted Net Income (Loss) Per Share

Basic and Diluted Net Income (Loss) Per Share

3.Basic and Diluted Net Income (Loss) Per Share

We present both basic earnings per share (“EPS”) and diluted EPS. Basic EPS excludes potential dilution and is computed by dividing “Net income (loss) attributable to DISH Network” by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if stock awards were exercised and if our Convertible Notes were converted. The potential dilution from stock awards is accounted for using the treasury stock method based on the average market value of our Class A common stock for the reporting period. The potential dilution from conversion of the Convertible Notes is accounted for using the if-converted method, which requires that all of the shares of our Class A common stock issuable upon conversion of the Convertible Notes will be included in the calculation of diluted EPS assuming conversion of the Convertible Notes at the beginning of the reporting period (or at time of issuance, if later).

The following table presents EPS amounts for all periods and the basic and diluted weighted-average shares outstanding used in the calculation.

	For the Three Months Ended
	March 31,
	2023		2022
	(In thousands, except per share amounts)
Net income (loss)	$	243,238	$	448,846
Less: Net income (loss) attributable to noncontrolling interests, net of tax		20,533		16,195
Net income (loss) attributable to DISH Network - Basic		222,705		432,651
Interest on dilutive Convertible Notes, net of tax (1)		—		—
Net income (loss) attributable to DISH Network - Diluted	$	222,705	$	432,651
Weighted-average common shares outstanding - Class A and B common stock:
Basic		531,293		529,067
Dilutive impact of Convertible Notes		107,016		107,016
Dilutive impact of stock awards outstanding		76		387
Diluted		638,385		636,470
Earnings per share - Class A and B common stock:
Basic net income (loss) per share attributable to DISH Network	$	0.42	$	0.82
Diluted net income (loss) per share attributable to DISH Network	$	0.35	$	0.68

(1) For the three months ended March 31, 2023 and 2022, substantially all of our interest expense was capitalized. See Note 2 for further information.

Certain stock awards to acquire our Class A common stock are not included in the weighted-average common shares outstanding above, as their effect is anti-dilutive. In addition, vesting of performance/market based options and rights to acquire shares of our Class A common stock granted pursuant to our performance-based stock incentive plans (“Restricted Performance Units”) are both contingent upon meeting certain goals, some of which are not yet probable of being achieved.

Furthermore, the warrants that we issued to certain option counterparties in connection with the Convertible Notes due 2026 are only exercisable at their expiration if the market price per share of our Class A common stock is greater than the strike price of the warrants, which is approximately $86.08 per share, subject to certain adjustments. As a consequence, the following are not included in the diluted EPS calculation.

	As of March 31,
	2023	2022
	(In thousands)
Anti-dilutive stock awards	15,170	11,259
Performance/market based options	14,308	15,981
Restricted Performance Units/Awards	693	1,273
Common stock warrants	46,029	46,029
Total	76,200	74,542