Earnings Per Share

9 Months Ended

Sep. 30, 2020

Earnings (Loss) Per ShareThe following is a summary of Lexicon’s earnings (loss) per share calculations and reconciliations of basic to diluted earnings (loss) per share.


(in thousands, except per share data)	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Numerator:
Net income (loss)	$	82,603	$	226,086	$	(53,079)	$	181,271
Add interest on Convertible Notes	1,258		1,277		—		3,790
Adjusted net income (loss)	$	83,861	$	227,363	$	(53,079)	$	185,061

Denominator:
Shares used in computing net income (loss) per common share, basic	107,309		106,272		106,974		106,200
Add effect of potential dilutive securities:
Share based compensation awards	51		3		—		177
Convertible Notes	10,192		10,365		—		10,365
Shares used in computing net income (loss) per common share, diluted	117,552		116,640		106,974		116,742

Net income (loss) per share - basic	$	0.77	$	2.13	$	(0.50)	$	1.71
Net income (loss) per share - diluted	$	0.71	$	1.95	$	(0.50)	$	1.59

For periods presented with a net loss, the weighted average number of shares outstanding are the same for both basic and diluted net loss per common share. The average number of shares associated with stock options and restricted stock units that were excluded from diluted earnings per share that would potentially dilute earnings per share in the future was 11,773 and 10,576, respectively, for the three months ended September 30, 2020 and 2019, and 11,859 and 8,452, respectively, for the nine months ended September 30, 2020 and 2019. For periods presented with a net loss, the shares associated with the Convertible Notes are not included in the computation of diluted earnings per share because they are antidilutive.