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Net Income Per Share
 6 Months Ended
Jun. 30, 2017
Net Income Per Share  
Net Income Per Share

 

2. 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. Diluted net income per share is computed by dividing net income adjusted with the interest expense on our unsecured convertible subordinated notes due 2023 (the “2023 Notes”) by the weighted-average number of shares of common stock and dilutive potential common stock equivalents then outstanding. Dilutive potential common stock equivalents include the assumed exercise, vesting and issuance of employee stock awards using the treasury stock method, as well as common stock issuable upon assumed conversion of our 2023 Notes using the if-converted method.

 

The following table shows the computation of basic and diluted net income per share for the three and six months ended June 30, 2017 and 2016:

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

(In thousands except per share data)

 

2017

 

2016

 

2017

 

2016

 

Numerator:

 

 

 

 

 

 

 

 

 

Net income, basic

 

$
35,146

 

$
14,597

 

$
51,991

 

$
19,032

 

Add: interest expense on 2023 Notes

 
1,414

 
1,457

 
2,821

 

—

 

 

 

 

 

 

 

 

 

 

 

Net income, diluted

 

$
36,560

 

$
16,054

 

$
54,812

 

$
19,032

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

Weighted-average shares used to compute basic net income per share

 
107,614

 
111,359

 
107,468

 
112,005

 

Dilutive effect of 2023 Notes

 
12,189

 
12,602

 
12,189

 

—

 

Dilutive effect of options and awards granted under equity incentive plan and employee stock purchase plan

 
660

 
355

 
660

 
526

 

 

 

 

 

 

 

 

 

 

 

Weighted-average shares used to compute diluted net income per share

 
120,463

 
124,316

 
120,317

 
112,531

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share

 

 

 

 

 

 

 

 

 

Basic

 

$
0.33

 

$
0.13

 

$
0.48

 

$
0.17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

$
0.30

 

$
0.13

 

$
0.46

 

$
0.17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anti-Dilutive Securities

 

The following common stock equivalents were not included in the computation of diluted net income per share because their effect was anti-dilutive:

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

(In thousands)

 

2017

 

2016

 

2017

 

2016

 

Outstanding options and awards granted under equity incentive plan and employee stock purchase plan

 
2,019

 
4,276

 
2,541

 
4,383

 

Shares issuable upon conversion of 2023 Notes

 

—

 

—

 

—

 
12,753

 

 

 

 

 

 

 

 

 

 

 

 

 
2,019

 
4,276

 
2,541

 
17,136