Net Income per Share

12 Months Ended

Dec. 31, 2016

Basic net income per share is computed using the weighted average number of common shares outstanding during the applicable period. Diluted net income per share is computed using the weighted average number of common shares outstanding during the period, plus the dilutive effect of potential common stock. Potential common stock consists of shares issuable pursuant to stock options, RSUs, DSUs, convertible senior notes and warrants issued by the Company. The dilutive effect of outstanding awards and convertible securities is reflected in diluted earnings per share by application of the treasury stock method.

The following table sets forth the components used in the computation of basic and diluted net income per share for the years ended December 31, 2016, 2015 and 2014 (in thousands, except per share data):



	2016		2015		2014
Numerator:
Net income	$	316,132	$	321,406	$	333,948
Denominator:
Shares used for basic net income per share	174,917		178,391		178,279
Effect of dilutive securities:
Stock options	384		794		1,221
RSUs and DSUs	914		1,230		1,686
Convertible senior notes	—		—		—
Warrants related to issuance of convertible senior notes	—		—		—
Shares used for diluted net income per share	176,215		180,415		181,186
Basic net income per share	$	1.81	$	1.80	$	1.87
Diluted net income per share	$	1.79	$	1.78	$	1.84

For the years ended December 31, 2016, 2015 and 2014, certain potential outstanding shares from stock options, service-based RSUs, convertible notes and warrants were excluded from the computation of diluted net income per share because the effect of including these items was anti-dilutive. Additionally, certain performance-based RSUs were excluded from the computation of diluted net income per share because the underlying performance conditions for such RSUs had not been met as of these dates. The number of potentially outstanding shares excluded from the computation of diluted net income per share for the years ended December 31, 2016, 2015 and 2014 (in thousands):



	2016	2015	2014
Stock options	58	22	402
Service-based RSUs	2,262	660	786
Performance-based RSUs	690	1,007	570
Convertible senior notes	7,704	7,704	7,704
Warrants related to issuance of convertible senior notes	7,704	7,704	7,704
Total shares excluded from computation	18,418	17,097	17,166