Net Income per Share

3 Months Ended

Mar. 31, 2020

Earnings Per Share Reconciliation [Abstract]

Net Income per Share

Net Income per ShareBasic 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, restricted stock units ("RSUs"), deferred stock units ("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 three months ended March 31, 2020 and 2019 (in thousands, except per share data):

	For the Three Months Ended March 31,
	2020		2019
Numerator:
Net income	$	123,146	$	107,130
Denominator:
Shares used for basic net income per share	161,992		163,236
Effect of dilutive securities:
Stock options	11		49
RSUs and DSUs	1,681		1,502
Convertible senior notes	—		—
Warrants related to issuance of convertible senior notes	—		—
Shares used for diluted net income per share	163,684		164,787
Basic net income per share	$	0.76	$	0.66
Diluted net income per share	$	0.75	$	0.65

For the three months ended March 31, 2020 and 2019, certain potential outstanding common 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 common shares excluded from the computation of diluted net income per share for the three months ended March 31, 2020 and 2019 are as follows (in thousands):

	For the Three Months Ended March 31,
	2020	2019
Service-based RSUs	2,022	2,565
Market-and performance-based RSUs	1,487	1,484
Convertible senior notes	21,991	12,093
Warrants related to issuance of convertible senior notes	21,991	12,093
Total shares excluded from computation	47,491	28,235