Net Income per Share

3 Months Ended

Mar. 31, 2023

Earnings Per Share Reconciliation [Abstract]

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 is reflected in diluted earnings per share by application of the treasury stock method and the dilutive effect of the convertible securities is reflected in diluted earnings per share by application of the if-converted method.

The components used in the computation of basic and diluted net income per share for the three months ended March 31, 2023 and 2022 were as follows (in thousands, except per share data):


	For the Three Months Ended March 31,
	2023		2022
Numerator:
Net income	$	97,106	$	133,376
Denominator:
Shares used for basic net income per share	155,637		160,494
Effect of dilutive securities:
Stock options	—		1
RSUs and DSUs	498		1,320
Convertible senior notes	—		1,822

Shares used for diluted net income per share	156,135		163,637
Basic net income per share	$	0.62	$	0.83
Diluted net income per share	$	0.62	$	0.82

For the three months ended March 31, 2023 and 2022, certain potential outstanding shares from service-based RSUs 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 market- and performance-based RSUs were excluded from the computation of diluted net income per share because the underlying market and 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 three months ended March 31, 2023 and 2022 were as follows (in thousands):


	For the Three Months Ended March 31,
	2023	2022

Service-based RSUs	7,867	2,234
Market- and performance-based RSUs	1,580	1,054

Warrants related to issuance of convertible senior notes	21,991	21,991
Total shares excluded from computation	31,438	25,279