Note 12—Earnings per Share

We compute EPS only for the period after February 1, 2017, the date on which our common stock began trading on the New York Stock Exchange. Basic EPS is computed by dividing the net income (loss) available to common shareholders for the period during which common stock was outstanding by the weighted average number of shares outstanding during such period, adjusted for non-vested shares of RSUs and RSAs. Diluted EPS is similar to computing basic EPS, except that the denominator is increased to include the dilutive effects of non-vested RSUs and RSAs, except when doing so would be anti-dilutive.

All outstanding non-vested RSUs and RSAs that have nonforfeitable rights to dividends or dividend equivalents that participate in undistributed earnings with common stock are considered participating securities and are included in the computation of EPS pursuant to the two-class method. The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings in periods when we have net income. Certain of our non-vested RSUs and RSAs, as identified in Note 10, are considered participating securities, as are our redeemable INVH LP units.

Basic and diluted EPS are calculated as follows:



(in thousands, except share and per share data)	For the Three Months Ended September 30, 2018			For the Three Months Ended September 30, 2017			For the Nine Months Ended September 30, 2018			February 1, 2017 through September 30, 2017
Numerator:
Net income (loss)	$	1,041		$	(22,510	)	$	(30,727	)	$	(59,372	)
Net loss for the period January 1, 2017 through January 31, 2017	—			—			—			16,879
Net income (loss) attributable to non-controlling interests	(21		)	—			532			—
Net income (loss) attributable to common shareholders	1,020			(22,510		)	(30,195		)	(42,493		)
Less: net income available to participating securities	(196		)	(235		)	(627		)	(344		)
Net income (loss) available to common shareholders — basic and diluted	$	824		$	(22,745	)	$	(30,822	)	$	(42,837	)

Denominator:
Weighted average common shares outstanding — basic	520,620,519			311,559,780			520,267,029			311,674,226
Weighted average common shares outstanding — diluted	521,761,076			311,559,780			520,267,029			311,674,226

Net income (loss) per common share — basic	$	—		$	(0.07	)	$	(0.06	)	$	(0.14	)
Net income (loss) per common share — diluted	$	—		$	(0.07	)	$	(0.06	)	$	(0.14	)

Incremental shares attributed to non-vested RSUs and RSAs are excluded from the computation of diluted EPS when they are anti-dilutive. As we had a net loss in certain periods, the inclusion of incremental shares would reduce our net loss and be anti-dilutive. The number of incremental shares excluded for those periods is (i) 1,170,889 for the nine months ended September 30, 2018, (ii) 951,217 during the three months ended September 30, 2017, and (iii) 623,375 for the period from February 1, 2017 through September 30, 2017. For the three months ended September 30, 2018, we had net income, and 140,301 incremental shares attributed to non-vested RSUs are excluded from the denominator as their inclusion would have been anti-dilutive.

For the three and nine months ended September 30, 2018, the redeemable INVH LP units have been excluded from the computation of EPS because all loss attributable to the INVH LP units has been recorded as non-controlling interest and thus excluded from net loss available to common shareholders. For the three and nine months ended September 30, 2018, the potential shares of common stock contingently issuable upon the conversion of the Convertible Senior Notes are also excluded from the computation of diluted EPS as we have the intent and ability to settle the obligations in cash.