Basic earnings per share computations are based on the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share computations include any dilutive effect of potential common shares. In periods with a net loss available to common shareholders, diluted earnings per share are calculated using weighted-average basic shares for that period, as utilizing diluted shares would be anti-dilutive to loss per share.

A reconciliation of the amounts used to calculate basic and diluted earnings per share for the three and nine months ended September 30, 2021 and 2020 follows:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions)	2021			2020			2021			2020
Net income (loss)	$	8		$	(445	)	$	30		$	(561	)
Less: Series B preferred stock cash and deemed dividends		(1	)		—			(3	)		—
Less: Series C preferred stock in-kind and deemed dividends		(2	)		—			(4	)		—
Less: Series A preferred stock cash and deemed dividends		—			(5	)		(3	)		(15	)
Plus: Expiration of Series A preferred stock embedded derivative		—			—			11			—
Net income (loss) available to common shareholders - basic and diluted	$	5		$	(450	)	$	31		$	(576	)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions of shares)	2021		2020		2021		2020
Weighted average shares — basic		78.6		64.8		78.3		50.8
Effect of dilutive securities
Employee stock options		1.9		—		2.1		—
Unvested restricted stock units		0.1		—		0.1		—
Weighted average shares — diluted		80.6		64.8		80.5		50.8

The computation of diluted earnings per share for the three and nine months ended September 30, 2021 excluded the impact of (1) the assumed conversion of $25 million of Convertible Notes issued in 2021, (2) the assumed conversion of 1.0 million shares of Series B Preferred Stock, (3) the assumed conversion of 1.0 million shares of Series C Preferred stock, (4) the assumed exercise of 3.1 million outstanding employee stock options and (5) the assumed vesting of 0.0 million and 0.3 million unvested restricted stock units for the three and nine months ended September 30, 2021, respectively, because the effects would have been anti-dilutive.

As a result of the net loss available to common shareholders for the three and nine months ended September 30, 2020, Kodak calculated diluted earnings per share using weighted-average basic shares outstanding. If Kodak reported income available to common shareholders for the three and nine months ended September 30, 2020 the calculation of diluted earnings per share would have included the assumed vesting of 0.6 million and 0.5 million unvested restricted stock units, respectively. The calculation of diluted earnings per share for the three months ended September 30, 2020 would have also included the assumed conversion of 1.2 million outstanding employee stock options.

The computation of diluted earnings per share for the three and nine months ended September 30, 2020 also excluded the impact of (1) the assumed conversion of 2.0 million shares of Series A Preferred Stock and (2) the assumed exercise of 3.1 million and 3.6 million outstanding employee stock options, respectively.