EARNINGS (LOSS) PER SHARE

6 Months Ended

Jun. 30, 2012

EARNINGS (LOSS) PER SHARE

NOTE 3—EARNINGS (LOSS) PER SHARE

The table below represents the computation of UAL basic and diluted earnings (loss) per share amounts and the number of securities that have been excluded from the computation of diluted earnings (loss) per share amounts because they were antidilutive (in millions, except per share amounts):

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
UAL basic earnings (loss) per share:
Net income (loss)	$	339		$	538		$	(109	)	$	325
Less: Income allocable to participating securities		(1	)		(2	)		—			(1	)
Earnings (loss) available to common stockholders	$	338		$	536		$	(109	)	$	324
Basic weighted average shares outstanding		331			330			331			329
Earnings (loss) per share, basic	$	1.02		$	1.63		$	(0.33	)	$	0.98
UAL diluted earnings (loss) per share:
Earnings (loss) available to common stockholders	$	338		$	536		$	(109	)	$	324
Effect of UAL 4.5% Senior Limited-Subordination Convertible Notes		2			11			—			—
Effect of Continental 4.5% Convertible Notes		2			2			—			4
Effect of Continental 6% Convertible Junior Subordinated Debentures		3			4			—			—
Effect of UAL 6% Senior Convertible Notes		4			5			—			9
Earnings (loss) available to common stockholders including the effect of dilutive securities	$	349		$	558		$	(109	)	$	337
UAL diluted shares outstanding:
Basic weighted average shares outstanding		331			330			331			329
Effect of stock options		1			1			—			2
Effect of UAL 4.5% Senior Limited-Subordination Convertible Notes		5			13			—			—
Effect of Continental 4.5% Convertible Notes		12			12			—			12
Effect of Continental 6% Convertible Junior Subordinated Debentures		4			4			—			—
Effect of UAL 6% Senior Convertible Notes		40			40			—			40
Diluted weighted average shares outstanding		393			400			331			383
Earnings (loss) per share, diluted	$	0.89		$	1.39		$	(0.33	)	$	0.88
UAL potentially dilutive shares excluded from diluted per share amounts:
Restricted stock and stock options		5			7			7			6
UAL 4.5% Senior Limited-Subordination Convertible Notes		—			—			5			18
Continental 4.5% Convertible Notes		—			—			12			—
Continental 6% Convertible Junior Subordinated Debentures		—			—			4			4
UAL 6% Senior Convertible Notes		—			—			40			—

UAL’s 6% Senior Notes due 2031 (the “6% Senior Notes”), with a principal amount of $652 million as of June 30, 2012, and the $125 million of UAL’s 8% Contingent Senior Notes (the “8% Notes”) issued by UAL in January 2012, are redeemable with either cash or shares of UAL common stock, or in the case of mandatory redemption, a combination thereof, at UAL’s option. The Company is obligated to issue an additional $62.5 million of the 8% Notes by February 2013, which are also redeemable on the same terms as the 6% Senior Notes and the other 8% Notes. These notes are not included in the diluted earnings (loss) per share calculation because it is UAL’s intent to redeem these notes with cash if UAL were to decide to redeem these notes.

During the second quarter of 2011, UAL repurchased at par value approximately $570 million of the $726 million outstanding principal amount of its 4.5% Senior Limited-Subordination Convertible Notes due 2021 (the “4.5% Notes”) with cash after the 4.5% Notes were put to UAL by the noteholders. For the three and six months ended June 30, 2011, the dilutive effect of the 4.5% Notes was excluded from the diluted earnings per share calculations from the date that notice was given of the Company’s intent to pay the notes put to it in cash up to the June 30, 2011 repurchase date.