Net Income Per Share

12 Months Ended

Jun. 26, 2016

Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed using the treasury stock method, for dilutive stock options, restricted stock units (“RSUs”), and Convertible Notes. The following table reconciles the numerators and denominators of the basic and diluted computations for net income per share.



	Year Ended
	June 26, 2016		June 28, 2015		June 29, 2014
	(in thousands, except per share data)
Numerator:
Net income	$	914,049	$	655,577	$	632,289
Denominator:
Basic average shares outstanding	158,919		159,629		164,741
Effect of potential dilutive securities:
Employee stock plans	2,120		3,193		2,864
Convertible notes	13,464		13,530		6,898
Warrants	656		715		—
Diluted average shares outstanding	175,159		177,067		174,503
Net income per share - basic	$	5.75	$	4.11	$	3.84
Net income per share - diluted	$	5.22	$	3.70	$	3.62

For purposes of computing diluted net income per share, weighted-average common shares do not include potentially dilutive securities that are anti-dilutive under the treasury stock method. The following potentially dilutive securities were excluded:



	Year Ended
	June 26, 2016	June 28, 2015	June 29, 2014
	(in thousands)
Number of options and RSUs excluded	149	330	78

Diluted shares outstanding include the effect of the Convertible Notes. Diluted shares outstanding do not include any effect resulting from note hedges associated with the Company’s 2016 or 2018 Notes (as described in Note 13) as their impact would have been anti-dilutive.