EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2021

9. EARNINGS PER SHARE:

Basic earnings per share are calculated by dividing net income by the weighted-average shares of common stock outstanding during the period. Diluted earnings per share are calculated by dividing net income by the weighted-average shares of common stock and dilutive common equivalent shares outstanding during the period. Dilutive common equivalent shares included in this calculation consist of dilutive shares issuable upon the assumed exercise of outstanding common stock options, the assumed vesting of outstanding restricted stock units, the assumed issuance of awards under the stock purchase plan and contingently issuable performance-based awards, as computed using the treasury stock method.

A summary of the earnings per share calculation is as follows:


	Three Months Ended
	March 31,
(In thousands, except per share amounts)	2021		2020
Basic earnings per share:
Net income	$	39,798	$	15,886
Weighted-average common shares		60,184		59,204
Basic earnings per share	$	0.66	$	0.27
Diluted earnings per share: ⁽¹⁾
Net income	$	39,798	$	15,886
Weighted-average common shares		60,184		59,204
Effect of dilutive awards:
Employee stock plans		1,267		1,064
Diluted weighted-average common shares		61,451		60,268
Diluted earnings per share	$	0.65	$	0.26

(1)

The Company includes the shares underlying performance-based awards in the calculation of diluted earnings per share if the performance conditions have been satisfied as of the end of the reporting period and excludes such shares when the necessary conditions have not been met. The Company has excluded the shares underlying the outstanding performance-based awards in the 2021 and 2020 calculations as the shares were not contingently issuable as of the end of the reporting periods.

In the three months ended March 31, 2021 and 2020, no outstanding stock awards were determined to be anti-dilutive and therefore excluded from the computation of diluted earnings per share.

In July 2020, the Company’s board of directors approved a two-for-one stock split in the form of a stock dividend to stockholders of record as of the close of business on August 14, 2020. Refer to Note 8, Stockholders’ Equity, for additional information. The share and per share information for all periods presented in this Form 10-Q reflects the effect of the stock split.