Earnings Per Share

9 Months Ended

Sep. 30, 2019

Basic net income per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period, excluding restricted stock, restricted stock units and performance-based restricted stock units, or “PSUs,” that have been issued but are not yet vested. Diluted net income per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period plus additional weighted-average common equivalent shares outstanding during the period when the effect is dilutive.

The following table sets forth the computation of basic and diluted net income per share for the periods ended:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2019		2018			2019		2018
	(in thousands, except per share amounts)
Basic net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$	57,518	$	128,746		$	593,576	$	546,369
Less: Undistributed earnings allocated to participating securities	—		(14		)	—		(161		)
Net income attributable to Vertex common shareholders—basic	$	57,518	$	128,732		$	593,576	$	546,208

Basic weighted-average common shares outstanding	256,946		254,905			256,289		254,096
Basic net income attributable to Vertex per common share	$	0.22	$	0.51		$	2.32	$	2.15

Diluted net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$	57,518	$	128,746		$	593,576	$	546,369
Less: Undistributed earnings allocated to participating securities	—		(13		)	—		(158		)
Net income attributable to Vertex common shareholders—diluted	$	57,518	$	128,733		$	593,576	$	546,211

Weighted-average shares used to compute basic net income per common share	256,946		254,905			256,289		254,096
Effect of potentially dilutive securities:
Stock options	2,080		2,962			2,297		2,990
Restricted stock and restricted stock units (including PSUs)	1,434		1,896			1,582		1,866
Employee stock purchase program	13		25			14		20
Weighted-average shares used to compute diluted net income per common share	260,473		259,788			260,182		258,972
Diluted net income attributable to Vertex per common share	$	0.22	$	0.50		$	2.28	$	2.11

The Company did not include the securities in the following table in the computation of the net income per share attributable to Vertex common shareholders calculations because the effect would have been anti-dilutive during each period:



	Three Months Ended September 30,		Nine Months Ended September 30,
	2019	2018	2019	2018
	(in thousands)
Stock options	3,303	2,572	3,116	2,152
Unvested restricted stock and restricted stock units (including PSUs)	13	1	7	4