Earnings per Share

Basic net earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average number of shares assuming dilution. Dilutive common shares outstanding is computed using the Treasury Stock method and in periods of income, reflects the additional shares that would be outstanding if dilutive stock options were exercised for common shares during the period.

Earnings per share (in millions, except share data):



	Three Months Ended
	March 31, 2018		April 1, 2017
Basic:
Net income	$	109	$	8
Weighted-average shares outstanding	53,286,249		51,842,025
Basic earnings per share	$	2.04	$	0.16

Diluted:
Net income	$	109	$	8
Weighted-average shares outstanding	53,286,249		51,842,025
Dilutive shares	699,506		1,104,858
Diluted weighted-average shares outstanding	53,985,755		52,946,883
Diluted earnings per share	$	2.01	$	0.16

There were 584 outstanding options to purchase common shares that were anti-dilutive and excluded from the first quarter earnings per share calculation as of March 31, 2018 compared to 532,353 as of April 1, 2017. Anti-dilutive securities consist primarily of stock appreciation rights (“SARs”) with an exercise price greater than the average market closing price of the Class A common stock.