Net Income Per Common Share

9 Months Ended

Oct. 02, 2022

Net Income per Common Share

N. NET INCOME PER COMMON SHARE

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

	For the Three Months Ended				For the Nine Months Ended
	October 2, 2022		October 3, 2021		October 2, 2022		October 3, 2021
	(in thousands, except per share amounts)
Net income for basic and diluted net income per share	$	183,485	$	256,718	$	543,200	$	790,549
Weighted average common shares-basic		156,364		164,583		159,325		165,690
Effect of dilutive potential common shares:
Convertible note hedge warrant shares (1)		8,284		9,819		9,114		9,774
Incremental shares from assumed conversion of convertible notes (2)		1,453		6,464		1,965		8,784
Restricted stock units		564		1,035		673		1,147
Stock options		45		73		56		87
Employee stock purchase plan		23		13		23		10
Dilutive potential common shares		10,369		17,404		11,831		19,802
Weighted average common shares-diluted		166,733		181,987		171,156		185,492
Net income per common share-basic	$	1.17	$	1.56	$	3.41	$	4.77
Net income per common share-diluted	$	1.10	$	1.41	$	3.17	$	4.26

(1) Convertible notes hedge warrant shares were calculated using the difference between the average Teradyne stock price for the period and the warrant price, multiplied by the number of warrant shares. The result of this calculation, representing the total intrinsic value of the warrant, was divided by the average Teradyne stock price for the period.

(2) Incremental shares from assumed conversion of the convertible notes were calculated using the difference between the average Teradyne stock price for the period and the conversion price, multiplied by the number of convertible notes shares. The result of this calculation, representing the total intrinsic value of the convertible debt, was divided by the average Teradyne stock price for the period.

The computation of diluted net income per common share for the three and nine months ended October 2, 2022 excludes the effect of the potential vesting of 0.7 million and 0.9 million, respectively, of restricted stock units because the effect would have been anti-dilutive.

The computation of diluted net income per common share for the three and nine months ended October 3, 2021 excludes the effect of the potential vesting of 0.1 million and 0.1 million, respectively, of restricted stock units because the effect would have been anti-dilutive.