Net Income Per Common Share (Tables)

9 Months Ended

Sep. 27, 2020

Computation of Basic and Diluted Net Income (Loss) 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
	September 27,		September 29,		September 27,		September 29,
	2020		2019		2020		2019
	(in thousands, except per share amounts)
Net income for basic and diluted net income per share	$	222,718	$	135,860	$	587,815	$	342,395

Weighted average common shares-basic		166,014		169,641		166,131		171,471
Effect of dilutive potential common shares:
Incremental shares from assumed conversion of convertible notes (1)		9,156		5,800		8,029		4,117
Convertible note hedge warrant shares (2)		7,775		3,580		6,364		1,786
Restricted stock units		1,237		1,313		1,104		1,112
Stock options		141		155		136		186
Employee stock purchase plan		15		5		13		13

Dilutive potential common shares		18,324		10,853		15,646		7,214

Weighted average common shares-diluted		184,338		180,494		181,777		178,685

Net income per common share-basic	$	1.34	$	0.80	$	3.54	$	2.00

Net income per common share-diluted	$	1.21	$	0.75	$	3.23	$	1.92

(1)

Incremental shares from assumed conversion of the convertible notes was calculated using the difference between the average Teradyne stock price for the period and the conversion price of $31.57, multiplied by 14.6 million 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.

(2)

Convertible notes hedge warrant shares were calculated using the difference between the average Teradyne stock price for the period and the warrant price of $39.62, multiplied by 14.6 million 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.