Net Income Per Common Share

6 Months Ended

Jul. 02, 2023

M. 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 Six Months Ended
	July 2,		July 3,		July 2,		July 3,
	2023		2022		2023		2022

	(in thousands, except per share amounts)
Net income for basic and diluted net income per share	$	120,050	$	197,787	$	203,581	$	359,715

Weighted average common shares-basic		154,760		159,563		155,332		160,805
Effect of dilutive potential common shares:
Convertible note hedge warrant shares (1)		8,876		9,029		8,929		9,528
Incremental shares from assumed conversion of convertible notes (2)		742		1,900		828		2,220
Restricted stock units		323		581		389		730
Stock options		43		54		45		61
Employee stock purchase plan		7		32		7		23

Dilutive potential common shares		9,991		11,596		10,198		12,562

Weighted average common shares-diluted		164,751		171,159		165,530		173,367

Net income per common share-basic	$	0.78	$	1.24	$	1.31	$	2.24

Net income per common share-diluted	$	0.73	$	1.16	$	1.23	$	2.07

(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 six months ended July 2, 2023

excludes the effect of the potential vesting of 0.4 million and 0.5 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 six months ended July 3, 2022

excludes the effect of the potential vesting of 0.1 million and 0.2 million, respectively, of restricted stock units because the effect would have been anti-dilutive.