3.	Net income per share

Basic earnings per share for the Company’s common stock is computed by dividing, net income available to common shareholders attributable to common stock for the period, and the corresponding adjustment attributable to changes in redeemable non-controlling interest, by the weighted average number of common shares outstanding during the period.

Diluted earnings per share for the Company’s common stock assume the issuance of shares as a consequence of a convertible debt securities conversion event.

The following table shows how net income is allocated using the “if converted” method for earnings per common share for the three and six-month periods ended June 30, 2014 and 2013:


	Three Months Ended June 30,
	2014						2013
	Basic			Diluted			Basic			Diluted
Net income (loss)	$	(25,588,478	)	$	(25,588,478	)	$	30,021,018		$	30,021,018

Net loss (income) attributable to noncontrolling interests		(5,552	)		(5,552	)		(42,377	)		(42,377	)

Change in redeemable amount of noncontrolling interest		(121,046	)		(121,046	)		(349,911	)		(349,911	)

Net income (loss) attributable to MercadoLibre, Inc. Shareholders corresponding to common stock	$	(25,715,076	)	$	(25,715,076	)	$	29,628,730		$	29,628,730


	Six Months Ended June 30,
	2014						2013
	Basic			Diluted			Basic			Diluted
Net income	$	4,739,475		$	4,739,475		$	47,543,609		$	47,543,609

Net loss (income) attributable to noncontrolling interests		(69,532	)		(69,532	)		(84,715	)		(84,715	)

Change in redeemable amount of noncontrolling interest		3,615			3,615			(133,951	)		(133,951	)

Net income attributable to MercadoLibre, Inc. Shareholders corresponding to common stock	$	4,673,558		$	4,673,558		$	47,324,943		$	47,324,943

Net income (loss) per share of common stock is as follows for the three and six-month periods ended June 30, 2014 and 2013:


	Three Months Ended June 30,
	2014						2013
	Basic			Diluted			Basic		Diluted

Net (loss) income attributable to MercadoLibre, Inc. Shareholders per common share	$	(0.58	)	$	(0.58	)	$	0.67	$	0.67


Numerator:

Net (loss) income attributable to MercadoLibre, Inc. Shareholders	$	(25,715,076	)	$	(25,715,076	)	$	29,628,730	$	29,628,730


Denominator:
Weighted average of common stock outstanding for Basic earnings per share		44,153,892			44,153,892			44,152,933		44,152,933
Adjustment for Convertible Notes		—			28,776			—		—

Adjusted weighted average of common stock outstanding for Diluted earnings per share		44,153,892			44,182,668			44,152,933		44,152,933


	Six months Ended June 30,
	2014				2013
	Basic		Diluted		Basic		Diluted

Net income attributable to MercadoLibre, Inc. Shareholders per common share	$	0.11	$	0.11	$	1.07	$	1.07


Numerator:

Net income attributable to MercadoLibre, Inc. Shareholders	$	4,673,558	$	4,673,558	$	47,324,943	$	47,324,943


Denominator:
Weighted average of common stock outstanding for Basic earnings per share		44,153,658		44,153,658		44,152,132		44,152,132
Adjustment for Convertible Notes		—		14,468		—		—

Adjusted weighted average of common stock outstanding for Diluted earnings per share		44,153,658		44,168,126		44,152,132		44,152,132

On June 30, 2014, the Company issued the 2.25% Convertible Senior Notes due 2019 (please refer to Note 9 of these interim condensed consolidated financial statements for discussion regarding these debt notes). The conversion of these debt notes are considered for diluted earnings per share utilizing the “if converted” method, the effect of that conversion is not assumed for purposes of computing diluted earnings per share if the effect is antidilutive. As the Notes were issued on June 30, 2014, they have been computed in the denominator (weighted average of common stock outstanding) for diluted earnings per share calculation for the three and six-month periods ended June 30, 2014.

The denominator for diluted net income / loss per share for the three and six-month periods ended June 30, 2014 does not include any effect from the capped call because it would be antidilutive. In the event of conversion of any or all of the Notes, the shares that would be delivered to the Company under the note hedges are designed to partially neutralize the dilutive effect of the shares that the Company would issue under the Notes.

For the three and six-month periods ended June 30, 2014 and 2013, there were no anti-dilutive shares that should have been excluded from the calculation of diluted net income (loss) per common share.