Net Income Per Share

3 Months Ended

Mar. 31, 2015

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-month periods ended March 31, 2015 and 2014:


	Three Months Ended March 31,
	2015		2014
	(In thousands)
	Basic	Diluted	Basic	Diluted
Net income	$ 1,721	$ 1,721	$ 30,328	$ 30,328
Net income attributable to noncontrolling interests	—	—	(64)	(64)
Change in redeemable amount of noncontrolling interest	—	—	61	61
Net income attributable to MercadoLibre, Inc. Shareholders
corresponding to common stock	$ 1,721	$ 1,721	$ 30,325	$ 30,325

Net income per share of common stock is as follows for the three-month periods ended March 31, 2015 and 2014:


	Three Months Ended March 31,
	2015		2014
	(In thousands, except per share data)
	Basic	Diluted	Basic	Diluted

Net income attributable to MercadoLibre, Inc. Shareholders per common share	$ 0.04	$ 0.04	$ 0.69	$ 0.69
Numerator:
Net income attributable to MercadoLibre, Inc. Shareholders	$ 1,721	$ 1,721	$ 30,325	$ 30,325
Denominator:
Weighted average of common stock outstanding for Basic earnings per share	44,154,796	44,154,796	44,153,818	44,153,818
Adjustment for Convertible Notes	—	—	—	—
Adjusted weighted average of common stock outstanding for Diluted earnings per share	44,154,796	44,154,796	44,153,818	44,153,818

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. For the three-month period ended March 31, 2015, the effect of the Convertible Senior Notes due 2019 on diluted earnings per share was anti-dilutive and, as a consequence, it was not computed for diluted earnings per share.

The denominator for diluted net income per share for the three-month period ended March 31, 2015 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.

- Definition

The entire disclosure for earnings per share.

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