Net income per share

6 Months Ended

Jun. 30, 2023

Basic earnings per share for the Company’s common stock is computed by dividing, net income for the period by the weighted average number of common shares outstanding during the period.

In August, 2018, the Company issued an aggregate principal amount of $880 million of 2.00% Convertible Senior Notes due 2028 (see Note 12 to these unaudited interim condensed consolidated financial statements and Note 17 to the financial statements for the year ended December 31, 2022, contained in the Company’s 2022 10-K). The conversion of these notes is included in the calculation for diluted earnings per share utilizing the “if converted” method. Accordingly, conversion of these Notes is not assumed for purposes of computing diluted earnings per share if the effect is antidilutive.

The denominator for diluted net income per share for the six and three-month periods ended June 30, 2023 and 2022 does not include any effect from the capped call transactions entered into by the Company with certain financial institutions with respect to shares of the Company’s common stock (“2028 Notes Capped Call Transactions”) because it would be antidilutive. In the event of conversion of any or all of the 2028 Notes, the shares that would be delivered to the Company under the 2028 Notes Capped Call Transactions are designed to partially neutralize the dilutive effect of the shares that the Company would issue under the Notes. See Note 17 to the financial statements for the year ended December 31, 2022, contained in the Company’s 2022 10-K for more details.

For the six and three-month periods ended June 30, 2022, the effect of the conversion of the Notes would have been antidilutive and, as a consequence, it was not factored into the calculation of diluted earnings per share.

Net income per share of common stock is as follows for the six and three-month periods ended June 30, 2023 and 2022:


	Six Months Ended June 30,								Three Months Ended June 30,
	2023				2022				2023				2022
	Basic		Diluted		Basic		Diluted		Basic		Diluted		Basic		Diluted
Net income per common share (*)	$	9.23	$	9.12	$	3.73	$	3.73	$	5.22	$	5.16	$	2.43	$	2.43

Numerator (in millions):
Net income	$	463	$	463	$	188	$	188	$	262	$	262	$	123	$	123
Effect of dilutive Convertible Senior Notes	—		4		—		—		—		2		—		—
Net income available to common stock	$	463	$	467	$	188	$	188	$	262	$	264	$	123	$	123

Denominator:
Weighted average of common stock outstanding for earnings per share	50,203,652		50,203,652		50,386,519		50,386,519		50,162,687		50,162,687		50,364,529		50,364,529
Adjustment for assumed conversions	—		990,268		—		—		—		990,268		—		—
Adjusted weighted average of common stock outstanding for earnings per share	50,203,652		51,193,920		50,386,519		50,386,519		50,162,687		51,152,955		50,364,529		50,364,529

(*) Figures have been calculated using non-rounded amounts.