Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2023

Basic and diluted net earnings per share

The following is a reconciliation of the shares used in calculating basic and diluted net earnings per share:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Net income (in millions)	$	152	$	12	$	343	$	206
Shares (in thousands):
Weighted average common shares outstanding	240,840		180,191		208,905		180,173
Add: Participating securities (a)	30		26		30		28
Weighted average common shares outstanding — Basic	240,870		180,217		208,935		180,201
Plus incremental shares from assumed conversions: (b)
Dilutive effect of stock options	832		523		776		516
Dilutive effect of restricted stock units and performance share units	487		199		372		153

Weighted average common shares outstanding — Diluted	242,189		180,939		210,083		180,870
Basic earnings per share	$	0.63	$	0.07	$	1.64	$	1.14
Diluted earnings per share	$	0.63	$	0.07	$	1.63	$	1.14

(a)Restricted stock units containing rights to non-forfeitable dividends that participate in undistributed earnings with common stockholders are considered participating securities for purposes of computing earnings per share.

(b)Incremental shares from stock options, restricted stock units and performance share units are computed by the treasury stock method. The weighted average shares listed below were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive for the periods presented or were otherwise excluded under the treasury stock method. The treasury stock method calculates dilution assuming the exercise of all in-the-money options and vesting of restricted stock units and performance share units, reduced by the repurchase of shares with the proceeds from the assumed exercises and unrecognized compensation expense for outstanding awards. Performance share units will be included in the treasury stock calculation of diluted earnings per share upon achievement of underlying performance or market conditions at the end of the reporting period. See Note 15, "Share-Based Compensation Plans," to the condensed consolidated financial statements for further detail on the performance share units.


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(in thousands)	2023	2022	2023	2022
Stock options	1,722	1,508	1,729	1,496
Restricted stock units	773	413	570	368
Performance share units	256	333	272	279