Earnings (Loss) Per Share

On January 31, 2017 our common stock was reclassified into shares of Class B common stock and, on February 6, 2017, we completed our IPO of Class A common stock. Other than voting rights, the Class B common stock has the same rights as the Class A common stock and therefore both are treated as the same class of stock for purposes of the earnings per share calculation. Laureate computes basic earnings per share (EPS) by dividing income available to common shareholders by the weighted average number of common shares outstanding for the reporting period. Diluted EPS reflects the potential dilution that would occur if share-based compensation awards or contingently issuable shares were exercised or converted into common stock. To calculate the diluted EPS, the basic weighted average number of shares is increased by the dilutive effect of stock options, restricted stock, and other share-based compensation arrangements determined using the treasury stock method, and contingently issuable shares using the if-converted method.

The following tables summarize the computations of basic and diluted earnings per share:



For the three months ended June 30,	2018			2017
Numerator used in basic and diluted earnings per common share:
Income from continuing operations attributable to Laureate Education, Inc.	$	224,410		$	116,386

Accretion of redemption value of redeemable noncontrolling interests and equity	882			(6,352		)
Adjusted for: accretion related to noncontrolling interests and equity redeemable at fair value	(556		)	(919		)
Accretion of Series A Preferred Stock	(4,650		)	(61,934		)
Gain upon conversion of Series A Preferred Stock	74,110			—
Distributed and undistributed earnings to participating securities	—			(7		)
Subtotal: accretion of Series A Preferred Stock, net and other redeemable noncontrolling interests and equity	69,786			(69,212		)
Net income available to common stockholders for basic earnings per share	$	294,196		$	47,174
Adjusted for: accretion of Series A Preferred Stock	4,650			—
Adjusted for: gain upon conversion of Series A Preferred Stock	(74,110		)	—
Net income available to common stockholders for diluted earnings per share	$	224,736		$	47,174

Denominator used in basic and diluted earnings per common share:
Basic weighted average shares outstanding	214,864			168,591
Dilutive effect of Series A Preferred Stock	9,135			—
Dilutive effect of stock options	—			—
Dilutive effect of restricted stock units	355			66
Diluted weighted average shares outstanding	224,354			168,657

Basic and diluted earnings per share:
Basic earnings per share	$	1.37		$	0.28
Diluted earnings per share	$	1.00		$	0.28



For the six months ended June 30,	2018			2017
Numerator used in basic and diluted earnings (loss) per common share:
Income (loss) from continuing operations attributable to Laureate Education, Inc.	$	393,289		$	(6,422	)

Accretion of redemption value of redeemable noncontrolling interests and equity	806			(530		)
Adjusted for: accretion related to noncontrolling interests and equity redeemable at fair value	(559		)	(6,357		)
Accretion of Series A Preferred Stock	(61,974		)	(101,194		)
Gain upon conversion of Series A Preferred Stock	74,110			—
Distributed and undistributed earnings to participating securities	—			—
Subtotal: accretion of Series A Preferred Stock, net and other redeemable noncontrolling interests and equity	12,383			(108,081		)
Net income (loss) available to common stockholders for basic earnings per share	$	405,672		$	(114,503	)
Adjusted for: accretion of Series A Preferred Stock	61,974			—
Adjusted for: gain upon conversion of Series A Preferred Stock	(74,110		)	—
Net income (loss) available to common stockholders for diluted earnings per share	$	393,536		$	(114,503	)

Denominator used in basic and diluted earnings (loss) per common share:
Basic weighted average shares outstanding	201,494			161,620
Dilutive effect of Series A Preferred Stock	22,564			—
Dilutive effect of stock options	—			—
Dilutive effect of restricted stock units	416			—
Diluted weighted average shares outstanding	224,474			161,620

Basic and diluted earnings (loss) per share:
Basic earnings (loss) per share	$	2.01		$	(0.71	)
Diluted earnings (loss) per share	$	1.75		$	(0.71	)

The shares of Class A common stock that were issuable upon completion of the conversion of the Series A Preferred Stock were not included in the calculation of diluted EPS for the three and six months ended June 30, 2017, as the effect would have been antidilutive. The shares of Class A common stock issuable upon completion of the conversion of the Series A Preferred Stock were included in the calculation of diluted EPS for the three and six months ended June 30, 2018, as the effect was dilutive. In the calculation of diluted EPS, the conversion of the Series A Preferred Stock was assumed to have occurred as of the beginning of the period; accordingly, the effects of the accretion and the gain upon conversion of the Series A Preferred Stock were removed from net income available to common stockholders for diluted earnings per share. The following table summarizes the number of stock options and shares of restricted stock that were excluded from the diluted EPS calculations because the effect would have been antidilutive:



	For the three months ended June 30,		For the six months ended June 30,
	2018	2017	2018	2017
Stock options	9,714	13,149	9,779	12,724
Restricted stock	131	173	169	529