Net Income Per Share

Basic net income per share is computed by dividing the net income for the period by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing the net income for the period by the weighted average number of shares of common stock and potentially dilutive common stock outstanding during the period. Potentially dilutive common shares include outstanding stock options and unvested restricted stock awards, which are reflected in diluted net income per share by application of the treasury stock method. Under the treasury stock method, the amount that the employee must pay for exercising stock options, the amount of stock-based compensation cost for future services that the Company has not yet recognized, and the estimated tax benefit that would be recorded in additional paid-in capital upon exercise are assumed to be used to repurchase shares.

Net income per share for the three and nine months ended September 29, 2013, and September 30, 2012, are as follows (in thousands, except per share data):



	Three Months Ended				Nine Months Ended
	September 29, 2013		September 30, 2012		September 29, 2013		September 30, 2012
Net income	$	14,457	$	23,791	$	43,785	$	70,460
Weighted average shares outstanding:
Basic	38,700		38,162		38,562		37,978
Dilutive potential common shares	498		640		565		704
Total diluted	39,198		38,802		39,127		38,682

Basic net income per share	$	0.37	$	0.62	$	1.14	$	1.86
Diluted net income per share	$	0.37	$	0.61	$	1.12	$	1.82

Weighted average stock options and unvested restricted stock awards to purchase 3.0 million shares and 2.6 million shares of the Company’s stock for the three months ended September 29, 2013, and September 30, 2012, respectively, and 2.8 million and 2.7 million shares for the nine months ended September 29, 2013, and September 30, 2012, respectively, were excluded from the computation of diluted net income per share because their effect would have been anti-dilutive.