Net Income Per Share

9 Months Ended

Oct. 25, 2015

Notes to financial statements [Abstract]

The following is a reconciliation of the numerator and denominator of the basic and diluted net income per share computations for the periods presented:



	Three Months Ended				Nine Months Ended
	October 25,		October 26,		October 25,		October 26,
	2015		2014		2015		2014
	(In millions, except per share data)
Numerator:
Net income	$	246	$	173	$	406	$	437
Denominator:
Denominator for basic net income per share, weighted average shares	542		548		544		555
Effect of dilutive securities:
Equity awards outstanding	13		10		13		11
Assumed conversion of 1% Convertible Senior Notes Due 2018	10		—		6		—
Denominator for diluted net income per share, weighted average shares	565		558		563		566
Net income per share:
Basic net income per share	$	0.45	$	0.32	$	0.75	$	0.79
Diluted net income per share	$	0.44	$	0.31	$	0.72	$	0.77
Potentially dilutive equity awards excluded from diluted net income per share because their effect would have been anti-dilutive	9		11		13		16

The 1.00% Convertible Senior Notes, or the Notes, are included in the calculation of diluted net income per share if their inclusion is dilutive. The Notes will generally have a dilutive impact on net income per share if our average stock price for the reporting period exceeds the conversion price of $20.1630 per share. For the three and nine months ended October 25, 2015, our average stock price for the reporting periods exceeded the conversion price, causing the Notes to have a dilutive impact for these periods.

The denominator for diluted net income per share does not include any effect from the convertible note hedge transaction, or the Note Hedges, that we entered into concurrently with the issuance of the Notes, as its effect would be anti-dilutive. In the event an actual conversion of any or all of the Notes occurs, the shares that would be delivered to us under the Note Hedges are designed to neutralize the dilutive effect of the shares that we would issue under the Notes.

The denominator for diluted net income per share will not include any effect from the warrants, which we entered into concurrently with the issuance of the Notes, unless our average stock price for the reporting period exceeds the strike price of $27.1119 per share.

Please refer to Note 11 of these Notes to Condensed Consolidated Financial Statements for additional discussion regarding the Notes.