Earnings per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Earnings per Share

Earnings per Share

We compute basic and diluted earnings per share using the two-class method, which allocates earnings to participating securities. The participating securities consist of our Series A Convertible Perpetual Preferred Stock. The undistributed earnings are allocated between common shares and participating securities as if all earnings had been distributed during the period. Losses are not allocated to the preferred shares.

The computations of basic and diluted earnings per share were as follows:

	Years Ended December 31,
(In millions, except per share data)	2019			2018			2017
Basic earnings per common share
Net income attributable to XPO	$	419		$	422		$	340
Series A preferred stock dividends	(3		)	(3		)	(3		)
Non-cash allocation of undistributed earnings	(37		)	(29		)	(25		)
Net income attributable to common shares, basic	$	379		$	390		$	312
Basic weighted-average common shares	96			123			115
Basic earnings per share	$	3.95		$	3.17		$	2.72
Diluted earnings per common share
Net income attributable to common shares, basic	$	379		$	390		$	312
Interest from Convertible Senior Notes	—			—			1
Net income attributable to common shares, diluted	$	379		$	390		$	313
Basic weighted-average common shares	96			123			115
Dilutive effect of Convertible Senior Notes	—			—			2
Dilutive effect of non-participating stock-based awards and equity forward	10			12			11
Diluted weighted-average common shares	106			135			128
Diluted earnings per share	$	3.57		$	2.88		$	2.45
Potential common shares excluded	10			10			10

Certain shares were not included in the computation of diluted earnings per share because the effect was anti-dilutive.