Earnings Per Share

6 Months Ended

Apr. 01, 2016

Basic EPS is computed by dividing net income attributable to Dolby Laboratories, Inc. by the number of weighted-average shares of Class A and Class B common stock outstanding during the period. Through application of the treasury stock method, diluted EPS is computed in the same manner, except that the number of weighted-average shares outstanding is increased by the number of potentially dilutive shares from employee incentive plans during the period.

Basic and diluted EPS are computed independently for each fiscal quarter and year-to-date period presented, which involves the use of different weighted-average share count figures relating to quarterly and annual periods. As a result, and after factoring the effect of rounding to the nearest cent per share, the sum of all four quarter-to-date EPS figures may not equal year-to-date EPS.

Potentially dilutive shares represent the hypothetical number of incremental shares issuable under the assumed exercise of outstanding stock options (both vested and non-vested), vesting of outstanding restricted stock units, and shares issued under our employee stock purchase plan. The calculation of dilutive shares outstanding excludes out-of-the-money stock options (i.e., such options' exercise prices were greater than the average market price of our common shares for the period) because their inclusion would have been antidilutive.

The following table sets forth the computation of basic and diluted EPS attributable to Dolby Laboratories, Inc. (in thousands, except per share amounts):



	Fiscal Quarter Ended				Fiscal Year-To-Date Ended
	April 1, 2016		March 27, 2015		April 1, 2016		March 27, 2015
Numerator:
Net income attributable to Dolby Laboratories, Inc.	$	67,398	$	57,974	$	98,299	$	99,331

Denominator:
Weighted-average shares outstanding—basic	100,456		102,509		100,600		102,406
Potential common shares from options to purchase common stock	748		889		674		941
Potential common shares from restricted stock units	351		506		442		750
Weighted-average shares outstanding—diluted	101,555		103,904		101,716		104,097

Net income per share attributable to Dolby Laboratories, Inc.:
Basic	$	0.67	$	0.57	$	0.98	$	0.97
Diluted	$	0.66	$	0.56	$	0.97	$	0.95

Antidilutive awards excluded from calculation:
Stock options	7,124		4,604		6,349		3,684
Restricted stock units	733		934		184		106