Earnings Per Share

12 Months Ended

Sep. 30, 2016

9. Earnings Per Share

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. Potentially dilutive shares include the hypothetical number of shares issued under the assumed exercise of outstanding stock options, vesting of outstanding RSUs and shares issued under our ESPP.

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.

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



	Fiscal Year Ended
	September 30, 2016		September 25, 2015		September 26, 2014
Numerator:
Net income attributable to Dolby Laboratories, Inc.	$	185,860	$	181,390	$	206,103

Denominator:
Weighted-average shares outstanding—basic	100,717		102,354		102,151
Potential common shares from options to purchase common stock	1,013		811		582
Potential common shares from restricted stock units	694		697		899
Weighted-average shares outstanding—diluted	102,424		103,862		103,632

Net income per share attributable to Dolby Laboratories, Inc.:
Basic	$	1.85	$	1.77	$	2.02
Diluted	$	1.81	$	1.75	$	1.99

Antidilutive awards excluded from calculation:
Stock options	2,971		4,270		3,987
Restricted stock units	30		127		1,835