Earnings per Share

3 Months Ended

Mar. 31, 2017

We present basic earnings per share (“EPS”) and diluted EPS for our Class A and Class B common stock. Basic EPS for our Class A and Class B common stock excludes potential dilution and is computed by dividing “Net income attributable to EchoStar common stock” by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if shares of common stock were issued pursuant to our stock-based compensation awards. The potential dilution from common stock awards was computed using the treasury stock method based on the average market value of our Class A common stock during the period. The calculation of our diluted weighted-average common shares outstanding excluded options to purchase shares of our Class A common stock, whose effect would be anti-dilutive, of 0.7 million shares and 3.3 million shares for the three months ended March 31, 2017 and 2016, respectively.

Prior to the Share Exchange, the EchoStar Tracking Stock was a participating security that shared in our consolidated earnings and therefore, we applied the two-class method to calculate EPS for periods prior to March 1, 2017. Under the two-class method, we allocated net income or loss attributable to EchoStar between common stock and the EchoStar Tracking Stock considering both dividends declared on each class of stock and the participation rights of each class of stock in undistributed earnings. Based on the 51.89% economic interest in the Hughes Retail Group represented by the EchoStar Tracking Stock, we allocated undistributed earnings to the EchoStar Tracking Stock based on 51.89% of the attributed net income or loss of the Hughes Retail Group. Moreover, because the reported amount of “Net income attributable to EchoStar” in our condensed consolidated statements of operations and comprehensive income (loss) excluded DISH Network’s 28.11% economic interest (represented by the HSS Tracking Stock) in the net loss of the Hughes Retail Group (reported as a noncontrolling interest), the amount of consolidated net income or loss allocated to holders of Class A and Class B common stock effectively excluded an aggregate 80.0% of the attributed net loss of the Hughes Retail Group.

The following table presents basic and diluted EPS amounts for all periods and the corresponding weighted-average shares outstanding used in the calculations.



	For the Three Months Ended March 31,
	2017			2016
	(In thousands, except per share amounts)
Amounts attributable to EchoStar common stock:
Net income attributable to EchoStar	$	37,715		$	49,155
Less: Net loss attributable to EchoStar Tracking Stock	(1,209		)	(1,519		)
Net income attributable to EchoStar common stock	$	38,924		$	50,674

Net income from continuing operations	$	32,347		$	37,616
Net income from discontinued operations	6,577			13,058
Net income attributable to EchoStar common stock	$	38,924		$	50,674

Weighted-average common shares outstanding :
Class A and B common stock:
Basic	94,745			93,331
Dilutive impact of stock awards outstanding	1,148			521
Diluted	95,893			93,852

Earnings per share:
Class A and B common stock:
Basic:
Continuing operations	$	0.34		$	0.40
Discontinued operations	0.07			0.14
Total basic earnings per share	$	0.41		$	0.54

Diluted:
Continuing operations	$	0.34		$	0.40
Discontinued operations	0.07			0.14
Total diluted earnings per share	$	0.41		$	0.54