Earnings Per Share

9 Months Ended

Sep. 26, 2020

EARNINGS PER SHARE

The Company computes EPS in accordance with ASC 260, Earnings per Share. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares of common stock outstanding.

Diluted EPS is computed using the weighted average number of shares of common stock, plus the effect of potentially dilutive securities. The Company applies the treasury method to calculate the dilution impact of share-based awards—stock options, non-vested restricted shares with forfeitable dividend rights, restricted stock units, and employee stock purchase plan deferrals. The Company applies the if-converted method to calculate the dilution impact of the Series A Convertible Preferred Stock. For the 13 weeks ended September 26, 2020 and September 28, 2019, share-based awards representing 9 million and 1 million underlying common shares, respectively, were not included in the computation because the effect would have been anti-dilutive. For the 39 weeks ended September 26, 2020 and September 28, 2019, share-based awards representing 9 million and 2 million underlying common shares, respectively, were not included in the computation because the effect would have been anti-dilutive. For the 13 weeks and 39 weeks ended September 26, 2020, convertible preferred stock representing 23 million and 12 million of underlying common shares, respectively, was not included in the computation because the effect would have been anti-dilutive.

The following table sets forth the computation of basic and diluted EPS:


	13 Weeks Ended				39 Weeks Ended
	September 26, 2020		September 28, 2019		September 26, 2020		September 28, 2019
Numerator:
Income (loss) from continuing operations	$	8	$	105	$	(216)	$	292
Income from discontinued operations	—		1		—		1
Net income (loss)	8		106		(216)		293
Series A Convertible Preferred Stock dividends (1)	10		—		15		—
Net (loss) income available to common shareholders	$	(2)	$	106	$	(231)	$	293
Denominator:
Weighted-average common shares outstanding	220		218		220		218
Effect of dilutive securities	—		2		—		1
Effect of dilutive underlying shares of the Series A Convertible Preferred Stock	—		—		—		—
Weighted-average dilutive shares outstanding	220		220		220		219
Basic earnings per share:
Continuing operations	$	(0.01)	$	0.48	$	(1.05)	$	1.33
Discontinued operations	0.00		0.01		0.00		0.01
Net (loss) income per share	$	(0.01)	$	0.49	$	(1.05)	$	1.34
Diluted earnings per share:
Continuing operations	$	(0.01)	$	0.47	$	(1.05)	$	1.33
Discontinued operations	0.00		0.01		0.00		0.01
Net (loss) income per share	$	(0.01)	$	0.48	$	(1.05)	$	1.34

(1) Preferred stock dividends for the second quarter of 2020 were declared on June 19, 2020 and were paid in kind on June 30, 2020. Preferred stock dividends for the third quarter of 2020 were declared on September 21, 2020 and were paid in kind on September 30, 2020.