Stockholders' Equity

6 Months Ended

Jun. 29, 2024

Earnings Per Share [Abstract]

Stockholders' Equity

STOCKHOLDERS’ EQUITY

Earnings Per Share

The Company computes EPS in accordance with Accounting Standards Codification (“ASC”) 260, Earnings per Share. Basic EPS is computed by dividing net income 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 applied 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 (the “Series A Preferred Stock”), if dilutive in the period. For the 13 weeks ended June 29, 2024, there were no anti dilutive shares excluded from the dilutive share based calculation. For the 13 weeks ended July 1, 2023, share-based awards representing less than 1 million underlying common shares were not included in the computation because the effect would have been anti-dilutive. For both the 26 weeks ended June 29, 2024 and July 1, 2023, share-based awards representing 1 million underlying common shares were not included in the computation because the effect would have been anti-dilutive. Additionally, Series A Preferred Stock shares were dilutive for the 13 weeks and 26 weeks ended July 1, 2023. For the 13 weeks and 26 weeks ended June 29, 2024, there are no Series A Preferred Stock outstanding.

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

	13 Weeks Ended				26 Weeks Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
Numerator:
Net income	$	198	$	182	$	280	$	264
Less: Series A Preferred Stock Dividends	—		—		—		(7)
Net income available to common shareholders	$	198	$	182	$	280	$	257
Denominator:
Weighted-average common shares outstanding—basic	246		238		245		232
Effect of dilutive share-based awards	2		2		3		2
Effect of dilutive underlying shares of the Series A Preferred Stock (1)	—		11		—		17
Weighted-average common shares outstanding—diluted	248		251		248		251
Net income per share
Basic	$	0.81	$	0.76	$	1.14	$	1.11
Diluted	$	0.80	$	0.73	$	1.13	$	1.05

(1)    Under the if-converted method, outstanding shares of the Series A Preferred Stock were treated as if converted to common shares for inclusion in the calculation of the weighted-average common shares outstanding—diluted. Under this approach, if converted, there would be no preferred stock outstanding and therefore no Series A Preferred Stock dividend. As of June 29, 2024, there are no Series A Preferred Stock outstanding.

Share Repurchase Program

On November 2, 2022, our Board of Directors approved a share repurchase program under which the Company was authorized to repurchase up to $500 million of its outstanding common stock. Prior to June 1, 2024, the Company repurchased $340 million of shares of common stock pursuant to such plan. On June 1, 2024, the Board approved, and on June 5, 2024, the Company announced, a new share repurchase authorization of $1 billion of the Company’s common stock, an increase of $840 million above the $160 million of capacity remaining as of June 1, 2024 under the prior November 2022 authorization. As of June 29, 2024, there was approximately $979 million in remaining funds authorized under the increased repurchase program. For the 13

weeks ended June 29, 2024, the Company repurchased 749,387 shares at an aggregate purchase price of approximately $41 million under the program, inclusive of $1 million of excise taxes, fees and commissions. For the 26 weeks ended June 29, 2024, the Company repurchased 1,033,375 shares at an aggregate purchase price of approximately $54 million under the program, inclusive of $1 million of excise taxes, fees and commissions.

The size and timing of any repurchases will depend on a number of factors, including share price, general business and market conditions and other factors. Under the share repurchase program, repurchases can be made from time to time using a variety of methods, including open market purchases, privately negotiated transactions, accelerated share repurchases and Rule 10b5-1 trading plans. The share repurchase program does not obligate the Company to acquire any particular amount of shares, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion. The repurchase authorization does not have an expiration date.