EARNINGS (LOSS) PER SHARE

12 Months Ended

Dec. 31, 2022

EARNINGS (LOSS) PER SHAREBasic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income (loss) adjusted for the gain on fair value of warrant liability, if the warrants are in-the-money and the impact is dilutive, by the weighted-average number of common shares outstanding during the period increased by the number of additional shares that would have been outstanding related to potentially dilutive equity-based compensation and warrants.

The details of the earnings per share calculations for the years ended December 31, 2022, 2021, and 2020 are as follows:


	Year Ended December 31,
(in millions, except per share and per share amounts)	2022		2021		2020(1)
Basic earnings (loss) per share computation:
Net income (loss)	$	76.6	$	119.6	$	(327.3)
Weighted-average number of shares outstanding - basic	376,730,519		355,544,632		307,076,397
Basic earnings per share	$	0.20	$	0.34	$	(1.07)

Diluted earnings (loss) per share computation:
Net income (loss)	$	76.6	$	119.6	$	(327.3)
Gain on fair value of warrant liabilities	(90.9)		—		—
Net income (loss) adjusted for the gain on fair value of warrant liabilities	$	(14.3)	$	119.6	$	(327.3)

Weighted-average number of shares outstanding - basic	376,730,519		355,544,632		307,076,397
Dilutive effect of private warrants	1,493,532		—		—
Dilutive effect of equity-based compensation	—		4,595,691		—
Weighted-average number of shares outstanding - diluted	378,224,051		360,140,323		307,076,397
Diluted earnings (loss) per share	$	(0.04)	$	0.33	$	(1.07)

(1)The Business Combination was accounted for as a reverse capitalization in accordance with U.S. GAAP. See “Description of the Business” in “Note 1 - Summary of Significant Accounting Policies.” Accordingly, weighted-average shares outstanding for purposes of the earnings per share calculation have been retroactively restated as shares reflecting the exchange ratio established in the Business Combination (1.0 Vertiv Holdings share to 118.261955 Vertiv Holdings Co shares).

The dilutive effect of warrants was 1.5 million shares for the year ended December 31, 2022. Additional stock awards represented 15.8 million shares were also outstanding during the year ended December 31, 2022, but were not included in the computation of diluted earnings per common share because the effect would be anti-dilutive.

The dilutive effect of stock awards was 4.6 million shares for the year ended December 31, 2021. Additional stock awards and warrants were also outstanding during the year ended December 31, 2021, but were not included in the computation of diluted earnings per common share because the effect would be anti-dilutive. Such anti-dilutive stock awards and warrants represented 2.3 million and 5.7 million shares for the year ended December 31, 2021, respectively.

The dilutive effect of stock awards was zero for the year ended December 31, 2020. Additional stock awards and warrants were also outstanding during the year ended December 31, 2020, but were not included in the computation of diluted earnings per common share because the effect would be anti-dilutive. Such anti-dilutive stock awards and warrants represented 6.7 million and 25.0 million shares for the year ended December 31, 2020, respectively.

In December of 2020, the Company announced its plans to redeem for cash all of its outstanding Public Warrants to purchase shares of Vertiv’s Class A common shares. During 2020, $156.5 of cash was generated from the exercise of 13.6 million Public Warrants.

In January of 2021, 9.3 million Public Warrants were exercised which generated cash proceeds of $107.5 in connection with Vertiv’s notice of redemption to redeem for cash all of its outstanding Public Warrants to purchase shares of Class A common stock. Public Warrants that remained exercised at 5 p.m. New York City time on January 18, 2021 were no longer exercisable, and the registered holders of such unexercised Public Warrants were entitled to receive the redemption price of $0.01 per Warrant.