Earnings Per Share

9 Months Ended

Sep. 30, 2023

Earnings Per Share

Earnings Per Share

Note 21—Earnings Per Share

Basic earnings per share is determined by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is determined by dividing net income by the weighted average number of shares of common stock outstanding, assuming all dilutive securities were issued.

The Company’s potentially dilutive securities are stock-based compensation awards. The Company applies the treasury stock method to determine the diluted weighted average number of shares of common stock outstanding based on the outstanding stock-based compensation awards.

The following table summarizes the basic and diluted earnings per share calculations:

	Quarter ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
	(in thousands, except per share amounts)
Net income	$	92,870	$	135,134	$	181,498	$	437,890
Weighted average shares of common stock outstanding		49,902		52,170		49,975		54,043
Effect of dilutive securities - shares issuable under stock-based compensation plan		2,659		2,798		2,760		2,870
Weighted average diluted shares of common stock outstanding		52,561		54,968		52,735		56,913
Basic earnings per share	$	1.86	$	2.59	$	3.63	$	8.10
Diluted earnings per share	$	1.77	$	2.46	$	3.44	$	7.69

Calculations of diluted earnings per share require certain potentially dilutive shares to be excluded when their inclusion in the diluted earnings per share calculation would be anti-dilutive. The following table summarizes the weighted-average number of anti-dilutive outstanding RSUs and stock options excluded from the calculation of diluted earnings per share:

	Quarter ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
	(in thousands except for weighted average exercise price)
Performance-based RSUs (1)		604		325		548		268
Time-based RSUs		—		—		46		116
Stock options (2)		219		1,423		287		1,312
Total anti-dilutive units and options		823		1,748		881		1,696
Weighted average exercise price of anti-dilutive stock options (2)	$	60.69	$	58.49	$	59.31	$	58.61

(1) Certain performance-based RSUs were outstanding but not included in the computation of earnings per share because the performance thresholds included in such RSUs have not been achieved.

(2) Certain stock options were outstanding but not included in the computation of diluted earnings per share because the weighted-average exercise prices were above the average stock prices for the period.