EARNINGS PER SHARE

3 Months Ended

Jan. 01, 2016

Basic net earnings per share is computed by dividing net earnings attributable to Varian by the weighted average number of shares of VMS common stock outstanding for the period. Diluted net earnings per share is computed by dividing net earnings attributable to Varian by the sum of the weighted average number of common shares outstanding and dilutive common shares under the treasury stock method.

The following table sets forth the computation of basic and diluted net earnings per share:



	Three Months Ended
	January 1,		January 2,
(In thousands, except per share amounts)	2016		2015
Net earnings attributable to Varian	$	89,027	$	93,314
Weighted average shares outstanding - basic	97,156		100,468
Dilutive effect of potential common shares	687		1,174
Weighted average shares outstanding - diluted	97,843		101,642
Net earnings per share attributable to Varian - basic	$	0.92	$	0.93
Net earnings per share attributable to Varian - diluted	$	0.91	$	0.92
Anti-dilutive employee shared based awards, excluded	1,244		504

The Company excludes potentially dilutive common shares (consisting of shares underlying stock options and the employee stock purchase plan) from the computation of diluted weighted average shares outstanding if the per share value, either the exercise price of the awards or the sum of (a) the exercise price of the awards and (b) the amount of the compensation cost attributed to future services and not yet recognized and (c) the amount of tax benefit or shortfall that would be recorded in additional paid-in capital when the award becomes deductible, is greater than the average market price of the shares, because the inclusion of the shares underlying these stock awards would be anti-dilutive to earnings per share.