Earnings Per Share

The following table sets forth the computation of basic earnings per share and earnings per share, assuming dilution:



	Fiscal Years
	2018			2017			2016
Numerator (Dollars in Millions):
Net Earnings	$	3,309		$	5,471		$	1,714
Dividend Equivalents on Restricted Stock	(1		)	(1		)	(1		)
Net Earnings, Attributable to Common Shareholders	$	3,308		$	5,470		$	1,713

Denominator (Units in Millions):
Average Common Shares Outstanding	857			911			947
Other Potentially Dilutive Common Shares	4			3			1
Average Common Shares Outstanding, Assuming Dilution	861			914			948

Net Earnings Per Share, Basic	$	3.86		$	6.01		$	1.81
Net Earnings Per Share, Assuming Dilution	$	3.84		$	5.99		$	1.81

Basic earnings per share is based on the weighted-average number of shares of common stock outstanding. Earnings per share, assuming dilution, is based on the weighted-average number of shares of common stock outstanding and common stock equivalents adjusted for the effects of common stock that may be issued as a result of potentially dilutive instruments. CSX's potentially dilutive instruments are made up of equity awards including performance units and employee stock options.

When calculating diluted earnings per share, CSX is required to include the potential shares that would be outstanding if all outstanding stock options were exercised. This number is different from outstanding stock options, which is included in Note 4, Stock Plans and Share-Based Compensation, because it is offset by shares CSX could repurchase using the proceeds from these hypothetical exercises to obtain the common stock equivalent. Approximately 479 thousand, 7.6 million and 2.8 million of total average outstanding stock options for 2018, 2017 and 2016, respectively, were excluded from the diluted earnings per share calculation because their effect was antidilutive.

Share Repurchases

Share repurchases under the $2 billion program announced in April 2015 were completed in April 2017. The Company subsequently announced a $1 billion share repurchase program in April 2017, with additional authority of $500 million added in July 2017. Repurchases under that program were completed on October 2, 2017. The Company announced a new $1.5 billion share repurchase program on October 25, 2017.

In February 2018, the Company announced an increase to the $1.5 billion share repurchase program first announced in October 2017, bringing the total authorized to $5 billion. This program was completed on January 16, 2019. Also on January 16, 2019, the Company announced another $5 billion share repurchase program. The repurchases may be made through a variety of methods including, but not limited to, open market purchases, purchases pursuant to Rule 10b5-1 plans, accelerated share repurchases and negotiated block purchases. The timing of share repurchases depends upon marketplace conditions and other factors, and the program remains subject to the discretion of the Board of Directors.

NOTE 2. Earnings Per Share, continued

During 2018, 2017, and 2016, CSX repurchased the following shares:



	Fiscal Years
	2018		2017		2016
Shares Repurchased (Units in Millions)	72		39		38
Cost of Shares (Dollars in Millions)	$	4,671	$	1,970	$	1,056
Average Price Paid per Share	$	64.64	$	50.80	$	27.52

During 2018, the Company entered into four accelerated share repurchase agreements to repurchase shares of the Company’s common stock. Under these agreements, the Company paid $1.5 billion and received approximately 22 million total shares, which are included in the table above.

Management's assessment of market conditions and other factors guide the timing and volume of repurchases. Future share repurchases are expected to be funded by cash on hand, cash generated from operations and debt issuances. Shares are retired immediately upon repurchase. In accordance with the Equity Topic in the ASC, the Company elected to allocate the excess of repurchase price over par value and record in retained earnings.