EARNINGS PER SHARE

Basic earnings per share are computed based on the weighted average number of common shares outstanding. Diluted earnings per share are calculated to reflect the potential dilution that could occur if securities or other contracts were exercised or converted into common stock.

Basic and diluted earnings per common share are calculated as follows:



	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions, except per share amounts)	2017		2016		2017		2016
Earnings per share — basic:
Goodyear net income	$	129	$	317	$	442	$	703
Weighted average shares outstanding	250		262		251		264
Earnings per common share — basic	$	0.52	$	1.21	$	1.76	$	2.66

Earnings per share — diluted:
Goodyear net income	$	129	$	317	$	442	$	703
Weighted average shares outstanding	250		262		251		264
Dilutive effect of stock options and other dilutive securities	4		4		4		4
Weighted average shares outstanding — diluted	254		266		255		268
Earnings per common share — diluted	$	0.50	$	1.19	$	1.73	$	2.62

Weighted average shares outstanding - diluted for the three and nine months ended September 30, 2017 and for the nine months ended September 30, 2016 exclude approximately 1 million equivalent shares related to options with exercise prices greater than the average market price of our common shares (i.e., "underwater" options). There were no equivalent shares related to options with exercise prices greater than the average market price of our common shares for the three months ended September 30, 2016.