Earnings Per Share

6 Months Ended

Jun. 30, 2020

NOTE 6. 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					Six Months Ended
	June 30,					June 30,
(In millions, except per share amounts)	2020			2019		2020			2019
Earnings (loss) per share — basic:
Goodyear net income (loss)	$	(696	)	$	54	$	(1,315	)	$	(7	)
Weighted average shares outstanding		234			233		234			232
Earnings (loss) per common share — basic	$	(2.97	)	$	0.23	$	(5.62	)	$	(0.03	)

Earnings (loss) per share — diluted:
Goodyear net income (loss)	$	(696	)	$	54	$	(1,315	)	$	(7	)
Weighted average shares outstanding		234			233		234			232
Dilutive effect of stock options and other dilutive securities		—			1		—			—
Weighted average shares outstanding — diluted		234			234		234			232
Earnings (loss) per common share — diluted	$	(2.97	)	$	0.23	$	(5.62	)	$	(0.03	)

Weighted average shares outstanding – diluted for the six months ended June 30, 2019 excludes the dilutive effect of approximately 2 million equivalent shares related primarily to options with exercise prices less than the average market price of our common shares (i.e., “in-the-money” options) as their inclusion would have been anti-dilutive due to the Goodyear net loss. There were no in-the-money options at June 30, 2020. Additionally, weighted average shares outstanding – diluted for the three and six months ended June 30, 2020 excludes approximately 9 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 approximately 2 million equivalent shares related to underwater options for the three and six months ended June 30, 2019.