EARNINGS PER SHARE

We compute basic earnings per share for Common Stock and Class B common stock using the two-class method. The Class B common stock is convertible into Common Stock on a share-for-share basis at any time. With respect to dividend rights, the Common Stock holders are entitled to cash dividends 10% higher than those declared and paid on the Class B common stock. The computation of diluted earnings per share for Common Stock assumes the conversion of Class B common stock using the if-converted method, while the diluted earnings per share of Class B common stock does not assume the conversion of those shares.

We compute basic and diluted earnings per share based on the weighted-average number of shares of Common Stock and Class B common stock outstanding as follows:



	Three Months Ended
	October 2, 2016					October 4, 2015
	Common Stock		Class B Common Stock			Common Stock		Class B Common Stock
Basic earnings per share:
Numerator:
Allocation of distributed earnings (cash dividends paid)	$	94,498	$	34,068		$	92,041	$	32,128
Allocation of undistributed earnings	72,691		26,146			22,693		7,909
Total earnings—basic	$	167,189	$	60,214		$	114,734	$	40,037

Denominator (shares in thousands):
Total weighted-average shares—basic	153,259		60,620			158,111		60,620

Earnings Per Share—basic	$	1.09	$	0.99		$	0.73	$	0.66

Diluted earnings per share:
Numerator:
Allocation of total earnings used in basic computation	$	167,189	$	60,214		$	114,734	$	40,037
Reallocation of total earnings as a result of conversion of Class B common stock to Common stock	60,214		—			40,037		—
Reallocation of undistributed loss	—		(160		)	—		(27		)
Total earnings—diluted	$	227,403	$	60,054		$	154,771	$	40,010

Denominator (shares in thousands):
Number of shares used in basic computation	153,259		60,620			158,111		60,620
Weighted-average effect of dilutive securities:
Conversion of Class B common stock to Common shares outstanding	60,620		—			60,620		—
Employee stock options	1,062		—			1,192		—
Performance and restricted stock units	220		—			152		—
Total weighted-average shares—diluted	215,161		60,620			220,075		60,620

Earnings Per Share—diluted	$	1.06	$	0.99		$	0.70	$	0.66

The earnings per share calculations for the three months ended October 2, 2016 and October 4, 2015 excluded 2,921 and 2,552, respectively, of stock options that would have been antidilutive.



	Nine Months Ended
	October 2, 2016					October 4, 2015
	Common Stock		Class B Common Stock			Common Stock			Class B Common Stock
Basic earnings per share:
Numerator:
Allocation of distributed earnings (cash dividends paid)	$	273,380	$	98,326		$	262,032		$	91,051
Allocation of undistributed earnings (loss)	170,458		61,027			(39,750		)	(13,766		)
Total earnings—basic	$	443,838	$	159,353		$	222,282		$	77,285

Denominator (shares in thousands):
Total weighted-average shares—basic	153,943		60,620			159,058			60,620

Earnings Per Share—basic	$	2.88	$	2.63		$	1.40		$	1.27

Diluted earnings per share:
Numerator:
Allocation of total earnings used in basic computation	$	443,838	$	159,353		$	222,282		$	77,285
Reallocation of total earnings as a result of conversion of Class B common stock to Common stock	159,353		—			77,285			—
Reallocation of undistributed (loss) earnings	—		(347		)	—			132
Total earnings—diluted	$	603,191	$	159,006		$	299,567		$	77,417

Denominator (shares in thousands):
Number of shares used in basic computation	153,943		60,620			159,058			60,620
Weighted-average effect of dilutive securities:
Conversion of Class B common stock to Common shares outstanding	60,620		—			60,620			—
Employee stock options	1,013		—			1,406			—
Performance and restricted stock units	182		—			238			—
Total weighted-average shares—diluted	215,758		60,620			221,322			60,620

Earnings Per Share—diluted	$	2.80	$	2.62		$	1.35		$	1.28

The earnings per share calculations for the nine months ended October 2, 2016 and October 4, 2015 excluded 3,680 and 2,660, respectively, of stock options that would have been antidilutive.