EX-11 2 ibm14q3_ex11.htm EX-11  

EXHIBIT 11

 

COMPUTATION OF BASIC AND DILUTED

EARNINGS PER SHARE

(UNAUDITED)

 

 

 

 

 

 

 

 

For the Three Months Ended

 

September 30, 2014

 

September 30 2013*

Number of shares on which basic earnings per share is calculated:

 

 

 

 

 

  Weighted-average shares outstanding during period

 

 991,835,307  

 

 

 1,090,922,993  

    Add – Incremental shares under stock-based compensation plans

 

 4,308,983  

 

 

 5,933,962  

    Add – Incremental shares associated with contingently issuable shares

 

 1,513,587  

 

 

 1,921,024  

  Number of shares on which diluted earnings per share is calculated

 

 997,657,878  

 

 

 1,098,777,979  

 

 

 

 

 

 

Income from continuing operations (millions)

$

 3,455  

 

$

 4,139  

Loss from discontinued operations, net of tax (millions)

 

 (3,437) 

 

 

 (98) 

Net income on which basic earnings per share is calculated (millions)

$

 18  

 

$

 4,041  

 

 

 

 

 

 

Income from continuing operations (millions)

$

 3,455  

 

$

 4,139  

Net income applicable to contingently issuable shares (millions)

 

–

 

 

–

Income from continuing operations on which diluted earnings per share is

 

 

 

 

 

 calculated (millions)

$

 3,455  

 

$

 4,139  

Loss from discontinued operations, net of tax on which basic and diluted

 

 

 

 

 

 earnings per share is calculated (millions)

 

 (3,437) 

 

 

 (98) 

Net income on which diluted earnings per share is calculated (millions)

$

 18  

 

$

 4,041  

 

 

 

 

 

 

Earnings per share of common stock:

 

 

 

 

 

 

 

 

 

 

 

Assuming dilution

 

 

 

 

 

  Continuing operations

$

 3.46  

 

$

 3.77  

  Discontinued operations

 

 (3.44) 

 

 

 (0.09) 

  Total

$

 0.02  

 

$

 3.68  

 

 

 

 

 

 

Basic

 

 

 

 

 

  Continuing operations

$

 3.48  

 

$

 3.79  

  Discontinued operations

 

 (3.46) 

 

 

 (0.09) 

  Total

$

 0.02  

 

$

 3.70  

 

 

 

 

 

 

 

 

 

 

 

 

       Stock options to purchase 3,187 shares were outstanding as of September 30, 2013 but were not included in the 

computation of diluted earnings per share because the options' exercise price during the respective period was greater than

the average market price of the common shares, and, therefore, the effect  would have been antidilutive. There were no

stock options outstanding at September 30, 2014 that were considered antidilutive.

 

 

 

 

 

 

* Reclassified to reflect discontinued operations presentation.

 

 

 

 

 

 

  

91 

EXHIBIT 11

 

COMPUTATION OF BASIC AND DILUTED

EARNINGS PER SHARE

(UNAUDITED)

 

 

 

 

 

 

 

 

For the Nine Months Ended

 

September 30, 2014

 

September 30 2013*

Number of shares on which basic earnings per share is calculated:

 

 

 

 

 

  Weighted-average shares outstanding during period

 

 1,008,895,540  

 

 

 1,101,830,931  

    Add – Incremental shares under stock compensation plans

 

 4,615,009  

 

 

 7,206,259  

    Add – Incremental shares associated with contingently issuable shares

 

 1,348,225  

 

 

 1,696,834  

  Number of shares on which diluted earnings per share is calculated

 

 1,014,858,774  

 

 

 1,110,734,023  

 

 

 

 

 

 

Income from continuing operations (millions)

$

 10,237  

 

$

 10,665  

Loss from discontinued operations, net of tax (millions)

 

 (3,698) 

 

 

 (366) 

Net income on which basic earnings per share is calculated (millions)

$

 6,539  

 

$

 10,299  

 

 

 

 

 

 

Income from continuing operations (millions)

$

 10,237  

 

$

 10,665  

 

 

 

 

 

 

Net income applicable to contingently issuable shares (millions)

 

0

 

 

 (1) 

Income from continuing operations on which diluted earnings per share is

 

 

 

 

 

 calculated (millions)

$

 10,236  

 

$

 10,663  

Loss from discontinued operations, net of tax on which basic and diluted

 

 

 

 

 

 earnings per share is calculated (millions)

 

 (3,698) 

 

 

 (366) 

Net income on which diluted earnings per share is calculated (millions)

$

 6,538  

 

$

 10,298  

 

 

 

 

 

 

Earnings per share of common stock:

 

 

 

 

 

 

 

 

 

 

 

Assuming dilution

 

 

 

 

 

  Continuing operations

$

 10.09  

 

$

 9.60  

  Discontinued operations

 

 (3.65) 

 

 

 (0.33) 

  Total

$

 6.44  

 

$

 9.27  

 

 

 

 

 

 

Basic

 

 

 

 

 

  Continuing operations

$

 10.15  

 

$

 9.68  

  Discontinued operations

 

 (3.67) 

 

 

 (0.33) 

  Total

$

 6.48  

 

$

 9.35  

 

 

 

 

 

 

 

 

 

 

 

 

       Stock options to purchase 7,535 shares and 1,062 shares  (average of first, second and third quarter share amounts) were

outstanding as of September 30, 2014 and 2013, respectively, but were not included  in the computation of diluted earnings

 per share because the options' exercise price during the respective periods was greater than the average market price

of the common shares, and, therefore, the effect would have been antidilutive.

 

 

 

 

 

 

* Reclassified to reflect discontinued operations presentation.

 

92