Net Income Per Share

12 Months Ended

Jan. 31, 2013

Notes To Financial Statements [Abstract]

Earnings Per Share [Text Block]

Net Income Per Share

The following provides the computation of basic and diluted net income per share:

Year ended January 31,	2013			2012		2011
Net income attributable to Mentor Graphics shareholders	$	138,736		$	83,872	$	28,584
Noncontrolling interest adjustment to redemption value	(5,272		)	—		—
Adjusted net income attributable to Mentor Graphics shareholders	$	133,464		$	83,872	$	28,584
Weighted average common shares used to calculate basic net income per share	110,998			110,138		107,743
Employee stock options, restricted stock units and employee stock purchase plan	3,019			2,777		2,118
Weighted average common and potential common shares used to calculate diluted net income per share	114,017			112,915		109,861
Net income per share attributable to Mentor Graphics shareholders:
Basic	$	1.20		$	0.76	$	0.27
Diluted	$	1.17		$	0.74	$	0.26

We excluded from the computation of diluted net income per share stock options and ESPP purchase rights to purchase 1,975 shares of common stock for the year ended January 31, 2013, 4,056 for fiscal 2012, and 6,921 for fiscal 2011. The stock options and ESPP purchase rights were determined to be anti-dilutive as a result of applying the treasury stock method.

We have reduced the numerator of our basic and diluted earnings per share calculation by $5,272 for the year ended January 31, 2013 for the accumulated adjustment of the noncontrolling interest with redemption feature to its calculated redemption value at January 31, 2013, recorded directly to retained earnings. For the year ended January 31, 2012, we excluded a similar adjustment of $1,682 from the calculation of basic and diluted earnings per share, as the amount was not significant.

The effect of the conversion of the 4.00% Debentures and the 6.25% Debentures (retired during fiscal 2012) was anti-dilutive and therefore excluded from the computation of diluted net income per share. We assume that the 4.00% Debentures and the 6.25% Debentures will be settled in common stock for purposes of calculating the dilutive effect on net income per share. If the 4.00% Debentures and the 6.25% Debentures had been dilutive we would have included additional income and additional incremental common shares as shown in the following table:

Year ended January 31,	2013		2012		2011
4.00% Debentures
Additional income	$	2,075	$	2,075	$	—
Additional incremental common shares (1)	—		—		—
Year ended January 31,	2013		2012		2011
6.25% Debentures
Additional income	$	—	$	—	$	3,062
Additional incremental common shares (1)	—		—		—

⁽¹⁾  Dilutive net income per share would have included no incremental shares for the years ended January 31, 2013, 2012, or 2011 as the stock price was below the conversion rate.

The conversion features of the 4.00% Debentures and the 6.25% Debentures, which allow for settlement in cash, common stock, or a combination of cash and common stock, are further described in Note 8. “Notes Payable.”