Net Income per Share

Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed using the treasury stock method, for dilutive stock options, restricted stock units, and Convertible Notes.

The following table reconciles the numerators and denominators of the basic and diluted computations for net income per share.



	Year Ended
	June 24, 2018		June 25, 2017		June 26, 2016
	(in thousands, except per share data)
Numerator:
Net income	$	2,380,681	$	1,697,763	$	914,049
Denominator:
Basic average shares outstanding	161,643		162,222		158,919
Effect of potential dilutive securities:
Employee stock plans	2,312		2,058		2,120
Convertible notes	12,258		16,861		13,464
Warrants	4,569		2,629		656
Diluted average shares outstanding	180,782		183,770		175,159
Net income per share - basic	$	14.73	$	10.47	$	5.75
Net income per share - diluted	$	13.17	$	9.24	$	5.22

For purposes of computing diluted net income per share, weighted-average common shares do not include potentially dilutive securities that are anti-dilutive under the treasury stock method. The following potentially dilutive securities were excluded:



	Year Ended
	June 24, 2018	June 25, 2017	June 26, 2016
	(in thousands)
Options and RSUs	34	34	149

Diluted shares outstanding do not include any effect resulting from note hedges associated with the Company’s 2018 Notes (as described in Note 13) as their impact would have been anti-dilutive.