Earnings Per Share

9 Months Ended

Sep. 30, 2015

Basic earnings per share of common stock is computed using the weighted average number of shares of common stock outstanding during each period. The diluted earnings per share of common stock include the effect of outstanding stock options, shares of restricted stock, or shares of our common stock held in a rabbi trust (when dilutive). The following table summarizes the calculation of basic and diluted earnings per share:



	Three Months Ended September 30,						Nine Months Ended September 30,
(millions, except per share amounts)	2015			2014			2015			2014
Net Income (Loss)	$	(283	)	$	419		$	(413	)	$	811
Earnings Adjustment from Assumed Conversion of Dilutive Shares of Common Stock in Rabbi Trust ⁽²⁾	—			(8		)	—			—
Net Income (Loss) Used for Diluted Earnings Per Share Calculation	$	(283	)	$	411		$	(413	)	$	811

Weighted Average Number of Shares Outstanding, Basic ⁽¹⁾	420			362			392			361
Incremental Shares from Assumed Conversion of Dilutive Stock Options, Restricted Stock, and Shares of Common Stock in Rabbi Trust ⁽²⁾	—			5			—			6
Weighted Average Number of Shares Outstanding, Diluted	420			367			392			367
Earnings (Loss) Per Share, Basic	$	(0.67	)	$	1.16		$	(1.05	)	$	2.25
Earnings (Loss) Per Share, Diluted	(0.67		)	1.12			(1.05		)	2.21
Number of Antidilutive Stock Options, Shares of Restricted Stock, and Shares of Common Stock in Rabbi Trust Excluded from Calculation Above	14			2			11			3


⁽¹⁾	The weighted average number of shares outstanding includes the weighted average shares of common stock issued in connection with the underwritten public offering of 24.15 million shares of Noble Energy common stock in first quarter 2015 and issued in connection with the exchange of approximately 41 million shares for all outstanding shares of Rosetta common stock on July 20, 2015.

⁽²⁾

For the three and nine months ended September 30, 2015, all outstanding options and non-vested restricted shares have been excluded from the calculation of diluted EPS as Noble Energy incurred losses. Therefore, inclusion of outstanding options and non-vested restricted shares in the calculation of diluted EPS would be anti-dilutive. Consistent with GAAP, when dilutive, deferred compensation gains or losses, net of tax, are excluded from net income while our common shares held in the rabbi trust are included in the diluted share count. For this reason, the diluted earnings per share calculations for the three months ended September 30, 2014 excluded deferred compensation (gains) losses, net of tax. The deferred compensation loss, net of tax, excluded for the calculation of diluted earnings per share for the nine months ended September 30, 2014 was de minimis.