Earnings Per Share

3 Months Ended

Jul. 01, 2016

Basic and diluted earnings per share are computed on the basis of the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share also include the incremental effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include the dilutive effect of shares underlying outstanding stock options, restricted stock, employee stock purchase plan and convertible senior notes.

The components of earnings per share are as follows:



	Three Months Ended
	July 1, 2016		July 3, 2015
	(In millions, except per share data)
Income from continuing operations	$	66	$	25
Income from discontinued operations, net of tax	69		92
Net income	$	135	$	117
Income per share - basic:
Continuing operations	$	0.11	$	0.04
Discontinued operations	$	0.11	$	0.13
Net income per share	$	0.22	$	0.17
Income per share - diluted:
Continuing operations	$	0.11	$	0.04
Discontinued operations	$	0.11	$	0.13
Net income per share	$	0.22	$	0.17

Weighted-average shares outstanding - basic	613		682
Dilutive potential shares from stock-based compensation and convertible note	7		9
Weighted-average shares outstanding - diluted	620		691
Anti-dilutive potential shares	2		—

The Company expects to settle the principal amount of the outstanding 2.50% Convertible Senior Notes in cash, and therefore uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread on the 2.50% Convertible Senior Notes has a dilutive impact on diluted net income per share of common stock when the average market price of the Company’s common stock for a given period exceeds the conversion price of $16.77 per share for the 2.50% Convertible Senior Notes.