Net Income Per Share

9 Months Ended

Jun. 23, 2012

Net Income Per Share

(9) Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding. Diluted net income per share is computed by dividing net income by the weighted average number of common shares outstanding plus the dilutive effect of potential common shares from outstanding stock options, restricted stock units, the employee stock purchase plan, and convertible debt determined by applying the treasury stock method. In accordance with ASC 718, Stock Compensation, the assumed proceeds under the treasury stock method include the average unrecognized compensation expense of restricted stock units and stock options that are in-the-money based on the Company’s average stock during the period.

The Company applies the provisions of ASC 260, Earnings per Share, Subtopic 10-45-44, to determine the diluted weighted average shares outstanding as it relates to its outstanding Convertible Notes, and due to the type of debt instrument issued, the Company uses the treasury stock method and not the if-converted method. The dilutive impact of the Company’s Convertible Notes is based on the difference between the Company’s current period average stock price and the conversion price of the Convertible Notes, provided there is a premium. Pursuant to this accounting standard, there is no dilution from the accreted principal of the Convertible Notes.

A reconciliation of basic and diluted share amounts is as follows:

	Three Months Ended				Nine Months Ended
	June 23, 2012		June 25, 2011		June 23, 2012		June 25, 2011
Numerator:
Net income	$	23,594	$	36,196	$	4,133	$	129,581
Denominator:
Basic weighted average common shares outstanding		264,609		261,784		263,742		260,744
Weighted average common stock equivalents from assumed exercise of stock options and restricted stock units		2,685		3,383		2,617		3,370
Diluted weighted average common shares outstanding		267,294		265,167		266,359		264,114
Basic net income per common share	$	0.09	$	0.14	$	0.02	$	0.50
Diluted net income per common share	$	0.09	$	0.14	$	0.02	$	0.49
Weighted-average anti-dilutive shares related to:
Outstanding stock options		7,568		5,930		8,654		7,117
Restricted stock units		—		—		529		—

Diluted weighted average shares outstanding do not include any effect resulting from the assumed conversion of the Company’s Convertible Notes as their impact would be anti-dilutive for all periods presented.