Net Income Per Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Net Income Per Share

6. NET INCOME PER SHARE

Predecessor Ambac common stock (and related stock options and restricted stock units) was cancelled upon emergence from bankruptcy on the Effective Date. Pursuant to the Reorganization Plan, 45,000,000 shares of new common stock at par value of $0.01 per share and 5,047,138 warrants were issued. Warrants entitle such holders to acquire up to 5,047,138 shares of new common stock at an exercise price of $16.67 per share at any time on or prior to April 30, 2023. For the two months ended June 30, 2013, 6,244 warrants were exercised, resulting in an issuance of 2,456 shares of common stock. As of June 30, 2013, Successor Ambac had 5,040,894 warrants outstanding. Successor Ambac’s common stock and warrants began trading on NASDAQ under the symbols “AMBC” and “AMBCW,” respectively, on May 1, 2013. As such, the earnings per share information for Predecessor Ambac is not meaningful to investors in Successor Ambac’s common stock and warrants.

Basic net income per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted net income per share is computed by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding plus all dilutive potential common shares outstanding during the period. All dilutive potential common shares outstanding consider common stock deliverable pursuant to warrants issued under the Reorganization Plan. The following table provides a reconciliation of the common shares used for basic earnings per share and diluted earnings per share:

	Successor Ambac		Predecessor Ambac
	Two months ended June 30, 2013		One month ended April 30, 2013		Three months ended June 30, 2012
Weighted average number of common shares used for basic earnings per share		45,000,653		302,469,626		302,469,196
Effect of potential dilutive shares:
Warrants		1,575,064		—		—
Restricted stock units		—		109,593		—
Weighted average number of common shares and potential dilutive shares used for diluted earnings per share	$	46,575,717	$	302,579,219	$	302,469,196
Anti-dilutive shares excluded from the above reconciliation:
Warrants		—		—		—
Stock options		—		461,150		850,308
Restricted stock units		—		—		71,296

	Successor Ambac		Predecessor Ambac
	Two months ended June 30, 2013		Four months ended April  30, 2013		Six months ended June 30, 2012
Weighted average number of common shares used for basic earnings per share		45,000,653		302,469,544		302,467,762
Effect of potential dilutive shares:
Warrants		1,575,064		—		—
Restricted stock units		—		109,701		—
Weighted average number of common shares and potential dilutive shares used for diluted earnings per share	$	46,575,717	$	302,579,245	$	302,467,762
Anti-dilutive shares excluded from the above reconciliation:
Warrants		—		—		—
Stock options		—		475,550		868,990
Restricted stock units		—		—		72,060