EARNINGS PER SHARE

Basic earnings per share is calculated by dividing income available to stockholders by the weighted-average number of

common shares outstanding during each period. Diluted earnings per share is computed using the weighted-average number of

common and dilutive common share equivalents outstanding during the period. Dilutive common share equivalents consist of

shares issuable upon the exercise or settlement of stock awards and shares issuable under the employee stock purchase plan

(calculated using the treasury stock method) during the period they were outstanding and potential dilutive common shares

from the conversion spread on the Company’s Convertible Notes and the Company's warrants.

The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share information):



	Year Ended December 31,
	2018		2017			2016
Numerator:
Income from continuing operations	$	575,667	$	21,985		$	469,855
(Loss) income from discontinued operations, net of income taxes	—		(42,704		)	66,257
Net income (loss)	$	575,667	$	(20,719	)	$	536,112
Denominator:
Denominator for basic earnings per share - weighted-average shares outstanding	136,030		150,779			155,134
Effect of dilutive employee stock awards	2,653		2,493			1,950
Effect of dilutive Convertible Notes	5,769		2,231			—
Effect of dilutive warrants	1,482		—			—
Denominator for diluted earnings per share - weighted-average shares outstanding	145,934		155,503			157,084

Basic earnings (loss) per share:
Income from continuing operations	$	4.23	$	0.15		$	3.03
(Loss) income from discontinued operations, net of income taxes	—		(0.28		)	0.43
Basic net earnings (loss) per share	$	4.23	$	(0.13	)	$	3.46

Diluted earnings (loss) per share:
Income from continuing operations	$	3.94	$	0.14		$	2.99
(Loss) income from discontinued operations, net of income taxes	—		(0.27		)	0.42
Diluted net earnings (loss) per share:	$	3.94	$	(0.13	)	$	3.41

For the year ended December 31, 2018, the weighted-average number of shares outstanding used in the computation of diluted earnings per share includes the dilutive effect of the Company's warrants, as the average stock price during the year was above the weighted-average warrant strike price of $94.94 per share. For the years ended December 31, 2017 and 2016, the weighted-average number of shares outstanding used in the computation of diluted earnings per share does not include common stock issuable upon the exercise of the Company's warrants. The effects of these potentially issuable shares were not included in the calculation of diluted earnings per share because the effect would have been anti-dilutive. Anti-dilutive stock-based awards excluded from the calculations of diluted earnings per share were immaterial during the periods presented.

The Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on its 0.500% Convertible Notes due 2019 on diluted earnings per share, if applicable, because upon conversion the Company will pay cash up to the aggregate principal amount of the Convertible Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election, in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted. The conversion spread will have a dilutive impact on diluted earnings per share when the average market price of the Company’s common stock for a given period exceeds the conversion price of $71.68 per share of common stock. For the years ended December 31, 2018 and 2017, the average market price of the Company's common stock exceeded the conversion price, therefore, the dilutive effect of the Convertible Notes was included in the denominator of diluted earnings per share. For the year ended December 31, 2016, the Convertible Notes have been excluded from the computation of diluted earnings per share as the effect would be anti-dilutive since the conversion price of the Convertible Notes exceeded the average market price of the Company’s common stock. See Note 13 to the Company's consolidated financial statements for detailed information on the Convertible Notes offering.