Google 2010 Annual Report Download - page 72

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rights of the Class A and Class B common shares as if the earnings for the year had been distributed. As the
liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis.
Further, as we assume the conversion of Class B common stock in the computation of the diluted net income per
share of Class A common stock, the undistributed earnings are equal to net income for that computation.
The following table sets forth the computation of basic and diluted net income per share of Class A and Class
B common stock (in millions, except share amounts which are reflected in thousands and per share amounts):
Year Ended December 31,
2008 2009 2010
Class A Class B Class A Class B Class A Class B
Basic net income per share:
Numerator
Allocation of undistributed earnings ....... $ 3,209 $ 1,018 $ 4,981 $ 1,539 $ 6,569 $ 1,936
Denominator
Weighted-average common shares
outstanding ......................... 238,473 75,614 241,575 74,651 246,168 72,534
Less: Weighted-average unvested
common shares subject to repurchase
or cancellation ..................... (120) (8) (5) 0 0 0
Number of shares used in per share
computation .................... 238,353 75,606 241,570 74,651 246,168 72,534
Basic net income per share ................... $ 13.46 $ 13.46 $ 20.62 $ 20.62 $ 26.69 $ 26.69
Diluted net income per share:
Numerator
Allocation of undistributed earnings for
basic computation .................... $ 3,209 $ 1,018 $ 4,981 $ 1,539 $ 6,569 $ 1,936
Reallocation of undistributed earnings as a
result of conversion of Class B to Class A
shares .............................. 1,018 0 1,539 0 1,936 0
Reallocation of undistributed earnings to
Class B shares . . . . . . . . . . . . . . . . . . . . . . . 0 (8) 0 (13) 0 (26)
Allocation of undistributed earnings ....... $ 4,227 $ 1,010 $ 6,520 $ 1,526 $ 8,505 $ 1,910
Denominator
Number of shares used in basic
computation ......................... 238,353 75,606 241,570 74,651 246,168 72,534
Weighted-average effect of dilutive
securities ............................
Add:
Conversion of Class B to Class A
common shares outstanding .... 75,606 0 74,651 0 72,534 0
Unvested common shares subject
to repurchase or cancellation . . . 128 8 5 0 0 0
Employee stock options, including
warrants issued under
Transferable Stock Option
program ...................... 2,810 223 2,569 114 3,410 71
Restricted shares and RSUs . . . . . . . 617 0 621 0 1,139 0
Number of shares used in per
share computation .......... 317,514 75,837 319,416 74,765 323,251 72,605
Diluted net income per share ................. $ 13.31 $ 13.31 $ 20.41 $ 20.41 $ 26.31 $ 26.31
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