Zynga 2012 Annual Report Download - page 104

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Accumulated Other Comprehensive Income (loss)
The components of accumulated other comprehensive income, net of taxes, were as follows (in thousands):
Year Ended December 31,
2012 2011 2010
Unrealized gains (losses) on available-for-sale securities ...... $ 649 $(91) $117
Unrealized gains (losses) on derivative investments .......... (2,423) — —
Foreign currency translation ............................. 327 453 (3)
Total ............................................... $(1,447) $362 $114
12. Net Income (Loss) Per Share of Common Stock
We compute net income (loss) per share of common stock using the two-class method required for
participating securities. Prior to the date of the initial public offering, we considered all series of our convertible
preferred stock to be participating securities due to their non-cumulative dividend rights. Additionally, we
consider shares issued upon the early exercise of options subject to repurchase and unvested restricted shares to
be participating securities, because holders of such shares have non-forfeitable dividend rights in the event we
declare a dividend for common shares. In accordance with the two-class method, net income allocated to these
participating securities, which include participation rights in undistributed net income, is subtracted from net
income (loss) to determine total net income (loss) to be allocated to common stockholders.
Basic net income (loss) per share is computed by dividing net income (loss) attributable to common
stockholders by the weighted-average number of common shares outstanding during the period. In computing
diluted net income (loss) attributable to common stockholders, net income (loss) is re-allocated to reflect the
potential impact of dilutive securities, including stock options, warrants, unvested restricted stock and unvested
ZSUs. Diluted net income (loss) per share is computed by dividing net income (loss) attributable to common
stockholders by the weighted-average number of common shares outstanding, including potential dilutive
securities. For periods in which we have generated a net loss or there is no income attributable to common
stockholders, we do not include stock options, warrants and unvested ZSUs in our calculation of diluted net
income (loss) per share, as the impact of these awards is anti-dilutive.
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