Southwest Airlines 2003 Annual Report Download - page 66

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returns. It is the Company’s practice to vigorously contest those proposed adjustments that it deems lacking
of merit. The Company's management does not expect that the outcome of any proposed adjustments
presented to date by the IRS, individually or collectively, will have a material adverse effect on the
Company's financial condition, results of operations, or cash flows.
16. NET INCOME PER SHARE
The following table sets forth the computation of net income per share, basic and diluted:
The Company has excluded 10 million, 11 million, and 6 million shares from its calculations of net income per
share, diluted, in 2003, 2002, and 2001, respectively, as they represent antidilutive stock options for the
respective periods presented.
(In millions, except per share amounts)
2003 2002 2001
Net income 442$ 241$ 511$
Weighted-average shares
outstanding, basic 783 773 763
Dilutive effect of Employee
stock options 39 36 44
Adjusted weighted-average
shares outstanding, diluted 822 809 807
Net income per share, basic $ .56 $ .31 $ .67
Net income per share, diluted $ .54 $ .30 $ .63