Theravance Just Filed Its Quarterly Report: 2. Net Income Per Sh...

2. Net Income Per Share

Basic net income per share attributable to Innoviva stockholders is computed by dividing net income attributable to Innoviva stockholders by the weighted-average number of shares of common stock outstanding. Diluted net income per share attributable to Innoviva stockholders is computed by dividing net income attributable to Innoviva stockholders by the weighted-average number of shares of common stock and dilutive potential common stock equivalents then outstanding. Dilutive potential common stock equivalents include the as sumed exercise, vesting and issuance of employee stock awards using the treasury stock method, as well as common stock issuable upon assumed conversion of our convertible subordinated notes due 2023 (the “2023 Notes”) using the if converted method.

Our convertible senior notes due 2025 (the “2025 Notes”) are convertible, based on the applicable conversion rate, into cash, shares of our common stock or a combination thereof, at our election. Our current intent is to settle the principal amount of the 2025 Notes in cash upon conversion. The impact of the assumed conversion premium to diluted net income per share is computed using the treasury stock method. As the average market price per share of our common stock as reported on The Nasdaq Global Select Market was lower than the initial conversion price of $17.26 per share, there was no dilutive effect of the assumed conversion premium for the three and six months ended June 30, 2021 and 2020, respectively.

The following table shows the computation of basic and diluted net income per share for the three and six months ended June 30, 2021 and 2020:

Three Months Ended June 30, 

Six Months Ended June 30, 

(In thousands except per share data)

     

2021

     

2020

     

2021

     

2020

Numerator:

Net income attributable to Innoviva stockholders, basic

$

88,948

$

76,844

 

$

183,071

 

$

142,281

Add: interest expense on 2023 Notes

 

1,163

 

1,184

 

2,367

 

2,364

Net income attributable to Innoviva stockholders, diluted

$

90,111

$

78,028

 

$

185,438

 

$

144,645

Denominator:

Weighted-average shares used to compute basic net income per share attributable to Innoviva stockholders

 

88,423

 

101,324

 

94,858

 

101,280

Dilutive effect of 2023 Notes

 

12,189

 

12,189

 

12,189

 

12,189

Dilutive effect of options and awards granted under equity incentive plan and employee stock purchase plan

 

27

 

32

 

49

 

58

Weighted-average shares used to compute diluted net income per share attributable to Innoviva stockholders

 

100,639

 

113,545

 

107,096

 

113,527

Net income per share attributable to Innoviva stockholders

Basic

$

1.01

$

0.76

 

$

1.93

 

$

1.40

Diluted

$

0.90

$

0.69

 

$

1.73

 

$

1.27

Anti-Dilutive Securities

The following common stock equivalents were not included in the computation of diluted net income per share because their effect was anti-dilutive:

Three Months Ended June 30, 

Six Months Ended June 30, 

(In thousands)

    

2021

    

2020

    

2021

    

2020

Outstanding options and awards granted under equity incentive plan and employee stock purchase plan

1,093

 

1,154

1,126

 

1,124

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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