Net Income Per Share

6 Months Ended

Aug. 04, 2023

Basic net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding and potentially dilutive securities outstanding during the period, using the treasury stock method. Potentially dilutive securities primarily include unvested restricted stock, which includes restricted stock unit (“RSU”) and performance stock unit (“PSU”) awards, and stock options, including purchase options under VMware’s employee stock purchase plan. Securities are excluded from the computation of diluted net income per share if their effect would be anti-dilutive.

The following table sets forth the computations of basic and diluted net income per share during the periods presented (table in millions, except per share amounts and shares in thousands):



	Three Months Ended				Six Months Ended
	August 4,		July 29,		August 4,		July 29,
	2023		2022		2023		2022
Net income	$	477	$	347	$	701	$	589
Weighted-average shares, basic	430,395		422,002		429,290		421,294
Effect of other dilutive securities	3,695		2,123		3,549		2,267
Weighted-average shares, diluted	434,090		424,125		432,839		423,561
Net income per weighted-average share, basic	$	1.11	$	0.82	$	1.63	$	1.40
Net income per weighted-average share, diluted	$	1.10	$	0.82	$	1.62	$	1.39

The following table sets forth the weighted-average common share equivalents of Common Stock that were excluded from the diluted net income per share calculations during the periods presented because their effect would have been anti-dilutive (shares in thousands):



	Three Months Ended		Six Months Ended
	August 4,	July 29,	August 4,	July 29,
	2023	2022	2023	2022
Anti-dilutive securities:
Employee stock options	—	159	—	126
RSUs	87	876	1,297	679
Total	87	1,035	1,297	805

VMWARE, INC. 10-Q