Apple 2004 Annual Report Download - page 76

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The following table sets forth the computation of basic and diluted earnings per share:
Potentially dilutive securities, including stock options; restricted stock units; and restricted stock, to purchase approximately 4.4 million,
50.8 million, and 58.0 million shares of common stock for the years ended September 25, 2004, September 27, 2003, and September 28, 2002,
respectively, were excluded from the computation of diluted earnings per share for these periods because their effect would have been
antidilutive.
Comprehensive Income
Comprehensive income consists of two components, net income and other comprehensive income. Other comprehensive income refers to
revenue, expenses, gains and losses that under generally accepted accounting principles are recorded as an element of shareholders' equity but
are excluded from net income. The Company's other comprehensive income is comprised of foreign currency translation adjustments from those
subsidiaries not using the U.S. dollar as their functional currency, unrealized gains and losses on marketable securities categorized as available-
for-sale, and net deferred gains and losses on certain derivative instruments accounted for as cash flow hedges.
Segment Information
The Company reports segment information based on the "management" approach. The management approach designates the internal reporting
used by management for making decisions and assessing performance as the source of the Company's reportable segments. Information about
the Company's products, major customers, and geographic areas on a company-wide basis is also disclosed.
72
For the Years Ended
September 25,
2004
September 27,
2003
September 28,
2002
Numerator (in millions):
Income before accounting changes
$
276
$
68
$
65
Cumulative effects of accounting changes, net of tax
—
1
—
Net income
$
276
$
69
$
65
Denominator (in thousands):
Weighted
-
average shares outstanding, excluding unvested
restricted stock
371,590
360,631
355,022
Effect of dilutive options, restricted stock units and restricted stock
15,721
2,835
6,763
Denominator for diluted earnings per share
387,311
363,466
361,785
Basic earnings per share before accounting changes
$
0.74
$
0.19
$
0.18
Cumulative effects of accounting changes, net of tax
—
—
—
Basic earnings per share after accounting changes
$
0.74
$
0.19
$
0.18
Diluted earnings per share before accounting changes
$
0.71
$
0.19
$
0.18
Cumulative effects of accounting changes, net of tax
—
—
—
Diluted earnings per share after accounting changes
$
0.71
$
0.19
$
0.18