Sirius XM Holdings Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Net Loss Per Common Share

Net Loss Per Common Share

3 Months Ended

Mar. 31, 2018

Basic net loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of shares of common stock outstanding during the period.

Diluted net loss per common share is computed by giving effect to all potential shares of common stock, including stock options, restricted stock units, market stock units, performance-based RSUs, potential ESPP shares and instruments convertible into common stock, to the extent dilutive. For the three months ended March 31, 2017 and 2018, basic net loss per common share was the same as diluted net loss per common share, as the inclusion of all potential common shares outstanding would have been anti-dilutive.

The following table sets forth the computation of historical basic and diluted net loss per common share:



	Three months ended March 31,
	2017			2018
	(in thousands except per share amounts)
Numerator
Net loss	$	(132,267	)	$	(131,705	)
Less: Stock dividend payable and transaction costs	—			7,363
Net loss available to common stockholders	(132,267		)	(139,068		)
Denominator
Weighted-average basic and diluted common shares	237,515			252,934
Net loss per common share, basic and diluted	$	(0.56	)	$	(0.55	)

The following potential common shares outstanding were excluded from the computation of diluted net loss per common share because including them would have been anti-dilutive:



	As of March 31,
	2017	2018
	(in thousands)
Shares issuable upon conversion of preferred stock	—	47,449
Restricted stock units	23,830	17,873
Options to purchase common stock	9,367	6,290
Performance awards*	2,056	1,016
Shares issuable pursuant to the ESPP	604	1,007
Total common stock equivalents	35,857	73,635
*Includes potential common shares outstanding for MSUs and PSUs

On December 9, 2015, we completed an offering of our 1.75% convertible senior notes due 2020. As we have the intention to settle the Notes either partially or wholly in cash, under the treasury stock method, the Notes will generally have a dilutive impact on earnings per share if we are in a net income position for the period and if our average stock price for the period exceeds approximately $16.42 per share of our common stock, the conversion price of the Notes. For the period from the issuance of the offering of the Notes through March 31, 2018, the conversion feature of the Notes was anti-dilutive, as we were in a net loss position for all periods and our average stock price was less than the conversion price.

In connection with the pricing of the Notes, we entered into Capped Call Transactions which increase the effective conversion price of the Notes, and are designed to reduce potential dilution upon conversion of the Notes. Since the beneficial impact of the capped call is anti-dilutive, it is excluded from the calculation of earnings per share. Refer to Note 11 "Debt Instruments" for further details regarding our Notes.