12. Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted-average number of common shares outstanding for the fiscal period. Diluted earnings per share is computed by giving effect to all potential weighted average dilutive common stock, including options, restricted stock units, warrants and the convertible senior notes. The dilutive effect of outstanding awards and convertible securities is reflected in diluted earnings per share by application of the treasury stock method.

A reconciliation of the denominator used in the calculation of basic and diluted earnings per share is as follows (in millions):

Fiscal Year Ended January 31, 2019 2018 2017 Numerator: Net income $1,110 $360 $323 Denominator: Weighted average shares outstanding for basic earnings per share 751 715 688 Effect of dilutive securities: Convertible senior notes which matured in April 2018 5 2 Employee stock awards 21 14 Warrants Adjusted weighted-average shares outstanding and assumed conversions for diluted earnings per share 775 735 700 The weighted-average number of shares outstanding used in the computation of diluted earnings per share does not include the effect of the following potential outstanding common stock. The effects of these potentially outstanding shares were not included in the calculation of diluted earnings/loss per share because the effect would have been anti-dilutive (in millions): Fiscal Year Ended January 31, 2019 2018 2017 Employee stock awards 11 Warrants 0 17