Earnings per share

Earnings per share is net profit attributable to ordinary shareholders divided by the weighted average number of shares in issue; a key profitability indicator disclosed on the face of the income statement.

ByHoang TruongUpdated July 2, 2026

FrameworkRatio analysis

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A company with €6.0 million in net profit attributable to ordinary shareholders and a weighted average of 10.0 million shares in issue produces basic EPS of €6.0m divided by 10.0m, or €0.60 per share. Shares issued partway through the year count only for the months they were outstanding, which is why the average is weighted rather than a simple year-end count.

Where it fits

SubjectFinancial AccountingCoreTopicThe Financial StatementsCoreTopicFinancial Statement Analysis & RatiosCore

The formula

LaTeX

\text{Basic EPS} = \dfrac{\text{Net profit attributable to ordinary shareholders}}{\text{Weighted average ordinary shares in issue}}

Variables

$P$: Net profit attributable to ordinary shareholders (after preference dividends) (€)
$n$: Weighted average number of ordinary shares in issue during the period (shares)

Required on the face of the income statement; the denominator is time-weighted when the share count changes mid-period.