How would one calculate the correct value of the outstanding diluted shares for the fourth (last) financial quarter of a company?

When using the SEC 10-Q and 10-K forms: The 10-Q forms contain the number of outstanding shares that are specific to the quarter (Q1 to Q3). The 10-K form contains the number of outstanding shares that are specific to the whole financial year.

How would I now calculate the number of outstanding shares that are specific to the fourth quarter?

Example for AAPL (values from 10-K and 10-Q SEC):

  • Q1 (10-Q), ending on 2019-12-28 reported 17.818.417.000 outstanding diluted shares
  • Q2 (10-Q), ending on 2020-03-28 reported 17.618.765.000 outstanding diluted shares
  • Q3 (10-Q), ending on 2020-06-27 reported 17.419.154.000 outstanding diluted shares
  • Annual report (10-K), ending on 2020-09-26 reported 17.528.214.000 outstanding diluted shares

What is the amount of outstanding diluted shares when viewing Q4 isolated? I found two different examples: https://stockanalysis.com/stocks/aapl/financials/ Here they display 17.256.516.000 as value for Q4 - although I don't get how they calculated it. Another example is this: https://www.macrotrends.net/stocks/charts/AAPL/apple/shares-outstanding Here they display the same value as the annual 10-K report, so 17.528.214.000 for Q4.

What is the 'correct' way to do this? Is there even a correct way to do it?

I was wondering about it because depending on the calculation of the outstanding shares the value of EPS (and others) may differ.


2 Answers 2


I believe the annual value is the average for that year.

$\frac{17.818.417.000 + 17.618.765.000 + 17.419.154.000 + 17.256.516.000}{4} = 17.528.213.000$

It's off by 1000 but that might be a rounding error somewhere.

  • $\begingroup$ I thought so too, so I checked some other companies, they are all off by 1000 or 2000 so I wasn't sure if that really is the correct calculation. Is this documented somewhere? $\endgroup$
    – meberhard
    Oct 8, 2021 at 14:55
  • $\begingroup$ I don't know about any specific documentation on it. Maybe you could try to calculate the weighted average first to see if it is because of some quarters being longer than others. $\endgroup$ Oct 8, 2021 at 14:59
  • $\begingroup$ I also had that in mind, but all quarters are exactly 91 days in the example above, so this should not make any difference. $\endgroup$
    – meberhard
    Oct 8, 2021 at 15:11

There is no "correct" way to determine a company's fully diluted shares. There is however an accounting convention that public companies use for financial reporting.

In your case, the latter 4Q20 figure, 17.528.214.000, is what the company reports in its FY2020 10-K.

In that 10-K, you'll find the figure reported as "Weighted-average diluted shares," and see that figure is linked to the accounting convention applied (you'll see a pop-up once you click on the figure; scroll to the third panel of the pop-up).

That panel will look like this: FASB rule

Professional investors will often create their own calculations based on their own assumptions to determine a fully-diluted share count that factors in a variety of derivative instruments and securities as disclosed in a company's financial statement footnotes, elsewhere in a 10-K or 10-Q, proxy statements, compensation agreement exhibits, debt indentures (for convertible securities), warrants purchase agreements, and other filings.

Because of the complexity of the above and in order to speak a "common language," most investors rely on the reported figure and a company's (usually) undisclosed calculation supporting it.


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