
	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2026		2025		2026		2025
Net income attributable to Xylem (in millions)	$	291	$	227	$	747	$	622
Shares (in thousands):
Weighted average common shares outstanding	232,702		243,436		237,246		243,297
Add: Participating securities (a)	17		18		16		22
Weighted average common shares outstanding — Basic	232,719		243,454		237,262		243,319
Plus incremental shares from assumed conversions: (b)
Dilutive effect of stock options	230		358		256		341
Dilutive effect of restricted stock units and performance share units	91		279		140		250
Weighted average common shares outstanding — Diluted	233,040		244,091		237,658		243,910
Basic earnings per share	$	1.25	$	0.93	$	3.15	$	2.56
Diluted earnings per share	$	1.25	$	0.93	$	3.14	$	2.55

(a)Restricted stock units containing rights to non-forfeitable dividends that participate in undistributed earnings with common stockholders are considered participating securities for purposes of computing earnings per share.

(b)Incremental shares from stock options, restricted stock units and performance share units are computed by the treasury stock method. The weighted average shares listed below were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive for the periods presented or were otherwise excluded under the treasury stock method. The treasury stock method calculates dilution assuming the exercise of all in-the-money options and vesting of restricted stock units and performance share units, reduced by the repurchase of shares with the proceeds from the assumed exercises and unrecognized compensation expense for outstanding awards. Performance share units are included in the treasury stock calculation of diluted earnings per share based upon achievement of underlying performance and market conditions at the end of the reporting period. See Note 15, "Share-Based Compensation Plans," to the condensed consolidated financial statements for further detail on the performance share units.