Earnings per Share (EPS)
EPS is the single most-watched number during earnings season. Companies report it quarterly, and it lands on the economic calendar alongside revenue figures. Because it scales profit to the per-share level, it lets analysts compare a large company and a small one on equal footing — raw profit totals alone can't do that.
Suppose a company earns $500 million in net profit and has 250 million shares outstanding. Its EPS would be $2.00 per share. That single figure is what analysts stack against their consensus estimate to decide whether results "beat" or "missed." Traders typically watch the gap between reported EPS and the estimate, not the absolute dollar amount.
There are two common versions to know. Basic EPS uses only actual shares outstanding. Diluted EPS also counts shares that could exist — from stock options or convertible bonds — so it is always a smaller, more conservative number. Financial data tables almost always show diluted EPS by default, which can trip up readers who expect the two to match.