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EXHIBIT 11
Xerox Corporation
Computation of Net Income Per Common Share
(Dollars in millions, except per-share data; shares in thousands)
Three months Nine Months
ended September 30, ended September 30,
2000 1999 2000 1999
I. Basic Net Income (Loss) Per Common Share
Net Income (Loss) $ (167) $ 339 $ (265) $ 1,130
Accrued dividends on ESOP preferred
stock, net (8) (9) (26) (29)
Adjusted net income (loss) $ (175) $ 330 $ (291) $ 1,101
Average common shares outstanding
during the period 666,802 663,409 666,284 661,094
Common shares contingently issuable
with respect to exchangeable shares 919 1,078 920 1,739
Adjusted average shares outstanding
for the period 667,721 664,487 667,204 662,883
Basic earnings (loss) per share $ (0.26) $ 0.50 $ (0.44) $ 1.66
II. Diluted Net Income (Loss) Per Common Share
Net Income (Loss) $ (167) $ 339 $ (265) $ 1,130
ESOP expense adjustment, net of tax - 1 - 5
Accrued dividends on ESOP preferred
stock, net (8) - (26) -
Interest on convertible debt,
net of tax - 4 - 12
Adjusted net income (loss) $ (175) $ 344 $ (291) $ 1,147
Average common shares outstanding
during the period 666,802 663,409 666,284 661,094
Stock options, incentive and
exchangeable shares 919 10,403 920 12,028
Convertible debt - 13,191 - 13,191
ESOP preferred stock - 52,159 - 52,159
Adjusted average shares outstanding
for the period 667,721 739,162 667,204 738,472
Diluted earnings (loss) per share $ (0.26) $ 0.47 $ (0.44) $ 1.55
