Adjusted diluted EPS (Earnings per Share) is net income adjusted for non-recurring costs and charges, net of tax, divided by the weighted average number of outstanding shares in the period, assuming that all convertible instruments issued, along with employee stock options, are converted into shares. Adjusted diluted EPS (Earnings per Share) better reflects the underlying performance of the business. Adjusted diluted EPS (Earnings per Share) compares with analyst estimates, and is the base for commuting the P/E ratio. You might be interested in: Diluted EPS (Earnings per Share) Basic EPS (Earnings per Share)