**EXHIBIT 11**

 

**HILTON HOTELS CORPORATION AND SUBSIDIARIES**

**Computation of Per Share Earnings**

 
| ** **                                                                                                   | ** ** | **YEARS ENDED DECEMBER 31,** | ** ** |
|--------------------------------------------------------------------------------------------------------------|------------|---------------------------------------------|------------|
| ** **                                                                                                   | ** ** | **2003**                                    | ** ** | **2004** | ** ** | **2005** | ** ** |
| **Basic**                                                                                                    |       |                                        |       |   |   |   |   |
| Net income (in millions)                                                                                     |       | $                                           | 164        |   | 238 |   | 460 |   |
|                                                                                                         |       |                                        |       |   |   |   |   |
| Weighted average common shares                                                                               |       | 377,941,000                                 |       | 384,362,000 |   | 382,790,000 |   |
|                                                                                                         |       |                                        |       |   |   |   |   |
| Basic earnings per common share                                                                              |       | $                                           | 0.43       |   | 0.62 |   | 1.20 |   |
|                                                                                                         |       |                                        |       |   |   |   |   |
| **Diluted**                                                                                                  |       |                                        |       |   |   |   |   |
| Income (in millions)                                                                                         |       |                                        |       |   |   |   |   |
| Net income                                                                                                   |       | $                                           | 164        |   | 238 |   | 460 |   |
| Add after tax interest applicable to  convertible notes                                                      |       | 14                                          |       | 12 |   | 12 |   |
| Net income, as adjusted                                                                                      |       | $                                           | 178        |   | 250 |   | 472 |   |
|                                                                                                         |       |                                        |       |   |   |   |   |
| Shares                                                                                                       |       |                                        |       |   |   |   |   |
| Weighted average common shares—basic                                                                    |       | 377,941,000                                 |       | 384,362,000 |   | 382,790,000 |   |
| Assuming conversion of convertible notes                                                                     |       | 26,375,000                                  |       | 25,556,000 |   | 25,556,000 |   |
| Dilutive effect of assumed option exercises  (as determined by the application of the treasury stock method) |       | 5,961,000                                   |       | 8,024,000 |   | 8,479,000 |   |
| Common and common equivalent shares as  adjusted                                                             |       | 410,277,000                                 |       | 417,942,000 |   | 416,825,000 |   |
|                                                                                                         |       |                                        |       |   |   |   |   |
| Diluted earnings per common share                                                                            |       | $                                           | 0.43       |   | 0.60 |   | 1.13 |   |

 

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