Table:
| Years Ended | July 27, 2019 | July 28, 2018 | July 29, 2017 |
| --- | --- | --- | --- |
| Net income . | $11,621 | $110 | $9,609 |
| Weighted-average shares—basic | 4,419 | 4,837 | 5,010 |
| Effect of dilutive potential common shares | 34 | 44 | 39 |
| Weighted-average shares—diluted . | 4,453 | 4,881 | 5,049 |
| Net income per share—basic . | $2.63 | $0.02 | $1.92 |
| Net income per share—diluted | $2.61 | $0.02 | $1.90 |
| Antidilutive employee share-based awards, excluded | 55 | 61 | 136 |
Paragraphs:
19. Net Income per Share
The following table presents the calculation of basic and diluted net income per share (in millions, except per-share amounts):
Employee equity share options, unvested shares, and similar equity instruments granted and assumed by Cisco are treated as potential common shares outstanding in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of in-the-money options, unvested restricted stock, and restricted stock units. The dilutive effect of such equity awards is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options and the amount of compensation cost for future service that has not yet recognized are collectively assumed to be used to repurchase shares.
Question:
What does diluted shares outstanding include?
Answer: the dilutive effect of in-the-money options, unvested restricted stock, and restricted stock units.