What are diluted shares?

Dear johnnyfinance-ga,

Here are some definitions for diluted shares. The first link has an
explanation which is too long to copy here in its entirety.
http://msnbc.msn.com/id/7477469/

?A way of characterizing the number of outstanding shares that a
publically held company could have. The diluted shares measure is the
sum of the company's normally outstanding shares, the shares that
would be outstanding if every warrant & stock option were exercised,
and the shares that would be outstanding if every security convertible
into the stock (e.g., certain preferred shares) were converted. This
is sometimes used when computing earnings per share numbers. A larger
number of outstanding shares means lower earnings per share, rather
obviously; this is known as "dilution of earnings" or computation of
"fully diluted" earnings.?
http://invest-faq.com/articles/trade-jargon.html

?Q. What is the difference between ?shares? and ?diluted shares?? 

A. The difference is that diluted shares take into account any stock
options or restricted stock granted to executives but not exercised or
received. It's considered the better number, but with most companies,
these two numbers don't differ unless the company has given out a huge
number of stock options. Tech companies would be a good example.?
http://www.businessjournalism.org/content/4883.cfm?print=yes

?Fully Diluted Shares
This is the number of shares of Common Stock that would be outstanding
if all convertible securities were converted to Common.?
http://corporate.globalsources.com/IRS/FGLOSARY.HTM


?Diluted shares are the pools of common shares outstanding issued by a
company, combined with the shares that would be created upon the
conversion of the company's options, warrants and convertible
securities.?
http://online.wsj.com/public/resources/documents/doe-help.htm

I hope this answers your question. If it does not, or the answer is
unclear, then please ask for clarification of this research before
rating the answer. I shall respond to the clarification request as
soon as I receive it.
Thank you
answerfinder

Search strategy
"diluted shares" glossary
://www.google.co.uk/search?hl=en&q=%22diluted+shares%22+glossary&btnG=Search&meta=
"diluted shares" 
://www.google.co.uk/search?hl=en&q=%22diluted+shares%22+&btnG=Search&meta=

The answer talks of stock and shares which throws up the anomoly of
the language difference between the UK and America so in future it
moight be worth noting from where the question originated.  I am happy
as I am aware of the different meanings but others might not be.

Many thanks,

I wil use the service again.

Johnnyfinance

Dear johnnyfinance-ga,

Should you use this service again, I thought I would mention that
unfortunately we researchers are not aware where in the world the
questioner lives unless they state it in their question. Occasionally
I ask for clarification if geographic location is relevant to the
question, but in this case I did not as it was only a $2 question and
I wanted to get the answer to you as soon a possible without delay.
I?m pleased the answer was clear to you. We researchers are quite
happy to deal with any request for clarification of any of our answers
to make sure you are satisfied.
Thank you for the rating.

answerfinder-ga

Thanks for that. I stumbled upon this Google service quite by chance
and I must say I'm impressed. Just hope I can fidn it next time I need
it.

Kind regards,

Johnnyfinance