Number of Shares Outstanding Can Vary

• The maximum number of authorized stock cannot be changed without shareholder approval. But the number of shares outstanding can increase or decrease as a corporation issues or buys back its shares; or insiders exercise their stock options.
  
  

Issued vs. Outstanding

• Shares outstanding exclude the issued shares that a corporation later bought back in the open market.
  
  

Per Share Numbers

• Shares outstanding are used to calculate various per share numbers. For example, earnings per share are calculated by dividing a company's net earnings by the number of shares outstanding.