1 EXHIBIT 11 NOISE CANCELLATION TECHNOLOGIES, INC. AND SUBSIDIARIES COMPUTATION OF NET (LOSS) PER SHARE (In thousands, except per share amounts) NINE MONTHS ENDED SEPTEMBER 30, -------------------------------------- PRIMARY 1995 1996 ------------------ ------------------ Net (loss) ($4,802) ($7,523) Less: reduction of interest expense or interest earned attributable to utilization of assumed proceeds from exercise of options and warrants in excess of amounts required to repurchase 20% of the outstanding common stock at average market price ------------------ ------------------ ADJUSTED NET (LOSS) ($4,802) ($7,523) ================== ================== Weighted average number of shares outstanding. 86,804 98,060 Add: common equivalent shares (determined using the "Treasury Stock" method) representing shares issuable upon assumed exercise of options and warrants in excess of average market price 5,624 1,168 Shares issuable upon conversion of Series B preferred shares - - ------------------ ------------------ SHARES USED FOR COMPUTATION 92,428 99,228 ================== ================== PRIMARY NET (LOSS) PER SHARE ($0.05) ($0.08) ================== ================== FULLY DILUTED Net (loss) ($4,802) ($7,523) Less: reduction of interest expense or interest earned attributable to utilization of assumed proceeds from exercise of options and warrants in excess of amounts required to repurchase 20% of the outstanding common stock at year-end market price if greater than average market price ------------------ ------------------ ADJUSTED NET (LOSS) ($4,802) ($7,523) ================== ================== Weighted average number of shares outstanding. 86,804 98,060 Add: common equivalent shares (determined using the "Treasury Stock" method) representing shares issuable upon assumed exercise of options and warrants in excess of year-end market price if greater than average market price 5,624 1,168 Shares issuable upon conversion of Series B preferred shares - - ------------------ ------------------ SHARES USED FOR COMPUTATION 92,428 99,228 ================== ================== FULLY DILUTED NET (LOSS) PER SHARE ($0.05) ($0.08) ================== ==================