1 Exhibit 11.1 TRANSITION SYSTEMS, INC. COMPUTATION OF PER SHARE EARNINGS For the three month period ended: March 31, 1997 March 30, 1996 -------------- -------------- Net income (loss)....... ................. ............ ......... ... $ 2,187,000 $ (910,000) Pro forma common stock outstanding (1).... ............ ......... ... -- 10,087,776 Common stock outstanding ................. ............ ......... ... 17,293,619 Cheap stock (2)....................... ... ............ ......... ... -- 3,500,425 Warrants ........ ............. ... ............ ......... ... -- 297,928 Common stock equivalents............................... ......... ... 3,211,911 -- Weighted average number of common shares and common equivalent shares outstanding ... ........ ......... ... 20,505,530 13,886,129 Net income (loss) per share............... ............ ......... ... $ 0.11 $ (0.07) For the six month period ended: Net income.............. ................. ............ ......... ... $ 3,966,000 $ 269,000 Pro forma common stock outstanding (1) ... ............ ......... ... -- 10,087,776 Common stock outstanding ................. ............ ......... ... 17,384,879 Cheap stock (2)......... ................. ............ ......... ... -- 3,500,425 Warrants ........ ................. ............ ......... ... -- 297,928 Common stock equivalents.................. ............ ......... ... 3,317,105 -- Weighted average number of common shares and common equivalent shares outstanding ............ ......... ... 20,701,984 13,886,129 Net income per share.... ................. ............ ......... ... $ 0.19 $ 0.02 (1) Gives effect to the Recapitalization. See Note 9 of Notes to Consolidated Financial Statements for the fiscal year ended September 30, 1996 which are contained in the Company's Annual Report on Form 10-K for such fiscal year, File No. 0-28182. (2) Calculated in accordance with the Securities and Exchange Commission Staff Accounting Bulletin No. 83 ("SAB 83"), except that common stock issuable upon conversion of the preferred stock is included in pro forma common stock outstanding and excluded from cheap stock.