Alpha Cognition Inc. Earnings Per Share Disclosure
NOTE 14 – NET LOSS PER SHARE
Net loss per common stock has been computed on the basis of the weighted-average number of common stock outstanding during the years ended December 31, 2025, and 2024. Diluted loss per share is computed similarly to basic loss per share, except that it includes the potential dilution that could occur if dilutive securities were exercised. We apply the treasury stock method in the calculation of diluted loss per share.
In years that liability-classified warrants and options are in the money, the Company determines whether such instruments are dilutive by calculating the effect on loss per share after considering both (a) the adjustment to the numerator that would result from reversing the impact of the change in fair value recorded to net loss during the period and (b) the adjustment to the denominator that would result from the incremental shares outstanding, using the treasury stock method, in an assumed exercise of these instruments at the beginning of the year.
The following table reconciles net loss and the weighted average shares outstanding for the basic calculation to the net loss and the weighted average shares outstanding for the diluted calculation for the years ended December 31:
| 2025 | 2024 | |||||||
| Numerator, diluted: | ||||||||
| Net loss | $ | (20,669,875 | ) | $ | (14,788,727 | ) | ||
| Adjustment for gain in fair value of warrant liabilities | (176,931 | ) | ||||||
| Adjusted numerator, diluted | $ | (20,846,806 | ) | $ | (14,788,727 | ) | ||
| Denominator, diluted: | ||||||||
| Weighted average common stock outstanding | 17,680,597 | 7,247,864 | ||||||
| Dilutive effect of common stock warrants | 832 | |||||||
| Weighted average dilutive common stock | 17,681,429 | 7,247,864 | ||||||
| Net loss per share, diluted | $ | (1.18 | ) | $ | (2.04 | ) | ||
The following potentially dilutive common shares related to outstanding securities for the years ended December 31, 2025 and 2024 were excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive for the year:
| 2025 | 2024 | |||||||
| Warrants | 3,392,952 | 2,777,647 | ||||||
| Common Stock options | 2,018,260 | 815,974 | ||||||
| ACI Canada legacy performance options | 265,642 | 265,642 | ||||||
| Convertible debentures | 430,805 | |||||||
| Total anti-dilutive features | 5,676,854 | 4,290,068 | ||||||
About Earnings Per Share Disclosures
The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.
Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.