Binah Capital Group, Inc. Earnings Per Share Disclosure
18.NET INCOME (LOSS) PER SHARE
The Series A and Series B Preferred Stock does not have similar economic rights to the common stock and management does not consider them to be in substance common shares for earnings per share (“EPS”) purposes. As a result, the weighted average Series A and Series B Preferred Stock outstanding during the period was not included in the calculation of weighted average common stock outstanding. Diluted earnings per share is computed by including the dilutive effect of the conversion of all potential common stock equivalents (which includes warrants, Series A Preferred Stock, Series B Preferred Stock, options and unvested restricted stock) and accordingly, as applicable adjusting net income to add back any changes in earnings that reduce earnings per common share in the period associated with the potential common stock equivalents.
The computation of loss per share and weighted average of the Company’s common stock outstanding for the years ended December 31, 2025 and 2024 is as follows (in thousands):
| For the year ended |
| For the year ended | |||
December 31, 2025 | December 31, 2024 | |||||
Net income (loss) | $ | 2,308 | $ | (5,292) | ||
Series A preferred dividends | 1,445 | 1,094 | ||||
Series B preferred dividends | 106 | 31 | ||||
Net income (loss) available to common shareholders | 757 | (6,417) | ||||
Shares for basic and diluted calculation | ||||||
Average shares used in basic computation | 16,657 | 16,593 | ||||
Dilutive effect of unvested stock units | 318 | — | ||||
Average shares used in diluted computation | 16,975 | 16,593 | ||||
Earnings (loss) per common share | ||||||
Basic | $ | 0.05 | $ | (0.39) | ||
Diluted | $ | 0.04 | $ | (0.39) | ||
The following table details the securities that have been excluded from the calculation of weighted-average shares for diluted earnings per share for the period presented as they were anti-dilutive (in thousands).
For the year ended | For the year ended | |||
| December 31, 2025 | | December 31, 2024 | |
Warrants | | 15,148 | | 15,148 |
Series A preferred stock | 1,626 | 1,555 | ||
Series B preferred stock | 150 | 150 | ||
Stock options | 873 | | — | |
Unvested restricted stock units | 182 | — |
During the preparation of the current period financial statements, the Company identified an immaterial error in the calculation of EPS for the prior periods. The error did not impact net income, total equity, or cash flows. The EPS figures for the prior periods have been revised accordingly in the comparative presentation. Management has concluded that the correction is not material to the prior period financial statements and does not require restatement.
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.