Net Income (Loss) Per Share
The following table summarizes the calculation of basic and diluted net income per share (in thousands, except per share data):
| | | | | | | | | | | | | | | |
| | | Year Ended December 31, |
| | | | | 2025 | | 2024 |
| Numerator: | | | | | | | |
| Net income (loss) - Basic and Diluted | | | | | $ | 17,051 | | | $ | 14,560 | |
| | | | | | | |
| Denominator: | | | | | | | |
| Weighted-average common shares outstanding - Basic | | | | | 10,067 | | | 9,846 | |
| Effect of common share equivalents | | | | | 403 | | | 481 | |
| Weighted-average common shares outstanding - Diluted | | | | | 10,470 | | | 10,327 | |
| | | | | | | |
| Net income (loss) per share: | | | | | | | |
| Basic | | | | | $ | 1.69 | | | $ | 1.48 | |
| Diluted | | | | | $ | 1.63 | | | $ | 1.41 | |
The following table summarizes common share equivalents that have been excluded from the computation of diluted net income (loss) per share because their effect was anti-dilutive (in thousands):
| | | | | | | | | | | | | | | |
| | | Year Ended December 31, |
| | | | | 2025 | | 2024 |
| Restricted stock units | | | | | — | | | 2 | |
| Stock options | | | | | — | | | 1 | |
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.