DAILY JOURNAL CORP Earnings Per Share Disclosure
Note 10. Net Income Per Share
Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the treasury stock method by dividing net income by the weighted average number of dilutive common shares outstanding during the period. Diluted shares outstanding is calculated by adding to the weighted average shares outstanding any potential dilutive securities outstanding for the period. Potential dilutive securities for the Company include only unvested restricted stock units.
The Company’s basic and diluted net income per share was as follows (in thousands, except share and per share amounts):
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Years Ended September 30, |
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2025 |
2024 |
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Numerator: |
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Net income |
$ | 112,137 | $ | 78,113 | ||||
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Denominator: |
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Basic weighted-average common shares outstanding |
1,377,426 | 1,377,026 | ||||||
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Effect of dilutive securities |
77 | - | ||||||
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Diluted weighted-average common shares outstanding |
1,377,503 | 1,377,026 | ||||||
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Basic EPS |
$ | 81.41 | $ | 56.73 | ||||
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Diluted EPS |
$ | 81.41 | $ | 56.73 | ||||
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.