LifeMD, Inc. Earnings Per Share Disclosure
Basic earnings (loss) per common share (“EPS”) is based on the weighted average number of common shares outstanding during each period presented. Shares of unissued vested restricted stock units (“RSUs”) and restricted stock awards (“RSAs”) are included in our calculation of basic weighted average common shares outstanding. Unvested RSUs and RSAs, convertible securities, warrants and options to purchase common stock are included as common stock equivalents only when dilutive. Potential common stock equivalents are excluded from diluted earnings per share when the effects would be antidilutive.
The Company follows the provisions of ASC 260, Diluted Earnings per Share. In computing diluted EPS, basic EPS is adjusted for the assumed issuance of all potentially dilutive securities. The dilutive effect of call options, warrants and share-based payment awards is calculated using the “treasury stock method,” which assumes that the “proceeds” from the exercise of these instruments are used to purchase common shares at the average market price for the period. The dilutive effect of traditional convertible debt and convertible preferred stock is calculated using the “if-converted method.” Under the if-converted method, securities are assumed to be converted at the beginning of the period, and the resulting common shares are included in the denominator of the diluted EPS calculation for the entire period being presented.
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| Net loss from continuing operations | $ | (10,232,233 | ) | $ | (23,175,393 | ) | ||
| Less: Preferred stock dividends | (3,106,250 | ) | (3,106,250 | ) | ||||
| Net loss from continuing operations attributable to LifeMD, Inc. common stockholders | (13,338,483 | ) | (26,281,643 | ) | ||||
| Net income from discontinued operations | 25,852,024 | 2,315,252 | ||||||
| Less: Net income attributable to noncontrolling interests of discontinued operations | 1,265,685 | 548,875 | ||||||
| Net income from discontinued operations attributable to LifeMD, Inc. common stockholders | 24,586,339 | 1,766,377 | ||||||
| Net income (loss) attributable to LifeMD, Inc. common stockholders | $ | 11,247,856 | $ | (24,515,266 | ) | |||
Basic loss per share from continuing operations is the same as diluted loss per share from continuing operations attributable to common stockholders for the years ended December 31, 2025 and 2024, because the inclusion of potential shares of common stock would have been anti-dilutive. The following table discloses the securities that were not included in the computation of diluted earnings (loss) per share as their inclusion would have been anti-dilutive:
| Year Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| RSUs and RSAs | 1,056,519 | 3,157,706 | ||||||
| Stock options | 394,124 | 1,288,000 | ||||||
| Warrants | 950,932 | 1,743,730 | ||||||
| Convertible long-term debt | 671,141 | |||||||
| Total | 2,401,575 | 6,860,577 | ||||||
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.