Note 7 – Earnings Per Share

 

Basic net loss per share is computed by dividing reported net loss by the weighted-average number of common shares outstanding for the reported period. In computing diluted earnings per share, common share equivalents are not considered in periods in which a net loss is reported, as the inclusion of the common share equivalents would be antidilutive. Since the Company was in a net loss for all periods presented in these consolidated financial statements, diluted net loss per share was the same as basic net loss per share.

 

   2025   2024 
  

Years Ended

December 31,

 
   2025   2024 
Numerator:   (in thousands, except per share data) 
Net loss attributable to common stockholders  $(10,549)  $(11,017)
Less: preferred dividends   (533)    
Net loss attributable to common shareholders   (11,082)   (11,017)
Denominator:          
Weighted-average common shares outstanding   4,969    2,938 
           
Net loss per common share  $(2.23)  $(3.75)

 

The following potential common share equivalents were excluded from the calculation of diluted net income per share in FY 2025 because their effect would have been anti-dilutive in the period presented (in thousands):

       
  

Years Ended

December 31,

 
   2025   2024 
Convertible preferred stock   20,782    26,560 
Common Stock Warrants   26,421     
Preferred Stock Warrants   247    247 
Stock options   7,337    5,027 
Total potential common stock excluded from net loss per share   54,787    31,834 

 

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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.