Net Income Per Share
A reconciliation of net income and the number of shares in the calculation of basic and diluted net income per share is as follows (in thousands, except share and per share amounts):
Year Ended
December 31,
202520242023
Basic net income per common share:
Numerator:
Net income$58,520 $54,336 $62,037 
Denominator:
Weighted-average shares used in computing basic net income per share85,651,72191,481,99595,021,175
Basic net income per share $0.68 $0.59 $0.65 
Diluted net income per common share:
Numerator:
Net income$58,520 $54,336 $62,037 
Denominator:
Weighted-average shares used in computing basic net income per share 85,651,72191,481,99595,021,175
Effect of dilutive securities:
     Options to purchase common stock3,173,4273,499,4124,813,004
     Shares issuable under ESPP609,553804
     Warrants to purchase common stock177,292458,537
      Restricted stock units1,036,635280,105378,879
Total effect of dilutive securities4,210,122 3,966,362 5,651,224 
Weighted-average shares used in computing diluted net income per share 89,861,84395,448,357100,672,399
Diluted net income per share $0.65 $0.57 $0.62 
The following weighted-average outstanding shares of potentially dilutive securities were excluded from the computation of diluted net income per share for the periods presented because including them would have been antidilutive:
Year Ended
December 31,
202520242023
Options to purchase common stock14,928,93813,868,63511,901,773
Shares issuable under ESPP2,5134,022919
Restricted stock units1,136,8032,118,1021,111,634
Total potential dilutive shares16,068,25415,990,75913,014,326

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.