Prairie Operating Co.PROP

Prairie Operating Co. Earnings Per Share Disclosure

10-KFiled Mar 31, 20262 min read
Note 17 – Earnings Per Share

The Company’s Series D Preferred Stock, unvested RSUs, and unvested PSUs are considered participating securities, as such, basic and diluted earnings (loss) per share is calculated using the two–class method, which proportionally allocates net income (loss) attributable to Prairie Operating Co. common stockholders between the Common Stock and the participating securities on an “as–converted” basis. However, the Series D Preferred Stock, RSU, and PSU holders do not have a contractual obligation to share in the Company’s losses, therefore, in periods of a net loss, no portion of such losses are allocated to the participating securities.

The following table presents the calculations of basic and diluted loss per share for the years indicated:

   
Year Ended December 31,
  
   
2025
    
2024
  
   
(In thousands, expect
share and per share
amounts)
  
Basic and diluted:
            
Net loss attributable to Prairie Operating Co. common stockholders
  
$
(60,907
)
  
$
(40,912
)
Net loss allocated to participating securities
    
—
      
—
  
Net loss attributable to Prairie Operating Co. common stockholders – basic and diluted
  
$
(60,907
)
  
$
(40,912
)
                 
Weighted average shares outstanding – basic and diluted
    
45,232,756
      
15,453,502
  

               
Basic and diluted loss per share
  
$
(1.35
)
  
$
(2.65
)
The following table presents the potentially dilutive securities which were not included in the computation of diluted loss per share for the years indicated because their inclusion would be anti–dilutive:

   
Year Ended December 31,
  
   
2025
    
2024
  
Anti–dilutive securities:
            
Merger Options (1)
    
4,966,666
      
—
  
Restricted stock and performance stock units (2)
    
11,086,313
      
1,337,631
  
Common stock warrants (3)
    
186,009,872
      
8,494,177
  
Series D Preferred Stock
    
1,196,336
      
2,891,336
  
Series F Preferred Stock (4)
    
127,816,770
      
—
  
Senior Convertible Note (5)
    
—
      
1,444,353
  

(1)
The Merger Options became exercisable upon the closing of the Bayswater Acquisition on March 26, 2025. Refer to Note 15 – Common Stock Options and Warrants for a discussion of the Merger Options.
(2)
As of December 31, 2025 and 2024, all of the restricted stock and performance stock units presented were unvested. Refer to Note 16 – Long–Term Incentive Compensation for a discussion of the restricted stock units and performance stock units.
(3)
Includes the maximum amount of Series F Preferred Stock Warrants as of December 31, 2025, which have not been issued as of December 31, 2025. Refer to Note 15 – Common Stock Options and Warrants for a discussion of the Series F Preferred Stock Warrants.
(4)
Assumes the maximum number of converted shares using the Alternative Conversion at the NASDAQ minimum floor price, as defined in the Series F Certificate of Designation, as of December 31, 2025. Refer to Note 13 – Mezzanine Equity for a discussion of the Series F Preferred Stock.
(5)
Reflects the conversion option of the $15.0 million Senior Convertible Note at 105% principal amount, pursuant to the SEPA. Refer to Note 10 – Debt for a discussion of the Senior Convertible Note and Note 12 – Common Stock for a discussion of the SEPA.

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.

Other Available Disclosures

Income TaxesRevenueFair ValuePP&ELeasesSegmentsDebtCommitmentsStock CompensationNew StandardsPay vs Performance