POWER SOLUTIONS INTERNATIONAL, INC.PSIX

POWER SOLUTIONS INTERNATIONAL, INC. Earnings Per Share Disclosure

10-KFiled Mar 24, 20252 min read
Earnings Per Share
The Company computes basic earnings per share by dividing net income by the weighted-average common shares outstanding during the year. Diluted earnings per share is calculated to give effect to all potentially dilutive common shares that were outstanding during the year. Weighted-average diluted common shares outstanding primarily reflect the additional shares that would be issued upon the assumed exercise of stock options and the assumed vesting of unvested share awards. The treasury stock method has been used to compute diluted earnings per share for 2024 and 2023.
The computations of basic and diluted earnings per share are as follows:
(in thousands, except per share basis)For the Year Ended December 31,
20242023
Numerator:
Net income – basic and diluted$69,279 $26,306 
Denominator:
Shares used in computing net income per share
Weighted-average common shares outstanding - basic
22,983 22,960 
Effect of dilutive securities
35 13 
Weighted-average common shares outstanding – diluted
23,018 22,973 
Earnings per common share
Earnings per share of common stock – basic$3.01 $1.15 
Earnings per share of common stock – diluted$3.01 $1.15 
The aggregate number of shares excluded from the diluted earnings per share calculations because they would have been anti-dilutive were less than 0.1 million and 0.1 million shares 2024 and 2023, respectively. For the twelve months ended December 31, 2024 and 2023, SARs and RSAs were not included in the diluted earnings per share calculations as they would have been anti-dilutive because the Company’s average stock price was less than or equal to the exercise price of the SARs or the grant price of the RSAs.

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

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