EARNINGS PER SHARE
Weighted average shares outstanding for basic and diluted earnings were as follows for the years ended December 31 (in thousands):
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| 2025 | | 2024 | | 2023 |
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| Basic weighted average shares outstanding | 29,875 | | | 30,538 | | | 30,626 | |
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| Dilutive effect of common stock options and stock units | 109 | | | 231 | | | 159 | |
| Diluted weighted average shares outstanding | 29,984 | | | 30,769 | | | 30,785 | |
The following table provides the potential anti-dilutive common stock units not included in the diluted weighted average shares calculations for the years ended December 31 (in thousands):
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| 2025 | | 2024 | | 2023 |
| Common stock units | 45 | | | — | | | 26 | |
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.