SMITH MICRO SOFTWARE, INC. Earnings Per Share Disclosure
9. Earnings Per Share
The Company calculates earnings per share (“EPS”) as required by FASB ASC Topic No. 260, Earnings Per Share. Basic EPS is calculated by dividing the net income available to common stockholders by the weighted average number of common shares outstanding for the period, excluding common stock equivalents. Diluted EPS is computed by dividing the net income available to common stockholders by the weighted average number of common shares outstanding for the period, plus the weighted average number of dilutive common stock equivalents outstanding for the period using the treasury-stock method. For periods with a net loss, the dilutive common stock equivalents are excluded from the diluted EPS calculation. For purposes of this calculation, common stock subject to repurchase by the Company, options, warrants, and convertible notes are considered to be common stock equivalents, and are only included in the calculation of diluted earnings per share when their effect is dilutive.
The following table sets forth the details of basic and diluted earnings per share (in thousands, except per share amounts):
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| Year Ended December 31, |
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| 2025 |
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| 2024 |
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Numerator: |
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Net loss |
| $ | (29,327 | ) |
| $ | (48,697 | ) |
Deemed Dividend |
| $ | (769 | ) |
| $ | — |
|
Net loss attributable to common stockholders for basic and diluted loss per share |
| $ | (30,096 | ) |
| $ | (48,697 | ) |
Denominator: |
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Weighted average shares outstanding – basic |
|
| 20,605 |
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|
| 12,367 |
|
Potential common shares – options / warrants (treasury stock method) |
|
| — |
|
|
| — |
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Weighted average shares outstanding – diluted |
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| 20,605 |
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|
| 12,367 |
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|
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Shares excluded (anti-dilutive) |
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| 10,675 |
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|
| 3,175 |
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Net loss per common share: |
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Basic |
| $ | (1.46 | ) |
| $ | (3.94 | ) |
Diluted |
| $ | (1.46 | ) |
| $ | (3.94 | ) |
The following shares were excluded from the computation of diluted net loss per share as the impact of including those shares would be anti-dilutive (in thousands):
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| Year Ended December 31, |
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|
| 2025 |
|
| 2024 |
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Outstanding stock options |
|
| 29 |
|
|
| 9 |
|
Outstanding warrants |
|
| 10,646 |
|
|
| 3,166 |
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Total anti-dilutive shares |
|
| 10,675 |
|
|
| 3,175 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 5, 2026 | Showing above |
| 2024 | Mar 12, 2025 | |
| 2023 | Feb 26, 2024 | |
| 2022 | Mar 23, 2023 | |
| 2021 | Mar 11, 2022 | |
| 2020 | Mar 8, 2021 | |
| 2019 | Mar 13, 2020 | |
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.