System1, Inc.SST

System1, Inc. Earnings Per Share Disclosure

10-KFiled Mar 10, 20252 min read
Net Loss Per Share
For the years ended December 31, 2024 and 2023, the basic net loss per share was calculated by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding. Basic and diluted net loss per share was calculated as follows (in thousands, except per share data):

For the Year Ended
December 31, 2024December 31, 2023
Basic and diluted net loss per share
Net loss from continuing operations attributable to System1, Inc.$(1.07)$(0.94)
Net loss from discontinued operations, net of tax attributable to System1, Inc.— (1.54)
Basic and Diluted net loss per share$(1.07)$(2.48)
Numerator:
Net loss from continuing operations attributable to System1, Inc.$(74,673)$(85,727)
Net loss from discontinued operations, net of tax attributable to System1, Inc.— (141,494)
Net loss attributable to System1, Inc.$(74,673)$(227,221)
Denominator:
Weighted-average common shares outstanding used in computing basic and diluted net loss per share69,554 91,454 

Shares of Class C common stock, RSUs and Warrants outstanding for the year December 31, 2024 and 2023, are considered potentially dilutive of the shares of Class A common stock and are included in the computation of diluted loss per share, except when the effect would be anti-dilutive. For the periods presented in the table above, a total of 16.8 million Warrants were excluded from the computation of net loss per share as the impact was anti-dilutive. For the year ended December 31, 2024, we excluded 21.9 million Stock Appreciation Rights as they are contingently issuable based on certain performance conditions, which were not achieved. See Note 16, Stock-Based Compensation, for additional details.
We do not consider unvested Class A common stock related to the Replacement Awards as outstanding for accounting purposes as they are subject to continued service requirements or contingencies. These shares are not included in the denominator of the net loss per share calculation until the employee provides the requisite service resulting in the vesting of the award or the contingency is removed, or upon termination of an employee at which point the common stock underlying award becomes issuable to the previous investors. Shares associated with the vested or forfeited Replacement Awards are deemed to be issued and outstanding for accounting purposes on the day of vesting or forfeiture.

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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