Note 21 - Earnings per Share

Prior to the preferred stock conversion, we calculated basic and diluted earnings per common share (“EPS”) pursuant to the two-class method. The two-class method is an earnings allocation formula that determines EPS for common stock and participating securities according to dividend and participation rights in undistributed earnings. Under this method, all earnings, distributed and undistributed, are allocated to common shares and participating securities based on their respective rights to receive dividends. Dilutive potential common shares include outstanding stock options, unvested restricted share units and convertible preferred stock. As noted above in Note 19, no shares of the Series A Preferred Stock remain outstanding and all rights of the holders to receive future dividends have been terminated as of the December 18, 2023 conversion date.

The following table summarizes the computation of basic and diluted earnings per common share under the two-class or as-converted method, as well as the anti-dilutive shares excluded:


	Year Ended September 30,
	2025		2024		2023
Basic earnings per common share:
Net income	$	63,018	$	42,001	$	12,322
Less: Preferred stock dividend declared	—		(1,097)		(5,069)
Income available for distribution	63,018		40,904		7,253
Income allocated to participating securities	—		(2,855)		(2,712)
Net income available to common shareholders	$	63,018	$	38,049	$	4,541

Weighted average basic shares outstanding	54,301		49,429		33,985

Basic income per common share	$	1.16	$	0.77	$	0.13

Diluted earnings per common share:

Net income available to common shareholders	$	63,018	$	38,049	$	4,541

Weighted average basic shares outstanding	54,301		49,429		33,985
Dilutive effect related to employee stock plans	1,314		1,422		494
Weighted average diluted shares outstanding	55,615		50,851		34,479

Diluted income per common share	$	1.13	$	0.75	$	0.13

Anti-dilutive shares excluded:
Outstanding stock-based grants	2		4		180
Convertible preferred stock	—		—		20,297
Total anti-dilutive shares excluded	2		4		20,477

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.

UNIVERSAL TECHNICAL INSTITUTE INC Earnings Per Share Disclosure

About Earnings Per Share Disclosures

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