NET INCOME PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS
Basic net income (loss) per share attributable to common stockholders is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted net income (loss) per share attributable to common stockholders is computed using the weighted-average number of outstanding shares of common stock and the effect of potentially dilutive
securities outstanding during the period. Potentially dilutive securities include stock options, RSUs (including PRSUs) and, to a lesser extent, ESPP shares. If dilutive, such potentially dilutive securities are reflected in net income (loss) per share attributable to common stockholders using the treasury stock method.
The following tables present the calculation of basic and diluted net income per share attributable to common stockholders for the periods presented (in thousands, except per share data):
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| Year Ended December 31, |
| 2025 | | 2024 | 2023 |
| Basic net income per share: | | | | | |
| Net income attributable to common stockholders | $ | 145,600 | | | $ | 132,850 | | | $ | 99,173 | |
| Shares used in computation: | | | | | |
| Weighted-average common shares outstanding | 63,334 | | | 67,415 | | | 69,221 | |
| Basic net income per share attributable to common stockholders: | $ | 2.30 | | | $ | 1.97 | | | $ | 1.43 | |
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| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Diluted net income per share: | | | | | |
| Net income attributable to common stockholders | $ | 145,600 | | | $ | 132,850 | | | $ | 99,173 | |
| Shares used in computation: | | | | | |
| Weighted-average common shares outstanding | 63,334 | | | 67,415 | | | 69,221 | |
| Stock options and ESPP | 207 | | | 335 | | | 333 | |
| RSUs | 1,549 | | | 2,861 | | | 4,042 | |
| | | | | |
| Number of shares used in diluted calculation | 65,090 | | | 70,611 | | | 73,596 | |
| Diluted net income per share attributable to common stockholders: | $ | 2.24 | | | $ | 1.88 | | | $ | 1.35 | |
The following stock-based instruments were excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented (in thousands):
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| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Stock options | 1,714 | | | 674 | | | 791 | |
| RSUs | 2,843 | | | 1,559 | | | 424 | |
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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.