NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period, plus potentially dilutive common shares, consisting of shares issuable in connection with stock options, restricted stock units (RSUs), performance-based restricted stock units (PSUs), the ESPP and convertible debt. The Company uses the treasury-stock method to compute diluted earnings per share with respect to its stock options and equivalents. The Company uses the if-converted method to compute diluted earnings per share with respect to its convertible debt. For purposes of this calculation, options to purchase stock, including stock options, RSUs, PSUs and ESPP, are considered to be potential common shares and are only included in the calculation of diluted net income (loss) per share when their effect is dilutive. Basic and diluted earnings per common share are calculated as follows:



	Three Months Ended March 31,
(in thousands, except for per share amounts)	2019			2018
Basic net income (loss) per share
Net income (loss)	$	(14,301	)	$	33,824
Denominator	64,239			63,503
Basic net income (loss) per share	$	(0.22	)	$	0.53

Diluted net income (loss) per share
Numerator:
Net income (loss)	$	(14,301	)	$	33,824
Add: Interest Expense on convertible debt, net of tax	—			5,187
Denominator:
Denominator for basic net income (loss) per share	64,239			63,503
Add effect of diluted securities:
Stock options and equivalents and convertible debt	—			18,374
Denominator for diluted net income (loss) per share	64,239			81,877
Diluted net income (loss) per share	$	(0.22	)	$	0.48

The following table sets forth outstanding potentially dilutive common shares that are not included in the computation of diluted net income (loss) per share because to do so would be anti-dilutive:



	Three Months Ended March 31,
(in thousands)	2019	2018
Convertible debt	17,931	—
Stock options and equivalents	6,103	4,248
Total potentially dilutive common shares	24,034	4,248