Net Income Per Share

9 Months Ended

Sep. 30, 2015

NET INCOME PER SHARE

Basic net income per share is computed using the weighted average number of common shares outstanding for the period, excluding unvested restricted stock and RSUs. Diluted net income per share is based upon the weighted average common shares outstanding for the period plus dilutive potential shares including unvested restricted stock, RSUs, and stock options using the treasury stock method. The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income per share:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
	(in thousands except per share amounts)				(in thousands except per share amounts)
Numerator:
Net income	$	184	$	1,073	$	1,720	$	3,106
Denominator:
Shares used in computation of basic net income per share (weighted average common shares outstanding)	28,190		28,505		28,027		28,420
Dilutive potential common shares:
Restricted Stock and RSUs	177		188		223		262
Stock options	767		658		643		673
Shares used in computation of diluted net income per share	29,134		29,351		28,893		29,355
Basic net income per share	$	0.01	$	0.04	$	0.06	$	0.11
Diluted net income per share	$	0.01	$	0.04	$	0.06	$	0.11

The Company includes the underlying market condition stock options in the calculation of diluted earnings per share if the performance condition has been satisfied as of the end of the reporting period and excludes such options if the performance condition has not been met. The Company has excluded the shares related to the market condition stock options from the calculations in all periods presented.

For the three months and nine months ended September 30, 2015, options to purchase approximately 917,000 and 1.8 million shares of common stock, respectively, with exercise prices greater than the average fair market value of the Company’s stock of $12.13 and $10.78 per share, respectively, were not included in the calculation because the effect would have been anti-dilutive.

For the three months and nine months ended September 30, 2014, options to purchase approximately 1.6 million and 1.5 million shares of common stock, respectively, with exercise prices greater than the average fair market value of the Company’s stock of $11.27 and $11.11 per share, respectively, were not included in the calculation because the effect would have been anti-dilutive.