NET INCOME (LOSS) PER SHARE

3 Months Ended

Mar. 31, 2021

Basic net income (loss) per share is computed using the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed using the weighted average number of shares of common stock, adjusted for any dilutive effect of potential common stock. Potential common stock, computed using the treasury stock method, includes stock options, RSUs, RSAs and ESPP.

The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income (loss) per share (in thousands, except per share amounts):


	Three Months Ended March 31,
	2021		2020
Numerator:
Net income (loss)	$	2,036	$	(4,828)
Denominator:
Weighted-average common stock outstanding, basic	28,579		31,006
Dilutive effect of potential common shares:
Stock options, stock awards and ESPP	601		—
Total shares, diluted	29,180		31,006
Basic net income (loss) per share	$	0.07	$	(0.16)
Diluted net income (loss) per share	$	0.07	$	(0.16)

We include the underlying market condition stock awards in the calculation of diluted earnings per share if the performance condition has been satisfied as of the end of the reporting period and exclude stock equity awards if the performance condition has not been met.

For the three months ended March 31, 2021, we had stock options, RSUs, PSUs and RSAs outstanding that could potentially dilute basic earnings per share in the future, but these were excluded from the computation of diluted net income (loss) per share because their effect would have been anti-dilutive. These outstanding securities consisted of the following (in thousands):


	Three Months Ended March 31,
	2021	2020
Stock options	14	1,370
RSUs and RSAs	—	1,263
	14	2,633