NET INCOME PER SHARE

3 Months Ended

Mar. 31, 2022

Basic net income per share is computed using the weighted average number of shares of common stock outstanding during the period. Diluted net income 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, stock awards and ESPP.

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


	Three Months Ended March 31,
	2022	2021

Denominator:
Weighted-average shares outstanding, basic	33,996	28,579
Shares related to outstanding options, unvested RSUs, RSAs, PSUs and ESPP	272	601
Weighted average shares outstanding, diluted	34,268	29,180

We include market condition-based performance restricted stock units 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, 2022 and 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 per share because their effect would have been anti-dilutive. These outstanding securities consisted of the following (in thousands):


	Three Months Ended March 31,
	2022	2021
Stock options	239	14
Restricted stock units, restricted stock awards and market condition-based restricted stock units	55	—
Total	294	14