Basic and Diluted Net Income (Loss) Per Common Share

6 Months Ended

Jun. 30, 2015

Basic and Diluted Net Income (Loss) Per Common Share

NOTE 2. BASIC AND DILUTED NET INCOME (LOSS) PER COMMON SHARE

Basic net income (loss) per common share (“Basic EPS”) excludes dilution and is computed by dividing net loss by the weighted average number of common shares outstanding during the year. Diluted net income (loss) per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other common stock equivalents were exercised or converted into common stock. In periods of net loss, common stock equivalents are excluded from the Diluted EPS computation, because they are antidilutive. Therefore, Diluted EPS equals Basic EPS for the three and six months ended June 30, 2015 presented in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The weighted-average number of shares outstanding used in the computation of basic and diluted earnings/loss per share does not include the effects of the following potential outstanding common stock (in thousands):

	June 30,
	2015
Stock options		2,781
Restricted stock awards		1,314
Potential shares from Convertible Notes		8,082

Potentially dilutive securities include outstanding options and restricted stock awards for the three and six months ended June 30, 2014 presented in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury method. The following table sets forth the calculation of basic and diluted net income per share (in thousands, except per share amounts):

	Three months ended June 30, 2014		Six months ended June 30, 2014
Net income, as reported	$	3,428	$	1,704

Weighted average shares of common stock outstanding		58,753		57,441
Dilutive effect of employee stock options and restricted stock awards		2,695		2,424
Shares used to compute diluted net income per share		61,448		59,865

Basic net income per share	$	0.06	$	0.03
Diluted net income per share	$	0.06	$	0.03