NOTE

8—NET

LOSS PER SHARE

Basic net loss per share is computed using the weighted-average number of shares outstanding during the period. In periods of net income, diluted shares outstanding include the dilutive effect of in-the-money equity awards (stock options, RSUs, PSUs and employee stock purchase plan contributions), which is calculated based on the average share price for each fiscal period using the treasury stock method.

In accordance with ASC

260

(Earnings per Share), the assumed proceeds under the treasury stock method include the average unrecognized compensation expense of in-the money stock options and restricted stock units. This results in the assumed buyback of additional shares, thereby reducing the dilutive impact of equity awards.

Diluted earnings per share is the same as basic earnings per share for the periods in which the Company had a net loss because the inclusion of outstanding common stock equivalents would be anti-dilutive.

The following table sets forth the computation of basic and diluted net income (loss) and the weighted average number of shares used in computing basic and diluted net income (loss) per share (in thousands, except per share data):

	Year Ended December 31,
	201 9		201 8		201 7
Numerator:
Net income (loss) (in thousands)	$	(12,348)	$	(30,770)	$	29,993
Denominator:
Weighted average shares of common stock outstanding used in computing net income (loss) per share, basic		14,096		13,771		13,873
Dilutive effect of incremental shares and share equivalents		-		-		855
Weighted average shares of common stock outstanding used in computing net income (loss) per share, diluted		14,096		13,771		14,728
Net loss per share :
Net income (loss) per share, basic	$	(0.88)	$	(2.23)	$	2.16
Net income (loss) per share, diluted	$	(0.88)	$	(2.23)	$	2.04

The following numbers of shares outstanding, prior to the application of the treasury stock method, were excluded from the computation of diluted net loss per common share for the period presented because including them would have had an anti-dilutive effect (in thousands):

	Year Ended December 31,
	201 9		201 8		201 7
Options to purchase common stock		417		664		42
Restricted stock units		559		432		9
Employee stock purchase plan shares		111		133		-
Performance stock units		178		43		-
Total		1,265		1,272		51