Net Income (Loss) Per Share

12 Months Ended

Dec. 31, 2023

NET INCOME (LOSS) PER SHARE

As of December 31, 2023, the Company’s convertible notes were potentially convertible into 8,696,792 shares of common stock. The Company used the if-converted method to calculate the potential dilutive effect of the conversion spread on diluted net income per share for the years ended December 31, 2023, 2022 and 2021.

The denominator for diluted net income (loss) per share does not include any effect from the capped call transactions the Company entered into concurrently with the issuance of the convertible notes, as this effect would be anti-dilutive. In the event of conversion of a convertible note, shares delivered to the Company under the capped call will offset the dilutive effect of the shares that the Company would issue under the convertible notes.

For the years ended December 31, 2023 and 2022, basic loss per common share and diluted loss per common share are the same in each respective period, as the inclusion of any potentially issuable shares would be anti-dilutive.

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


	Year Ended December 31,
	2023		2022		2021
Numerator:
Net income (loss)	$	(162,833)	$	(82,340)	$	2,062
Denominator:
Weighted average shares of common stock outstanding used in computing net income (loss) per share, basic	19,885		18,747		17,891
Dilutive effect of incremental shares and share equivalents:
Options	—		—		68
RSUs	—		—		294
PSUs	—		—		104
ESPP	—		—		5
Weighted average shares of common stock outstanding used in computing net income (loss) per share, diluted	19,885		18,747		18,362
Net income (loss) per share:
Net income (loss) per share, basic	$	(8.19)	$	(4.39)	$	0.12
Net income (loss) per share, diluted	$	(8.19)	$	(4.39)	$	0.11

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


	Year Ended December 31,
	2023	2022	2021
Capped call	10,780	10,780	4,167
Convertible debt	8,697	8,697	4,167
Options to purchase common stock	1,282	514	166
Restricted stock units	682	460	32
Employee stock purchase plan shares	—	38	—
Performance stock units	227	446	120
Total	21,668	20,935	8,652