Net Income (Loss) per Share Attributable to Common Stock

Net income (loss) per share attributable to common stock is computed by dividing the net income (loss) attributable to common stock by the weighted-average number of common shares outstanding. The Company has outstanding stock options, restricted stock units, employee stock purchase plan shares, Notes, and previously had redeemable convertible preferred stock, which are considered in the calculation of diluted net income (loss) attributable to common stock per share whenever doing so would be dilutive.

The Company calculates basic and diluted net income (loss) per share attributable to common stock in conformity with the two-class method required for companies with participating securities. The Company considers all series of redeemable convertible preferred stock to be participating securities. Under the two-class method, net income (loss) attributable to common stock is not allocated to the redeemable convertible preferred stock as the holders of redeemable convertible preferred stock do not have a contractual obligation to share in losses. Upon the conversion of the redeemable convertible preferred stock to common stock on the date of the IPO, or August 2, 2017, the Company only had one class of participating security, common stock. Diluted net income (loss) per share attributable to common stock is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period.

The following table sets forth the calculation of basic and diluted net income (loss) per share attributable to common stock during the periods presented:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2018		2017			2018			2017
Numerator:
Net income (loss)	$	3,475	$	10,558		$	(29,756	)	$	(13,203	)
Accretion of preferred stock	—		(40,224		)	—			(175,915		)
Net income (loss) attributable to common stock - basic and diluted	$	3,475	$	(29,666	)	$	(29,756	)	$	(189,118	)
Denominator:
Weighted average shares:
Basic	87,743,223		58,868,903			84,327,266			29,678,082
Dilutive shares from stock plans	6,899,240		—			—			—
Diluted	94,642,463		58,868,903			84,327,266			29,678,082
Net income (loss) per share:
Net income (loss) per share attributable to common stock - basic	$	0.04	$	(0.50	)	$	(0.35	)	$	(6.37	)
Net income (loss) per share attributable to common stock - diluted	$	0.04	$	(0.50	)	$	(0.35	)	$	(6.37	)

The following outstanding shares of common stock equivalents as of September 30, 2018 and 2017 were excluded from the computation of the diluted net income (loss) per share attributable to common stock for the periods presented because their effect would have been anti-dilutive:



	Three Months Ended September 30,		Nine Months Ended September 30,
	2018	2017	2018	2017
Redeemable convertible preferred stock	—	55,422,002	—	55,422,002
Options to purchase common stock	—	13,298,339	10,150,522	13,298,339
Restricted stock units	238,668	—	2,081,173	—
Total	238,668	68,720,341	12,231,695	68,720,341

The Company considered the impact of the Notes on its diluted net income per share for the three months ended September 30, 2018 based on the treasury stock method as the Company has the ability, and intends, to settle any conversions of the Notes solely in cash. The treasury stock method requires that the dilutive effect of common stock issuable upon conversion of the Notes be computed in the periods in which it reports net income. For the three months ended September 30, 2018, there was no dilutive effect from the Notes.