Net Loss Per Share

12 Months Ended

Dec. 31, 2019

Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including our convertible senior notes, outstanding stock options, stock related to unvested restricted stock awards, and common stock issuable pursuant to the ESPP to the extent dilutive. Basic and diluted net loss per share was the same for each period presented, as the inclusion of all potential common shares outstanding would have been anti-dilutive.

The net loss per share is allocated based on the contractual participation rights of the Class A and Class B common shares as if the loss for the year has been distributed. As the liquidation and dividend rights are identical, the net loss is allocated on a proportionate basis.

We consider unvested restricted stock awards granted under the 2014 Equity Incentive Plan to be participating securities because holders of such shares have non-forfeitable dividend rights in the event of our declaration of a dividend for common shares. In future periods to the extent we are profitable, we will subtract earnings allocated to these participating securities from net income to determine net income attributable to common stockholders.

A reconciliation of the denominator used in the calculation of basic and diluted loss per share is as follows (in thousands, except share and per share data):


	Year ended
	December 31, 2019						December 31, 2018						December 31, 2017
	Class A		Class B		Class A		Class B		Class A		Class B
Numerator
Net loss	$	(38,661)	$	(9,473)	$	(38,733)	$	(11,338)	$	(33,016)	$	(11,410)

Denominator
Weighted-average common shares outstanding - basic and diluted	37,190,224		9,112,432		33,758,623		9,881,785		30,929,899		10,688,939
Basic and diluted net loss per share	$	(1.04)	$	(1.04)	$	(1.15)	$	(1.15)	$	(1.07)	$	(1.07)

The anti-dilutive securities excluded from the weighted-average shares used to calculate the diluted net loss per common share were as follows:


	As of December 31,
	2019	2018	2017
Shares subject to outstanding common stock options	4,353,167	6,400,175	8,145,777
Shares subject to unvested restricted stock awards	—	—	163,332
Shares subject to unvested restricted stock units	3,039,020	2,359,261	574,072
Shares issuable pursuant to the ESPP	76,466	105,583	85,509

Additionally, approximately 4.3 million shares of our Class A common stock underlying the conversion option in the Notes, are not considered in the calculation of diluted net loss per share as the effect would be anti-dilutive. We use the treasury stock method for calculating any potential dilutive effect of the conversion option on diluted net income per share, if applicable. During the year ended December 31, 2019, the average market price of our Class A common stock did not exceed the conversion price of the Notes of $80.16 per share.