Earnings (Loss) Per Share Attributable to Common Stockholders

12 Months Ended

Jul. 31, 2021

Earnings (Loss) Per Share Attributable to Common Stockholders

Basic and diluted net income (loss) per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. We consider early exercised share options to be participating securities. In connection with our IPO, we established two classes of authorized common stock: Class A common stock and Class B common stock. As a result, all then-outstanding shares of common stock were converted into shares of Class B common stock upon effectiveness of our IPO. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting, conversion, and transfer rights. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to ten votes per share. Each share of Class B common stock is convertible at any time at the option of the stockholder into one share of Class A common stock.

Undistributed earnings allocated to participating securities are subtracted from net income (loss) in determining net income (loss) attributable to common stockholders. Basic earnings per share (“EPS”) attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. All participating securities are excluded from basic weighted-average common shares outstanding.

For the calculation of diluted earnings (loss) per share, net income (loss) attributable to common stockholders for basic EPS is adjusted by the effect of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding, including all potentially dilutive common shares. The undistributed earnings are allocated based on the contractual participation rights of the Class A and Class B common shares as if the earnings for the year have been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis. The computation of the diluted net income (loss) per share of Class A common stock assumes the conversion of Class B common stock, while diluted net income (loss) per share of Class B common stock does not assume the conversion of Class A common stock as Class A common stock is not convertible into Class B common stock.

A reconciliation of the numerator and denominator used in the calculation of the basic and diluted EPS attributable to common stockholders is as follows (in thousands except share and per share amounts):


	July 31, 2021				August 1, 2020				August 3, 2019
(in thousands except share and per share amounts)	Class A		Class B		Class A		Class B		Class A		Class B
Numerator:
Net income (loss)	(5,557)		(3,319)		(36,860)		(30,257)		16,604		20,277
Less: noncumulative dividends to preferred stockholders	—		—		—		—		—		—
Less: undistributed earnings to participating securities	—		—		—		—		(8)		(10)
Net income (loss) attributable to common stockholders – basic	(5,557)		(3,319)		(36,860)		(30,257)		16,596		20,267
Add: adjustments to undistributed earnings to participating securities	—		—		—		—		1		—
Reallocation of undistributed earnings as a result of conversion of Class B common stock to Class A common stock	—		—		—		—		20,267		—
Reallocation of undistributed earnings to Class B common stock	—		—		—		—		—		302
Net income (loss) attributable to common stockholders – diluted	(5,557)		(3,319)		(36,860)		(30,257)		36,864		20,569
Denominator:
Weighted-average shares of common stock – basic	66,351,916		39,623,487		56,228,429		46,154,853		45,027,352		54,986,110
Conversion of Class B common stock to Class A common stock outstanding	—		—		—		—		54,986,110		—
Effect of dilutive stock options and restricted stock units	—		—		—		—		3,640,164		2,849,737
Effect of potentially dilutive preferred stock warrants	—		—		—		—		—		—
Weighted-average shares of common stock – diluted	66,351.916		39,623.487		56,228.429		46,154.853		103,653.626		57,835.847
Earnings (loss) per share attributable to common stockholders:
Basic	$	(0.08)	$	(0.08)	$	(0.66)	$	(0.66)	$	0.37	$	0.37
Diluted	$	(0.08)	$	(0.08)	$	(0.66)	$	(0.66)	$	0.36	$	0.36

The following common stock equivalents were excluded from the computation of diluted earnings (loss) per share for the periods presented because including them would have been antidilutive:


	July 31, 2021	August 1, 2020	August 3, 2019


Restricted stock units that settle into Class A common stock	10,264,925	7,965,447	2,914,630
Stock options to purchase Class A common stock	2,361,055	2,924,512	1,547,495
Stock options to purchase Class B common stock	1,289,427	3,540,414	969,179
Total	13,915,407	14,430,373	5,431,304