NET INCOME (LOSS) PER SHARE

3 Months Ended

Mar. 31, 2020

Basic net income (loss) per share is calculated by dividing net income (loss) available to Class A common shareholders by the weighted average numbers of shares outstanding during the period. Class C Common Stock is excluded from the weighted average shares outstanding immediately following the Closing Date for the calculation of basic net income per share, as holders of Class C Common Stock are not entitled to any dividends or liquidating distributions.

The Company uses the “if-converted method” to determine the potential dilutive effect of (i) exchanges of outstanding Common Units of Altus Midstream and corresponding shares of its outstanding Class C Common Stock (ii) earn-out consideration, and (iii) assumed exchange of the outstanding Preferred Units of Altus Midstream for shares of Class A Common Stock. The treasury stock method is used to determine the potential dilutive effect of its outstanding warrants.

The computation of basic and diluted net income (loss) per share for the periods presented in the consolidated financial statements is shown in the table below.



	Three Months Ended March 31,
	2020							2019
	Loss			Shares	Per Share			Income		Shares	Per Share

	(In thousands, except per share data)
Basic:
Net income (loss) attributable to Class A common shareholders	$	(9,853	)	74,929	$	(0.13	)	$	1,100	74,929	$	0.01
Effective of dilutive securities:
Redeemable noncontrolling interest — Apache limited partner	$	(35,201	)	250,000				$	3,525	250,000
Diluted:
Net income (loss) attributable to Class A common shareholders	$	(45,054	)	324,929	$	(0.14	)	$	4,625	324,929	$	0.01

The diluted earnings per share calculation excludes the effects of the following, since the associated impacts would have been anti-dilutive for all relevant periods presented:


•	An assumed exchange of the outstanding Preferred Units of Altus Midstream for shares of Class A Common Stock; and


•	Outstanding warrants of the Company to purchase an aggregate 18,941,631 shares of Class A Common Stock.

Further discussion of the Preferred Units and associated embedded features can be found in Note 10—Series A Cumulative Redeemable Preferred Units and Note 13—Fair Value Measurements, respectively. Earn-out consideration granting Apache the right to receive up to 37,500,000 shares of Class A Common Stock is not included in the earnings per share calculation above, as the conditions for issuance were not satisfied as of the quarter ended March 31, 2020.