Net Income (Loss) Per Share

12 Months Ended

Dec. 31, 2023

In March 2021, the Company amended its certificate of incorporation to create two classes of common stock outstanding: Class A common stock and Class B common stock. As more fully described in Note 14 “Redeemable Convertible Preferred Stock and Stockholders’ Equity”, the rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one (1) vote per share and each share of Class B common stock is entitled to ten (10) votes per share. Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Shares of Class B common stock

are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible. See Note 14 “Redeemable Convertible Preferred Stock and Stockholders’ Equity” for additional information regarding the current conversion and transfer terms of the Company’s common stock. The Company allocates undistributed earnings attributable to common stock between the common stock classes on a one-to-one basis when computing net income (loss) per share. As a result, basic and diluted net income (loss) per share of Class A common stock and share of Class B common stock are equivalent.

Net income (loss) per share information is determined using the two-class method, which includes the weighted-average number of shares of common stock outstanding during the period and other securities that participate in dividends (a participating security). With respect to shares of Preferred Stock that were issued and outstanding prior to the IPO, the Company considers the shares of Preferred Stock to be participating securities because they include rights to participate in dividends with the common stock.

Under the two-class method, basic 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 shares of common stock outstanding during the period. Diluted net income (loss) per share attributable to common stockholders is computed using the more dilutive of (1) the two-class method or (2) the if-converted method. The Company allocates net income first to the holders of the Preferred Stock based on dividend rights under the Company’s certificate of incorporation and then to preferred and common stockholders based on ownership interests. Net losses are not allocated to preferred stockholders as they do not have an obligation to share in the Company’s net losses.

Diluted net income (loss) per share gives effect to all potentially dilutive securities. Potential dilutive securities consist of shares of common stock issuable upon the exercise of stock options, shares of common stock issuable upon the conversion of the outstanding shares of Preferred Stock, and shares of common stock issuable upon the vesting of restricted stock awards.

For the years ended December 31, 2022 and 2021, the net loss attributable to common stockholders is divided by the weighted-average number of shares of common stock outstanding during the period to calculate both basic and diluted earnings per share. The dilutive effect of common stock equivalents has been excluded from the calculation of diluted net loss per share for these periods as its effect would have been anti-dilutive due to the net losses incurred for these periods.

For the year ended December 31, 2023, dilutive net income per share attributable to common stockholders was calculated by dividing net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period, including the dilutive impact of stock options and shares of common stock issuable upon the vesting of Restricted Stock Awards.

The following table presents a reconciliation of weighted-average shares outstanding used in the calculation of basic and diluted net income (loss) per share:


	Year ended December 31,
	2023	2022	2021
Weighted-average shares outstanding:
Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders — basic	142,593,000	141,160,000	126,586,000
Dilutive effect of share equivalents resulting from stock options	3,403,051	—	—
Dilutive effect of share equivalents resulting from restricted stock awards	69,282	—	—
Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders — diluted	146,065,333	141,160,000	126,586,000

The following potentially dilutive common stock equivalents have been excluded from the calculation of diluted weighted-average shares outstanding for the periods presented:


	Year ended December 31,
	2023	2022	2021
Stock options outstanding	3,748,877	6,865,265	6,329,822
Unvested RSAs, RSUs, and PSUs	1,558,847	1,328,714	345,026

For the years ended December 31, 2023, and 2022, 1,077,726 and 1,283,620, shares of Class A common stock potentially issuable under PSU awards were excluded from the table above, respectively. The performance-based conditions had not been met and were deemed improbable of achievement as of the reporting period end date. The Company did not have PSU awards in 2021. See Note 15 “Stock-Based Compensation” for additional information regarding the Company’s PSU awards.