Earnings Per Share

6 Months Ended

Jun. 30, 2023

Basic earnings per share (“basic EPS”) and diluted earnings per share (“diluted EPS”) attributable to common stockholders is calculated in conformity with the two-class method required for participating securities: Class A and Class B common stock. 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 twenty 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.

Basic EPS attributable to common stockholders is computed by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding during the period. For the calculation of diluted EPS, net income attributable to common stockholders for basic EPS is adjusted by the effect of dilutive securities. Diluted EPS attributable to common stockholders is computed by dividing the net income attributable to common stockholders by the weighted-average number of common shares outstanding, including all potentially dilutive common shares.

As the economic rights of Class A and Class B common stock are identical, undistributed earnings are allocated on a proportionate basis and presented on a combined basis. The following table sets forth the computation of basic and diluted

EPS and a reconciliation of the weighted average number of common and common equivalent shares outstanding for the three and six months ended June 30, 2023 and 2022 (in thousands, except share and per share amounts):


	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Numerator:
Net income	$	4,582	$	4,852	$	6,491	$	13,751
Denominator:
Weighted-average shares—basic	167,423,656		164,919,979		167,100,292		164,664,480
Effect of dilutive stock options	14,818,670		21,933,701		14,831,121		24,246,816
Effect of dilutive restricted stock	1,090,234		2,049,872		1,163,537		2,231,537
Weighted-average shares—diluted	183,332,560		188,903,553		183,094,950		191,142,834

Earnings per share:
Basic earnings per share	$	0.03	$	0.03	$	0.04	$	0.08
Effect of dilutive stock options and restricted stock	(0.01)		—		—		(0.01)
Diluted earnings per share	$	0.02	$	0.03	$	0.04	$	0.07

The Company excluded the following weighted average common equivalent shares from the computation of diluted earnings per share for the three and six months ended June 30, 2023 and the three and six months ended June 30, 2022 because including them would have had an anti-dilutive effect:


	Three months ended June 30,		Six months ended June 30,
	2023	2022	2023	2022
Stock options to purchase common stock	11,303,495	4,936,480	10,198,597	3,629,244
Restricted stock units	2,287,331	1,307,017	2,030,447	1,010,997