Earnings Per Share (EPS)

12 Months Ended

Dec. 31, 2024

Earnings Per Share ("EPS")

Earnings Per Share ("EPS")

Note 15 – Earnings Per Share (“EPS”)

Predecessor

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted net loss per common share excludes the potential impact of the Company’s convertible preferred stock, common stock warrants, and common stock options because the Company's net losses would cause such shares to be anti-dilutive. Therefore, as the Company recorded net losses in the periods presented, basic and diluted net loss per common share are the same.

	Predecessor
	Period from January 1 to July 30, 2024		Year ended December 31, 2023
Numerator:
Net loss attributable to common stockholders	$	(21,278)	$	(36,590)
Denominator:
Weighted-average shares outstanding used in computing net loss per share attributable to common stockholders - basic and diluted		815,854		759,814
Net loss per share attributable to common stockholders - basic and diluted	$	(26.08)	$	(48.16)

The following potentially dilutive securities were excluded from the computation of diluted net loss per share calculations for the periods presented because the impact of including them would be anti-dilutive:

	Predecessor
	As of July 30, 2024	As of December 31, 2023
Convertible preferred stock	4,732,044	4,939,946
Stock options	740,409	747,001
SVB Warrants	—	49,080
Total potentially dilutive securities	5,472,453	5,736,027

Successor

After the Business Combination, the Successor calculated basic earnings-per-share (“EPS”) and diluted EPS to common stockholders in conformity with the two-class method required for companies with participating securities. The Company considered (i) the Convertible Securities Notes and (ii) the earnout shares subject to vesting conditions to be participating securities as they participate in any distributions declared by the Company. The Company’s Base Warrants and Convert Warrants are considered as non-participating securities, as the holders are not entitled to any shareholder right prior to the exercise of the Base Warrants and the Convert Warrants. As of the reporting date, none of the Base Warrants or the Convert Warrants were exercised to receive the Company’s Common Stock.

Under the two-class method, undistributed earnings allocated to these participating securities were subtracted from net income in determining net income attributable to common stockholders. In periods of net loss, losses are allocated to the participating security only if the security has not only the right to participate in earnings, but also a contractual obligation to share in the Company's losses. As the Company incurred a net loss for the period from July 31, 2024 to December 31, 2024 (Successor), the Convertible Securities Notes were not considered participating securities, and were excluded from the two-class method EPS calculation for those periods.

Further, Basic EPS under the two-class method includes the impact of the Company’s PIPE Pre-funded Warrants as the PIPE Pre-funded Warrants are exercisable for only $0.01 per share (i.e., de minimis cash consideration) without an expiration date and not subject to exercise contingencies.

The Company discloses the Diluted EPS under the if-converted method as such diluted EPS is lower than the diluted EPS calculated under the two-class method. The Earn-out shares subject to vesting conditions are not considered in the denominator for the calculation of diluted EPS as the vesting conditions for the Earn-out shares were not met during the successor reporting period.

The following table sets forth the computation of basic earnings per share attributable to common stockholders and the participating securities for the periods presented (in thousands, except share and per share data):

Basic EPS:

	July 31, 2024 to December 31, 2024 (Successor)
(amounts in thousands, except share and per share data)	Common Shares		Convertible Securities Notes		Sponsor Earnout
Numerator:
Net loss allocated to each class of participating securities	$	(49,888)	$	—	$	(3,875)
Denominator:
Weighted-average shares outstanding		14,772,692		—		—
Shares issuable to Convertible Securities Notes		—		—		—
Sponsor Earnout		—		—		1,147,500
Net loss per share attributable to each class of participating securities – Basic	$	(3.38)	$	—	$	(3.38)

The following table sets forth the computation of diluted earnings per share attributable to common stockholders for the periods presented (in thousands, except share and per share data):

Diluted EPS:

	Successor
(amounts in thousands, except share and per share data)	July 31, 2024 to December 31, 2024
Numerator:
Net loss – Basic	$	(53,763)
Less: Adjustment for fair value changes to convertible securities notes		(929)
Net loss attributable to common stockholders – Diluted	$	(54,692)
Denominator:
Weighted-average shares outstanding – Basic		14,772,692
Weighted-average effect of shares issuable to Convertible Securities Notes (if-converted method)		—
Weighted-average shares outstanding – Diluted		14,772,692
Net loss per share attributable to common shares – Diluted (if-converted method)	$	(3.70)

The following potentially dilutive securities were excluded from the computation of diluted net loss per share calculations for the periods presented because the impact of including them would be anti-dilutive:

	Successor
	December 31, 2024
Base Warrants	7,528,727
Convert Warrants	1,500,000
Earn-out Shares, subject to vesting conditions	1,147,500
Stock options issued in connection with the Business Combination	7,587
Total potentially dilutive securities	10,183,814