Net Income (Loss) Per Common Share

3 Months Ended

Mar. 31, 2016

NOTE 6. NET INCOME (LOSS) PER COMMON SHARE

The computation of basic net income (loss) per common share is based on the weighted-average number of common shares outstanding during each period. The computation of diluted net income (loss) per common share is based on the weighted-average number of common shares outstanding during the period plus, when their effect is dilutive, incremental shares consisting of shares subject to stock options, restricted stock units, performance share units, stock appreciation rights, ESPP shares, warrants, and shares issuable upon conversion of convertible debt.

In periods where the Company reports a net loss, all common stock equivalents are deemed anti-dilutive such that basic net loss per common share and diluted net loss per common share are equal.

For the three months ended March 31, 2016, employee stock-based awards to purchase approximately 4.2 million shares of the Company’s common stock were excluded from the computation of diluted net income per common share because their effect would have been anti-dilutive. For the three months ended March 31, 2015, approximately 22.8 million potentially dilutive common shares were excluded from the diluted net loss per common share computation because such securities had an anti-dilutive effect on net loss per common share due to the Company’s net loss for the period.

The following table reconciles the numerator and denominator used to calculate diluted net income (loss) per common share:

	Three Months Ended March 31,
	2016		2015
Numerator:
Net income (loss)	$	4,816	$	(3,118	)
Denominator:
Weighted-average common shares, basic		164,247		156,637
Dilutive effect of common stock equivalents		4,150		—
Weighted-average common shares, diluted		168,397		156,637