4. EARNINGS PER SHARE

3 Months Ended

Aug. 31, 2019

Earnings Per Share [Abstract]

4. EARNINGS PER SHARE

4. EARNINGS PER SHARE

    Basic earnings per share is determined using the weighted average number of common shares outstanding during the period. Diluted earnings per share is determined using the weighted average number of common shares and potential common shares (representing the dilutive effect of stock options, RSUs and ESPP shares) outstanding during the period using the treasury stock method.

    The following table presents the computation of basic and diluted net loss per share attributable to Aehr Test Systems common shareholders (in thousands, except per share data):

	Three Months Ended
	August 31,
	2019		2018
Numerator: Net loss	$	(413)	$	(1,515)
Denominator for basic net loss per share:
Weighted average shares outstanding		22,708		22,190
Shares used in basic net loss per share calculation		22,708		22,190
Effect of dilutive securities		--		--
Denominator for diluted net loss per share		22,708		22,190
Basic net loss per share	$	(0.02)	$	(0.07)
Diluted net loss per share	$	(0.02)	$	(0.07)

    For the purpose of computing diluted earnings per share, the weighted average number of potential common shares does not include stock options with an exercise price greater than the average fair value of the Company’s common stock for the period, as the effect would be anti-dilutive. In the three months ended August 31, 2019 and 2018 potential common shares have not been included in the calculation of diluted net loss per share as the effect would be anti-dilutive. As such, the numerator and the denominator used in computing both basic and diluted net loss per share for these periods are the same. Stock options to purchase 3,434,000 shares of common stock, RSUs for 20,000 shares and ESPP rights to purchase 297,000 ESPP shares were outstanding as of August 31, 2019, but were not included in the computation of diluted net loss per share, because the inclusion of such shares would be anti-dilutive. Stock options to purchase 3,189,000 shares of common stock, RSUs for 43,000 shares and ESPP rights to purchase 359,000 ESPP shares were outstanding as of August 31, 2018, but were not included in the computation of diluted net loss per share, because the inclusion of such shares would be anti-dilutive. The 2,657,000 shares convertible under the 9.0% Convertible Secured Notes (the “Convertible Notes”) outstanding on August 31, 2018 were not included in the computation of diluted net loss per share because the inclusion of such shares would be anti-dilutive.