4. EARNINGS PER SHARE

6 Months Ended

Nov. 30, 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) income per share attributable to Aehr Test Systems common shareholders (in thousands, except per share data):

	Three Months Ended					Six Months Ended
	November 30,					November 30,
	2019		2018			2019			2018
Numerator: Net income (loss)	$	251	$	(629	)	$	(162	)	$	(2,144	)
Denominator for basic net income (loss) per share:
Weighted average shares outstanding		22,823		22,294			22,765			22,242
Shares used in basic net income (loss) per share calculation		22,823		22,294			22,765			22,242
Effect of dilutive securities		89		—			—			—
Denominator for diluted net income (loss) per share		22,912		22,294			22,765			22,242
Basic net income (loss) per share	$	0.01	$	(0.03	)	$	(0.01	)	$	(0.10	)
Diluted net income (loss) per share	$	0.01	$	(0.03	)	$	(0.01	)	$	(0.10	)

    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 antidilutive. Stock options to purchase 2,919,000 shares of common stock were outstanding as of November 30, 2019, but were not included in the computation of diluted net income per share, because the inclusion of such shares would be antidilutive. In the three months ended November 30, 2018 and six months ended November 30, 2019 and 2018, potential common shares were not included in the calculation of diluted net loss per share as the effect would be antidilutive. 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 3,373,000 shares of common stock, RSUs for 38,000 shares and ESPP rights to purchase 327,000 ESPP shares were outstanding as of November 30, 2018, but were not included in the computation of diluted net loss per share because the inclusion of such shares would be antidilutive. The 2,657,000 shares convertible under the 9% Convertible Secured Notes (the “Convertible Notes”) outstanding at November 30, 2018 were not included in the computation of diluted net loss per share because the inclusion of such shares would be antidilutive.