NET INCOME PER SHARE

3 Months Ended

Aug. 31, 2023

Net income per share:

NET INCOME PER SHARE

11. NET INCOME PER SHARE

Basic net income per share is determined using the weighted average number of common shares outstanding during the period. Diluted net income per share is determined using the weighted average number of common shares and potential common shares (representing the dilutive effect of stock options, unvested RSUs, and ESPP shares) outstanding during the period using the treasury stock method. The following table presents the computation of basic and diluted net income per share:

	Three Months Ended August 31,
(In thousands, except per share data)	2023		2022
Numerator:
Net income	$	4,674	$	589
Denominator:
Basic weighted average shares outstanding		28,649		27,242
Dilutive effect of common equivalent shares outstanding		983		1,546
Diluted weighted average shares outstanding		29,632		28,788
Net income per share - Basic	$	0.16	$	0.02
Net income per share - Diluted	$	0.16	$	0.02

For the purpose of computing diluted net income per share, weighted average potential common shares do 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. Stock options to purchase 2,000 and 152,000 shares of common stock were outstanding as of August 31, 2023 and 2022, respectively, but were not included in the computation of diluted net income per share, because the inclusion of such shares would be anti-dilutive.