Net Income Per Share

12 Months Ended

Dec. 31, 2023

Net Income Per Share

Basic earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per share includes the weighted average number of common shares outstanding and the number of equivalent shares which would be issued related to unvested restricted stock, warrants, and acquisition consideration using the treasury method, unless such additional equivalent shares are anti-dilutive. Upon adoption of ASU 2020-06 on January 1, 2022, the Company prospectively utilized the if-converted method to calculate the impact of convertible instruments on diluted earnings per share.

The following table presents the calculation of basic and diluted net income per share (in thousands, except per share information):


	Year Ended December 31,
	2023		2022		2021
Net income	$	98,933	$	104,392	$	52,091
Add back interest expense on convertible notes, net of tax (1)	2,213		2,261		—
Net income, diluted	$	101,146	$	106,653	$	52,091

Basic:
Weighted-average shares of common stock outstanding	33,992		33,869		32,202
Shares used in computing basic net income per share	33,992		33,869		32,202

Effect of dilutive securities:
Restricted stock subject to vesting	139		270		559
Shares issuable for conversion of convertible senior notes (1)	2,430		2,422		1,564
Shares issuable for acquisition consideration (2)	150		50		198
Shares issuable for exercise of warrants	—		120		147
Shares used in computing diluted net income per share	36,711		36,731		34,670

Basic net income per share	$	2.91	$	3.08	$	1.62
Diluted net income per share	$	2.76	$	2.90	$	1.50

(1)Upon adoption of ASU 2020-06 on January 1, 2022, the Company prospectively utilized the if-converted method to calculate the impact of convertible instruments on diluted earnings per share. Prior period amounts have not been adjusted due to the adoption of ASU 2020-06 under the modified retrospective method.

(2)For the year ended December 31, 2023, this represents the shares held in escrow pursuant to: (i) the Asset Purchase Agreement with Zeon Solutions Incorporated and certain related entities (collectively, “Zeon”); (ii) the Asset Purchase Agreement with Catalyst Networks, Inc. (“Brainjocks”); (iii) the Stock Purchase Agreement with the shareholders of Productora de Software S.A.S. (“PSL”); (iv) the Purchase Agreement with Talos LLC, Talos Digital LLC, Talos Digital SAS and TCOMM SAS (“Talos”); (v) the Stock Purchase Agreement with the shareholders of Izmul S.A. (“Overactive”); (vi) the Stock Purchase Agreement with the shareholders of Inflection Point Systems, Inc. (“Inflection Point”); and (vii) the Purchase Agreement with Ameex Technologies Corporation (“Ameex”), as part of the consideration. For the year ended December 31, 2022, this represents the shares held in escrow pursuant to: (i) the Asset Purchase Agreement with Zeon; (ii) the Asset Purchase Agreement with Brainjocks; (iii) the Stock Purchase Agreement with the shareholders of PSL; (iv) the Purchase Agreement with Talos; (v) the Stock Purchase Agreement with the shareholders of Overactive; (vi) the Purchase Agreement with Inflection Point; and (vii) the Purchase Agreement with Ameex, as part of the consideration. For the year ended December 31, 2021, this represents the shares held in escrow pursuant to: (i) the Asset Purchase Agreement with Zeon; (ii) the Asset Purchase Agreement with MedTouch LLC; (iii) the Asset Purchase Agreement with Brainjocks; (iv) the Stock Purchase Agreement with the shareholders of PSL; (v) the Purchase Agreement with Talos; and (vi) the Stock Purchase Agreement with the shareholders of Overactive, as part of the consideration.

The number of anti-dilutive securities not included in the calculation of diluted net income per share were as follows (in thousands):


	Year Ended December 31,
	2023	2022	2021
Restricted stock subject to vesting	177	110	—
Convertible senior notes	—	—	1,980
Warrants related to the issuance of convertible senior notes	2,431	2,084	1,980
Total anti-dilutive securities	2,608	2,194	3,960

See Note 12, Long-term Debt, for further information on the convertible senior notes and warrants related to the issuance of convertible notes.

The Company’s Board of Directors authorized the repurchase of up to $375.0 million of Company common stock through a stock repurchase program expiring December 31, 2024. The program could be suspended or discontinued at any time, based on market, economic, or business conditions. The timing and amount of repurchase transactions will be determined by management based on its evaluation of market conditions, share price, and other factors. Since the program’s inception on August 11, 2008, the Company has repurchased approximately $291.1 million (16.5 million shares) of outstanding common stock through December 31, 2023.