Earnings Per Share

6 Months Ended

Jun. 30, 2022

Basic and Diluted Earnings Per Share

The components of basic and diluted earnings per share are as follows (in thousands, except share and per share amounts):


	Three Months Ended June 30,				Six Months Ended June 30,
Numerator:	2022		2021		2022		2021
Net income	$	10,828	$	14,490	$	19,731	$	29,040
Net loss attributable to redeemable noncontrolling interest	14		255		190		535
Net income attributable to common stockholders - basic (A)	10,842		14,745		19,921		29,575
Add back interest expense, net of tax, attributable to convertible senior notes	587		—		1,173		—
Net income attributable to common stockholders - diluted (B)	$	11,429	$	14,745	$	21,094	$	29,575
Denominator:
Weighted average common shares outstanding — basic (C)	49,931,689		49,808,969		50,068,176		49,686,110
Dilutive effect of convertible senior notes, stock options and restricted stock units	4,825,331		1,945,423		4,986,794		2,103,833
Weighted average common shares outstanding — diluted (D)	54,757,020		51,754,392		55,054,970		51,789,943
Net income per share:
Basic (A/C)	$	0.22	$	0.30	$	0.40	$	0.60
Diluted (B/D)	$	0.21	$	0.28	$	0.38	$	0.57

The following securities have been excluded from the calculation of diluted weighted average common shares outstanding as the inclusion of these securities would have an anti-dilutive effect:


	Three Months Ended June 30,		Six Months Ended June 30,
	2022	2021	2022	2021
Stock options	329,826	133,700	327,959	133,700
Restricted stock units	314,174	149,291	356,290	123,091

Our redeemable noncontrolling interest relates to our 85% equity ownership interest in OpenEye. The OpenEye stockholder agreement contains a put option that gives the minority OpenEye stockholders the right to sell their OpenEye shares to us based on the fair value of the shares. The OpenEye stockholder agreement also contains a call option that gives us the right to purchase the remaining OpenEye shares from the minority OpenEye stockholders based on the fair value of the shares. The put and call options can each be exercised beginning in the first quarter of 2023. This redeemable noncontrolling interest is considered temporary equity and we report it between liabilities and stockholders’ equity in the condensed consolidated balance sheets. The amount of the net income or loss attributable to redeemable noncontrolling interests is recorded in the condensed consolidated statements of operations.

Prior to the adoption of ASU 2020-06, since we expected to settle the principal amount on our outstanding 2026 Notes in cash and any excess in cash or shares of our common stock, we used the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread had a dilutive impact on diluted net income per share of common stock when the average market price of our common stock for a given period exceeded the conversion price of $147.19 per share for the 2026 Notes. Based on the initial conversion price and the average market price of our common stock for the three and six months ended June 30, 2021, there was no dilutive effect of the 2026 Notes on our earnings per share during the three and six months ended June 30, 2021.

Upon adoption of ASU 2020-06 on January 1, 2022, we began using the if-converted method when calculating the dilutive impact of the 2026 Notes on net income per share. As a result, we included 3,396,950 shares related to the 2026 Notes within the weighted average shares outstanding when calculating the diluted net income per share for the three and six months ended June 30, 2022. Additionally, we included $0.6 million and $1.2 million of debt issuance cost amortization, net of tax, within the numerator of the diluted net income per share for the three and six months ended June 30, 2022, respectively