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Earnings per Share
6 Months Ended
Jun. 30, 2022
Earnings Per Share [Abstract]  
Earnings per Share

Note 8. Earnings per Share

Basic and diluted earnings per share is presented in conformity with the two-class method required for multiple classes of common stock. The rights of the holders of Class A and Class B common stock are identical, except for voting and conversion rights. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to ten votes per share and is convertible at any time into one share of Class A common stock.

Basic earnings per share is computed by dividing the net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period.

Diluted earnings per share represents net income divided by the weighted-average number of shares of common stock outstanding, inclusive of the effect of dilutive stock options and RSUs. The undistributed earnings are allocated based on the participation rights of shares of Class A and Class B common stock as if the earnings for the year have been distributed. As the liquidation and dividend rights are identical for both classes, the undistributed earnings are allocated on a proportionate basis.

The calculation of diluted earnings per share for Class A common stock assumes the conversion of Class B common stock, while diluted earnings per share of Class B common stock does not assume the conversion of Class A common stock as Class A common stock is not convertible into Class B common stock. Similarly, outstanding options to purchase Class B common stock and RSUs that are dilutive are included in the calculation of diluted earnings for both Class A and Class B common stock.

The following table presents the calculation of basic and diluted earnings per share:

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

 

Class A

 

 

Class B

 

 

Class A

 

 

Class B

 

 

Class A

 

 

Class B

 

 

Class A

 

 

Class B

 

 

 

(in thousands, except per share data)

 

Numerator

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

9,035

 

 

$

7,238

 

 

$

15,858

 

 

$

15,680

 

 

$

21,475

 

 

$

17,366

 

 

$

26,556

 

 

$

27,234

 

Reallocation of undistributed earnings as a result of conversion of Class B to Class A common stock

 

 

7,238

 

 

 

 

 

 

15,680

 

 

 

 

 

 

17,366

 

 

 

 

 

 

27,234

 

 

 

 

Reallocation of undistributed earnings to Class B common stock

 

 

 

 

 

160

 

 

 

 

 

 

434

 

 

 

 

 

 

411

 

 

 

 

 

 

767

 

Net income attributable to common
   stockholders — diluted

 

$

16,273

 

 

$

7,398

 

 

$

31,538

 

 

$

16,114

 

 

$

38,841

 

 

$

17,777

 

 

$

53,790

 

 

$

28,001

 

Denominator

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares used
   to compute earnings per
   share — basic

 

 

40,706

 

 

 

32,606

 

 

 

36,397

 

 

 

35,990

 

 

 

40,521

 

 

 

32,768

 

 

 

35,588

 

 

 

36,497

 

Conversion of Class B to Class A
   common stock outstanding

 

 

32,606

 

 

 

 

 

 

35,990

 

 

 

 

 

 

32,768

 

 

 

 

 

 

36,497

 

 

 

 

Effect of dilutive stock options
   and RSUs

 

 

1,323

 

 

 

1,323

 

 

 

2,035

 

 

 

2,035

 

 

 

1,431

 

 

 

1,431

 

 

 

2,143

 

 

 

2,143

 

Weighted average number of shares
   used to compute earnings
   per share — diluted

 

 

74,635

 

 

 

33,929

 

 

 

74,422

 

 

 

38,025

 

 

 

74,720

 

 

 

34,199

 

 

 

74,228

 

 

 

38,640

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.22

 

 

$

0.22

 

 

$

0.44

 

 

$

0.44

 

 

$

0.53

 

 

$

0.53

 

 

$

0.75

 

 

$

0.75

 

Diluted

 

$

0.22

 

 

$

0.22

 

 

$

0.42

 

 

$

0.42

 

 

$

0.52

 

 

$

0.52

 

 

$

0.72

 

 

$

0.72

 

 

The following have been excluded from the computation of basic and diluted earnings per share as their effect would have been anti-dilutive (in thousands):

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Stock options to purchase Class B
   shares and RSUs

 

 

504

 

 

 

150

 

 

 

986

 

 

 

269