3. INCOME (LOSS) PER SHARE

We compute basic income (loss) per share using the weighted average number of common shares outstanding. The Company has two categories of dilutive potential common shares: Series A preferred shares issued in May 2011 in connection with our registered direct offering and shares issuable upon exercise of options. We compute diluted earnings per share using the if-converted method for preferred shares and the treasury stock method for stock options, respectively. Shares issuable upon exercise of 699 options and 17 common shares issuable upon conversion of preferred shares were not considered in computing diluted income (loss) per share for the three and six months ended March 31, 2019 because they were anti-dilutive. Shares issuable upon exercise of 802 options and 17 common shares issuable upon conversion of preferred shares were not considered in computing diluted income (loss) per share for the three and six months ended March 31, 2020 because they were anti-dilutive.

The following table reconciles our computation of basic net loss per share to diluted loss per share:


	Three Months Ended				Six Months Ended
	March 31,				March 31,
	2020		2019		2020		2019
Basic net loss per share:
Net loss applicable to common shareholders	$	(588)	$	(569)	$	(2,014)	$	(654)
Weighted average common shares outstanding		10,843		10,290		10,756		10,268
Basic net loss per share	$	(0.05)	$	(0.06)	$	(0.19)	$	(0.06)
Diluted net loss per share:
Diluted net loss applicable to common shareholders	$	(588)	$	(569)	$	(2,014)	$	(654)
Weighted average common shares outstanding		10,843		10,290		10,756		10,268
Plus: Incremental shares from assumed conversions:
Series A preferred shares		—		—		—		—
Dilutive stock options/shares		—		—		—		—
Diluted weighted average common shares outstanding		10,843		10,290		10,756		10,268
Diluted net loss per share	$	(0.05)	$	(0.06)	$	(0.19)	$	(0.06)