Earnings (Loss) Per Share

3 Months Ended

Mar. 31, 2024

Basic earnings (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period, which includes the February 2023 Warrants (See Note 9, “Debt and Convertible Notes Payable”, and Note 13, “Stockholders’ Equity”). Diluted earnings (loss) per common share is calculated by dividing the adjusted net income (loss) by the weighted average number of common shares outstanding combined with dilutive common share equivalents outstanding, if the effect is dilutive. Potentially dilutive common share equivalents consist of incremental shares of common stock issuable upon conversion of convertible notes payable, exercise of stock warrants and vesting and settlement of stock awards. The dilutive effect of non-vested stock issued under share‑based compensation plans, shares issuable under the Employee Stock Purchase Plan (ESPP), employee stock options outstanding, and the Pre-Funded stock warrants are computed using the treasury stock method. The dilutive effect of the Convertible Notes is computed using the if‑converted method.

For all periods presented in the table below, weighted average shares and earnings (loss) per share reflect the effects of the Reverse Stock Split. The calculation of the basic and diluted earnings (loss) per share for the three months ended March 31, 2024 and 2023 is as follows (in thousands):


	Three months ended March 31,
		2024		2023
Numerator:
Net income for basic earnings per share		$	1,562	$	21,343
Adjustments to net income available to shareholders
Paid-in-Kind interest expense on convertible notes payable and Contract Consideration Convertible Notes Payable		—		1,571
Valuation gain on Contract Consideration Convertible Notes Payable carried at fair value		—		(26,095)
Adjusted net income (loss) for diluted earnings per share		$	1,562	$	(3,181)





Denominator:
Basic weighted average shares outstanding		29,431		16,468
Dilutive effect of convertible notes payable		—		9,994
Dilutive effect of warrants outstanding		779		—
Dilutive effect of stock options and restricted shares		106		—
Diluted weighted average shares outstanding		30,316		26,462

Basic earnings per share		$	0.05	$	1.30
Diluted earnings (loss) per share		$	0.05	$	(0.12)
Anti-dilutive incremental shares excluded from denominator for diluted earnings computation

Average number of diluted shares for June 2022 stock warrants (1)		—		1,500
Average number of diluted shares for options and restricted stock (1)		—		170

(1) These items were not included in the dilution calculation for the three months ended March 31, 2023 due to their anti-dilutive effect as it would reduce the loss per share.