Earnings Per Share

3 Months Ended

Mar. 31, 2021

Earnings per share (“EPS”) of Class A and Class B Common Stock amounts are computed using the two‑class method required for participating securities and using the if‑converted method for the 2026 Notes in accordance with ASU 2020‑06.

The Company issues certain restricted stock awards determined to be participating securities because holders of such shares have non-forfeitable dividend rights in the event of the Company’s declaration of a dividend for common shares. As of March 31, 2021 and 2020, there were no participating securities outstanding.

Undistributed earnings allocated to participating securities are subtracted from net income in determining basic net income attributable to common stockholders. Basic EPS is computed by dividing basic net income attributable to common stockholders by the weighted average number of shares, inclusive of undistributed shares held in the DCP as phantom shares.

For the Company’s diluted EPS numerator, interest expense, net of tax, attributable to the conversion of the 2026 Notes is added back to basic net income attributable to common stockholders. For the Company’s diluted EPS denominator, the basic weighted average number of shares is adjusted by the effect of dilutive securities, including awards under the Company’s equity compensation plans and ESPP, and by the dilutive effect of the assumed conversion of the 2026 Notes. Diluted EPS attributable to common stockholders is computed by dividing diluted net income attributable to common stockholders by the weighted average number of fully diluted common shares.

Except with respect to voting and conversion, the rights of the holders of the Company’s Class A Common Stock and the Company’s Class B Common Stock are identical. Each class of shares has the same rights to dividends and allocation of income (loss) and, therefore, earnings per share would not differ under the two‑class method.

The details of basic and diluted EPS are as follows:


	Three Months Ended
	March 31,
	2021		2020
Numerator:
Net income	$	57,006	$	29,669
Less: Net income attributable to participating securities	—		—
Net income attributable to Class A and Class B common stockholders, basic	57,006		29,669
Add: Interest expense, net of tax, attributable to assumed conversion of 2026 Notes	130		—
Net income attributable to Class A and Class B common stockholders, diluted	$	57,136	$	29,669

Denominator:
Weighted average shares, basic	302,583,452		285,486,972
Dilutive effect of securities	11,388,113		6,891,655
Dilutive effect of ESPP	114,364		—
Dilutive effect of assumed conversion of 2026 Notes	7,650,720		—
Weighted average shares, diluted	321,736,649		292,378,627

Net income per share, basic	$	0.19	$	0.10
Net income per share, diluted	$	0.18	$	0.10

The following potential common shares were excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been anti‑dilutive for the periods presented:


	Three Months Ended
	March 31,
	2021	2020
RSUs	6,714	—
Total anti-dilutive securities	6,714	—