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Net Income (loss) Per Share
 9 Months Ended
Sep. 30, 2013
Net Income (loss) Per Share [Abstract]  
Net Income (loss) Per Share
Note 10. Net Income (loss) Per Share

Basic net income (loss) per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted average number of common shares outstanding and potentially dilutive common shares outstanding during the period. The dilutive effect of outstanding stock options and restricted stock awards is reflected in diluted earnings per share by application of the treasury stock method. Potentially dilutive common shares consist of common shares issuable upon the exercise of stock options and vesting of restricted stock awards. Potentially dilutive common shares are excluded in net loss periods, as their effect would be anti-dilutive.
A reconciliation of the numerators and denominators of the basic and diluted net income (loss) per share calculations is as follows (in thousands, except per share data):

 
 
Three Months Ended
  
Nine Months Ended
 
 
 
September 30,
  
September 30,
 
 
 
2013
  
2012
  
2013
  
2012
 
Numerator:
 
  
  
  
 
Net income (loss) attributable to AXT, Inc.
 
$
(2,295
)
 
$
932
  
$
(6,730
)
 
$
3,866
 
Less: Preferred stock dividends
  
(44
)
  
(44
)
  
(132
)
  
(132
)
 
                
Net income (loss) available to common stockholders
 
$
(2,339
)
 
$
888
  
$
(6,862
)
 
$
3,734
 
Denominator:
                
Weighted average common shares (basic)
  
32,366
   
32,183
   
32,407
   
32,118
 
Effect of dilutive securities:
                
Common stock options
  
—
   
582
   
—
   
754
 
Restricted stock awards
  
—
   
4
   
—
   
39
 
Weighted average common shares (dilutive)
  
32,366
   
32,769
   
32,407
   
32,911
 
Net income (loss) attributable to AXT, Inc. per common share:
                
Basic
 
$
(0.07
)
 
$
0.03
  
$
(0.21
)
 
$
0.12
 
Diluted
 
$
(0.07
)
 
$
0.03
  
$
(0.21
)
 
$
0.11
 
Options excluded from diluted net income (loss)  per share as the impact is anti-dilutive
  
2,524
   
992
   
2,563
   
977
 
Restricted stock excluded from diluted net income (loss) per share as the impact is anti-dilutive
  
243
   
172
   
242
   
14
 

The 883,000 shares of $0.001 par value Series A preferred stock issued and outstanding as of both September 30, 2013 and December 31, 2012, valued at $3,532,000 are non-voting and non-convertible preferred stock with a 5.0% cumulative annual dividend rate payable when declared by the board of directors and $4 per share liquidation preference over common stock, and must be paid before any distribution is made to common stockholders. These preferred shares were issued to Lyte Optronics, Inc. stockholders in connection with the completion of our acquisition of Lyte Optronics, Inc. on May 28, 1999.