Net Income Per Share

3 Months Ended

Mar. 31, 2019

Basic net income per share is computed using the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed by adjusting the weighted-average number of common shares outstanding for the effect of dilutive potential common shares outstanding during the period. Potential common shares included in the diluted calculation consist of incremental shares issuable upon the exercise of outstanding stock options calculated using the treasury stock method.

The following table sets forth the calculation of basic and diluted net income per share (in thousands, except per share amounts):



	Three Months Ended
	March 31,
	2019		2018
Numerator:
Net income	$	3,120	$	2,502
Denominator:
Weighted average common shares—basic	11,914		12,462
Effect of dilutive securities: stock options	310		—
Weighted average common shares—diluted	12,224		12,462

Net income per share—basic	$	0.26	$	0.20
Net income per share—diluted	$	0.26	$	0.20

For the three months ended March 31, 2019 and March 31, 2018, options to purchase 150,000 and 950,000 shares of common stock were not included in the computation of diluted net income per share because the effect would have been anti-dilutive.