Net Income Per Share

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				Nine Months Ended
	September 30,				September 30,
	2019		2018		2019		2018
Numerator:
Net income	$	306	$	118	$	4,754	$	3,097
Denominator:
Weighted average common shares—basic	11,767		12,314		11,894		12,412
Effect of dilutive securities: stock options	189		349		258		218
Weighted average common shares—diluted	11,956		12,663		12,152		12,630

Net income per share—basic	$	0.03	$	0.01	$	0.40	$	0.25
Net income per share—diluted	$	0.03	$	0.01	$	0.39	$	0.25

For the three and nine months ended September 30, 2019, options to purchase 1,050,000 shares of common stock were not included in the computation of diluted net income per share because the effect would have been anti-dilutive. For the three and nine months ended September 30, 2018, options to purchase 220,000 shares of common stock were not included in the computation of diluted net income per share because the effect would have been anti-dilutive.