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Net Income (Loss) Per Share

3 Months Ended

Mar. 31, 2020

Note 3. Net Income (Loss) Per Share

Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average shares of common stock outstanding for the period. Diluted net income (loss) per share is calculated by dividing net income (loss) by the weighted average shares of common stock outstanding for the period plus amounts representing the dilutive effect of securities that are convertible into common stock. The Company calculates diluted income (loss) per common share using the treasury stock method and the as-if-converted method, as applicable.

The following table presents the computation of net income (loss) per share (in thousands except per share data):

	Three months ended March 31,
	2020			2019
Numerator:
Net income (loss)	$	(1,202	)	$	337
Denominator:
Weighted average common shares outstanding - basic		9,690			9,626
Plus dilutive effect of potential common shares		—			335
Weighted average common shares outstanding - diluted		9,690			9,961
Net income (loss) per share:
Basic	$	(0.12	)	$	0.03
Diluted	$	(0.12	)	$	0.03

Diluted weighted average common shares outstanding for the three months ended March 31, 2019, includes 335,000 options outstanding.

Potentially dilutive securities (in common stock equivalent shares) not included in the calculation of diluted net income (loss) per share because to do so would be anti-dilutive are as follows (in thousands):

	Three months ended March 31,
	2020		2019
Stock options and restricted stock		1,211		468
Warrants outstanding		51		51
Total		1,262		519