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Note 6 - Earnings (Loss) Per Common Share

9 Months Ended

Sep. 28, 2025

Notes to Financial Statements

Earnings Per Share [Text Block]

(6)

Earnings (Loss) Per Common Share

The Company computes earnings per share using the two-class method, which is an earnings allocation formula that determines earnings per share for common stock and participating securities. Restricted stock awards granted by the Company are considered a participating security since it contains a non-forfeitable right to dividends.

Our potentially dilutive securities include potential common shares related to our stock options, restricted stock awards and restricted stock units. Diluted earnings per share considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares would have an anti-dilutive effect. Diluted earnings per share excludes the impact of common shares related to our stock options in periods in which the option exercise price is greater than the average market price of our common stock for the period. There were 1,057,000 potential common shares excluded from diluted earnings per share for the three months ended September 28, 2025 and 1,054,000 potential common shares excluded from diluted earnings per share for the three months ended September 29, 2024. For the nine months ended September 28, 2025 and the three and nine months ended September 29, 2024, diluted weighted average common shares do not include the impact of any outstanding stock options and unvested compensation-related shares because the effect of these items on diluted net loss would be anti-dilutive.

A reconciliation of the weighted average shares outstanding used in the calculation of basic and diluted income (loss) per common share is as follows (in thousands):

		Three Months Ended								Nine Months Ended
		September 28,				September 29,				September 28,				September 29,
		2025				2024				2025				2024
		(Unaudited)								(Unaudited)
Income (loss) attributable to stockholders:
Net income (loss) as reported		$	517			$	390			$	(2,433	)		$	(1,815	)
Less distributed and undistributed earnings allocable to restricted award holders			(16	)			(15	)			0				0
Net income (loss) allocable to common stockholders		$	501			$	375			$	(2,433	)		$	(1,815	)

Income (loss) per common share attributable to stockholders:
Basic		$	0.02			$	0.02			$	(0.11	)		$	(0.08	)
Diluted		$	0.02			$	0.02			$	(0.11	)		$	(0.08	)

Weighted average shares outstanding – basic			22,325				22,088				22,251				22,011
Weighted average additional shares assuming conversion of potential common shares			538				327				0				0
Weighted average shares outstanding – diluted			22,863				22,415				22,251				22,011