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Note 10 - Capital Stock and Stock-based Compensation | 9 Months Ended
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Sep. 30, 2023
Notes to Financial Statements |
Shareholders' Equity and Share-Based Payments [Text Block] |
10. | Capital Stock and Stock-Based Compensation
Stock-Based Payment Awards Stock-based awards consist of stock options, time-based restricted stock units, market condition restricted stock units, and shares issued under the Company’s employee stock purchase plan. Activity under the Company’s equity incentive plans for the nine months ended September 30, 2023 is as follows:
|  |  |  |  |  | Weighted |  |  |  |  |  |  |  |  |  |  | Market |  |  |  |  |
|  |  |  |  |  | Average |  |  |  |  |  |  |  |  |  |  | Condition |  |  |  |  |
|  | Stock |  |  | Exercise |  |  | Restricted |  |  | Grant Date |  |  | Restricted |  |  | Grant Date |
|  | Options |  |  | Price |  |  | Stock Units |  |  | Fair Value |  |  | Stock Units |  |  | Fair Value |
Balance at December 31, 2022 |  |  | 1,238,776 |  |  | $ | 3.15 |  |  |  | 1,093,801 |  |  | $ | 3.94 |  |  |  | 646,235 |  |  | $ | 4.51 |
Granted |  |  | - |  |  |  | - |  |  |  | 1,306,445 |  |  |  | 2.82 |  |  |  | 558,958 |  |  |  | 2.61 |
Exercised |  |  | (213,644 | ) |  |  | 2.38 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Vested (RSUs) |  |  | - |  |  |  | - |  |  |  | (295,531 | ) |  |  | 2.97 |  |  |  | (115,976 | ) |  |  | 2.98 |
Cancelled/Forfeited |  |  | (101,065 | ) |  |  | 2.47 |  |  |  | (86,440 | ) |  |  | 3.90 |  |  |  | (87,138 | ) |  |  | 4.64 |
Balance at September 30, 2023 |  |  | 924,067 |  |  |  | 3.37 |  |  |  | 2,018,275 |  |  |  | 3.36 |  |  |  | 1,002,079 |  |  |  | 3.62 |
Stock-based compensation expense for the three and nine months ended September 30, 2023 and 2022 is allocated as follows:
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(in thousands) |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Cost of revenues |  | $ | 58 |  |  | $ | - |  |  | $ | 222 |  |  | $ | 88 |
Sales and marketing expenses |  |  | 193 |  |  |  | 147 |  |  |  | 533 |  |  |  | 493 |
General and administrative expenses |  |  | 1,012 |  |  |  | 919 |  |  |  | 2,585 |  |  |  | 2,633 |
Research and development expenses |  |  | 100 |  |  |  | 73 |  |  |  | 278 |  |  |  | 187 |
Total stock-based compensation expenses |  | $ | 1,363 |  |  | $ | 1,139 |  |  | $ | 3,618 |  |  | $ | 3,401 |
As of September 30, 2023, the total compensation costs related to unvested awards not yet recognized is $6.0 million and the weighted average period over which it is expected to be recognized is approximately 1.7 years. The Company did not capitalize any stock-based compensation during the three and nine month periods ended September 30, 2023. The weighted average estimated fair value of the market condition restricted stock awards that were granted during the nine months ended September 30, 2023 was $2.61 per unit. The estimate of the fair value was determined using a Monte-Carlo valuation simulation, which included the following assumptions:
Volatility |  |  | 56.8 | %
Risk-free interest rate |  |  | 4.6 | %
Correlation coefficient |  |  | 41.7 | %
Dividend yield |  |  | - | %
Earnings (Loss) Per Share Basic earnings (loss) per share (EPS) is calculated by dividing net income (loss) by the number of weighted average shares of common stock outstanding during the period. The calculation of diluted earnings per share assumes conversion of stock options and restricted stock units into common stock using the treasury method. The weighted average number of shares used to compute basic and diluted EPS consisted of the following:
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(in thousands, except per share data) |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Net loss available to common stockholders |  | $ | (1,239 | ) |  | $ | (3,405 | ) |  | $ | (1,597 | ) |  | $ | (7,850 | )
Weighted average shares outstanding - basic |  |  | 42,688 |  |  |  | 41,637 |  |  |  | 42,345 |  |  |  | 41,353 |
Dilutive effect of equity awards |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Weighted average shares outstanding - diluted |  |  | 42,688 |  |  |  | 41,637 |  |  |  | 42,345 |  |  |  | 41,353 |
Basic loss per share |  | $ | (0.03 | ) |  | $ | (0.08 | ) |  | $ | (0.04 | ) |  | $ | (0.19 | )
Diluted loss per share |  | $ | (0.03 | ) |  | $ | (0.08 | ) |  | $ | (0.04 | ) |  | $ | (0.19 | )
Shares excluded from diluted loss per share due to their anti-dilutive effect |  |  | 3,952 |  |  |  | 3,594 |  |  |  | 3,847 |  |  |  | 3,676 |

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