Basic earnings per share is computed using the weighted-average number of common shares outstanding for the period. Diluted earnings per share is computed using the weighted-average number of common shares outstanding for the period plus dilutive potential common shares, including performance share awards, using the treasury stock method. Performance share awards are included based on the number of shares that would be issued as if the end of the reporting period was the end of the performance period and the result was dilutive.

The following table sets forth the computation of the Company’s basic and diluted net earnings per share for the years ended December 31, 2025 and 2024 (in thousands, except share and per share data):


	Year Ended December 31,
	2025			2024
Numerator:
Net income (loss) attributable to Drilling Tools International stockholders	$	(3,761	)	$	3,014
Denominator
Weighted-average common shares used in computing earnings per share — basic		35,533,268			31,938,847
Weighted-average effect of potentially dilutive securities:
Effect of potentially dilutive stock options		—			311,277
Effect of potentially dilutive performance-based stock options		—			41,033
Effect of potentially dilutive restricted stock units		—			17,022
Weighted-average common shares outstanding — diluted		35,533,268			32,308,179
Earnings per share — basic	$	(0.11	)	$	0.09
Earnings per share — diluted	$	(0.11	)	$	0.09

As of December 31, 2025 and 2024, the Company’s potentially dilutive securities consisted of options to purchase common stock as well as restricted stock units. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net income per share for the periods presented because including them would have had an anti-dilutive effect:


	Year Ended December 31,
	2025		2024
Performance-based options outstanding		534,063		—
Stock options outstanding		4,429,563		140,135
Restricted stock units outstanding		1,022,451		—
Total		5,986,077		140,135