14. Earnings per Share

Basic earnings (loss) per share (“EPS” or “LPS”) is calculated by dividing net income (loss) attributable to Target Hospitality by the weighted average number of shares of Common Stock outstanding during the period. Diluted EPS is computed similarly to basic net earnings per share, except that it includes the potential dilution that could occur if dilutive securities were exercised. We apply the treasury stock method in the calculation of diluted earnings per share. During periods when net losses are incurred, potential dilutive securities would be anti-dilutive and are excluded from the calculation of diluted loss per share for that period. A net loss was recorded for the year ended December 31, 2025, while net income was recorded for the years ended December 31, 2024 and 2023, respectively. 

The following table reconciles net income (loss) attributable to common stockholders and the weighted average shares outstanding for the basic calculation to the net income (loss) attributable to common stockholders and the weighted average shares outstanding for the diluted calculation for the periods indicated below ($ in thousands, except per share amounts):

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When liability-classified warrants are in the money and the impact of their inclusion on diluted EPS is dilutive, diluted EPS also assumes share settlement of such instruments through an adjustment to net income (loss) available to common stockholders for the fair value (gain) loss on common stock warrant liabilities and inclusion of the number of dilutive shares in the denominator. Public and Private Warrants representing a total of 8,044,287 shares of the Company’s Common Stock for the year ended December 31, 2023 were included in the computation of diluted EPS because their effect is dilutive. No Public or Private Warrants, which expired in accordance with their terms on March 15, 2024, were outstanding as of December 31, 2024 and 2025, respectively, and because they are considered anti-dilutive for the period they were outstanding; the Public and Private Warrants had no impact on the computation of diluted EPS for the year ended December 31, 2024.

As discussed in Note 16, stock-based compensation awards were outstanding for the years ended December 31, 2025, 2024 and 2023, respectively. For the year ended December 31, 2025, these stock-compensation awards were excluded from the computation of diluted LPS, as their effect would have been anti-dilutive as a net loss was recorded for the year ended December 31, 2025. For the years ended December 31, 2024 and 2023, stock-based compensation awards were included in the computation of diluted EPS because their effect is dilutive as noted in the above table. However,

approximately 683,406 of contingently issuable PSUs were excluded from the computation of diluted EPS for the year ended December 31, 2024 as not all necessary conditions for issuance of these PSUs were satisfied, which includes 208,406 of PSUs that did not meet all of the Company’s Diversification EBITDA and TSR criteria (see Note 16). Additionally, approximately 716,025 of contingently issuable PSUs were excluded from the computation of diluted EPS for the year ended December 31, 2023 as not all necessary conditions for issuance of these PSUs were satisfied, which includes 91,025 of PSUs that did not meet all of the Company’s Diversification EBITDA and TSR criteria (see Note 16).    

Shares of treasury stock have been excluded from the computation of EPS.