Basic net income (loss) per share is computed using net income (loss) available to common stockholders divided by the weighted average number of shares of common stock outstanding during the period. The Company’s Series A Convertible Preferred Stock and Series B Convertible Preferred Stock are participating securities, as they are entitled to participate in dividends with common stockholders on an as-converted basis. Accordingly, the Company applies the two-class method to allocate earnings between common stockholders and the participating preferred stock. Under the two-class method, net income (loss) available to common stockholders represents net income (loss) allocated to common stockholders after allocation of dividends and undistributed earnings to participating preferred stockholders.

For the three months ended March 31, 2026, net income allocated to preferred stockholders included $2.7 million and $2.3 million of accumulated undeclared dividends on the Company’s Series A Convertible Preferred Stock and Series B Convertible Preferred Stock, respectively, as well as a portion of undistributed earnings allocated under the two-class method. Diluted net income (loss) per share reflects the effect of potentially dilutive securities, applying the if-converted method for its convertible preferred stock and the treasury stock method for warrants and stock options.

For the three months ended March 31, 2026, the Company reported net income available to common stockholders. The Company evaluated all potentially dilutive securities, including its Series A Convertible Preferred Stock and Series B Convertible Preferred Stock, and determined that their inclusion under the if-converted method would be anti-dilutive for the period. Accordingly, these securities were excluded from diluted weighted-average shares outstanding. Certain other instruments, including warrants and unvested RSUs, were also anti-dilutive and were excluded from diluted net income (loss) per share. Accordingly, diluted net income (loss) per share is equal to basic net income (loss) per share for the three months ended March 31, 2026.

The following table summarizes the Company’s computation of basic and diluted net income (loss) per share available to common stockholders for the three months ended March 31, 2026 and 2025:


	Three Months Ended March 31,
	2026		2025
Numerator:
Net income (loss)	$	5,686	$	(5,688)
Less: Earnings allocated to participating securities
Accumulated undeclared dividends - Series A	(2,664)		—
Accumulated undeclared dividends - Series B	(2,283)		—
Allocable net income (loss)	739		(5,688)
Allocation of undistributed earnings - Series A	(199)		—
Allocation of undistributed earnings - Series B	(185)		—


Net income (loss) available to common stockholders	$	355	$	(5,688)
Denominator:

Weighted average common shares outstanding - basic and diluted	5,455		4,618



Net income (loss) per common share available to common stockholders - basic and diluted	$	0.07	$	(1.23)

The Company has issued warrants that are exercisable for little or no consideration. Accordingly, the underlying shares are included in weighted average shares outstanding for both basic and diluted net income (loss) per share from the dates they became exercisable. The Company repurchased and reissued these warrants on November 3, 2025 in connection with the Hawthorn transaction, which did not impact basic or diluted net income (loss) per share.

The Company’s IPO warrants are excluded from basic weighted average shares outstanding and are included in diluted shares only when dilutive under the treasury stock method. For the periods presented, the warrants were out-of-the-money and anti-dilutive.

The Company’s Series A Convertible Preferred Stock and Series B Convertible Preferred Stock are considered participating securities and are included in the computation of basic earnings per share under the two-class method.

For diluted earnings per share, the Company evaluates the impact of these instruments under the if-converted method. As of March 31, 2026, no mandatory conversion events had occurred, and the Company evaluated the potential dilutive effect of the Series A Convertible Preferred Stock and Series B Convertible Preferred Stock under the if-converted method. For the three months ended March 31, 2026, the effect of assumed conversion was anti-dilutive and, accordingly, the shares issuable upon conversion were excluded from diluted weighted-average shares outstanding.

The Company’s potentially dilutive securities, including shares issuable upon conversion of preferred stock, unvested RSUs, stock options and warrants, are evaluated for inclusion in diluted net income (loss) per share for the periods presented and are included only to the extent they are dilutive. Unvested RSUs were evaluated under the treasury stock method and were excluded from diluted net income (loss) per share as the assumed proceeds, including unrecognized compensation cost, exceeded the average market price of the Company’s common stock, resulting in no incremental shares.

The following table summarizes potential common shares outstanding at each period end that were excluded from diluted net income (loss) per share because their effect would have been anti-dilutive:


	Three Months Ended March 31,
	2026	2025
Public warrants	500,000	500,000
Private warrants	13,300	13,300
Stock options	255,189	270,554
Unvested restricted stock units	83,396	203,714
Shares issuable upon Series A and Series B Preferred Stock Conversion	5,891,471	—
Total potential common shares excluded	6,743,356	987,568