Basic net income per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net income per share reflects the potential dilution that could occur from securities or other contracts to issue common stock, including senior convertible notes, stock options, restricted stock units, and performance-based restricted stock units. Diluted net income per share for the Company's convertible senior notes is calculated using the if-converted method. Under this method, interest expense, net of tax, associated with the convertible senior notes is added back to net income and the shares issuable upon conversion are included in diluted weighted-average shares outstanding.

A reconciliation of the numerators and the denominators of the basic and dilutive net income per common share computations are as follows:


	Three months ended				Six months ended
	June 30,				June 30,
	2026		2025		2026		2025
	(in thousands, except per share data)				(in thousands, except per share data)
Numerator:
Net income - basic	$	17,050	$	13,779	$	32,729	$	24,790
Effect of dilutive shares on net income
Interest expense on convertible senior notes, net of tax		1,001		—		2,035		—
Net income - diluted	$	18,051	$	13,779	$	34,764	$	24,790

Denominator:
Weighted average basic common shares outstanding		22,858		22,614		22,830		22,592
Effect of dilutive securities:
Options to purchase common stock		160		210		168		235
Restricted stock units		34		40		30		39
Performance-based restricted stock units		36		28		34		30
Convertible senior notes		1,443		—		1,443		—
Weighted average dilutive common shares outstanding		24,531		22,892		24,505		22,896

Net income per share:
Basic	$	0.75	$	0.61	$	1.43	$	1.10
Diluted	$	0.74	$	0.60	$	1.42	$	1.08

During the three- and six-months ended June 30, 2026, the Company had $172.5 million principal amount of 2.5% Senior Convertible Notes outstanding. The Senior Convertible Notes were assumed converted at the beginning of the reporting period for purposes of calculating diluted net income per share. Accordingly, the Company added back $1.0 million and $2.0 million of after-tax interest expense to the numerator and included 1.4 million shares issuable upon conversion in the denominator for the three- and six-months ended June 30, 2026. Because the effect of the assumed conversion was dilutive, the Senior Convertible Notes were included in the computation of diluted net income per share. There was no dilutive effect on the calculations for the three- and six-months ended June 30, 2025.

The Company has excluded potential dilutive securities from the computation of diluted earnings per common share that would be anti-dilutive to net income per common share. 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 common share attributable to common shareholders for the periods indicated because including them would have an anti-dilutive effect:


	Three months ended				Six months ended
	June 30,				June 30,
	2026		2025		2026		2025
	(in thousands)				(in thousands)
Convertible senior notes		—		1,442		—		1,442
Options to purchase common stock		290		126		293		126
Restricted stock units		—		32		—		32
Performance-based restricted stock units		—		10		—		10
		290		1,610		293		1,610