The Company computed basic net income per share based on the weighted average number of shares of common stock outstanding during the period. The Company computed diluted net income per share based on the weighted average number of shares of common stock outstanding plus potentially dilutive common stock equivalents outstanding during the period. For the purposes of this calculation, stock options, restricted stock units, performance stock units, and stock sold through the ESPP are considered common stock equivalents.

A reconciliation of the numerator and denominator used in the calculation of the basic and diluted net income per share is as follows (in thousands, except share and per share amounts):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Numerator:
Net income	$	42,279	$	45,851	$	109,674	$	130,344



Denominator:
Weighted average shares used to compute net income attributable to common stockholders:
Basic	39,402,195		39,078,378		39,344,326		38,827,038
Potential dilutive stock-based options and awards	218,103		223,861		253,704		423,642

Diluted	39,620,298		39,302,239		39,598,030		39,250,680
Net income per share:
Basic	$	1.07	$	1.17	$	2.79	$	3.36
Diluted	$	1.07	$	1.17	$	2.77	$	3.32

For the three and nine months ended September 30, 2026 and 2025, an immaterial number of outstanding stock-based awards were excluded from the computation of diluted net income per share because their effect was anti-dilutive.