Envestnet, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Net Income (Loss) Per Share

Net Income (Loss) Per Share

3 Months Ended

Mar. 31, 2021

Prior to January 1, 2021, the Company accounted for the effect of its convertible notes using the treasury stock method since they may be settled in cash, shares or a combination thereof at the Company's option. Pursuant to the adoption of ASU 2020-06 on January 1, 2021, the Company now accounts for the effect of its convertible notes on diluted net income per share using the if-converted method (See “Note 2—Basis of Presentation” and “Note 8—Debt”).

Basic net income (loss) per common share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding for the period. For the calculation of diluted net income (loss) per share, the basic weighted average number of shares is increased by the dilutive effect of stock options, common warrants, restricted stock awards and restricted stock units and convertible notes, if dilutive, using either the treasury method or if-converted method, as appropriate.

The following table provides the numerators and denominators used in computing basic and diluted net income (loss) per share attributable to Envestnet, Inc.:


	Three Months Ended
	March 31,
		2021		2020
		(in thousands, except share and per share data)







Net income (loss) attributable to Envestnet, Inc. - Basic (a)		$	14,946	$	(7,336)
Interest on dilutive Convertible Notes due 2025, net of tax		1,252		—
Net income (loss) attributable to Envestnet, Inc - Diluted (b)		$	16,198	$	(7,336)

Weighted-average common shares outstanding:
Basic (c)		54,208,469		53,016,511
Effect of dilutive shares:
Options to purchase common stock		222,387		—
Unvested restricted stock units		562,606		—
Convertible Notes due 2025		4,848,044		—
Warrants		76,142		—
Diluted (d)		59,917,648		53,016,511

Net income (loss) per share attributable to Envestnet, Inc common stock:
Basic (a/c)		$	0.28	$	(0.14)
Diluted (b/d)		$	0.27	$	(0.14)

Securities that were anti-dilutive and therefore excluded from the computation of diluted net income (loss) per share were as follows:


	Three Months Ended
	March 31,
		2021	2020
Options to purchase common stock		—	785,399
Unvested RSUs and PSUs		—	2,074,757
Warrants		—	470,000
Convertible Notes due 2023		5,050,505	5,050,505
Total anti-dilutive securities		5,050,505	8,380,661