1
 
                                                                    EXHIBIT 11.1
 
                                  VERITY, INC.
 
                   COMPUTATION OF NET INCOME (LOSS) PER SHARE
 


                                                                      YEAR ENDED MAY 31,
                                                                -------------------------------
                                                                 1996        1995        1994
                                                                -------     -------     -------
                                                                               
Primary and Fully Diluted:
  Weighted average common shares outstanding for the period...    7,270       1,399         667
  Common Equivalent Shares pursuant to Staff Accounting
     Bulletin No. 83..........................................      559       2,236       2,236
                                                                -------     -------     -------
Shares used in per share calculation..........................    7,829       3,635       2,903
                                                                =======     =======     =======
Net loss before accretion.....................................  $  (313)    $(5,838)    $(5,104)
Accretion to redemption value of mandatorily redeemable
  preferred stock.............................................     (611)     (2,081)     (2,646)
                                                                -------     -------     -------
Net loss applicable to common stockholders....................  $  (924)    $(7,919)    $(7,750)
                                                                =======     =======     =======
Net loss per share............................................  $ (0.12)    $ (2.18)    $ (2.67)
                                                                =======     =======     =======