Leases

The Company has entered into various operating lease agreements for its offices and co-location sites and related equipment. The Company has also entered into sublease agreements with tenants of various offices previously vacated by the Company. These operating leases have lease periods expiring between 2026 and 2046. Additionally, the Company entered into an operating lease with a data center operator for space in the Virginia area. Contemporaneously, the Company entered into a sublease with the affiliate of a large social media customer for the use of the space on substantially similar terms. Both the lease and sublease for the data center expire in 2037.

The Company’s operating lease costs for the years ended December 31, 2025, 2024 and 2023 were as follows (in thousands):


	Real Estate Arrangements		Co-location Arrangements		Data Center Sublease		Total
2025
Operating lease cost	$	66,545	$	260,243	$	6,959	$	333,747
Short-term lease cost	381		25,590		—		25,971
Variable lease cost	26,218		73,375		1,074		100,667
Sublease income	(31,459)		—		(8,187)		(39,646)
Total operating lease costs (income)	$	61,685	$	359,208	$	(154)	$	420,739

2024
Operating lease cost	$	67,757	$	225,145	$	—	$	292,902
Short-term lease cost	660		25,288		—		25,948
Variable lease cost	26,122		67,728		—		93,850
Sublease income	(31,722)		—		—		(31,722)
Total operating lease costs	$	62,817	$	318,161	$	—	$	380,978

2023
Operating lease cost	$	74,054	$	179,552	$	—	$	253,606
Short-term lease cost	133		23,565		—		23,698
Variable lease cost	25,860		62,084		—		87,944
Sublease income	(32,024)		—		—		(32,024)
Total operating lease costs	$	68,023	$	265,201	$	—	$	333,224

Lease costs for real estate arrangements and the data center sublease are included in general and administrative expenses in the consolidated statements of income. Lease costs for co-location arrangements are primarily included in cost of revenue in the consolidated statements of income.

Weighted average remaining lease terms and discount rates related to the Company's operating leases as of December 31, 2025 and 2024 were as follows:


	December 31, 2025						December 31, 2024
	Real Estate Arrangements		Co-location Arrangements		Data Center Sublease		Real Estate Arrangements		Co-location Arrangements		Data Center Sublease
Weighted average remaining lease term (in years)	8.1		4.8		11.9		9.1		4.6		0.0
Weighted average discount rate	3.6	%	4.4	%	5.1	%	3.5	%	4.3	%	—	%

Maturities of operating lease liabilities as of December 31, 2025 were as follows (in thousands):


	Real Estate Arrangements		Co-location Arrangements		Data Center Sublease
2026	$	69,605	$	229,288	$	43,580
2027	67,183		160,536		41,793
2028	61,593		124,197		42,838
2029	59,376		102,560		43,909
2030	58,666		63,985		45,007
Thereafter	210,526		98,149		343,135
Total lease payments	526,949		778,715		560,262
Less: imputed interest	68,683		81,944		145,266
Total lease liabilities	$	458,266	$	696,771	$	414,996

The table above excludes future sublease income of $164.7 million from real estate arrangements and $566.5 million from the data center sublease that are expected to be recognized through 2034 and 2037, respectively. As of December 31, 2025, the Company had additional operating leases for co-location arrangements that had not yet commenced of $278.0 million, of which a majority will commence in 2026, with lease terms of one year to twenty years. Additionally, the final portion of the data center sublease commenced in January 2026, with a total commitment of $187.1 million and a lease term of twelve years. Both the lease cost and associated sublease income are expected to substantially offset each other.

As of December 31, 2025, the Company had outstanding letters of credit in the amount of $4.4 million, primarily related to operating leases. The letters of credit remain in effect until the Company fulfills its obligations under these leases or as such obligations expire under the terms of the letters of credit.

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.

AKAMAI TECHNOLOGIES INC Leases Disclosure

About Leases Disclosures

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