LEASES
The Company primarily leases office space used in connection with its operations under various operating leases, the majority of which contain escalation clauses.
ROU assets represent the Company’s right to use the underlying assets for the lease term and lease liabilities represent the present value of the Company’s obligation to make payments arising from these leases. ROU assets and related lease liabilities are based on the present value of fixed lease payments over the lease term using the Company’s incremental borrowing rate on the lease commencement date, the date of acquisition for any leases acquired in connection with a business combination, or January 1, 2019, the date ASC Topic 842, Leases (“ASC 842”) was adopted, for leases that commenced prior to that date. The Company combines the lease and non-lease components of lease payments in determining ROU assets and related lease liabilities. If the lease includes one or more options to extend the term of the lease, the renewal option is considered in the lease term if it is reasonably certain the Company will exercise the option(s). Lease expense is recognized on a straight-line basis over the term of the lease. As permitted by ASC 842, leases with an initial term of twelve months or less (“short-term leases”) are not recorded on the balance sheet.
Variable lease payments consist primarily of common area maintenance, utilities, and taxes, which are not included in the recognition of ROU assets and related lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The following table presents the balances of ROU assets and lease liabilities within the balance sheet:
| | | | | | | | | | | | | | | | | | | | |
| | | | December 31, |
| Leases | | Balance Sheet Classification | | 2025 | | 2024 |
| | | | (In thousands) |
| Assets: | | | | | | |
| ROU assets | | Other non-current assets | | $ | 25,333 | | | $ | 30,418 | |
| | | | | | |
| Liabilities: | | | | | | |
| Current lease liabilities | | Accrued expenses and other current liabilities | | $ | 13,460 | | | $ | 12,824 | |
| Long-term lease liabilities | | Other long-term liabilities | | 24,168 | | | 35,494 | |
| Total lease liabilities | | | | $ | 37,628 | | | $ | 48,318 | |
The following table presents the net lease expense within the statement of operations:
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Year Ended December 31, |
| Lease Expense | | Statement of Operations Classification | | 2025 | | 2024 | | 2023 |
| | | | (In thousands) |
| Fixed lease expense | | Cost of revenue | | $ | 241 | | | $ | 410 | | | $ | 392 | |
| Fixed lease expense | | Selling and marketing expense | | 198 | | | 196 | | | 116 | |
| Fixed lease expense | | General and administrative expense | | 5,752 | | | 13,184 | | | 11,225 | |
| Fixed lease expense | | Product development expense | | 537 | | | 643 | | | 399 | |
Total fixed lease expense(a) | | | | 6,728 | | | 14,433 | | | 12,132 | |
| | | | | | | | |
| Variable lease expense | | Selling and marketing expense | | 3 | | | — | | | 36 | |
| Variable lease expense | | General and administrative expense | | 2,723 | | | 3,691 | | | 5,071 | |
| Variable lease expense | | Product development expense | | 13 | | | — | | | 156 | |
| Total variable lease expense | | | | 2,739 | | | 3,691 | | | 5,263 | |
| Net lease expense | | | | $ | 9,467 | | | $ | 18,124 | | | $ | 17,395 | |
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(a) Includes (i) lease impairment charges of $0.0 million, $7.2 million, and $0.7 million, and (ii) sublease income of $3.9 million, $4.3 million, and $4.3 million for the years ended December 31, 2025, 2024, and 2023, respectively.
Maturities of lease liabilities as of December 31, 2025(b) are summarized below:
| | | | | | | | |
| Year Ending December 31: | | (In thousands) |
| 2026 | | $ | 15,196 | |
| 2027 | | 12,951 | |
| 2028 | | 6,815 | |
| 2029 | | 4,278 | |
| 2030 | | 825 | |
| Thereafter | | 1,955 | |
| Total | | 42,020 | |
| Less: Interest | | 4,392 | |
| Present value of lease liabilities | | $ | 37,628 | |
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(b) At December 31, 2025 there were no legally binding minimum lease payments for leases signed but not yet commenced.
The following are the weighted average assumptions used for lease term and discount rate:
| | | | | | | | | | | | | | |
| | December 31, |
| | 2025 | | 2024 |
| Remaining lease term | | 3.34 years | | 4.0 years |
| Discount rate | | 6.58 | % | | 6.63 | % |
The following is the supplemental cash flow information:
| | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| (In thousands) |
| ROU assets obtained in exchange for lease liabilities | $ | 2,161 | | | $ | 1,241 | | | $ | 6,696 | |
| Derecognition of ROU assets due to termination or modification | $ | (469) | | | $ | (415) | | | $ | (5,266) | |
| Cash paid for amounts included in the measurement of lease liabilities | $ | 15,902 | | | $ | 23,143 | | | $ | 25,806 | |