12. LEASES
We have operating leases for office space and a data center. Our leases have remaining lease terms of two years to seven years, some of which may include options to extend the leases perpetually, and some of which may include options to terminate the leases within one year. Variable lease costs include executory costs, such as taxes, insurance, and maintenance.
The components of lease expense were as follows (in thousands):
| | | | | | | | | | | | | | | | | | |
| Year ended December 31, | |
| 2025 | | 2024 | | 2023 | |
| Operating lease cost | $ | 2,074 | | | $ | 3,240 | | | $ | 5,257 | | |
| | | | | | |
| Variable lease cost | 929 | | | 906 | | | 1,300 | | |
The following tables provides a summary of other information related to leases (in thousands):
| | | | | | | | | | | | | | | | | |
| Year ended December 31, |
| 2025 | | 2024 | | 2023 |
| Cash payments included in operating cash flows from lease arrangements | $ | 1,628 | | | $ | 3,253 | | | $ | 5,500 | |
| Right-of-use assets obtained in exchange for new operating lease liabilities | — | | | 7,170 | | | 836 | |
| | | | | |
The following table provides a summary of balance sheet information related to leases:
| | | | | | | | | | | |
| December 31, |
| 2025 | | 2024 |
| Weighted-average remaining lease term—operating leases | 6.76 years | | 6.65 years |
| Weighted-average discount rate—operating leases | 7 | % | | 6 | % |
Maturity of lease liabilities under our non-cancellable operating leases as of December 31, 2025, are as follows (in thousands):
| | | | | | | | |
| Payments due by period | | |
| 2026 | | $ | 1,285 | |
| 2027 | | 1,150 | |
| 2028 | | 1,099 | |
| 2029 | | 1,132 | |
| 2030 | | 1,040 | |
| Thereafter | | 2,457 | |
| Total lease payments | | 8,163 | |
| Less interest | | 1,592 | |
| Present value of lease liabilities | | $ | 6,571 | |
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.