Cars.com Inc. Leases Disclosure
Note 7. Leases
Leases. The Company is obligated as a lessee under certain non-cancelable operating leases for office space, and is also obligated to pay insurance, maintenance and other executory costs associated with these leases. In May 2016, the Company entered into a lease of office space in Chicago, Illinois. In November 2024, the Company amended this lease, which resulted in a reduction of its office space by 67%, extension of the lease term from June 2031 to June 2036 for the remaining office space, and paid a termination penalty of $10.5 million. This was accounted for as a lease modification. Monthly rental payments under the lease escalate by 2.5% each year through June 2031, then by 1.5% each year through the remainder of the lease. As a result of this lease modification, and the commencement of a separate lease, the Company recognized $4.7 million of right of use assets obtained in exchange for lease obligations during the year ended December 31, 2024.
As of December 31, 2025, the Company’s scheduled future minimum lease payments under operating leases having initial noncancelable lease terms of more than one year, is as follows (in thousands):
2026 |
|
$ |
3,919 |
|
2027 |
|
|
2,040 |
|
2028 |
|
|
2,093 |
|
2029 |
|
|
2,001 |
|
2030 |
|
|
1,925 |
|
Thereafter |
|
|
10,442 |
|
Total minimum lease payments |
|
|
22,420 |
|
Less: Imputed interest (1) |
|
|
(5,463 |
) |
Present value of the minimum lease payments |
|
|
16,957 |
|
Less: Current maturities of lease obligations |
|
|
(2,973 |
) |
Long-term lease obligations |
|
$ |
13,984 |
|
As of December 31, 2025 and 2024, the Company's operating lease balance sheet information is as follows (in thousands):
|
|
December 31, |
|
|||||
Balance sheet information: |
|
2025 |
|
|
2024 |
|
||
|
$ |
15,854 |
|
|
$ |
16,810 |
|
|
|
|
2,973 |
|
|
|
4,085 |
|
|
|
|
13,984 |
|
|
|
16,545 |
|
|
The difference between the operating lease assets and the operating lease liabilities is primarily due to a lease incentive received related to the lease in Chicago, Illinois.
Other information related to the Company’s operating leases for the years ended December 31, 2025, 2024 and 2023 is as follows (in thousands, except months and percentages):
|
|
Year Ended December 31, |
|
|||||||||
Income statement information: |
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Operating lease cost |
|
$ |
2,149 |
|
|
$ |
2,986 |
|
|
$ |
3,035 |
|
Short-term lease cost |
|
|
72 |
|
|
|
66 |
|
|
|
79 |
|
Variable lease cost |
|
|
213 |
|
|
|
4,443 |
|
|
|
3,461 |
|
Total lease cost |
|
$ |
2,434 |
|
|
$ |
7,495 |
|
|
$ |
6,575 |
|
|
|
|
|
|
|
|
|
|
|
|||
Other information: |
|
|
|
|
|
|
|
|
|
|||
Cash paid for amounts included in the measurement of operating lease liabilities (1) |
|
$ |
4,986 |
|
|
$ |
14,790 |
|
|
$ |
3,672 |
|
Weighted-average remaining lease term (in months) |
|
|
120 |
|
|
|
130 |
|
|
|
89 |
|
Weighted-average discount rate |
|
|
6.4 |
% |
|
|
6.4 |
% |
|
|
7.5 |
% |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 25, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 26, 2020 | |
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.