Equillium, Inc. Leases Disclosure
6. Leases
In September 2025, the Company entered into a non-cancelable operating lease for laboratory space in San Diego, California which expires in January 2028. Upon lease commencement, the Company recognized a right-of-use asset and a corresponding lease liability of $0.5 million. The Company's lease for laboratory space in La Jolla, California expired in August 2025 and the Company did not renew that lease. The Company also leases office space located in La Jolla that expires in February 2027.
The terms of the Company’s non-cancelable operating lease arrangements typically contain fixed lease payments which increase over the term of the lease at fixed rates and include rent holidays and provide for additional renewal periods. Lease expense is recognized over the term of the lease on a straight-line basis. All of the Company’s leases are classified as operating leases. The Company has determined that periods covered by options to extend the Company’s leases are excluded from the lease term as the Company is not reasonably certain the Company will exercise such options. Operating lease expense, including expenses related to short-term leases, was $0.5 million for each of the years ended December 31, 2025 and 2024.
Under the lease arrangements, the Company may be required to pay directly, or reimburse the lessor for real estate taxes, insurance, utilities, maintenance and other operating costs. Such amounts are variable and therefore not included in the measurement of the right-of-use assets and related lease liability but are instead recognized as variable lease expense in the Company's consolidated statements of operations and comprehensive loss when they are incurred. Variable lease expense, including expenses related to short-term leases, was $0.3 million for each of the years ended December 31, 2025 and 2024.
The Company records its right-of-use-assets within other assets (long term) and its operating lease liabilities within other current and long-term liabilities.
Additional information related to the Company’s leases as of and for the years ended December 31, 2025 and 2024 is as follows (in thousands, except lease term and discount rate):
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|
December 31, 2025 |
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December 31, 2024 |
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Balance sheet information |
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|
|
|
|
|
||
Right-of-use assets |
|
$ |
658 |
|
|
$ |
364 |
|
Lease liabilities, current |
|
$ |
363 |
|
|
$ |
197 |
|
Lease liabilities, non-current |
|
|
356 |
|
|
|
187 |
|
Total lease liabilities |
|
$ |
719 |
|
|
$ |
384 |
|
Other information |
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|
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|
|
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Weighted average remaining lease term |
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1.85 years |
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|
1.88 years |
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||
Weighted average discount rate |
|
|
9.74 |
% |
|
|
8.25 |
% |
Supplemental cash flow information |
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|
|
|
|
|
||
Operating cash outflows from operating leases |
|
$ |
244 |
|
|
$ |
478 |
|
Maturities of lease liabilities as of December 31, 2025, were as follows (in thousands):
Year ending December 31, |
|
|
|
|
2026 |
|
$ |
421 |
|
2027 |
|
|
370 |
|
2028 |
|
|
5 |
|
Total undiscounted lease payments |
|
|
796 |
|
Less: imputed interest |
|
|
(77 |
) |
Total lease liabilities |
|
$ |
719 |
|
As of December 31, 2025, the Company did not have any leases that have not yet commenced that create significant rights and obligations.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 25, 2026 | Showing above |
| 2024 | Mar 27, 2025 | |
| 2023 | Mar 25, 2024 | |
| 2022 | Mar 23, 2023 | |
| 2021 | Mar 23, 2022 | |
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.