GRID DYNAMICS HOLDINGS, INC.GDYN

GRID DYNAMICS HOLDINGS, INC. Leases Disclosure

10-KFiled Mar 5, 20262 min read
Leases
A major part of the Company's lease obligations is for office real estate. The Company may also lease corporate apartments, cars, and office equipment. Payments on some of our leases may depend on index or rate, including Consumer Price Index. Such payments are included in the calculation of lease liability and assets at the commencement dates, all future changes are
accounted as variable payments similar to other variable payments, such as common area maintenance, property and other taxes, utilities and insurance that are based on the lessor’s cost.
The Company’s leases have remaining lease terms ranging from 14 days to 5.5 years. Certain lease agreements may include the option to extend or terminate before the end of the contractual term and are often non-cancelable or cancellable only by the payment of penalties. The Company includes these options in the lease term when it is reasonably certain that they will be exercised.
The Company had no finance leases as of each of December 31, 2025 and 2024. Operating lease expense is recorded on a straight-line basis over the lease term and lease costs were as follows:
For the years ended December 31,
202520242023
(in thousands)
Operating lease cost$6,108 $5,365 $3,860 
Variable lease cost627 511 405 
Short-term lease cost1,182 551 343 
Total lease cost$7,917 $6,427 $4,608 
Supplemental information related to operating lease transactions is as follows:
For the years ended December 31,
202520242023
(in thousands)
Lease liability payments$5,988 $5,079 $3,692 
Lease right-of-use assets obtained in exchange for liabilities$7,917 $6,938 $5,005 
Non-cash net increase in lease assets due to lease modifications
$1,535 $98 $553 
Non-cash net decrease in lease liability due to lease modifications$(1,417)$(739)$(553)
Weighted average remaining lease term and discount rate as of December 31, 2025 and 2024 were as follows:
As of December 31,
20252024
Weighted average remaining lease term, in years3.73.0
Weighted average discount rate7.6 %8.1 %
As of December 31, 2025, operating lease liabilities will mature as follows:
Lease Payments
(in thousands)
20266,367 
20275,421 
20283,218 
20292,569 
20301,881 
Thereafter213 
Total lease payments19,669 
Less: imputed interest(2,633)
Total$17,036 
The Company does not have material operating or finance lease agreements that had not yet commenced.

Historical Timeline

Fiscal YearFiled
2025Mar 5, 2026Showing above
2024Feb 27, 2025
2023Feb 29, 2024
2022Feb 28, 2023

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.

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