7. LEASES

Components of lease expense were as follows (in thousands):

 

 

Year Ended June 30,

 

 

 

2025

 

 

2024

 

 

2023

 

Operating lease costs

 

$

4,019

 

 

$

1,616

 

 

$

1,460

 

Variable lease costs

 

 

1,203

 

 

 

545

 

 

 

469

 

Short term lease costs

 

 

103

 

 

 

73

 

 

 

108

 

Finance lease costs

 

 

36

 

 

 

15

 

 

 

 

 

$

5,361

 

 

$

2,249

 

 

$

2,037

 

For the year ended June 30, 2025, we made cash payments of $3.9 million for operating lease obligations. These payments are included in operating cash flows. As of June 30, 2025, the weighted-average remaining lease term under our capitalized operating leases was 5.4 years, while the weighted-average discount rate for our operating leases was approximately 6.1%. As of June 30, 2024, the weighted-average remaining lease term under our capitalized operating leases was 4.5 years, while the weighted-average discount rate for our operating leases was approximately 6.0%.

The future undiscounted cash flows for each of the next five years and thereafter, and reconciliation to the lease liabilities as of June 30, 2025 for our operating leases were as follows (in thousands):

Fiscal Year ending June 30,

 

Operating Leases

 

 

2026

 

$

6,626

 

 

2027

 

 

5,702

 

 

2028

 

 

6,155

 

 

2029

 

 

3,179

 

 

2030

 

 

1,863

 

 

Thereafter

 

 

4,566

 

 

Total lease payments

 

 

28,091

 

 

Imputed interest

 

 

(4,499

)

 

Total operating lease liability

 

$

23,592

 

(1)

Operating lease liability - current

 

$

5,318

 

(2)

Operating lease liability - long-term

 

 

18,274

 

(3)

 

$

23,592

 

(1)

 

(1)
Represents the present value of the operating lease liabilities as of June 30, 2025.
(2)
Current operating lease liabilities are presented within accrued liabilities on our consolidated balance sheets.
(3)
Long-term operating lease liabilities are presented within other liabilities on our consolidated balance sheets.

 

 

The lease payments presented in the table above exclude amounts related to a failed sale-leaseback transaction. For information regarding the failed sale-leaseback transaction, refer to Note 15.

 

For information regarding the Company's related party leases, refer to Note 14.

Historical Timeline

Fiscal YearFiled
2025Sep 11, 2025Showing above
2024Sep 13, 2024
2023Sep 12, 2023
2022Sep 2, 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.