IAC Inc.IAC
IAC Inc. Leases Disclosure
NOTE 5—LEASES
The Company primarily leases office space used in connection with its operations under various operating leases, the majority of which contain escalation clauses.
ROU assets represent the Company’s right to use the underlying assets for the lease term and lease liabilities represent the present value of the Company’s obligation to make payments arising from these leases. ROU assets and related lease liabilities are based on the present value of fixed lease payments over the lease term using the Company’s and People Inc.’s respective incremental borrowing rates on the lease commencement date or the date of acquisition for any leases acquired in connection with a business combination. The Company combines the lease and non-lease components of lease payments in determining ROU assets and related lease liabilities. If the lease includes one or more options to extend the term of the lease, the renewal option is considered in the lease term if it is reasonably certain the Company will exercise the option(s). Lease expense is recognized on a straight-line basis over the term of the lease. As permitted by ASC Topic 842, Leases, leases with an initial term of twelve months or less (“short-term leases”) are not recorded on the balance sheet.
Variable lease payments consist primarily of common area maintenance, utilities and taxes, which are not included in the recognition of ROU assets and related lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The following table presents the balances of ROU assets and lease liabilities within the balance sheet:
| December 31, | ||||||||||||||||||||
| Leases | Balance Sheet Classification | 2025 | 2024 | |||||||||||||||||
| (In thousands) | ||||||||||||||||||||
| Assets: | ||||||||||||||||||||
| ROU assets | $ | 158,630 | $ | 224,759 | ||||||||||||||||
| Liabilities: | ||||||||||||||||||||
| Current lease liabilities | $ | 39,506 | $ | 49,231 | ||||||||||||||||
| Long-term lease liabilities | 160,451 | 309,160 | ||||||||||||||||||
| Total lease liabilities | $ | 199,957 | $ | 358,391 | ||||||||||||||||
The following table presents the net lease expense within the statement of operations:
| Year Ended December 31, | ||||||||||||||||||||||||||
| Lease Expense | Statement of Operations Classification | 2025 | 2024 | 2023 | ||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||
| Fixed lease expense | Cost of revenue | $ | 545 | $ | 739 | $ | 316 | |||||||||||||||||||
| Fixed lease expense | Selling and marketing expense | 494 | 470 | 2,246 | ||||||||||||||||||||||
| Fixed lease expense | General and administrative expense | (1,859) | 44,461 | 98,698 | ||||||||||||||||||||||
| Fixed lease expense | Product development expense | 331 | 400 | 259 | ||||||||||||||||||||||
Total fixed lease expense(a) | (489) | 46,070 | 101,519 | |||||||||||||||||||||||
| Variable lease expense | Selling and marketing expense | — | — | 43 | ||||||||||||||||||||||
| Variable lease expense | General and administrative expense | 9,085 | 15,118 | 14,514 | ||||||||||||||||||||||
| Total variable lease expense | 9,085 | 15,118 | 14,557 | |||||||||||||||||||||||
| Net lease expense | $ | 8,596 | $ | 61,188 | $ | 116,076 | ||||||||||||||||||||
_____________________
(a) The year ended December 31, 2025 includes net gains of $41.5 million resulting from the amendments to a lease, which provided for the surrender of certain office space early and is included in “General and administrative expense” in the statement of operations. The year ended December 31, 2023 includes a $44.7 million lease impairment charge related to certain unoccupied leased office space due to the continued decline in the commercial real estate market, which is included in “General and administrative expense” in the statement of operations. The years ended December 31, 2025, 2024 and 2023 also include (i) $9.6 million, $11.8 million and $11.4 million, respectively, of sublease income, (ii) $2.9 million, $0.1 million and $3.5 million, respectively, of additional lease impairments, (iii) $0.7 million, $0.9 million and $1.3 million, respectively, of short-term lease expense and (iv) $(0.1) million, $0.2 million and $(0.4) million, respectively, of additional net (losses) gains on terminations of leases. See “Note 2—Summary of Significant Accounting Policies” for additional information on the amendments of lease agreements and impairment charges of ROU assets.
Maturities of lease liabilities at December 31, 2025(b) are summarized below:
| Year Ending December 31, | (In thousands) | |||||||
| 2026 | $ | 50,256 | ||||||
| 2027 | 35,672 | |||||||
| 2028 | 35,766 | |||||||
| 2029 | 34,477 | |||||||
| 2030 | 33,788 | |||||||
| Thereafter | 50,690 | |||||||
| Total | 240,649 | |||||||
| Less: Interest | 40,692 | |||||||
| Present value of lease liabilities | $ | 199,957 | ||||||
_____________________
(b) At December 31, 2025, there were no legally binding minimum lease payments for leases signed but not yet commenced.
The following are the weighted average assumptions used for lease term and discount rate:
| December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| Remaining lease term | 6.1 years | 7.2 years | ||||||||||||
| Discount rate | 6.25% | 4.97% | ||||||||||||
The following is the supplemental cash flow information:
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In thousands) | ||||||||||||||||||||
| ROU assets obtained in exchange for lease liabilities | $ | 7,186 | $ | 9,339 | $ | 2,152 | ||||||||||||||
| Derecognition of ROU assets due to termination or modification | $ | (36,539) | $ | (47) | $ | (28,747) | ||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities | $ | 101,734 | $ | 69,684 | $ | 74,898 | ||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 28, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Mar 1, 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.